PARTICIPATION AGREEMENT

                     Dated as of July 29, 1998

                               among


                CENTENNIAL HEALTHCARE CORPORATION,
           as the Construction Agent and as the Lessee,

           THE VARIOUS PARTIES HERETO FROM TIME TO TIME,
                        as the Guarantors,

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


    THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE
         PARTIES HERETO FROM TIME TO TIME, as the Holders,


    THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE
         PARTIES HERETO FROM TIME TO TIME, as the Lenders,


      FIRST UNION CAPITAL MARKETS, A DIVISION OF WHEAT FIRST
                         SECURITIES, INC.,
                       as Syndication Agent,

                                and


                        NATIONSBANK, N.A.,
                   as the Agent for the Lenders
              and respecting the Security Documents,
           as the Agent for the Lenders and the Holders,
                 to the extent of their interests



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iii

                         TABLE OF CONTENTS

                                                               Page
SECTION 1.  THE LOANS.............................................1
SECTION 2.  HOLDER ADVANCES.......................................2
SECTION 3.  SUMMARY OF TRANSACTIONS...............................2
      3.1. Operative Agreements...................................2
      3.2. Property Purchase......................................2
      3.3. Construction of Improvements; Commencement of Basic
      Rent........................................................3
      3.4. [Intentionally Omitted]................................3
SECTION 4.  THE CLOSINGS..........................................3
      4.1. Initial Closing Date...................................3
      4.2. Initial Closing Date; Property Closing Dates;
      Acquisition Advances; Construction Advances.................3
SECTION 5.  FUNDING OF ADVANCES; CONDITIONS PRECEDENT; REPORTING
REQUIREMENTS ON COMPLETION DATE;  THE LESSEE'S DELIVERY OF
NOTICES; RESTRICTIONS ON LIENS....................................3
      5.1. General................................................3
      5.2. Procedures for Funding.................................4
      5.3. Conditions Precedent for  the Lessor, the Agent, the
      Lenders and the Holders Relating to the Initial Closing Date
      and the Advance of Funds for the Acquisition of a Property..6
      5.4. Conditions Precedent for the Lessor, the Agent, the
      Lenders and the Holders Relating to the Advance of Funds
      after the Acquisition Advance..............................11
      5.5. Additional Reporting and Delivery Requirements on
      Completion Date and on Construction Period Termination Date.13
      5.6. The Construction Agent's Delivery of Construction
      Budget Modifications.......................................14
      5.7. Restrictions on Liens.................................14
      5.8 Joinder Agreement Requirements.........................14
      5.9 [Intentionally Omitted]................................15
      5.10. Payments.............................................15
      5.11. Increase in Holder Commitments and Lender Commitments.15
      5.12. Modifications of Schedules Reflecting Holder
      Commitments and/or Lender Commitments......................15
      5.13. Substitution of Properties...........................16
      5.14. Minimum Size of Construction Advance.................16
      5.15. Time Limit for Acquisition of Properties.............16
SECTION 6.  REPRESENTATIONS AND WARRANTIES.......................16
      6.1. Representations and Warranties of the Borrower........16
      6.2. Representations and Warranties of the Construction
      Agent and the Lessee.......................................19
SECTION 6B.  GUARANTY............................................24
      6B.1. Guaranty of Payment and Performance..................24
      6B.2. Obligations Unconditional............................25
      6B.3. Modifications........................................26
      6B.4. Waiver of Rights.....................................26
      6B.5. Reinstatement........................................27
      6B.6. Remedies.............................................27
      6B.7. Limitation of Guaranty...............................27
      6B.9. Release of Guarantors................................28
SECTION 7. PAYMENT OF CERTAIN EXPENSES...........................28
      7.1. Transaction Expenses..................................28
      7.2. Brokers' Fees.........................................29
      7.3. Certain Fees and Expenses.............................29
      7.4. Unused Fee............................................30
      7.5. Upfront Fee...........................................30
      7.6. Agent's Fee...........................................30
SECTION 8.  OTHER COVENANTS AND AGREEMENTS.......................31
      8.1. Cooperation with the Construction Agent or the Lessee.31
      8.2. Covenants of the Owner Trustee and the Holders........31
      8.3. Credit Party Covenants, Consent and Acknowledgment....33
      8.4. Sharing of Certain Payments...........................37
      8.5. Grant of Easements, etc...............................38
      8.6. Appointment of Agent..................................38
      8.7. Collection and Allocation of Payments and Other Amounts.39
      8.8. Release of Properties, etc............................42
SECTION 9.  CREDIT AGREEMENT AND TRUST AGREEMENT.................42
      9.1. The Construction Agent's and the Lessee's Credit
      Agreement Rights...........................................42
      9.2. The Construction Agent's and the Lessee's Trust
      Agreement Rights...........................................43
SECTION 10.  TRANSFER OF INTEREST................................44
      10.1. Restrictions on Transfer.............................44
      10.2. Effect of Transfer...................................45
SECTION 11.  INDEMNIFICATION.....................................45
      11.1. General Indemnity....................................45
      11.2. General Tax Indemnity................................48
      11.3. Increased Costs, Illegality, etc.....................52
      11.4. Funding/Contribution Indemnity.......................54
      11.5. EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE,
      STRICT LIABILITY, ETC......................................54
SECTION 12.  MISCELLANEOUS.......................................55
      12.1. Survival of Agreements...............................55
      12.2. Notices..............................................55
      12.3. Counterparts.........................................57
      12.4. Terminations, Amendments, Waivers, Etc.; Unanimous
      Vote Matters...............................................57
      12.5. Headings, etc........................................59
      12.6. Parties in Interest..................................59
      12.7. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF
      JURY TRIAL; VENUE..........................................59
      12.8. Severability.........................................60
      12.9. Liability Limited....................................60
      12.10. Rights of the Credit Parties........................61
      12.11. Further Assurances..................................62
      12.12. Calculations under Operative Agreements.............62
      12.13. Confidentiality.....................................62
      12.14. Financial Reporting/Tax Characterization............63
      12.15. Set-off.............................................63


EXHIBITS

A - Form of Requisition - Sections 4.2, 5.2, 5.3 and 5.4

B - Form of Outside Counsel Opinion for the Lessee - Section 5.3(j)

C - Form of Officer's Certificate - Section 5.3(z)

D- Form of Secretary's Certificate - Section 5.3(aa)

E - Form of Officer's Certificate - Section 5.3(cc)

F - Form of Secretary's Certificate - Section 5.3(dd)

G - Form of Outside Counsel Opinion for the Owner Trustee Section 5.3(ee)

H - Form of Outside Counsel Opinion for the Lessee - Section 5.3(ff)

I - Form of Officer's Certificate - Section 5.5

J - Form of Joinder Agreement - Section 5.8(a)

K - Description of Material Litigation - Section 6.2(d)

L  - State of  Incorporation/Formation  and Principal  Place of Business of Each
   Guarantor - Section 6.2(i)

M - Form of Officer's Compliance Certificate - Section 8.3(l)

Appendix A - Rules of Usage and Definitions



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                      PARTICIPATION AGREEMENT


      THIS  PARTICIPATION  AGREEMENT  dated  as of July 29,  1998  (as  amended,
modified,  extended,  supplemented,  restated and/or replaced from time to time,
this "Agreement") is by and among CENTENNIAL HEALTHCARE  CORPORATION,  a Georgia
corporation  (the "Lessee" or the  "Construction  Agent");  the various  parties
hereto from time to time as guarantors  (subject to the definition of Guarantors
in  Appendix  A  hereto,  individually,  a  "Guarantor"  and  collectively,  the
"Guarantors");  FIRST SECURITY BANK,  NATIONAL  ASSOCIATION,  a national banking
association, not individually (in its individual capacity, the "Trust Company"),
except as expressly  stated  herein,  but solely as the Owner  Trustee under the
Centennial Real Estate Trust 1998-1 (the "Owner Trustee",  the "Borrower" or the
"Lessor");  the various banks and other lending  institutions  which are parties
hereto from time to time as holders of  certificates  issued with respect to the
Centennial  Real Estate Trust 1998-1  (subject to the  definition  of Holders in
Appendix A hereto,  individually,  a "Holder" and collectively,  the "Holders");
the various banks and other lending  institutions  which are parties hereto from
time to time as lenders  (subject  to the  definition  of Lenders in  Appendix A
hereto, individually,  a "Lender" and collectively,  the "Lenders"); FIRST UNION
CAPITAL  MARKETS,  A  DIVISION  OF WHEAT  FIRST  SECURITIES,  INC.,  a  Virginia
corporation, as syndication agent ("Syndication Agent"), and NATIONSBANK,  N.A.,
a national banking association,  as the agent for the Lenders and respecting the
Security Documents,  as the agent for the Lenders and the Holders, to the extent
of their interests (in such capacity,  the "Agent").  Capitalized terms used but
not  otherwise  defined in this  Agreement  shall have the meanings set forth in
Appendix A hereto.

      In consideration of the mutual  agreements herein contained and other good
and valuable  consideration,  the receipt of which is hereby  acknowledged,  the
parties hereto hereby agree as follows:

                       SECTION 1. THE LOANS.

      Subject  to the  terms  and  conditions  of this  Agreement  and the other
Operative  Agreements and in reliance on the  representations  and warranties of
each of the parties hereto contained herein or made pursuant hereto, the Lenders
have  severally  agreed  to make  Loans to the  Lessor  from  time to time in an
aggregate  principal  amount  of up to  the  amount  of  the  respective  Lender
Commitments  in order for the  Lessor to  acquire  the  Properties  and  certain
Improvements,  to develop and construct certain  Improvements in accordance with
the  Agency  Agreement  and the terms and  provisions  hereof  and for the other
purposes  described  herein,  and in consideration of the receipt of proceeds of
the Loans,  the Lessor  will  issue the Notes.  The Loans  shall be made and the
Notes shall be issued pursuant to the Credit Agreement. Pursuant to Section 5 of
this Agreement and Section 2 of the Credit Agreement,  the Loans will be made to
the  Lessor  from  time to time at the  request  of the  Construction  Agent  in
consideration for the Construction Agent agreeing for the benefit of the Lessor,
pursuant  to the Agency  Agreement,  to acquire the  Properties,  to acquire the
Equipment,  to construct  certain  Improvements and to cause the Lessee to lease
the  Properties,  each in  accordance  with the Agency  Agreement  and the other
Operative  Agreements.  The Loans and the  obligations  of the Lessor  under the
Credit Agreement shall be secured by the Collateral.

                    SECTION 2. HOLDER ADVANCES.

      Subject  to the  terms  and  conditions  of this  Agreement  and the other
Operative  Agreements and in reliance on the  representations  and warranties of
each of the parties hereto  contained  herein or made pursuant  hereto,  on each
date Advances are requested to be made in accordance with Section 5 hereof, each
Holder  severally  shall make a Holder Advance on a pro rata basis to the Lessor
with  respect to the  Centennial  Real Estate  Trust  1998-1 based on its Holder
Commitment in an amount in immediately  available  funds such that the aggregate
of all Holder  Advances  made by the Holders on such date shall be three percent
(3%) of the amount of the Requested Funds on such date; provided, that no Holder
shall be obligated for any Holder Advance in excess of its pro rata share of the
Available Holder Commitment. The aggregate amount of Holder Advances shall be up
to the aggregate  amount of the Holder  Commitments.  No prepayment or any other
payment  with  respect to any Advance  shall be  permitted  such that the Holder
Advance  with  respect to such  Advance is less than three  percent  (3%) of the
outstanding  amount of such Advance,  except in connection  with  termination or
expiration of the Term or in connection  with the exercise of remedies  relating
to the occurrence of a Lease Event of Default. The representations,  warranties,
covenants  and  agreements  of the  Holders  herein  and in the other  Operative
Agreements are several, and not joint or joint and several.

                SECTION 3. SUMMARY OF TRANSACTIONS.

      3.1. Operative Agreements.

      On the date  hereof,  each of the  respective  parties  hereto and thereto
shall execute and deliver this  Agreement,  the Lease,  each  applicable  Ground
Lease,  the  Agency  Agreement,  the  Credit  Agreement,  the  Notes,  the Trust
Agreement,  the Certificates,  the Security Agreement,  each applicable Mortgage
Instrument and such other documents,  instruments,  certificates and opinions of
counsel as agreed to by the parties hereto.

      3.2. Property Purchase.

      On each Property  Closing Date and subject to the terms and  conditions of
this  Agreement  (a) the Holders will each make a Holder  Advance in  accordance
with  Sections 2 and 5 of this  Agreement  and the terms and  provisions  of the
Trust  Agreement,  (b) the  Lenders  will each  make  Loans in  accordance  with
Sections 1 and 5 of this  Agreement  and the terms and  provisions of the Credit
Agreement, (c) the Lessor will purchase and acquire good and marketable title to
or ground lease pursuant to a Ground Lease, the applicable Property,  each to be
within an Approved  State,  identified by the  Construction  Agent, in each case
pursuant to a Deed,  Bill of Sale or Ground Lease, as the case may be, and grant
the  Agent  a lien  on such  Property  by  execution  of the  required  Security
Documents,  (d) the Agent, the Lessee and the Lessor shall execute and deliver a
Lease Supplement relating to such Property and (e) the Basic Term shall commence
with respect to such Property.

      3.3. Construction of Improvements; Commencement of Basic
Rent.

      Construction Advances will be made with respect to particular Improvements
to be  constructed  and with respect to ongoing Work regarding the Equipment and
construction of particular Improvements, in each case, pursuant to the terms and
conditions of this Agreement and the Agency  Agreement.  The Construction  Agent
will act as a  construction  agent on behalf of the Lessor  respecting  the Work
regarding  the  Equipment,   the  construction  of  such  Improvements  and  the
expenditures  of  the  Construction  Advances  related  to  the  foregoing.  The
Construction  Agent  shall  promptly  notify the Lessor upon  Completion  of the
Improvements  and the  Lessee  shall  commence  to pay Basic Rent as of the Rent
Commencement Date.

      3.4. [Intentionally Omitted]


                     SECTION 4. THE CLOSINGS.

      4.1. Initial Closing Date.

      All  documents  and  instruments  required to be  delivered on the Initial
Closing  Date shall be  delivered  at the  offices  of Moore & Van Allen,  PLLC,
Charlotte, North Carolina, or at such other location as may be determined by the
Lessor, the Agent and the Lessee.

      4.2. Initial Closing Date; Property Closing Dates;
      Acquisition Advances; Construction Advances.

      The  Construction  Agent  shall  deliver  to the  Agent a  requisition  (a
"Requisition"),  in the form attached  hereto as Exhibit A or in such other form
as is  satisfactory to the Agent,  in its reasonable  discretion,  in connection
with (a) the  Transaction  Expenses and other fees,  expenses and  disbursements
payable, pursuant to Section 7.1, by the Lessor and (b) each Acquisition Advance
pursuant to Section 5.3 and (c) each  Construction  Advance  pursuant to Section
5.4.

       SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT;
            REPORTING REQUIREMENTS ON COMPLETION DATE;
     THE LESSEE'S DELIVERY OF NOTICES; RESTRICTIONS ON LIENS.

      5.1. General.

           (a) To the extent funds have been  advanced to the Lessor as Loans by
      the  Lenders  and to the Lessor as Holder  Advances  by the  Holders,  the
      Lessor will use such funds from time to time in accordance  with the terms
      and conditions of this Agreement and the other Operative Agreements (i) at
      the  direction  of the  Construction  Agent to acquire the  Properties  in
      accordance with the terms of this Agreement,  the Agency Agreement and the
      other  Operative  Agreements,  (ii) to make  Advances to the  Construction
      Agent to  permit  the  acquisition,  testing,  engineering,  installation,
      development,  construction,   modification,  design,  and  renovation,  as
      applicable,  of the Properties (or components  thereof) in accordance with
      the terms of the Agency Agreement and the other Operative Agreements,  and
      (iii) to pay Transaction Expenses,  fees, expenses and other disbursements
      payable by the Lessor under Sections 7.1(a) and 7.1(b).

           (b) In lieu of the payment of interest on the Loans and Holder  Yield
      on the Holder Advances on any Scheduled Interest Payment Date with respect
      to any Property during the period prior to the Rent Commencement Date with
      respect to such Property,  (i) each Lender's Loan shall  automatically  be
      increased  by the amount of  interest  accrued and unpaid on such Loan for
      such  period  (except to the extent that at any time such  increase  would
      cause such Lender's Loan to exceed such Lender's Available Commitment,  in
      which  case the  Lessee  shall pay such  excess  amount to such  Lender in
      immediately available funds on the date such Lender's Available Commitment
      was exceeded),  and (ii) each Holder's Holder Advance shall  automatically
      be  increased  by the amount of Holder  Yield  accrued  and unpaid on such
      Holder Advance for such period (except to the extent that at any time such
      increase  would  cause the Holder  Advance of such  Holder to exceed  such
      Holder's Available Holder  Commitment,  in which case the Lessee shall pay
      such excess amount to such Holder in  immediately  available  funds on the
      date the Available  Holder  Commitment of such Holder was exceeded).  Such
      increases in a Lender's  Loan and a Holder's  Holder  Advance  shall occur
      without any disbursement of funds by any Person.

      5.2. Procedures for Funding.

           (a) The  Construction  Agent shall  designate  the date for  Advances
      hereunder in accordance  with the terms and provisions  hereof;  provided,
      however,  it is understood  and agreed that no more than four (4) Advances
      (excluding  any  conversion  and/or  continuation  of any  Loan or  Holder
      Advance) may be requested  during any  calendar  month.  Not less than (i)
      three  (3)  Business  Days  prior to the date that the  first  Advance  is
      requested  hereunder and (ii) three (3) Business Days prior to the date on
      which any subsequent  Acquisition Advance or Construction Advance is to be
      made, the Construction  Agent shall deliver to the Agent, (A) with respect
      to the  date  that the  first  Advance  is  requested  hereunder  and each
      subsequent  Acquisition Advance, a Requisition as described in Section 4.2
      hereof (including  without  limitation a legal description of the Land, if
      any,  a  schedule  of the  Improvements,  if any,  and a  schedule  of the
      Equipment, if any, acquired or to be acquired on such date, and a schedule
      of the Work,  if any, to be  performed,  each of the  foregoing  in a form
      reasonably  acceptable  to  the  Agent)  and  (B)  with  respect  to  each
      Construction  Advance, a Requisition  identifying (among other things) the
      Property to which such Construction Advance relates.

           (b) Each Requisition shall: (i) be irrevocable, (ii) request funds in
      an amount that is not in excess of the total  aggregate  of the  Available
      Commitments plus the Available Holder  Commitments at such time, and (iii)
      request  that the Holders  make Holder  Advances and that the Lenders make
      Loans to the Lessor  for the  payment of  Transaction  Expenses,  Property
      Acquisition  Costs  (in  the  case of an  Acquisition  Advance)  or  other
      Property  Costs  (in  the  case  of  a  Construction  Advance)  that  have
      previously been incurred or are to be incurred on the date of such Advance
      to the extent such were not subject to a prior  Requisition,  in each case
      as specified in the Requisition.

           (c) Subject to the satisfaction of the conditions precedent set forth
      in Sections 5.3 or 5.4, as  applicable,  on each Property  Closing Date or
      the date on which the  Construction  Advance is to be made, as applicable,
      (i) the  Lenders  severally  shall  make Loans  based on their  respective
      Lender  Commitments  to  the  Lessor  in  an  aggregate  amount  equal  to
      ninety-seven  percent  (97%)  of  the  Requested  Funds  specified  in any
      Requisition  (ratably  between  the  Tranche A Lenders  and the  Tranche B
      Lenders with the Tranche A Lenders funding  eighty-eight  percent (88%) of
      the Requested Funds and the Tranche B Lenders funding nine percent (9%) of
      the Requested  Funds),  up to an aggregate  principal  amount equal to the
      aggregate of the Available  Commitments,  (ii) the Holders severally shall
      make Holder Advances based on their  respective  Holder  Commitments in an
      aggregate  amount  equal  to  three  percent  (3%) of the  balance  of the
      Requested  Funds  specified  in  such  Requisition,  up to  the  aggregate
      advanced   amount  equal  to  the  aggregate  of  the   Available   Holder
      Commitments;  and (iii) the total amount of such Loans and Holder Advances
      made on such date  shall (x) be used by the Lessor to pay  Property  Costs
      and/or  Transaction  Expenses within ten (10) Business Days of the receipt
      by the Lessor of such Advance unless such advance is in connection with an
      Escrowed  Closing (as defined in Section  5.2(d) hereof) and within ninety
      (90) days of receipt by the Lessor of such Advance if such Advance is made
      in connection with an Escrowed Closing or (y) be advanced by the Lessor on
      the date of such  Advance to the  Construction  Agent or the Lessee to pay
      Property  Costs,  as  applicable.   Notwithstanding   that  the  Operative
      Agreements  state that  Advances  shall be directed  to the  Lessor,  each
      Advance  shall in fact be  directed  to the Agent (for the  benefit of the
      Lessor) and applied by the Agent (for the benefit of the Lessor)  pursuant
      to the requirements imposed on the Lessor under the Operative Agreements.

           (d) With  respect  to an  Advance  obtained  by the Lessor to pay for
      Property  Costs and/or  Transaction  Expenses or other costs payable under
      Section 7.1 hereof and not  expended by the Lessor for such purpose on the
      date of such Advance,  such amounts shall either (i) be held by the Lessor
      (or the Agent on behalf of the Lessor) until the  applicable  closing date
      and applied for such  purpose on such  closing  date or (ii) be held by an
      escrow  agent on behalf of the Lessor  until the  applicable  closing date
      pursuant  to an escrow  agreement  in a form  acceptable  to the Agent and
      applied for such purpose in  accordance  with the terms and subject to the
      conditions set forth in such escrow agreement (an "Escrowed Closing").  If
      the closing does not occur within ten (10) Business Days (or within ninety
      (90) days in the case of an Escrowed  Closing) of the date of the Lessor's
      receipt of such  Advance,  such  amounts  shall be applied  regarding  the
      applicable  Advance to repay the Lenders and the Holders  and,  subject to
      the terms hereof,  and of the Credit  Agreement  and the Trust  Agreement,
      shall become upon such repayment  available for future  Advances.  Amounts
      paid pursuant to Section 5.13 of this Agreement or otherwise in connection
      with a Terminated  Property shall become upon such repayment available for
      future  Advances  up to but not to  exceed  the  aggregate  amount  of the
      Advances made for the  Terminated  Property.  Any such amounts held by the
      Lessor  (or the Agent or escrow  agent on behalf of the  Lessor)  shall be
      subject to the lien of the Security Agreement.

           (e) All Operative Agreements which are to be delivered to the Lessor,
      the Agent,  the Lenders or the Holders shall be delivered to the Agent, on
      behalf of the  Lessor,  the Agent,  the Lenders or the  Holders,  and such
      items (except for Notes,  Certificates,  Bills of Sale,  the Ground Leases
      and  chattel  paper  originals,  with  respect to which in each case there
      shall be only one original)  shall be delivered with originals  sufficient
      for the Lessor,  the Agent,  each Lender and each Holder.  All other items
      which are to be  delivered  to the Lessor,  the Agent,  the Lenders or the
      Holders  shall be  delivered  to the Agent,  on behalf of the Lessor,  the
      Agent,  the Lenders or the Holders,  and such other items shall be held by
      the Agent.  To the extent any such other  items are  requested  in writing
      from time to time by the Lessor, any Lender or any Holder, the Agent shall
      provide a copy of such item to the party requesting it.

           (f)   Notwithstanding  the  completion  of  any  closing  under  this
      Agreement  pursuant to Sections 5.3 or 5.4,  each  condition  precedent in
      connection with any such closing may be subsequently enforced by the Agent
      (unless such has been expressly waived in writing by the Agent,  acting at
      the direction of the Majority Secured Parties).

      5.3. Conditions  Precedent for the Lessor,  the Agent, the Lenders and the
           Holders Relating to the Initial Closing Date and the Advance of Funds
           for the Acquisition of a Property.

      The obligations (i) on the Initial Closing Date of the Lessor,  the Agent,
the Lenders and the Holders to enter into the transactions  contemplated by this
Agreement,  including  without  limitation the obligation to execute and deliver
the  applicable  Operative  Agreements  to which each is a party on the  Initial
Closing  Date,  (ii) on the Initial  Closing  Date of the Holders to make Holder
Advances, and of the Lenders to make Loans in order to pay Transaction Expenses,
fees,  expenses  and other  disbursements  payable by the Lessor  under  Section
7.1(a) of this  Agreement and (iii) on a Property  Closing Date of the Holder to
make  Holder  Advances  and of the  Lenders  to make  Loans for the  purpose  of
providing funds to the Lessor necessary to pay the Transaction  Expenses,  fees,
expenses and other  disbursements  payable by the Lessor under Section 7.1(b) of
this  Agreement  and to acquire  or ground  lease a  Property  (an  "Acquisition
Advance"),  in each case (with regard to the foregoing Sections 5.3(i), (ii) and
(iii)) are subject to the  satisfaction  or waiver of the  following  conditions
precedent  on or prior to the Initial  Closing Date or the  applicable  Property
Closing  Date,  as the  case may be (to the  extent  such  conditions  precedent
require the  delivery of any  agreement,  certificate,  instrument,  memorandum,
legal or other opinion, appraisal,  commitment, title insurance commitment, lien
report  or any other  document  of any kind or type,  such  shall be in form and
substance   satisfactory   to  the   Agent,   in  its   reasonable   discretion;
notwithstanding  the  foregoing,  the  obligations  of each  party  shall not be
subject to any conditions contained in this Section 5.3 which are required to be
performed by such party):

           (a) the correctness (as to the Lessee, only in all material respects)
      of the  representations  and  warranties of the parties to this  Agreement
      contained  herein,  in each of the  other  Operative  Agreements  and each
      certificate  delivered  pursuant  to any  Operative  Agreement  (including
      without  limitation the  Incorporated  Representations  and Warranties) on
      each such date;

           (b) the  performance  by the  parties  to  this  Agreement  of  their
      respective   agreements  contained  herein  and  in  the  other  Operative
      Agreements to be performed by them on or prior to each such date;

           (c) the Agent shall have received a fully executed  counterpart  copy
      of the Requisition, appropriately completed;

           (d) title to each such Property shall conform to the  representations
      and warranties set forth in Section 6.2(l) hereof;

           (e) the  Construction  Agent shall have delivered to the Agent a good
      standing  certificate for the  Construction  Agent in the state where each
      such  Property is located,  the Deed with respect to the Land and existing
      Improvements  (if any), a copy of the Ground Lease (if any), and a copy of
      the Bill of Sale with respect to the Equipment (if any),  respecting  such
      of the foregoing as are being  acquired or ground leased on each such date
      with the  proceeds  of the Loans and  Holder  Advances  or which have been
      previously  acquired or ground  leased with the  proceeds of the Loans and
      Holder  Advances  and  such  Land,  existing  Improvements  (if  any)  and
      Equipment (if any) shall be located in an Approved State;

           (f) there shall not have  occurred and be  continuing  any Default or
      Event of Default under any of the Operative  Agreements  and no Default or
      Event of Default under any of the Operative  Agreements will have occurred
      after giving effect to the Advance requested by each such Requisition;

           (g) the  Construction  Agent shall have  delivered to the Agent title
      insurance  commitments to issue policies  respecting each such Property in
      favor of the Lessor (as fee simple  owner of each such  Property,  and the
      Construction Agent shall use all commercially reasonable efforts to obtain
      a special  endorsement  (to the extent such special  endorsement  does not
      exceed $500 in cost) providing that in the event the Lease  respecting any
      such  Property is ever deemed to be a  mortgage,  such policy  insures the
      interests  of the  Lessor  as a  mortgagee)  and  the  Agent  from a title
      insurance  company  acceptable  to the Agent,  with such title  exceptions
      thereto as are acceptable to the Agent;

           (h) the  Construction  Agent  shall  have  delivered  to the Agent an
      environmental site assessment respecting each such Property prepared by an
      independent recognized professional acceptable to the Agent;

           (i) the Construction Agent shall have delivered to the Agent a survey
      (with a flood hazard certification) respecting each such Property prepared
      by an independent recognized professional acceptable to the Agent;

           (j) unless such an opinion has previously been delivered with respect
      to a  particular  state,  the  Construction  Agent shall have caused to be
      delivered  to the Agent a legal  opinion  in the form  attached  hereto as
      Exhibit B or in such other form (excluding zoning, permits or similar land
      use, development or construction laws) as is reasonably  acceptable to the
      Agent with respect to local law real property issues  respecting the state
      in which each such Property is located addressed to the Lessor, the Agent,
      the Lenders and the Holders,  from counsel located in the state where each
      such Property is located,  prepared by counsel acceptable to the Agent and
      a separate flood hazard certificate respecting each such Property prepared
      by an independent recognized professional acceptable to the Agent;

           (k) the Agent shall be satisfied that the acquisition, ground leasing
      and/or  holding of each such  Property  and the  execution of the Mortgage
      Instrument  and the  other  Security  Documents  will not  materially  and
      adversely  affect the rights of the Lessor,  the Agent, the Holders or the
      Lenders under or with respect to the Operative Agreements;

           (l) the  Construction  Agent shall have delivered to the Agent copies
      of invoices for, or other reasonably satisfactory evidence of, the various
      Transaction Expenses and other fees, expenses and disbursements referenced
      in Sections 7.1(a) or 7.1(b) of this Agreement, as appropriate;

           (m) the  Construction  Agent shall have caused to be delivered to the
      Agent a Mortgage  Instrument  (in such form as is acceptable to the Agent,
      with  revisions as necessary to conform to applicable  state law),  Lessor
      Financing Statements and Lender Financing Statements  respecting each such
      Property, all fully executed and in recordable form;

           (n) the Lessee shall have delivered to the Agent (or the escrow agent
      in connection with an Escrowed Closing) with respect to each such Property
      a Lease  Supplement and a memorandum  (or short form lease)  regarding the
      Lease and such Lease Supplement (such memorandum or short form lease to be
      in the form attached to the Lease as Exhibit B or in such other form as is
      acceptable  to the Agent,  with  modifications  as necessary to conform to
      applicable state law, and in form suitable for recording);

           (o)  with  respect  to  each  Acquisition  Advance,  the  sum  of the
      Available Commitment plus the Available Holder Commitment (after deducting
      the Unfunded  Amount,  if any, and after giving effect to the  Acquisition
      Advance) will be sufficient to pay all amounts payable therefrom;

           (p)  if  any  such  Property  is  subject  to  a  Ground  Lease,  the
      Construction  Agent  shall have caused a lease  memorandum  (or short form
      lease) to be  delivered  to the Agent (or the escrow  agent in  connection
      with an Escrowed  Closing)  for such Ground Lease and, if requested by the
      Agent,  a landlord  waiver and a mortgagee  waiver (in each case,  in such
      form as is reasonably acceptable to the Agent);

           (q) counsel  (acceptable  to the Agent) for the ground lessor of each
      such  Property  subject to a Ground Lease shall have issued to the Lessor,
      the Agent, the Lenders and the Holders, its opinion;

           (r) the  Construction  Agent  shall  have  delivered  to the  Agent a
      preliminary Construction Budget for each such Property, if applicable;

           (s) the Construction  Agent shall have provided evidence to the Agent
      of insurance with respect to each such Property as provided in the Lease;

           (t) subject to Section  8.3(e) of this  Agreement,  the  Construction
      Agent shall have caused an Appraisal  regarding  each such  Property to be
      provided to the Agent from an appraiser selected by the Agent;

           (u) the  Construction  Agent shall cause (i) Uniform  Commercial Code
      lien searches,  tax lien searches and judgment lien searches regarding the
      Lessee to be conducted  (and copies  thereof to be delivered to the Agent)
      in  such  jurisdictions  as  determined  by  the  Agent  by  a  nationally
      recognized  search  company  acceptable  to the  Agent  and (ii) the liens
      referenced in such lien searches which are  objectionable  to the Agent to
      be either  removed or otherwise  handled in a manner  satisfactory  to the
      Agent;

           (v) all  taxes,  fees  and  other  charges  in  connection  with  the
      execution,  delivery,  recording, filing and registration of the Operative
      Agreements  and/or  documents  related  thereto  shall  have  been paid or
      provisions  for such payment shall have been made to the  satisfaction  of
      the Agent;

           (w) in the  opinion of the Agent and its  counsel,  the  transactions
      contemplated  by the Operative  Agreements do not and will not subject the
      Lessor, the Lenders, the Agent or the Holders to any violation of Law;

           (x) each of the Operative  Agreements to be entered into on such date
      shall have been duly  authorized,  executed  and  delivered by the parties
      thereto,  and shall be in full force and effect,  and the Agent shall have
      received a fully executed copy of each of the Operative Agreements;

           (y) since the date of the most recent  audited  financial  statements
      (as delivered pursuant to the requirements of the Lessee Credit Agreement)
      of the Lessee, there shall not have occurred any event, condition or state
      of facts  which  shall  have or could  reasonably  be  expected  to have a
      Material  Adverse  Effect;  provided,  the foregoing shall not prevent the
      Lessee from exercising  rights expressly granted to the Lessee pursuant to
      the provisions of the Operative Agreements;

           (z) as of the  Initial  Closing  Date  only,  the  Agent  shall  have
      received an Officer's  Certificate,  dated as of the Initial Closing Date,
      of the  Lessee in the form  attached  hereto as Exhibit C or in such other
      form as is  acceptable  to the  Agent  stating  that (i)  each  and  every
      representation  and  warranty  of  each  Credit  Party  contained  in  the
      Operative  Agreements  to which it is a party is true and  correct  in all
      material  respects on and as of the Initial  Closing Date; (ii) no Default
      or Event of Default has occurred  and is  continuing  under any  Operative
      Agreement;  (iii) each Operative  Agreement to which any Credit Party is a
      party is in full force and effect with respect to it; and (iv) each Credit
      Party has duly performed and complied with all  covenants,  agreements and
      conditions  contained herein or in any Operative  Agreement required to be
      performed or complied with by it on or prior to the Initial Closing Date;

           (aa) as of the  Initial  Closing  Date  only,  the Agent  shall  have
      received (i) a certificate  of the Secretary or an Assistant  Secretary of
      each Credit  Party,  dated as of the  Initial  Closing  Date,  in the form
      attached hereto as Exhibit D or in such other form as is acceptable to the
      Agent  attaching and certifying as to (1) the  resolutions of the Board of
      Directors of such Credit Party duly  authorizing  the execution,  delivery
      and  performance by such Credit Party of each of the Operative  Agreements
      to which it is or will be a party,  (2) the articles of  incorporation  of
      such Credit Party  certified as of a recent date by the Secretary of State
      of its state of  incorporation  and its by-laws and (3) the incumbency and
      signature of persons  authorized  to execute and deliver on behalf of such
      Credit Party the  Operative  Agreements  to which it is or will be a party
      and  (ii) a good  standing  certificate  (or  local  equivalent)  from the
      respective  states where such Credit Party is  incorporated  and where the
      principal place of business of such Credit Party is located as to its good
      standing  in  each  such  state.  To the  extent  any  Credit  Party  is a
      partnership,  a limited liability company or is otherwise organized,  such
      Person shall deliver to the Agent (in form and substance  satisfactory  to
      the Agent) as of the Initial Closing Date (A) a certificate regarding such
      Person and any corporate  general partners  covering the matters described
      in Exhibit D and (B) a good standing certificate, a certificate of limited
      partnership  or  a  local  equivalent  of  either  of  the  foregoing,  as
      applicable;

           (bb) as of the  Initial  Closing  Date  only,  there  shall  not have
      occurred  any  materially  adverse  change  in  the  business,   financial
      condition,  assets or property of the Lessee and its Subsidiaries taken as
      a whole as a result of any event,  condition,  circumstance or contingency
      from  that set forth in the most  recent  audited  consolidated  financial
      statements of the Credit Parties which have been provided to the Agent;

           (cc) as of the  Initial  Closing  Date  only,  the Agent  shall  have
      received an  Officer's  Certificate  of the Lessor dated as of the Initial
      Closing  Date in the form  attached  hereto as  Exhibit E or in such other
      form as is  acceptable  to the  Agent,  stating  that (i)  each and  every
      representation  and  warranty  of the Lessor  contained  in the  Operative
      Agreements  to which it is a party is true  and  correct  in all  material
      respects  on and as of the  Initial  Closing  Date,  (ii)  each  Operative
      Agreement  to which the Lessor is a party is in full force and effect with
      respect to it and (iii) the Lessor has duly  performed  and complied  with
      all  covenants,  agreements  and  conditions  contained  herein  or in any
      Operative  Agreement required to be performed or complied with by it on or
      prior to the Initial Closing Date;

           (dd) as of the  Initial  Closing  Date  only,  the Agent  shall  have
      received (i) a certificate of the Secretary, an Assistant Secretary, Trust
      Officer or Vice President of the Trust Company in the form attached hereto
      as  Exhibit  F or in  such  other  form  as is  acceptable  to the  Agent,
      attaching  and  certifying  as  to  (A)  the  signing   resolutions   duly
      authorizing the execution,  delivery and performance by the Lessor of each
      of the  Operative  Agreements  to which it is or will be a party,  (B) its
      articles of  association  or other  equivalent  charter  documents and its
      by-laws,  as  the  case  may  be,  certified  as of a  recent  date  by an
      appropriate  officer  of the  Trust  Company  and (C) the  incumbency  and
      signature of persons  authorized  to execute and deliver on its behalf the
      Operative  Agreements  to  which it is a party  and  (ii) a good  standing
      certificate from the Office of the Comptroller of the Currency;

           (ee) as of the  Initial  Closing  Date only,  counsel  for the Lessor
      acceptable to the Agent shall have issued to the Lessee, the Holders,  the
      Lenders and the Agent its opinion in the form attached hereto as Exhibit G
      or in such other form as is reasonably acceptable to the Agent;

           (ff) as of the Initial  Closing  Date only,  the  Construction  Agent
      shall have caused to be delivered to the Agent a legal opinion in the form
      attached  hereto  as  Exhibit  H or in such  other  form as is  reasonably
      acceptable to the Agent,  addressed to the Lessor,  the Agent, the Lenders
      and the Holders, from counsel acceptable to the Agent; and

           (gg) as of the Initial  Closing  Date only,  the  Construction  Agent
      shall cause (i) tax lien  searches and judgment  lien  searches  regarding
      each Credit Party to be conducted  (and copies  thereof to be delivered to
      the  Agent)  in  such  jurisdictions  as  determined  by  the  Agent  by a
      nationally  recognized search company acceptable to the Agent and (ii) the
      liens  referenced in such lien  searches  which are  objectionable  to the
      Agent to be either removed or otherwise  handled in a manner  satisfactory
      to the Agent.


      5.4. Conditions  Precedent for the Lessor,  the Agent, the Lenders and the
           Holders  Relating  to the  Advance  of Funds  after  the  Acquisition
           Advance.

      The obligations of the Holders to make Holder Advances, and the Lenders to
make Loans in  connection  with all  requests  for  Advances  subsequent  to the
acquisition of a Property (and to pay the Transaction  Expenses,  fees, expenses
and  other  disbursements  payable  by the  Lessor  under  Section  7.1 of  this
Agreement in connection  therewith) are subject to the satisfaction or waiver of
the following  conditions  precedent.  (To the extent such conditions  precedent
require the  delivery of any  agreement,  certificate,  instrument,  memorandum,
legal or other opinion, appraisal,  commitment, title insurance commitment, lien
report  or any other  document  of any kind or type,  such  shall be in form and
substance   satisfactory   to  the   Agent,   in  its   reasonable   discretion.
Notwithstanding  the  foregoing,  the  obligations  of each  party  shall not be
subject to any conditions contained in this Section 5.4 which are required to be
performed by such party.):

           (a) the correctness (as to the Lessee, only in all material respects)
      on such date of the  representations and warranties of the parties to this
      Agreement contained herein, in each of the other Operative  Agreements and
      in  each  certificate   delivered  pursuant  to  any  Operative  Agreement
      (including  without  limitation  the  Incorporated   Representations   and
      Warranties) as of the date given or made or deemed given or made;

           (b) the  performance  by the  parties  to  this  Agreement  of  their
      respective   agreements  contained  herein  and  in  the  other  Operative
      Agreements to be performed by them on or prior to each such date;

           (c) the Agent shall have received a fully executed counterpart of the
      Requisition, appropriately completed;

           (d)  based  upon the  applicable  Construction  Budgets  which  shall
      satisfy the requirements of this Agreement,  the Available Commitments and
      the Available Holder Commitment (after deducting the Unfunded Amount) will
      be sufficient to complete the Improvements;

           (e) there shall not have  occurred and be  continuing  any Default or
      Event of Default under any of the Operative  Agreements  and no Default or
      Event of Default under any of the Operative  Agreements will have occurred
      after  giving  effect  to  the  Construction   Advance  requested  by  the
      applicable Requisition;

           (f) the title  insurance  policy  delivered  in  connection  with the
      requirements  of Section 5.3(g) shall provide for (or shall be endorsed to
      provide for)  insurance  in an amount at least equal to the maximum  total
      Property  Cost  indicated  by  the  Construction  Budget  referred  to  in
      subparagraph  (d) above and there  shall be no title  change or  exception
      reasonably objectionable to the Agent;

           (g) the  Construction  Agent shall have delivered to the Agent copies
      of the Plans and Specifications for the applicable Improvements;

           (h) the Construction Agent shall have delivered to the Agent invoices
      for,  or  other  reasonably  satisfactory  evidence  of,  any  Transaction
      Expenses and other fees, expenses and disbursements  referenced in Section
      7.1(b) that are to be paid with the Advance;

           (i) the  Construction  Agent  shall have  delivered,  or caused to be
      delivered  to the  Agent,  invoices,  Bills  of  Sale or  other  documents
      acceptable  to the Agent,  in each case with  regard to any  Equipment  or
      other components of such Property then being acquired with the proceeds of
      the Loans and Holder  Advances  and naming  the  Lessor as  purchaser  and
      transferee;

           (j) all  taxes,  fees  and  other  charges  in  connection  with  the
      execution,  delivery,  recording, filing and registration of the Operative
      Agreements  shall have been paid or provisions for such payment shall have
      been made to the satisfaction of the Agent;

           (k) since the date of the most recent  audited  Financial  Statements
      (as such term is defined in the Lessee  Credit  Agreement)  of the Lessee,
      there shall not have occurred any event, condition or state of facts which
      shall have or could  reasonably  be  expected  to have a Material  Adverse
      Effect;  provided,  the  foregoing  shall  not  prevent  the  Lessee  from
      exercising  rights  expressly  granted  to  the  Lessee  pursuant  to  the
      provisions of the Operative Agreements; and

           (l) in the  opinion of the Agent and its  counsel,  the  transactions
      contemplated  by the Operative  Agreements do not and will not subject the
      Lessor, the Lenders, the Agent or the Holders to any violation of Law.

      5.5. Additional Reporting and Delivery Requirements on
           Completion Date and on Construction Period Termination
           Date.

      On or prior to the  Completion  Date for each Property,  the  Construction
Agent shall deliver to the Agent an Officer's  Certificate  in the form attached
hereto  as  Exhibit  I or in such  other  form  as is  acceptable  to the  Agent
specifying (a) the address for such Property,  (b) the Completion  Date for such
Property,  (c) the  aggregate  Property  Cost for such  Property,  (d) detailed,
itemized  documentation  supporting  the asserted  Property Cost figures and (e)
that all  representations and warranties of the Construction Agent and Lessee in
each of the Operative Agreements and each certificate delivered pursuant thereto
(including without limitation the Incorporated  Representations  and Warranties)
are true and correct in all material  respects as of the  Completion  Date.  The
Agent  shall  have the  right  to  contest  the  information  contained  in such
Officer's Certificate.  Furthermore, on or prior to the Completion Date for each
Property,  the Construction  Agent shall deliver or cause to be delivered to the
Agent (unless  previously  delivered to the Agent)  originals of the  following,
each of which shall be in form and  substance  acceptable  to the Agent,  in its
reasonable  discretion:  (w) a title insurance  endorsement  regarding the title
insurance  policy  delivered  in  connection  with the  requirements  of Section
5.3(g),  but only to the extent such  endorsement  is  necessary  to provide for
insurance in an amount at least equal to the maximum total Property Cost and, if
endorsed,  the  endorsement  shall  not  include  a title  change  or  exception
objectionable  to the  Agent;  (x) an  as-built  survey for such  Property,  (y)
insurance certificates  respecting such Property as required hereunder and under
the Lease Agreement, and (z) if requested by the Agent, amendments to the Lessor
Financing  Statements executed by the appropriate  parties. In addition,  on the
Completion  Date for such Property the  Construction  Agent covenants and agrees
that the recording fees,  documentary stamp taxes or similar amounts required to
be paid in connection with the related  Mortgage  Instrument shall be paid in an
amount required by applicable law, subject,  however,  to the obligations of the
Lenders  and the Holders to fund such costs to the extent  required  pursuant to
Section 7.1.

      5.6. The Construction Agent's Delivery of Construction
           Budget Modifications.

      The  Construction  Agent covenants and agrees to deliver to the Agent each
month notification of any modification to any Construction  Budget regarding any
Property if such  modification  increases the cost to construct  such  Property;
provided no Construction  Budget may be increased unless (a) the title insurance
policies  referenced  in  Section  5.3(g)  are also  modified  or  endorsed,  if
necessary, to provide for insurance in an amount that satisfies the requirements
of Section  5.4(f) of this  Agreement  and (b) after  giving  effect to any such
amendment,  the Construction  Budget remains in compliance with the requirements
of Section 5.4(d) of this Agreement.

      5.7. Restrictions on Liens.

      On each Property  Closing Date,  the  Construction  Agent shall cause each
Property  acquired  by the Lessor on such date to be free and clear of all Liens
except those  referenced in Sections  6.2(r)(i) and  6.2(r)(ii).  On each date a
Property  is either sold to a third  party in  accordance  with the terms of the
Operative  Agreements or,  pursuant to Section  22.1(a) of the Lease  Agreement,
retained by the  Lessor,  the Lessee  shall  cause such  Property to be free and
clear of all Liens  (other  than  Lessor  Liens and such  other  Liens  that are
expressly  set forth as title  exceptions on the title  commitment  issued under
Section  5.3(g)  with  respect  to  such  Property,  to the  extent  such  title
commitment has been approved or accepted by the Agent).

      5.8  Joinder Agreement Requirements.

      Each  Domestic  Subsidiary  formed or acquired  subsequent  to the Initial
Closing Date shall become a Guarantor and shall satisfy the following conditions
within  thirty (30) days after the  formation or  acquisition  of such  Domestic
Subsidiary:

           (a) such Domestic Subsidiary shall execute and deliver to the Agent a
      Joinder Agreement in the form attached hereto as Exhibit J;

           (b) such Domestic Subsidiary shall have delivered to the Agent (x) an
      Officer's  Certificate  of such  Domestic  Subsidiary in the form attached
      hereto as Exhibit C, (y) a  certificate  of the  Secretary or an Assistant
      Secretary  of such  Domestic  Subsidiary  in the form  attached  hereto as
      Exhibit D and (z) good standing  certificates  (or local  equivalent) from
      the respective  states where such Domestic  Subsidiary is  incorporated or
      organized  and where the  principal  place of  business  of such  Domestic
      Subsidiary is located as to its good standing in each such state;

           (c) such  Domestic  Subsidiary  shall have  delivered to the Agent an
      opinion of counsel  (acceptable to the Agent) in the form attached  hereto
      as Exhibit H; and

           (d) the Agent shall have received such other documents,  certificates
      and information as the Agent shall have reasonably requested.

      5.9  [Intentionally Omitted].

      5.10.Payments.

      All payments of principal,  interest,  Holder  Advances,  Holder Yield and
other  amounts to be made by the  Construction  Agent or the  Lessee  under this
Agreement or any other Operative  Agreements  (excluding Excepted Payments which
shall be paid  directly  to the party to whom such  payments  are owed) shall be
made to the Agent at the  office  designated  by the Agent  from time to time in
Dollars and in  immediately  available  funds,  without  setoff,  deduction,  or
counterclaim.  Subject to the  definition  of  "Interest  Period" in  Appendix A
attached  hereto,  whenever  any  payment  under  this  Agreement  or any  other
Operative  Agreements  shall be stated to be due on a day that is not a Business
Day,  such  payment may be made on the next  succeeding  Business  Day, and such
extension of time in such case shall be included in the computation of interest,
Holder  Yield  and  fees  payable  pursuant  to  the  Operative  Agreements,  as
applicable and as the case may be.

      5.11.Increase in Holder Commitments and Lender Commitments.

      From time to time prior to the  Construction  Period  Termination Date and
upon no less than thirty (30) Business Days' notice  delivered to the Agent, the
Construction  Agent on behalf of the Owner  Trustee  may elect to  increase  the
Holder  Commitments  and the Lender  Commitments of each Holder and each Lender,
ratably,  by an  amount  equal to the  aggregate  proposed  amount  of  increase
multiplied  by (x) in the  case  of each  Holder,  the  fraction  in  which  the
numerator is the Holder Commitment of such Holder and the denominator is the sum
of all Holder Commitments and all Lender Commitments and (y) in the case of each
Lender,  the fraction in which the  numerator is the Lender  Commitment  of such
Lender and the  denominator is the sum of all Holder  Commitments and all Lender
Commitments;  provided,  no such increase in the Holder  Commitments  and/or the
Lender  Commitments shall be effective,  valid or enforceable  unless: (a) there
shall  be a  concurrent,  dollar  for  dollar  reduction  in the  Lessee  Credit
Agreement  Commitment  Amount of each  lender  thereunder  corresponding  to the
increase in the Holder Commitments and the Lender Commitments, (b) no Default or
Event of  Default  shall have  occurred  and be  continuing  as of the date such
increase  is to be made  and (c) in the  aggregate,  all such  increases  in the
Holder Commitments and the Lender Commitments from time to time shall not exceed
forty million Dollars ($40,000,000).  Each party to this Agreement agrees to the
above-referenced  mechanics  for  increases  in the Holder  Commitments  and the
Lender Commitments.  The Agent shall promptly notify each Holder and each Lender
upon receipt by the Agent of any notice  pursuant to the first  sentence of this
Section 5.11.

      5.12.Modifications of Schedules Reflecting Holder
           Commitments and/or Lender Commitments.

      To the extent the Holder  Commitments  and/or the Lender  Commitments  are
increased or decreased in accordance with the terms of the Operative Agreements,
then the Agent shall  prepare and  distribute a  replacement  Schedule I for the
Trust Agreement and a replacement  Schedule 1.1 for the Credit  Agreement which,
in each case,  shall be binding and  enforceable  against  all  parties  (absent
manifest error).

      5.13.Substitution of Properties.

      From time to time and upon no less than thirty  (30) days prior  notice to
the  Agent,  Lessee may  request  to  substitute  a  property  (the  "Substitute
Property") for another  Property then subject to the Operative  Agreements  (the
"Terminated  Property").  The Financing Parties shall permit the substitution of
the Substitute  Property so long as all conditions  precedent for the Substitute
Property are satisfied pursuant to the Operative  Agreements  (including without
limitation  Section 5.3 of this Agreement)  prior to the date specified for such
substitution and the Fair Market Sales Value of the Substitute Property is equal
to or greater than the Fair Market Sales Value of the Terminated Property,  such
determination  of Fair Market  Sales  Value to be  determined  by the  Appraisal
Procedure  and to the extent  Appraisals  are  required,  such  Appraisals to be
conducted  within  sixty  (60)  days  prior  to  the  date  specified  for  such
substitution.  The Terminated  Property shall be sold to the Lessee  pursuant to
Sections  20.1 and 20.2 of the Lease but shall  not count  against  the  limited
number  of  Properties  which  may be  purchased  by  the  Lessee  prior  to the
Expiration Date.

      5.14.Minimum Size of Construction Advance.

           The Holders and the Lenders shall have no obligation to make Advances
at any time for  modifications,  improvements or the like regarding any Property
unless each such Advance is in excess of five hundred Dollars ($500) per bed per
Property.

      5.15.Time Limit for Acquisition of Properties.

           On and after the Construction  Period Termination Date, (a) the Owner
Trustee shall not acquire any Property (subject,  however,  to Section 5.13) and
(b) no Financing Party shall be required to make any Advance for the acquisition
of any Property.


            SECTION 6. REPRESENTATIONS AND WARRANTIES.

      6.1. Representations and Warranties of the Borrower.

      Effective as of the Initial Closing Date and the date of each Advance, the
Trust  Company in its  individual  capacity and as the  Borrower,  as indicated,
represents  and  warrants  to each  of the  other  parties  hereto  as  follows,
provided,  that the representations in the following paragraphs (h), (j) and (k)
are made solely in its capacity as the Borrower:

           (a) It is a national  banking  association  and is duly organized and
      validly  existing and in good standing under the laws of the United States
      of America and has the power and  authority  to enter into and perform its
      obligations  under the Trust  Agreement and  (assuming due  authorization,
      execution  and  delivery of the Trust  Agreement  by the  Holders) has the
      corporate and trust power and authority to act as the Owner Trustee and to
      enter into and perform the  obligations  under each of the other Operative
      Agreements  to which the Trust Company or the Owner  Trustee,  as the case
      may be, is or will be a party and each  other  agreement,  instrument  and
      document to be executed and delivered by it on or before such Closing Date
      in connection with or as contemplated by each such Operative  Agreement to
      which the Trust  Company or the Owner  Trustee,  as the case may be, is or
      will be a party;

           (b)  The  execution,  delivery  and  performance  of  each  Operative
      Agreement  to  which it is or will be a party,  either  in its  individual
      capacity or (assuming  due  authorization,  execution  and delivery of the
      Trust Agreement by the Holders) as the Owner Trustee,  as the case may be,
      has been duly  authorized by all necessary  action on its part and neither
      the  execution  and  delivery   thereof,   nor  the  consummation  of  the
      transactions  contemplated  thereby,  nor compliance by it with any of the
      terms and  provisions  thereof (i) does or will  require  any  approval or
      consent  of  any  trustee  or  holders  of  any  of  its  indebtedness  or
      obligations,  (ii) does or will contravene any Legal Requirement  relating
      to its banking or trust powers, (iii) does or will contravene or result in
      any breach of or constitute any default  under,  or result in the creation
      of any Lien upon any of its property under, (A) its charter or by-laws, or
      (B) any indenture,  mortgage, chattel mortgage, deed of trust, conditional
      sales  contract,  bank  loan or credit  agreement  or other  agreement  or
      instrument to which it is a party or by which it or its  properties may be
      bound or  affected,  which  contravention,  breach,  default or Lien under
      clause (B) would  materially  and  adversely  affect its  ability,  in its
      individual  capacity or as the Owner Trustee,  to perform its  obligations
      under the Operative Agreements to which it is a party or (iv) does or will
      require any Governmental Action by any Governmental  Authority  regulating
      its banking or trust powers;

           (c) The Trust  Agreement  and,  assuming  the Trust  Agreement is the
      legal, valid and binding  obligation of the Holders,  each other Operative
      Agreement to which the Trust Company or the Owner Trustee, as the case may
      be, is or will be a party have been,  or on or before  such  Closing  Date
      will be, duly  executed and  delivered  by the Trust  Company or the Owner
      Trustee,  as the case may be, and the Trust  Agreement and each such other
      Operative  Agreement to which the Trust Company or the Owner  Trustee,  as
      the case may be, is a party  constitutes,  or upon  execution and delivery
      will constitute, a legal, valid and binding obligation enforceable against
      the Trust Company or the Owner Trustee,  as the case may be, in accordance
      with the terms thereof;

           (d) There is no action or  proceeding  pending or, to its  knowledge,
      threatened  to which it is or will be a party,  either  in its  individual
      capacity or as the Owner Trustee,  before any Governmental Authority that,
      if  adversely  determined,  would  materially  and  adversely  affect  its
      ability,  in its individual  capacity or as the Owner Trustee,  to perform
      its obligations  under the Operative  Agreements to which it is a party or
      would  question the  validity or  enforceability  of any of the  Operative
      Agreements to which it is or will become a party;

           (e) It has not  assigned or  transferred  any of its right,  title or
      interest in or under the Lease,  the Agency  Agreement  or its interest in
      any  Property  or any  portion  thereof,  except  in  accordance  with the
      Operative Agreements;

           (f) No  Default of Event of Default  under the  Operative  Agreements
      attributable to it has occurred and is continuing;

           (g) Except as otherwise contemplated in the Operative Agreements, the
      proceeds  of the Loans and  Holder  Advances  shall not be  applied by the
      Owner Trustee for any purpose other than the purchase  and/or lease of the
      Properties,  the  acquisition,  installation and testing of the Equipment,
      the construction of Improvements  and the payment of Transaction  Expenses
      and the fees,  expenses  and other  disbursements  referenced  in Sections
      7.1(a) and 7.1(b) of this  Agreement,  in each case which  accrue prior to
      the Rent Commencement Date with respect to a particular Property;

           (h) Neither the Owner Trustee nor any Person  authorized by the Owner
      Trustee to act on its behalf has offered or sold any interest in the Trust
      Estate or the Notes, or in any similar security relating to a Property, or
      in any security  the offering of which for the purposes of the  Securities
      Act would be deemed to be part of the same offering as the offering of the
      aforementioned securities to, or solicited any offer to acquire any of the
      same from, any Person other than, in the case of the Notes, the Agent, and
      neither the Owner  Trustee nor any Person  authorized by the Owner Trustee
      to act on its behalf will take any action which would subject, as a direct
      result of such action  alone,  the issuance or sale of any interest in the
      Trust Estate or the Notes to the provisions of Section 5 of the Securities
      Act or require the  qualification  of any  Operative  Agreement  under the
      Trust Indenture Act of 1939, as amended;

           (i) The Owner Trustee's principal place of business,  chief executive
      office and office where the  documents,  accounts and records  relating to
      the  transactions  contemplated by this Agreement and each other Operative
      Agreement  are kept are located at 79 South Main  Street,  Salt Lake City,
      Utah 84111;

           (j) The Owner  Trustee is not  engaged  principally  in, and does not
      have as one (1) of its  important  activities,  the  business of extending
      credit for the purpose of  purchasing or carrying any margin stock (within
      the  meaning of  Regulation  U of the Board of  Governors  of the  Federal
      Reserve System of the United  States),  and no part of the proceeds of the
      Loans or the Holder  Advances  will be used by it to purchase or carry any
      margin stock or to extend  credit to others for the purpose of  purchasing
      or carrying any such margin stock or for any purpose that violates,  or is
      inconsistent  with,  the provisions of Regulations T, U, or X of the Board
      of Governors of the Federal Reserve System of the United States;

           (k) The Owner  Trustee is not an  "investment  company"  or a company
      controlled by an "investment company" within the meaning of the Investment
      Company Act;

           (l) Each Property is free and clear of all Lessor Liens  attributable
      to the Owner Trustee in its individual capacity; and

           (m) The  Owner  Trustee,  in its  trust  capacity,  is a party  to no
      documents,  instruments or agreements other than the Operative  Agreements
      to which it is a party  and any  other  documents  delivered  by the Owner
      Trustee in connection with the Operative Agreements.

      6.2.  Representations  and  Warranties of the  Construction  Agent and the
Lessee.

      Effective as of the Initial  Closing Date,  the date of each Advance,  the
date  each  Domestic  Subsidiary  delivers  a  Joinder  Agreement  and the  Rent
Commencement  Date,  each Credit  Party  represents  and warrants to each of the
other parties hereto that:

           (a) The  Incorporated  Representations  and  Warranties  are true and
      correct in all material  respects (unless such relate solely to an earlier
      point in time) and the Lessee  has  delivered  to the Agent the  financial
      statements and other reports referred to in Section 3 of the Lessee Credit
      Agreement;

           (b) The execution and delivery by each Credit Party of this Agreement
      and the  other  applicable  Operative  Agreements  as of such date and the
      performance by each Credit Party of its respective  obligations under this
      Agreement and the other  applicable  Operative  Agreements  are within the
      corporate,  partnership or limited  liability company (as the case may be)
      powers of each Credit  Party,  have been duly  authorized by all necessary
      corporate,  partnership or limited  liability company (as the case may be)
      action on the part of each Credit Party (including  without limitation any
      necessary shareholder action), have been duly executed and delivered, have
      received all necessary  governmental approval, and do not and will not (i)
      violate any Legal  Requirement which is binding on any Credit Party or any
      of its  Subsidiaries,  (ii)  contravene  or conflict  with, or result in a
      breach of, any  provision  of the  Articles of  Incorporation,  By-Laws or
      other  organizational  documents  of  any  Credit  Party  or  any  of  its
      Subsidiaries or of any agreement,  indenture, instrument or other document
      which is binding on any Credit Party or any of its  Subsidiaries  or (iii)
      result in, or require,  the creation or imposition of any Lien (other than
      pursuant  to the terms of the  Operative  Agreements)  on any asset of any
      Credit Party or any of its Subsidiaries;

           (c) This  Agreement and the other  applicable  Operative  Agreements,
      executed prior to and as of such date by any Credit Party,  constitute the
      legal,  valid and binding  obligation of such Credit Party, as applicable,
      enforceable  against such Credit Party, as applicable,  in accordance with
      their  terms.  Each  Credit  Party  has  executed  the  various  Operative
      Agreements required to be executed by such Credit Party as of such date;

           (d) Except as described in Exhibit K, there are no material  actions,
      suits or proceedings pending or, to our knowledge,  threatened against any
      Credit Party in any court or before any Governmental  Authority (nor shall
      any order, judgment or decree have been issued or proposed to be issued by
      any Governmental Authority to set aside,  restrain,  enjoin or prevent the
      full   performance   of  any  Operative   Agreement  or  any   transaction
      contemplated  thereby) that (i) concern any Property or any Credit Party's
      interest  therein,  (ii)  question the validity or  enforceability  of any
      Operative  Agreement  to which any Credit  Party is a party or the overall
      transaction  described  in the  Operative  Agreements  to which any Credit
      Party is a party or (iii) have or could  reasonably  be expected to have a
      Material Adverse Effect;

           (e) No  Governmental  Action by any  Governmental  Authority or other
      authorization,  registration,  consent,  approval, waiver, notice or other
      action by, to or of any other  Person  pursuant to any Legal  Requirement,
      contract,  indenture,  instrument  or agreement or for any other reason is
      required to authorize or is required in connection with (i) the execution,
      delivery or  performance  of any Operative  Agreement,  (ii) the legality,
      validity,  binding effect or  enforceability  of any Operative  Agreement,
      (iii) the acquisition,  ownership,  construction,  completion,  occupancy,
      operation,  leasing or subleasing of any Property or (iv) any Advance,  in
      each case, except those which have been obtained and are in full force and
      effect;

           (f) Upon the execution  and delivery of each Lease  Supplement to the
      Lease,  (i) the Lessee will have  unconditionally  accepted  the  Property
      subject  to the Lease  Supplement  and will  have a valid  and  subsisting
      leasehold interest in such Property,  subject only to the Permitted Liens,
      and (ii) no offset  will  exist  with  respect  to any Rent or other  sums
      payable under the Lease;

           (g) Except as otherwise contemplated by the Operative Agreements, the
      Construction  Agent shall not use the  proceeds  of any Holder  Advance or
      Loan  for  any  purpose  other  than  the  purchase  and/or  lease  of the
      Properties,  the  acquisition,  installation and testing of the Equipment,
      the construction of Improvements  and the payment of Transaction  Expenses
      and the fees,  expenses  and other  disbursements  referenced  in Sections
      7.1(a) and 7.1(b) of this  Agreement,  in each case which  accrue prior to
      the Rent Commencement Date with respect to a particular Property;

           (h)  All  information   heretofore  or   contemporaneously   herewith
      furnished by each Credit Party or its Subsidiaries to the Agent, the Owner
      Trustee,  any Lender or any Holder for purposes of or in  connection  with
      this  Agreement  and the  transactions  contemplated  hereby  is,  and all
      information  hereafter  furnished  by or on behalf of each Credit Party or
      its Subsidiaries to the Agent, the Owner Trustee, any Lender or any Holder
      pursuant  hereto or in  connection  herewith will be, true and accurate in
      every material  respect on the date as of which such  information is dated
      or certified,  and such  information,  taken as a whole, does not and will
      not omit to state any material  fact  necessary to make such  information,
      taken as a whole, not misleading;

           (i) The  principal  place of  business,  chief  executive  office and
      office of the  Construction  Agent  and the  Lessee  where the  documents,
      accounts and records  relating to the  transactions  contemplated  by this
      Agreement and each other  Operative  Agreement are kept are located at 400
      Perimeter  Center Terrace,  Suite 650,  Atlanta,  Georgia 30346, in DeKalb
      County,  Georgia  and the  states of  formation  and the  chief  executive
      offices of each other  Credit Party are located at the places set forth in
      Exhibit L;

           (j) The representations and warranties of each Credit Party set forth
      in any of the  Operative  Agreements  are true and correct in all material
      respects  on and as of each such  date as if made on and as of such  date.
      Each  Credit  Party is in all  material  respects in  compliance  with its
      obligations under the Operative  Agreements and there exists no Default or
      Event of Default under any of the Operative Agreements which is continuing
      and which has not been cured  within  any cure  period  expressly  granted
      under the terms of the applicable  Operative Agreement or otherwise waived
      in accordance with the applicable Operative Agreement. No Default or Event
      of Default will occur under any of the  Operative  Agreements  as a result
      of, or after giving effect to, the Advance requested by the Requisition on
      the date of each Advance;

           (k) As of each  Property  Closing Date,  the date of each  subsequent
      Advance and the Rent  Commencement  Date only,  each  Property  then being
      financed  consists  of (i)  unimproved  Land or  (ii)  Land  and  existing
      Improvements  thereon which Improvements are either suitable for occupancy
      at the time of acquisition  or ground leasing or will be renovated  and/or
      modified in  accordance  with the terms of this  Agreement.  Each Property
      then being financed is located at the location set forth on the applicable
      Requisition, each of which is in one (1) of the Approved States;

           (l) As of each  Property  Closing Date,  the date of each  subsequent
      Advance  and the Rent  Commencement  Date  only,  the  Lessor has good and
      marketable fee simple title to each  Property,  or, if any Property is the
      subject of a Ground Lease,  the Lessor will have a valid ground  leasehold
      interest  enforceable  against  the  ground  lessor  of such  Property  in
      accordance  with the terms of such Ground Lease,  subject only to (i) such
      Liens  referenced in Sections  6.2(r)(i) and  6.2(r)(ii) on the applicable
      Property  Closing Date and (ii) subject to Section  5.7,  Permitted  Liens
      after the applicable Property Closing Date;

           (m) As of each  Property  Closing Date,  the date of each  subsequent
      Advance and the Rent Commencement Date only, no portion of any Property is
      located  in an area  identified  as a  special  flood  hazard  area by the
      Federal Emergency  Management Agency or other applicable agency, or if any
      such  Property is located in an area  identified as a special flood hazard
      area by the  Federal  Emergency  Management  Agency  or  other  applicable
      agency,  then flood  insurance  has been  obtained  for such  Property  in
      accordance  with Section  14.2(b) of the Lease and in accordance  with the
      National Flood Insurance Act of 1968, as amended;

           (n) As of each  Property  Closing Date,  the date of each  subsequent
      Advance and the Rent  Commencement  Date only, each Property complies with
      all Insurance Requirements and, in all material respects, all standards of
      Lessee with respect to similar properties owned by Lessee;

           (o) As of each  Property  Closing Date,  the date of each  subsequent
      Advance and the Rent  Commencement  Date only, each Property complies with
      all Legal  Requirements as of such date (including  without limitation all
      zoning  and land use laws and  Environmental  Laws),  except to the extent
      that failure to comply therewith,  individually or in the aggregate, shall
      not have and could not  reasonably be expected to have a Material  Adverse
      Effect;

           (p) As of each  Property  Closing Date,  the date of each  subsequent
      Advance and the Rent  Commencement  Date only,  all utility  services  and
      facilities   necessary   for  the   construction   and  operation  of  the
      Improvements and the installation and operation of the Equipment regarding
      each Property  (including  without limitation gas,  electrical,  water and
      sewage  services and  facilities)  are available at the applicable Land or
      will be constructed prior to the Completion Date for such Property;

           (q) As of each  Property  Closing Date,  the date of each  subsequent
      Advance and the Rent Commencement Date only, acquisition, installation and
      testing of the Equipment (if any) and construction of the Improvements (if
      any) to such date  shall  have been  performed  in a good and  workmanlike
      manner,   substantially  in  accordance  with  the  applicable  Plans  and
      Specifications;

           (r)  (i)  The  Security   Documents   create,  as  security  for  the
           Obligations  (as such term is  defined  in the  Security  Agreement),
           valid and enforceable security interests in, and Liens on, all of the
           Collateral,  in favor of the Agent,  for the  ratable  benefit of the
           Lenders and the Holders, as their respective  interests appear in the
           Operative  Agreements,  and such  security  interests  and  Liens are
           subject to no other  Liens  other than Liens that are  expressly  set
           forth  as title  exceptions  on the  title  commitment  issued  under
           Section 5.3(g) with respect to the applicable Property, to the extent
           such  title   commitment  has  been  approved  by  the  Agent.   Upon
           recordation of the Mortgage  Instrument in the real estate  recording
           office  in  the   applicable   Approved   State   identified  by  the
           Construction  Agent or the Lessee,  the Lien  created by the Mortgage
           Instrument  in  the  real  property  described  therein  shall  be  a
           perfected first priority mortgage Lien on such real property in favor
           of the Agent, for the ratable benefit of the Lenders and the Holders,
           as their respective interests appear in the Operative Agreements, and
           (subject  to  Section  5.7)  Permitted  Liens  after  the  applicable
           Property  Closing Date. To the extent that the security  interests in
           the portion of the Collateral  comprised of personal  property can be
           perfected by filing in the filing offices in the applicable  Approved
           States  or  elsewhere  identified  by the  Construction  Agent or the
           Lessee, upon filing of the Lender Financing Statements in such filing
           offices,  the security  interests  created by the Security  Agreement
           shall be perfected first priority security interests in such personal
           property  in favor  of the  Agent,  for the  ratable  benefit  of the
           Lenders and the Holders, as their respective  interests appear in the
           Operative  Agreements,  and (subject to Section 5.7) Permitted  Liens
           after the applicable Property Closing Date;

                (ii)  The  Lease   Agreement   creates,   as  security  for  the
           obligations  of the  Lessee  under  the  Lease  Agreement,  valid and
           enforceable security interests in, and Liens on, each Property leased
           thereunder,  in favor of the Lessor,  and such security interests and
           Liens are  subject to no other  Liens  other than (aa) Liens that are
           expressly  set  forth as title  exceptions  on the  title  commitment
           issued under Section 5.3(g) with respect to the applicable  Property,
           to the extent such title  commitment  has been approved by the Agent,
           and  (bb)  (subject  to  Section  5.7)  Permitted   Liens  after  the
           applicable  Property Closing Date. Upon recordation of the memorandum
           of the Lease  Agreement and the  memorandum of a Ground Lease (or, in
           either case, a short form lease) in the real estate  recording office
           in the applicable Approved State identified by the Construction Agent
           or the Lessee,  the Lien  created by the Lease  Agreement in the real
           property  described  therein  shall  be a  perfected  first  priority
           mortgage  Lien on such real  property in favor of the Agent,  for the
           ratable benefit of the Lenders and the Holders,  as their  respective
           interests appear in the Operative Agreements.  To the extent that the
           security  interests  in the  portion  of any  Property  comprised  of
           personal  property  can be  perfected  by the  filing  in the  filing
           offices in the applicable  Approved State or elsewhere  identified by
           the  Construction  Agent or the  Lessee  upon  filing  of the  Lessor
           Financing  Statements  in such filing  offices,  a security  interest
           created by the Lease  Agreement  shall be  perfected  first  priority
           security  interests in such personal property in favor of the Lessor,
           which rights pursuant to the Lessor Financing Statements are assigned
           to the Agent, for the ratable benefit of the Lenders and the Holders,
           as their respective interests appear in the Operative Agreements;

           (s) The Plans and  Specifications  for each Property will be prepared
      prior  to  the   commencement  of  construction  in  accordance  with  all
      applicable Legal Requirements (including without limitation all applicable
      Environmental Laws and building,  planning, zoning and fire codes), except
      to the extent  the  failure to comply  therewith,  individually  or in the
      aggregate,  shall not have and could not  reasonably be expected to have a
      Material  Adverse  Effect.  Upon completion of the  Improvements  for each
      Property in accordance with the applicable Plans and Specifications,  such
      Improvements  will be within any building  restriction  lines and will not
      encroach in any manner onto any  adjoining  land  (except as  permitted by
      express written easements, which have been approved by the Agent);

           (t) As of the Rent  Commencement  Date only,  each Property  shall be
      improved  substantially  in  accordance  with  the  applicable  Plans  and
      Specifications  and  in  a  good  and  workmanlike  manner  and  shall  be
      operational;

           (u) As of the Initial Closing Date, each Domestic  Subsidiary (formed
      prior to or on such  date)  shall  have  executed  this  Agreement  in its
      capacity as a Guarantor;

           (v) As of each  Property  Closing Date only,  each  Property has been
      acquired or ground  leased  pursuant to a Ground  Lease at a price that is
      not materially in excess of fair market value or fair market rental value,
      as the case may be;

           (w)  Respecting  each Property for which no Appraisal  satisfying the
      requirements  of the Operative  Agreements has been provided to the Agent,
      the anticipated  Property Cost for all such Properties which have the same
      Property  Closing Date  (determined  pursuant to the  Construction  Budget
      therefor)  does not  exceed  eight (8) times the pro forma  EBITDA for all
      such  Properties and the actual Property Cost for all such Properties does
      not exceed eight (8) times the pro forma  EBITDA for all such  Properties;
      and

           (x) Each Credit Party has (i)  initiated a review and  assessment  of
      all areas within its and each of its Subsidiaries' business and operations
      (including  those  affected by  suppliers,  vendors and  customers of each
      Credit  Party and the  Subsidiaries  of each  Credit  Party) that could be
      adversely  affected by the Year 2000  Problem,  (ii)  developed a plan and
      timeline for  addressing the Year 2000 Problem on a timely basis and (iii)
      to date, implemented that plan in accordance with that timetable. Based on
      the foregoing,  each Credit Party believes that all computer  applications
      (including those of suppliers,  vendors and customers of each Credit Party
      and the Subsidiaries of each Credit Party) that are material to its or any
      of its Subsidiaries'  business and operations are reasonably expected on a
      timely basis to be able to perform properly  date-sensitive  functions for
      all  dates  before  and after  January  1,  2000  (that is, be "Year  2000
      Compliant"),  except to the extent  that a failure to do so shall not have
      and could not reasonably be expected to have a Material Adverse Effect.


                       SECTION 6B. GUARANTY

      6B.1.Guaranty of Payment and Performance.

      Subject to Section 6B.7,  each  Guarantor  hereby,  jointly and severally,
unconditionally  guarantees  to each  Financing  Party the  prompt  payment  and
performance  of the  Company  Obligations  in full when due  (whether  at stated
maturity, as a mandatory prepayment,  by acceleration or otherwise) or when such
is otherwise to be  performed;  provided,  notwithstanding  the  foregoing,  the
obligations  of the  Guarantors  under this  Section 6B shall not  constitute  a
direct  guaranty of the  indebtedness  of the Lessor  evidenced by the Notes but
rather a  guaranty  of the  Company  Obligations  arising  under  the  Operative
Agreements.  This Section 6B is a guaranty of payment and performance and not of
collection  and  is a  continuing  guaranty  and  shall  apply  to  all  Company
Obligations  whenever arising. All rights granted to the Financing Parties under
this Section 6B shall be subject to the provisions of Section 8.2(h) and 8.6.

      6B.2.Obligations Unconditional.

      Each Guarantor agrees that the obligations of the Guarantors hereunder are
absolute and unconditional,  irrespective of the value,  genuineness,  validity,
regularity or  enforceability of any of the Operative  Agreements,  or any other
agreement or instrument  referred to therein,  or any  substitution,  release or
exchange  of  any  other  guarantee  of or  security  for  any  of  the  Company
Obligations,   and,  to  the  fullest  extent   permitted  by  applicable   law,
irrespective  of  any  other  circumstance   whatsoever  which  might  otherwise
constitute a legal or equitable  discharge or defense of a surety,  guarantor or
co-obligor, it being the intent of this Section 6B.2 that the obligations of the
Guarantors  hereunder  shall be  absolute  and  unconditional  under any and all
circumstances. Each Guarantor agrees that this Section 6B may be enforced by the
Financing  Parties  without  the  necessity  at  any  time  of  resorting  to or
exhausting  any other  security or  collateral  and without the necessity at any
time of having  recourse  to the  Notes,  the  Certificates  or any other of the
Operative  Agreements or any collateral,  if any, hereafter securing the Company
Obligations or otherwise and each  Guarantor  hereby waives the right to require
the Financing  Parties to proceed against the Construction  Agent, the Lessee or
any other Person (including without limitation a co-guarantor) or to require the
Financing  Parties to pursue any other remedy or enforce any other  right.  Each
Guarantor  further  agrees  that it  hereby  subordinates  any and all  right of
subrogation, indemnity, reimbursement or contribution against the Lessee and the
Construction Agent or any other Guarantor of the Company Obligations for amounts
paid under  this  Section  6B until  such time as the  Loans,  Holder  Advances,
accrued  but unpaid  interest,  accrued  but unpaid  Holder  Yield and all other
amounts owing under the Operative  Agreements  have been paid in full,  and each
Guarantor  further  agrees  not to assert  any such  right  until the  Financing
Parties  have  been paid in full  with  respect  to all  amounts  owed  under or
pursuant to the Operative  Agreements.  Without  limiting the  generality of the
waiver provisions of this Section 6B, each Guarantor hereby waives any rights to
require the Financing  Parties to proceed against the  Construction  Agent,  the
Lessee or any  co-guarantor  or to require  Lessor to pursue any other remedy or
enforce any other right, including without limitation,  any and all rights under
N.C.  Gen.  Stat.  ss. 26-7 through 26-9.  Each  Guarantor  further  agrees that
nothing  contained herein shall prevent the Financing  Parties from suing on any
Operative  Agreement  or  foreclosing  any  security  interest in or Lien on any
collateral,  if any,  securing the Company  Obligations  or from  exercising any
other  rights  available  to it under  any  Operative  Agreement,  or any  other
instrument of security,  if any, and the exercise of any of the aforesaid rights
and the  completion  of any  foreclosure  proceedings  shall  not  constitute  a
discharge of any  Guarantor's  obligations  hereunder;  it being the purpose and
intent of each  Guarantor  that its  obligations  hereunder  shall be  absolute,
independent and unconditional under any and all circumstances; provided that any
amounts  due under this  Section 6B which are paid to or for the  benefit of any
Financing Party shall reduce the Company  Obligations by a corresponding  amount
(unless  required to be  rescinded  at a later  date).  Neither any  Guarantor's
obligations  under this  Section 6B nor any remedy for the  enforcement  thereof
shall be impaired,  modified, changed or released in any manner whatsoever by an
impairment,  modification, change, release or limitation of the liability of the
Construction Agent or the Lessee or by reason of the bankruptcy or insolvency of
the Construction  Agent or the Lessee or any other Credit Party.  Each Guarantor
waives any and all notice of the creation,  renewal, extension or accrual of any
of the Company  Obligations  and notice of or proof of reliance by any Financing
Party upon this  Section  6B or  acceptance  of this  Section  6B.  The  Company
Obligations  shall  conclusively  be deemed to have been created,  contracted or
incurred, or renewed, extended, amended or waived, in reliance upon this Section
6B. All  dealings  between  the  Construction  Agent,  the Lessee and any of the
Guarantors,  on the one hand,  and the  Financing  Parties,  on the other  hand,
likewise  shall be  conclusively  presumed  to have been had or  consummated  in
reliance upon this Section 6B.

      6B.3.Modifications.

      Each  Guarantor  agrees  that (a) all or any part of the  security  now or
hereafter  held  for  the  Company  Obligations,   if  any,  may  be  exchanged,
compromised or surrendered  from time to time; (b) no Financing Party shall have
any  obligation  to  protect,  perfect,  secure  or  insure  any  such  security
interests,  liens or encumbrances now or hereafter held, if any, for the Company
Obligations or the properties subject thereto;  (c) the time or place of payment
of the Company Obligations may be changed or extended, in whole or in part, to a
time certain or  otherwise,  and may be renewed or  accelerated,  in whole or in
part;  (d) the  Construction  Agent,  the Lessee and any other party  liable for
payment under the Operative Agreements may be granted indulgences generally; (e)
any of the  provisions  of  the  Notes,  the  Certificates  or any of the  other
Operative  Agreements  may  be  modified,  amended  or  waived;  (f)  any  party
(including  any  co-guarantor)  liable for the  payment  thereof  may be granted
indulgences  or be released;  and (g) any deposit  balance for the credit of the
Construction  Agent, the Lessee or any other party liable for the payment of the
Company  Obligations  or liable upon any security  therefor may be released,  in
whole or in part,  at,  before  or after the  stated,  extended  or  accelerated
maturity of the Company Obligations,  all without notice to or further assent by
such  Guarantor,  which shall remain  bound  thereon,  notwithstanding  any such
exchange, compromise, surrender, extension, renewal, acceleration, modification,
indulgence or release.

      6B.4.Waiver of Rights.

      Each  Guarantor  expressly  waives  to the  fullest  extent  permitted  by
applicable  law: (a) notice of  acceptance  of this Section 6B by any  Financing
Party and of all  extensions  of credit or other  Advances  to the  Construction
Agent  and the  Lessee by the  Lenders  pursuant  to the terms of the  Operative
Agreements;  (b) presentment and demand for payment or performance of any of the
Company  Obligations;  (c) protest  and notice of  dishonor  or of default  with
respect to the Company Obligations or with respect to any security therefor; (d)
notice of any Financing Party obtaining, amending,  substituting for, releasing,
waiving  or  modifying  any  security  interest,  lien or  encumbrance,  if any,
hereafter   securing  the  Company   Obligations,   or  any  Financing   Party's
subordinating,  compromising,  discharging or releasing such security interests,
liens or encumbrances, if any; and (e) all other notices to which such Guarantor
might otherwise be entitled.  Notwithstanding  anything to the contrary  herein,
(i) each  Guarantor's  payments  hereunder  shall be due five (5) Business  Days
after  written  demand  by the  Agent  for  such  payment  (unless  the  Company
Obligations are automatically  accelerated pursuant to the applicable provisions
of the Operative  Agreements  in which case the  Guarantors'  payments  shall be
automatically  due) and (ii) any modification of the Operative  Agreements which
has the effect of increasing  the Company  Obligations  shall not be enforceable
against a Guarantor unless such Guarantor executes the document  evidencing such
modification  or otherwise  reaffirms its guaranty in writing in connection with
such modification.

      6B.5.Reinstatement.

      The  obligations  of  the  Guarantors  under  this  Section  6B  shall  be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Company Obligations is rescinded or
must be  otherwise  restored  by any holder of any of the  Company  Obligations,
whether  as a result of any  proceedings  in  bankruptcy  or  reorganization  or
otherwise, and each Guarantor agrees that it will indemnify each Financing Party
on demand for all reasonable costs and expenses (including,  without limitation,
reasonable  fees of counsel)  incurred by any Financing Party in connection with
such rescission or restoration,  including without limitation any such costs and
expenses  incurred in  defending  against any claim  alleging  that such payment
constituted  a  preference,  fraudulent  transfer or similar  payment  under any
bankruptcy, insolvency or similar law.

      6B.6.Remedies.

      The Guarantors agree that, as between the Guarantors, on the one hand, and
each Financing Party, on the other hand, the Company Obligations may be declared
to be forthwith due and payable as provided in the applicable  provisions of the
Operative  Agreements (and shall be deemed to have become  automatically due and
payable  in  the  circumstances  provided  therein)  notwithstanding  any  stay,
injunction or other prohibition  preventing such declaration (or preventing such
Company Obligations from becoming  automatically due and payable) as against any
other  Person  and  that,  in the  event of such  declaration  (or such  Company
Obligations  being deemed to have become  automatically  due and payable),  such
Company  Obligations  (whether or not due and payable by any other Person) shall
forthwith  become  due and  payable by the  Guarantors  in  accordance  with the
applicable provisions of the Operative Agreements.

      6B.7.Limitation of Guaranty.

      Notwithstanding  any provision to the contrary  contained herein or in any
of  the  other  Operative  Agreements,  to the  extent  the  obligations  of any
Guarantor  shall be  adjudicated to be invalid or  unenforceable  for any reason
(including  without  limitation  because of any applicable  state or federal law
relating to fraudulent  conveyances or transfers)  then the  obligations of such
Guarantor  hereunder  shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including without  limitation
the Bankruptcy Code).

      Subject to Section 6B.5, upon the satisfaction of the Company  Obligations
in full,  regardless  of the  source of  payment,  the  Guarantors'  obligations
hereunder  shall be deemed  satisfied,  discharged  and  terminated  other  than
indemnifications set forth herein that expressly survive.

      6B.8.Payment of Amounts to the Agent.

      Each Financing Party hereby  instructs each Guarantor,  and each Guarantor
hereby acknowledges and agrees, that until such time as the Loans and the Holder
Advances are paid in full and the Liens evidenced by the Security  Agreement and
the Mortgage Instruments have been released any and all Rent (excluding Excepted
Payments  which shall be payable to each Holder or other Person as  appropriate)
and any and all other  amounts  of any kind or type  under any of the  Operative
Agreements due and owing or payable to any Person shall instead be paid directly
to the Agent (excluding  Excepted Payments which shall be payable to each Holder
or other Person as appropriate) or as the Agent may direct from time to time for
allocation  and  distribution  in accordance  with the  procedures  set forth in
Section 8.7 hereof.

      6B.9.Release of Guarantors.

      Each  Financing  Party hereby agrees that (a) the Agent shall be permitted
to release any  Guarantor  from its guaranty  obligations  under this Section 6B
without  the consent of any other  Financing  Party if the release is granted in
connection  with a disposition by the applicable  Credit Party of all the shares
of stock or  partnership  or other equity  interest in such  Guarantor  and such
disposition is permitted pursuant to the applicable  provisions of the Operative
Agreements and the Lessee Credit  Agreement and (b) the Agent shall be permitted
to release any Guarantor from its guaranty  obligations  under this Section 6B.9
without the consent of any other  Financing Party if the release is requested by
Centennial  in  connection  with a  dissolution  of the  Guarantor,  subject  to
Centennial  providing to the Agent  written  representations  to the effect that
such Guarantor has no business operations and no assets.


              SECTION 7. PAYMENT OF CERTAIN EXPENSES.

      7.1. Transaction Expenses.

           (a) The Lessor  agrees on the Initial  Closing Date, to pay, or cause
      to be paid,  all  Transaction  Expenses  arising from the Initial  Closing
      Date,  including  without  limitation  all reasonable  fees,  expenses and
      disbursements  of the various legal  counsels for the Lessor and the Agent
      in  connection  with  the  transactions   contemplated  by  the  Operative
      Agreements and incurred in connection  with such Initial Closing Date, the
      initial  fees and  expenses  of the Owner  Trustee due and payable on such
      Initial  Closing  Date,  all fees,  taxes and expenses for the  recording,
      registration  and  filing  of  documents  and all other  reasonable  fees,
      expenses  and  disbursements  incurred  in  connection  with such  Initial
      Closing  Date;  provided,  however,  the  Lessor  shall  pay such  amounts
      described  in this  Section  7.1(a) only if (i) such  amounts are properly
      described  in a  Requisition  delivered  on or before the Initial  Closing
      Date,  and (ii) funds are made available by the Lenders and the Holders in
      connection  with such  Requisition  in an amount  sufficient to allow such
      payment.  On the Initial  Closing  Date after  delivery and receipt of the
      Requisition  referenced in Section 4.2(a) hereof and  satisfaction  of the
      other conditions precedent for such date, the Holders severally shall make
      Holder  Advances and the Lenders  severally shall make Loans to the Lessor
      to  pay  for  the   Transaction   Expenses,   fees,   expenses  and  other
      disbursements  referenced  in this Section  7.1(a).  The Lessee  agrees to
      timely pay all amounts  referred to in this  Section  7.1(a) to the extent
      not paid by the Lessor.

           (b) Assuming no Default or Event of Default  shall have  occurred and
      be continuing and only for the period prior to the Rent Commencement Date,
      the  Lessor  agrees  on each  Property  Closing  Date,  on the date of any
      Construction  Advance  and on the  Completion  Date to pay, or cause to be
      paid, all Transaction Expenses including without limitation all reasonable
      fees,  expenses and  disbursements  of the various legal  counsels for the
      Lessor and the Agent in connection with the  transactions  contemplated by
      the Operative  Agreements  and billed in  connection  with such Advance or
      such  Completion  Date,  all amounts  described in Section  7.1(a) of this
      Agreement  which  have not  been  previously  paid,  the  annual  fees and
      reasonable out-of-pocket expenses of the Owner Trustee, all fees, expenses
      and disbursements incurred with respect to the various items referenced in
      Sections 5.3, 5.4 and/or 5.5  (including  without  limitation any premiums
      for title insurance policies and charges for any updates to such policies)
      and all other  reasonable fees,  expenses and  disbursements in connection
      with such Advance or such Completion Date including without limitation all
      expenses  relating to and all fees,  taxes and expenses for the recording,
      registration and filing of documents and during the Commitment Period, all
      fees, expenses and costs referenced in Sections 7.3(a), 7.3(b), 7.3(d) and
      7.4;  provided,  however,  the Lessor shall pay such amounts  described in
      this Section  7.1(b) only if (i) such amounts are properly  described in a
      Requisition  delivered  on the  applicable  date and (ii)  funds  are made
      available  by  the  Lenders  and  the  Holders  in  connection  with  such
      Requisition  in an  amount  sufficient  to  allow  such  payment.  On each
      Property  Closing  Date,  on the date of any  Construction  Advance or any
      Completion  Date,  after  delivery  of  the  applicable   Requisition  and
      satisfaction of the other conditions  precedent for such date, the Holders
      severally shall make Holder Advances and the Lenders  severally shall make
      Loans to the Lessor to pay for the Transaction  Expenses,  fees,  expenses
      and other  disbursements  referenced  in this Section  7.1(b).  The Lessee
      agrees to timely pay all amounts referred to in this Section 7.1(b) to the
      extent not paid by the Lessor.

           (c) Fees payable under the Operative  Agreements  shall be calculated
      on the basis of a year of three  hundred  sixty  (360) days for the actual
      days elapsed.

      7.2. Brokers' Fees.

      The Lessee agrees to pay or cause to be paid any and all brokers' fees, if
any, including without limitation any interest and penalties thereon,  which are
payable in connection with the  transactions  contemplated by this Agreement and
the other Operative Agreements.

      7.3. Certain Fees and Expenses.

      The Lessee  agrees to pay or cause to be paid (a) the $5,000  initial  fee
and the $5,000 annual fee, each payable to the Owner Trustee (for its individual
account) and all  reasonable  expenses of the Owner Trustee and any  co-trustees
(including  without  limitation  reasonable  counsel  fees and  expenses) or any
successor owner trustee and/or co-trustee, for acting as the owner trustee under
the Trust  Agreement,  (b) all  reasonable  costs and  expenses  incurred by the
Credit Parties,  the Agent,  the Lenders,  the Holders or the Lessor in entering
into any Lease Supplement and any future amendments, modifications, supplements,
restatements   and/or   replacements  with  respect  to  any  of  the  Operative
Agreements,  whether or not such Lease  Supplement,  amendments,  modifications,
supplements,  restatements  and/or  replacements are ultimately entered into, or
giving or withholding of waivers of consents hereto or thereto,  which have been
requested  by any Credit  Party,  the Agent,  the  Lenders,  the  Holders or the
Lessor,  (c) all reasonable  costs and expenses  incurred by the Credit Parties,
the  Agent,  the  Lenders,  the  Holders or the  Lessor in  connection  with any
exercise  of  remedies  under any  Operative  Agreement  or any  purchase of any
Property by the  Construction  Agent,  the Lessee or any third party and (d) all
reasonable  costs and expenses  incurred by the Credit Parties,  the Agent,  the
Lenders, the Holders or the Lessor in connection with any transfer or conveyance
of any  Property,  whether or not such  transfer  or  conveyance  is  ultimately
accomplished.

      7.4. Unused Fee.

      During the Commitment  Period,  the Lessee agrees to pay or to cause to be
paid to the Agent for the account of (a) the  Lenders,  respectively,  an unused
fee  (the  "Lender  Unused  Fee")  equal to the  product  of the  average  daily
Available  Commitment of each Lender during the Commitment  Period multiplied by
the Applicable Percentage per annum and (b) the Holders, respectively, an unused
fee  (the  "Holder  Unused  Fee")  equal to the  product  of the  average  daily
Available  Holder  Commitment  of  each  Holder  during  the  Commitment  Period
multiplied by the  Applicable  Percentage  per annum.  Such Unused Fees shall be
payable  quarterly  in arrears  on each  Unused Fee  Payment  Date.  If all or a
portion of any such Unused Fee shall not be paid when due,  such overdue  amount
shall bear interest,  payable by the Lessee on demand, at a rate per annum equal
to the ABR  (or in the  case of  Holder  Yield,  the  ABR  plus  the  Applicable
Percentage for Eurodollar  Holder  Advances) plus two percent (2%) from the date
of such  non-payment  until  such  amount  is paid in full  (as  well as  before
judgment).

      7.5. Upfront Fee.

      The Lessee  shall pay or cause to be paid on the Initial  Closing  Date an
upfront  fee  payable  to each  Lender  and  each  Holder  (for  the  respective
individual accounts of each such entity) on the terms and conditions and at such
times set forth or referenced in a letter  agreement  concerning such fees dated
on or about the Initial Closing Date addressed to Centennial from the Agent.

      7.6. Agent's Fee.

      The  Lessee  shall pay or cause to be paid an  administrative  agency  fee
payable to the Agent for its individual  account on the terms and conditions and
at such terms set forth or referenced in a letter agreement  concerning such fee
dated on or about the Initial  Closing  Date  addressed to  Centennial  from the
Agent.



            SECTION 8. OTHER COVENANTS AND AGREEMENTS.

      8.1. Cooperation with the Construction Agent or the Lessee.

      The  Holders,  the Lenders,  the Lessor (at the  direction of the Majority
Secured  Parties)  and the Agent  shall,  at the  expense  of and to the  extent
reasonably  requested  by the  Construction  Agent or the  Lessee  (but  without
assuming  additional  liabilities on account thereof and only to the extent such
is acceptable to the Holders,  the Lenders,  the Lessor (at the direction of the
Majority  Secured  Parties)  and the  Agent  in  their  reasonable  discretion),
cooperate  with the  Construction  Agent or the  Lessee in  connection  with the
Construction Agent or the Lessee satisfying its covenant  obligations  contained
in the Operative  Agreements  including without  limitation at any time and from
time to  time,  promptly  and duly  executing  and  delivering  any and all such
further  instruments,  documents  and  financing  statements  (and  continuation
statements related thereto).

      8.2. Covenants of the Owner Trustee and the Holders.

      Each of the Owner  Trustee and the Holders  hereby  agrees that so long as
this Agreement is in effect:

           (a)  Neither  the  Owner  Trustee  (in its trust  capacity  or in its
      individual  capacity) nor any Holder will create or permit to exist at any
      time,  and each of them will,  at its own cost and expense,  promptly take
      such  action  as may be  necessary  duly to  discharge,  or to cause to be
      discharged,  all  Lessor  Liens  on  the  Properties  attributable  to it;
      provided,  however,  that the Owner  Trustee and the Holders  shall not be
      required  to so  discharge  any such  Lessor  Lien while the same is being
      contested in good faith by appropriate  proceedings  diligently prosecuted
      so long as such proceedings  shall not materially and adversely affect the
      rights of the Lessee under the Lease and the other Operative Agreements or
      involve any  material  danger of  impairment  of the Liens of the Security
      Documents or of the sale,  forfeiture  or loss of, and shall not interfere
      with the use or  disposition  of,  any  Property  or title  thereto or any
      interest therein or the payment of Rent;

           (b) Without  prejudice to any right under the Trust  Agreement of the
      Owner Trustee to resign (subject to the requirement set forth in the Trust
      Agreement that such  resignation  shall not be effective until a successor
      shall have  agreed to accept such  appointment),  or the  Holders'  rights
      under the Trust  Agreement to remove the  institution  acting as the Owner
      Trustee  (after  consent to such  removal by the Agent as  provided in the
      Trust Agreement),  each of the Owner Trustee and the Holders hereby agrees
      with the  Lessee  and the Agent (i) not to  terminate  or revoke the trust
      created by the Trust Agreement  except as permitted by Article VIII of the
      Trust  Agreement,  (ii) not to amend,  supplement,  terminate or revoke or
      otherwise  modify any provision of the Trust Agreement in such a manner as
      to adversely affect the rights of any such party without the prior written
      consent  of such  party and  (iii) to comply  with all of the terms of the
      Trust Agreement,  the  nonperformance of which would adversely affect such
      party;

           (c) The Owner  Trustee or any  successor  may resign or be removed by
      the  Holders  as the Owner  Trustee,  a  successor  Owner  Trustee  may be
      appointed and a  corporation  may become the Owner Trustee under the Trust
      Agreement,  only in  accordance  with the  provisions of Article IX of the
      Trust Agreement and, with respect to such appointment, with the consent of
      the Lessee (so long as there shall be no Lease Event of Default that shall
      have occurred and be continuing),  which consent shall not be unreasonably
      withheld or delayed;

           (d) The Owner Trustee, in its capacity as the Owner Trustee under the
      Trust Agreement,  and not in its individual  capacity,  shall not contract
      for, create, incur or assume any Indebtedness,  or enter into any business
      or other  activity or enter into any contracts or  agreements,  other than
      pursuant to or under the Operative Agreements;

           (e) The  Holders  will not  instruct  the Owner  Trustee  to take any
      action in violation of the terms of any Operative Agreement;

           (f) Neither any Holder nor the Owner  Trustee  shall (i) commence any
      case,  proceeding  or other action with respect to the Owner Trustee under
      any  existing  or future law of any  jurisdiction,  domestic  or  foreign,
      relating   to   bankruptcy,   insolvency,   reorganization,   arrangement,
      winding-up,  liquidation,  dissolution,  composition  or other relief with
      respect  to it or its  debts,  or (ii)  seek  appointment  of a  receiver,
      trustee,  custodian or other  similar  official  with respect to the Owner
      Trustee  or for all or any  substantial  benefit of the  creditors  of the
      Owner Trustee; and neither any Holder nor the Owner Trustee shall take any
      action in furtherance  of, or indicating  its consent to,  approval of, or
      acquiescence in, any of the acts set forth in this paragraph;

           (g) The Owner  Trustee  shall give prompt  notice to the Lessee,  the
      Holders and the Agent if the Owner  Trustee's  principal place of business
      or chief executive office, or the office where the records  concerning the
      accounts or contract rights relating to any Property are kept, shall cease
      to be located at 79 South Main Street,  Salt Lake City,  Utah 84111, or if
      it shall change its name;

           (h) The Owner  Trustee shall take or refrain from taking such actions
      and grant or refrain  from  granting  such  approvals  with respect to the
      Operative  Agreements  and/or  relating  to any  Property  in each case as
      directed in writing by the Agent (until such time as the Loans are paid in
      full,  and then by the Majority  Holders) or, in connection  with Sections
      8.5 and 9.2 hereof, the Lessee;  provided,  however,  that notwithstanding
      the foregoing  provisions of this subparagraph (h) the Owner Trustee,  the
      Agent,  the Lenders and the Holders each  acknowledge,  covenant and agree
      that  neither the Owner  Trustee  nor the Agent shall act or refrain  from
      acting,  regarding  each  Unanimous  Vote  Matter,  until  such  party has
      received  the  approval of each  Lender and each  Holder  affected by such
      matter; and

           (i) The  Owner  Trustee  shall  be  restricted  to  acquiring  and/or
      constructing Properties identified by the Construction Agent.

      8.3. Credit Party Covenants, Consent and Acknowledgment.

           (a) Each Credit Party acknowledges and agrees that the Owner Trustee,
      pursuant to the terms and  conditions  of the Security  Agreement  and the
      Mortgage  Instruments,  shall create Liens respecting the various personal
      property,  fixtures and real  property  described  therein in favor of the
      Agent.  Each Credit Party  hereby  irrevocably  consents to the  creation,
      perfection and maintenance of such Liens.  Each Credit Party shall, to the
      extent reasonably requested by any of the other parties hereto,  cooperate
      with the other parties in connection with their covenants herein or in the
      other  Operative  Agreements  and shall from time to time duly execute and
      deliver any and all such  further  instruments,  documents  and  financing
      statements  (and  continuation  statements  related  thereto) as any other
      party hereto may reasonably request.

           (b) The Lessor hereby  instructs  each Credit Party,  and each Credit
      Party hereby  acknowledges  and agrees,  that until such time as the Loans
      and the Holder  Advances  are paid in full and the Liens  evidenced by the
      Security Agreement and the Mortgage Instruments have been released (i) any
      and all Rent (excluding  Excepted  Payments which shall be payable to each
      Holder or other Person as  appropriate)  and any and all other  amounts of
      any kind or type under any of the  Operative  Agreements  due and owing or
      payable  to any  Person  shall  instead  be  paid  directly  to the  Agent
      (excluding  Excepted  Payments  which  shall be payable to each  Holder or
      other Person as  appropriate) or as the Agent may direct from time to time
      for  allocation  and  distribution  in accordance  with the procedures set
      forth in Section 8.7 hereof, (ii) all rights of the Lessor under the Lease
      shall be  exercised  by the Agent and (iii) each Credit  Party shall cause
      all notices, certificates, financial statements,  communications and other
      information which are delivered,  or are required to be delivered,  to the
      Lessor, to also to be delivered at the same time to the Agent.

           (c) No  Credit  Party  shall  consent  to or  permit  any  amendment,
      supplement  or  other  modification  of the  terms  or  provisions  of any
      Operative  Agreement  except  in  accordance  with  Section  12.4  of this
      Agreement.

           (d) Each Credit Party hereby  covenants  and agrees that,  except for
      amounts payable as Basic Rent, any and all payment  obligations owing from
      time to time under the  Operative  Agreements  by any Person to the Agent,
      any Lender,  any Holder or any other Person shall (without further action)
      be deemed to be Supplemental  Rent  obligations  payable by the Lessee and
      guaranteed  by  the  other  Credit  Parties.   Without  limitation,   such
      obligations  of  the  Credit  Parties  shall  include  without  limitation
      arrangement  fees,  administrative  fees,  unused  fees,  breakage  costs,
      indemnities, trustee fees and transaction expenses incurred by the parties
      hereto in connection with the  transactions  contemplated by the Operative
      Agreements.

           (e) The Lessee hereby  covenants and agrees to cause an Appraisal for
      each Property to be issued and delivered to the Agent as of the applicable
      Property  Closing  Date (or,  with  respect  to  either of the  Properties
      identified  on  Exhibit N hereto,  within  forty-five  (45) days after the
      Property Closing Date for the applicable  Property) until such time as the
      aggregate appraised value (pursuant to such Appraisals) of Properties then
      subject  to the Lease  Agreement  equals  or  exceeds  an amount  equal to
      one-half  (1/2) of the then current  Commitment  (the  "Minimum  Appraisal
      Level").  To the extent the appraised value (pursuant to such  Appraisals)
      of Properties then subject to the Lease Agreement at any time or from time
      to time is below the Minimum Appraisal Level, the Lessee further covenants
      and  agrees to cause  Appraisals  and/or  reappraisals  to be  issued  and
      delivered  to the Agent  respecting  Properties  then subject to the Lease
      Agreement to re-establish  the Minimum  Appraisal Level within thirty (30)
      days. In addition,  the Lessee  covenants and agrees to cause an Appraisal
      or reappraisal to be issued  respecting  each Property as requested by the
      Agent  from  time to time  (i) at each  and  every  time as such  shall be
      required to satisfy any regulatory  requirements imposed on the Agent, the
      Lessor,  the Trust Company,  any Lender and/or any Holder,  (ii) after the
      occurrence and during the continuation of an Event of Default and (iii) as
      required  pursuant to Section 5.13 of this  Agreement  and Section 20.1 of
      the  Lease.  All  Appraisals  and  reappraisals  issued  pursuant  to  the
      Operative  Agreements  (including  without limitation this Section 8.3(e))
      must be in form and substance  satisfactory  to the Agent, at the cost and
      expense  of the  Lessee,  delivered  to the  Agent  and from an  appraiser
      selected by the Agent.

           (f)  [Intentionally Omitted]

           (g) At any  time  the  Lessor  or the  Agent is  entitled  under  the
      Operative Agreements to possession of a Property or any component thereof,
      each of the Construction Agent and the Lessee hereby covenants and agrees,
      at its own cost and expense,  to assemble  and make the same  available to
      the Agent (on behalf of the Lessor).

           (h)  The  Lessee  hereby  covenants  and  agrees  that   Non-Integral
      Equipment  respecting any  individual  parcel of Property shall at no time
      constitute  in  excess  of ten  percent  (10%) of the  aggregate  Advances
      respecting such parcel of Property funded at such time under the Operative
      Agreements.

           (i) The Lessee hereby  covenants and agrees that as of Completion (i)
      the Property Cost for each  individual  parcel of the Property shall be no
      less than  $2,000,000  and (ii) each  parcel  of the  Property  shall be a
      Permitted Facility.

           (j) The Lessee hereby  covenants and agrees that it shall give prompt
      notice to the Agent if the Lessee's  principal  place of business or chief
      executive office, or the office where the records  concerning the accounts
      or contract  rights  relating to any Property are kept,  shall cease to be
      located  at 400  Perimeter  Center  Terrace,  Suite 650,  Atlanta,  DeKalb
      County, Georgia, 30346 or if it shall change its name.

           (k) Unless the Agent otherwise  agrees in writing,  the Lessee hereby
      covenants  and  agrees  that the  aggregate  Property  Cost of  Properties
      purchased for any reason by the Lessee prior to the Expiration  Date shall
      not exceed  twenty-five  percent (25%) of the aggregate  Property Cost for
      all Properties  funded during the Commitment  Period;  provided,  however,
      Properties constituting Terminated Properties shall not be considered when
      calculating such twenty-five percent (25%) maximum.

           (l)  Until  all the  obligations  of the  Credit  Parties  under  the
      Operative  Agreements  (other than indemnity  claims  unasserted as of the
      Expiration Date) have been finally and indefeasibly  paid and satisfied in
      full, the Lender Commitments and the Holder Commitments terminated and the
      Term has expired or been earlier terminated,  then unless consent has been
      obtained  from the Majority  Secured  Parties,  the Lessee will furnish or
      cause to be furnished  to each Holder,  each Lender and the Agent at their
      respective  addresses  set forth or  referenced  in  Section  12.2 of this
      Agreement,  or such other office as may be  designated by any such Holder,
      Lender  or the  Agent  from  time  to  time:  (i) at each  time  financial
      statements  are  delivered or to be delivered  pursuant to Section 28.1 of
      the Lease, a certificate duly signed by the chief executive officer, chief
      operating  officer,  chief financial  officer,  treasurer or controller of
      Centennial setting forth the Adjusted Total Debt to Adjusted EBITDAR ratio
      for the Rolling Period ending with such  quarter-end and setting forth the
      computations  employed in calculating the ratio (the "Margin Certificate")
      and  (ii)  at  each  time  financial  statements  are  delivered  or to be
      delivered pursuant to Section 28.1 of the Lease, a compliance  certificate
      duly executed by the  president,  treasurer,  chief  financial  officer or
      controller of Centennial  substantially  in the form of Exhibit M attached
      hereto (the "Officer's Compliance Certificate").

           (m) The Lessee  hereby  covenants  and agrees  that the rights of the
      Lessee under this  Agreement  and the Lease shall not impair or in any way
      diminish the  obligations of the  Construction  Agent and/or the rights of
      the Lessor under the Agency Agreement.

           (n) Each  Credit  Party  hereby  covenants  and  agrees to cause each
      Domestic  Subsidiary  formed or acquired after the Initial Closing Date to
      execute a Joinder  Agreement  within  thirty (30) days of the formation or
      acquisition of such Domestic Subsidiary.

           (o) Each Credit Party shall promptly  notify the Agent,  or cause the
      Agent to be promptly notified, upon such Credit Party gaining Knowledge of
      the  occurrence  of any Default or Event of Default which is continuing at
      such time. In any event, such notice shall be provided to the Agent within
      ten (10) days of when such Credit Party gains such Knowledge.

           (p) Until all of the  obligations  under  the  Operative  Agreements,
      other than indemnity  claims  unasserted as of the Expiration  Date,  have
      been finally and  indefeasibly  paid and  satisfied in full and the Lender
      Commitments and the Holder Commitments  terminated unless consent has been
      obtained from the Majority Secured Parties, each Credit Party will:

                (i) except as permitted by the express  provisions of the Lessee
           Credit Agreement,  preserve and maintain its separate legal existence
           and all rights, franchises,  licenses and privileges necessary to the
           conduct  of its  business,  and  qualify  and remain  qualified  as a
           foreign  corporation (or partnership,  limited  liability  company or
           other such similar  entity,  as the case may be) and authorized to do
           business in each  jurisdiction  in which the failure to do so qualify
           would have a Material Adverse Effect;

                (ii) pay and perform all obligations of the Credit Parties under
           the  Operative   Agreements  and  pay  and  perform  (A)  all  taxes,
           assessments  and  other  governmental  charges  that may be levied or
           assessed  upon  it  or  any  of  its  property,  and  (B)  all  other
           indebtedness,   obligations   and   liabilities  in  accordance  with
           customary  trade  practices,  which if not paid would have a Material
           Adverse  Effect;  provided that any Credit Party may contest any item
           described  in  this  Section  8.3(p)(ii)  in  good  faith  so long as
           adequate  reserves are maintained  with respect thereto in accordance
           with GAAP;

                (iii)to  the  extent  failure  to do so  would  have a  Material
           Adverse  Effect,  (A)  observe  and  remain  in  compliance  with all
           applicable   Laws  and   maintain   in  full  force  and  effect  all
           Governmental  Actions,  in each case applicable to the conduct of its
           business,   (B)  keep  in  full  force  and   effect  all   licenses,
           certifications or accreditations  necessary for any Facility to carry
           on its business and (C) not permit the  termination  of any insurance
           reimbursement program available to any Facility;

                (iv) permit the Financing  Parties,  or their respective  agents
           from time to time to conduct  inspections  of the  Properties and the
           Health Care  Facilities  during normal  business  hours at reasonable
           times and, except upon the occurrence and during the  continuation of
           any Event of Default,  without undue  disruption of operations at any
           such Property or Health Care Facility; and

                (v)  keep and  maintain  satisfactory  and  adequate  books  and
           records of account in accordance with GAAP and make or cause the same
           to be made available to the Financing  Parties,  or their  respective
           agents,  during normal  business  hours at any  reasonable  time upon
           reasonable  notice for  inspection  and to make extracts  thereof and
           permit any  Financing  Party,  or any of its  respective  agents,  to
           discuss the contents of same with senior  officers of the appropriate
           Credit Party and also with outside  auditors and  accountants of such
           Credit Party. With the consent of the appropriate Credit Party, which
           consent will not be unreasonably withheld and which consent shall not
           be  required  during  the  existence  of an  Event  of  Default,  any
           Financing Party, or any of its respective  agents, may also meet with
           other officers and employees of such Credit Party.

           (q) The Lessee shall  perform any and all  obligations  of the Lessor
      under,  and cause the Lessor to otherwise  remain in full compliance with,
      the terms and provisions of each Ground Lease, if any.

           (r) To the extent the Lessee is in  compliance  with its  obligations
      under the Operative  Agreements  (including  without  limitation  Sections
      5.3(t) and 8.3(e) of this Agreement) to provide Appraisals  respecting the
      Properties, then additional Properties may be financed under the Operative
      Agreements  without  providing  Appraisals;   provided,   the  anticipated
      Property  Cost (for  Properties  which are not  Completed  at the Property
      Closing  Date  therefor,  as such  cost  is  reflected  in the  applicable
      Construction  Budget) and the actual Property Cost (for  Properties  which
      are Completed at the Property Closing Date therefor) of all Properties for
      which  Appraisals  are not  supplied  shall not exceed an amount  equal to
      eight (8) times the pro forma EBITDAR for all such  Properties;  provided,
      further,  if the anticipated  Property Cost (for Properties  which are not
      Completed at the Property Closing Date therefor, as such cost is reflected
      in the applicable  Construction  Budget) and the actual Property Cost (for
      Properties  which are Completed at the Property Closing Date therefor) for
      all  Properties for which  Appraisals  are not supplied  exceeds eight (8)
      times such pro forma EBITDAR for all such Properties,  then the applicable
      prospective  additional Properties shall be ineligible for financing under
      the Operative Agreements.

           (s) If the  Lessee  Credit  Agreement  is secured at any time or from
      time to time after the Initial  Closing Date with  additional  collateral,
      then the  Lessee  shall  cause all  obligations  secured  pursuant  to the
      Operative  Agreements at each such time (including  without limitation the
      obligations  owed  to the  Financing  Parties  pursuant  to the  Operative
      Agreements) to be secured ratably at each such time with the Lessee Credit
      Agreement.

           (t) Each  Credit  Party will  promptly  notify the Agent in the event
      such Credit Party  discovers or determines  that any computer  application
      (including those of any supplier,  vendor or customer of such Credit Party
      or any  Subsidiary  of such Credit  Party) that is material to such Credit
      Party's or any of its  Subsidiaries'  business and operations  will not be
      Year 2000 Compliant, except to the extent that such failure shall not have
      and could not reasonably be expected to have a Material Adverse Effect.

      8.4. Sharing of Certain Payments.

      Except for Excepted  Payments,  the parties hereto  acknowledge  and agree
that all  payments  due and owing by any Credit  Party to the  Lessor  under the
Lease or any of the other Operative Agreements shall be made by any Credit Party
directly to the Agent as more particularly  provided in Section 8.3 hereof.  The
Lessor, the Holders,  the Agent, the Lenders and the Credit Parties  acknowledge
the terms of Section 8.7 of this Agreement  regarding the allocation of payments
and  other  amounts  made or  received  from time to time  under  the  Operative
Agreements and agree,  that all such payments and amounts are to be allocated as
provided in Section 8.7 of this Agreement.

      8.5. Grant of Easements, etc.

      The Agent,  the Lenders and the Holders  hereby agree that,  so long as no
Event of Default shall have occurred and be continuing, the Owner Trustee shall,
from time to time at the  request of the Lessee  (and with the prior  consent of
the Agent),  in  connection  with the  transactions  contemplated  by the Agency
Agreement, the Lease or the other Operative Agreements,  (i) grant easements and
other  rights in the nature of  easements  with  respect to any  Property,  (ii)
release existing  easements or other rights in the nature of easements which are
for the  benefit of any  Property,  (iii)  execute and deliver to any Person any
instrument  appropriate  to confirm or effect such grants or releases,  and (iv)
execute  and  deliver  to any  Person  such  other  documents  or  materials  in
connection with the acquisition, development, construction, testing or operation
of any Property,  including without limitation  reciprocal easement  agreements,
construction contracts,  operating agreements,  development  agreements,  plats,
replats or subdivision documents; provided, that each of the agreements referred
to in this Section 8.5 shall be of the type  normally  executed by the Lessee in
the  ordinary  course of the  Lessee's  business  and  shall be on  commercially
reasonable terms so as not to diminish the value of any Property in any material
respect.

      8.6. Appointment of Agent.

      The Holders  hereby  appoint the Agent to act as collateral  agent for the
Holders in connection with the Lien granted by the Security  Documents to secure
the Holder Amount. The Lenders and the Holders  acknowledge and agree and direct
that the rights and  remedies of the  beneficiaries  of the Lien of the Security
Documents  shall be  exercised  by the Agent on behalf  of the  Lenders  and the
Holders  as  directed  from time to time by the  Majority  Secured  Parties  or,
pursuant to Sections 8.2(h) and 12.4, all of the Lenders and the Holders, as the
case may be; provided, in all cases, the Agent shall allocate payments and other
amounts received in accordance with Section 8.7. The Agent is further  appointed
to provide notices under the Operative Agreements on behalf of the Owner Trustee
(as determined by the Agent, in its reasonable  discretion),  to receive notices
under the  Operative  Agreements  on behalf of the Owner Trustee and (subject to
Sections 8.5 and 9.2) to take such other action under the  Operative  Agreements
on behalf of the Owner  Trustee as the Agent shall  determine in its  reasonable
discretion  from time to time. The Agent hereby accepts such  appointments.  For
purposes hereof,  the provisions of Section 7 of the Credit Agreement,  together
with such  other  terms and  provisions  of the Credit  Agreement  and the other
Operative  Agreements as required for the full  interpretation  and operation of
Section 7 of the Credit  Agreement  are hereby  incorporated  by reference as if
restated  herein for the mutual  benefit of the Agent and each Holder as if each
Holder were a Lender  thereunder.  Outstanding  Holder  Advances and outstanding
Loans shall each be taken into  account for  purposes  of  determining  Majority
Secured  Parties.  Further,  the Agent  shall be entitled to take such action on
behalf of the Owner  Trustee as is  delegated  to the Agent under any  Operative
Agreement (whether express or implied) as may be reasonably  incidental thereto.
The parties hereto hereby agree to the provisions contained in this Section 8.6.
Any appointment of a successor  agent under Section 7.9 of the Credit  Agreement
shall also be effective as an appointment  of a successor  agent for purposes of
this Section 8.6.

      8.7. Collection and Allocation of Payments and Other
Amounts.

           (a)  Each  Credit  Party  has  agreed  pursuant  to  Section  5.8 and
      otherwise in accordance with the terms of this Agreement to pay to (i) the
      Agent any and all Rent and any and all other  amounts  of any kind or type
      under any of the  Operative  Agreements  due and owing or  payable  to any
      Person (excluding  Excepted  Payments) and (ii) each Person as appropriate
      the Excepted Payments.  Promptly after receipt,  the Agent shall apply and
      allocate,  in accordance  with the terms of this Section 8.7, such amounts
      received from any Credit Party and all other payments,  receipts and other
      consideration of any kind whatsoever received by the Agent pursuant to the
      Security  Agreement or otherwise received by the Agent, the Holders or any
      of the Lenders in connection with the Collateral,  the Security  Documents
      or any of the other Operative Agreements.  Ratable distributions among the
      Lenders and the Holders  under this Section 8.7 shall be made based on (in
      the  case of the  Lenders)  the  ratio  of the  outstanding  Loans  to the
      aggregate  Property Cost and (in the case of the Holders) the ratio of the
      outstanding  Holder  Advances  to the  aggregate  Property  Cost.  Ratable
      distributions  among the Tranche A Lenders under this Section 8.7 shall be
      made  based on the  ratio of the  individual  Tranche  A  Lender's  Lender
      Commitment  for  Tranche  A Loans to the  aggregate  of all the  Tranche A
      Lenders'  Lender  Commitments for Tranche A Loans.  Ratable  distributions
      among the Tranche B Lenders  under this Section 8.7 shall be made based on
      the ratio of the  individual  Tranche B  Lender's  Lender  Commitment  for
      Tranche B Loans to the  aggregate  of all the  Tranche B  Lenders'  Lender
      Commitments for Tranche B Loans.  Ratable  distributions among the Lenders
      (in situations where the Tranche A Lenders are not differentiated from the
      Tranche B  Lenders)  shall be made  based on the  ratio of the  individual
      Lender's  Lender  Commitment to the  aggregate of all the Lenders'  Lender
      Commitments.  Ratable  distributions  among the Holders under this Section
      8.7  shall  be  based  on the  ratio  of the  individual  Holder's  Holder
      Commitment to the aggregate of all the Holders' Holder Commitments.

           (b)  Payments  and other  amounts  received by the Agent from time to
      time in accordance with the terms of subparagraph (a) shall be applied and
      allocated as follows:

                (i) Any such  payment  or amount  identified  as or deemed to be
           Basic Rent shall be applied and allocated by the Agent first, ratably
           to the Lenders and the Holders for  application and allocation to the
           payment of interest on the Loans and  thereafter the principal of the
           Loans  which is due and  payable  on such date and to the  payment of
           accrued  Holder  Yield  with  respect  to  the  Holder  Advances  and
           thereafter  the portion of the Holder  Advances  which is due on such
           date; and second, if no Default or Event of Default is in effect, any
           excess  shall be paid to such  Person or  Persons  as the  Lessee may
           designate;  provided,  that if a Default  or Event of  Default  is in
           effect, such excess (if any) shall instead be held by the Agent until
           the earlier of (I) the first date  thereafter  on which no Default or
           Event of  Default  shall be in effect  (in which  case such  payments
           shall then be made to such other  Person or Persons as the Lessee may
           designate) and (II) the Maturity Date or the Expiration  Date, as the
           case may be (or, if earlier, the date of any Acceleration),  in which
           case such  amounts  shall be  applied  and  allocated  in the  manner
           contemplated by Section 8.7(b)(iv).

                (ii) If on any date the Agent or the Lessor  shall  receive  any
           amount in respect of (A) any  Casualty  or  Condemnation  pursuant to
           Sections  15.1(a) or 15.1(g) of the Lease  (excluding any payments in
           respect  thereof which are payable to the Lessee in  accordance  with
           the  Lease),  or (B) the  Termination  Value in  connection  with the
           delivery  of a  Termination  Notice  pursuant  to Article  XVI of the
           Lease, or (C) the  Termination  Value in connection with the exercise
           of the  Purchase  Option  under  Section  20.1  of the  Lease  or the
           exercise of the option of the Lessor to transfer  the  Properties  to
           the Lessee  pursuant to Section 20.3 of the Lease, or (D) any payment
           required to be made or elected to be made by the  Construction  Agent
           to the Lessor pursuant to the terms of the Agency  Agreement,  or (E)
           any payment made  pursuant to Section 5.13 or otherwise in connection
           with a Terminated  Property,  then in each case,  the Lessor shall be
           required  to pay such  amount  received  (1) if no  Acceleration  has
           occurred, to prepay the principal balance of the Loans and the Holder
           Advances,  on a pro  rata  basis,  a  portion  of such  amount  to be
           distributed to the Lenders and the Holders or (2) if an  Acceleration
           has occurred,  to apply and allocate the proceeds respecting Sections
           8.7(b)(ii)(A)   through  8.7(b)(ii)(D)  in  accordance  with  Section
           8.7(b)(iii) hereof.

                (iii)Subject to Section  8.7(c),  an amount equal to any payment
           identified  as  proceeds of the sale or other  disposition  (or lease
           upon the  exercise  of  remedies)  of the  Properties  or any portion
           thereof,  whether  pursuant  to  Article  XXII  of the  Lease  or the
           exercise of remedies under the Security  Documents or otherwise,  the
           execution  of  remedies  set forth in the Lease  and any  payment  in
           respect of excess wear and tear pursuant to Section 22.3 of the Lease
           (whether  such  payment  relates  to a period  before  or  after  the
           Construction  Period Termination Date) shall be applied and allocated
           by the Agent  first,  ratably  to the  payment of the  principal  and
           interest of the Tranche B Loans then outstanding,  second, ratably to
           the payment to the Holders of the  outstanding  principal  balance of
           all Holder Advances plus all outstanding Holder Yield with respect to
           such outstanding  Holder  Advances,  third, to the extent such amount
           exceeds the maximum  amount to be returned  pursuant to the foregoing
           provisions  of this  paragraph  (iii),  ratably to the payment of the
           principal  and  interest  of the  Tranche A Loans  then  outstanding,
           fourth,  to any and all  other  amounts  owing  under  the  Operative
           Agreements  to the Lenders under the Tranche B Loans,  fifth,  to any
           and all other  amounts  owing under the  Operative  Agreements to the
           Holders,  sixth,  to any  and  all  other  amounts  owing  under  the
           Operative  Agreements to the Lenders  under the Tranche A Loans,  and
           seventh, to the extent moneys remain after application and allocation
           pursuant to clauses first  through sixth above,  to the Owner Trustee
           for  application and allocation to any and all other amounts owing to
           the Holders or the Owner Trustee and as the Holders shall  determine;
           provided, where no Event of Default shall exist and be continuing and
           a  prepayment  is made for any reason  with  respect to less than the
           full amount of the outstanding  principal amount of the Loans and the
           outstanding  Holder  Advances,  the  proceeds  shall be  applied  and
           allocated ratably to the Lenders and to the Holders.

                (iv) Subject to Section 8.7(c),  an amount equal to (A) any such
           payment  identified as a payment  pursuant to Section  22.1(b) of the
           Lease (or otherwise) of the Maximum  Residual  Guarantee  Amount (and
           any such lesser  amount as may be required by Section  22.1(b) of the
           Lease) in respect of the  Properties and (B) any other amount payable
           upon any  exercise of remedies  after the  occurrence  of an Event of
           Default  not  covered by  Sections  8.7(b)(i)  or  8.7(b)(iii)  above
           (including  without limitation any amount received in connection with
           an  Acceleration  which does not represent  proceeds from the sale or
           liquidation  of the  Properties)  and (C) any other amount payable by
           any  Guarantor  pursuant to Section 6B shall be applied and allocated
           by the Agent  first,  ratably,  to the payment of the  principal  and
           interest balance of Tranche A Loans then outstanding, second, ratably
           to the payment of the principal and interest balance of the Tranche B
           Loans  then  outstanding,  third,  ratably  to  the  payment  of  the
           principal balance of all Holder Advances plus all outstanding  Holder
           Yield with respect to such outstanding  Holder Advances,  fourth,  to
           the payment of any other  amounts  owing to the Lenders  hereunder or
           under any of the other Operative Agreement,  and fifth, to the extent
           moneys remain after  application  and allocation  pursuant to clauses
           first through fourth above,  to the Owner Trustee for application and
           allocation to Holder  Advances and Holder Yield and any other amounts
           owing to the  Holders  or the  Owner  Trustee  as the  Holders  shall
           determine.

                (v)  An  amount  equal  to  any  such  payment   identified   as
           Supplemental  Rent shall be applied and allocated by the Agent to the
           payment of any  amounts  then owing to the Agent,  the  Lenders,  the
           Holders and the other parties to the Operative  Agreements (or any of
           them) (other than any such amounts payable  pursuant to the preceding
           provisions  of this  Section  8.7(b)) as shall be  determined  by the
           Agent  in  its  reasonable   discretion;   provided,   however,  that
           Supplemental  Rent received  upon the exercise of remedies  after the
           occurrence and during the continuation of an Event of Default in lieu
           of or in substitution of the Maximum Residual  Guarantee Amount or as
           a partial payment thereon shall be applied and allocated as set forth
           in Section 8.7(b)(iv).

                (vi) The Agent in its  reasonable  judgment  shall  identify the
           nature of each payment or amount  received by the Agent and apply and
           allocate each such amount in the manner specified above.

           (c) Upon the  termination  of the Lender  Commitments  and the Holder
      Commitments  and the  payment  in full of the Loans and all other  amounts
      owing by the Owner Trustee  hereunder or under any Credit Document and the
      payment in full of all amounts  owing to the Holders and the Owner Trustee
      under the Trust  Agreement,  any moneys  remaining with the Agent shall be
      returned  to the Owner  Trustee  or such  other  Person or  Persons as the
      Holders may designate for  application and allocation to any and all other
      amounts owing to the Holders or the Owner Trustee and as the Holders shall
      determine. In the event of an Acceleration it is agreed that, prior to the
      application  and allocation of amounts  received by the Agent in the order
      described in Section 8.7(b) above, any such amounts shall first be applied
      and allocated to the payment of (i) any and all sums advanced by the Agent
      in order to preserve the Collateral or to preserve its Lien thereon,  (ii)
      the expenses of retaking, holding, preparing for sale or lease, selling or
      otherwise disposing or realizing on the Collateral,  or of any exercise by
      the  Agent of its  rights  under the  Security  Documents,  together  with
      reasonable  attorneys' fees and expenses and court costs and (iii) any and
      all other amounts reasonably owed to the Agent under or in connection with
      the  transactions  contemplated  by the  Operative  Agreements  (including
      without limitation any accrued and unpaid administration fees).

      8.8. Release of Properties, etc.

      If the Lessee  shall at any time  purchase  any  Property  pursuant to the
Lease,  or the  Construction  Agent shall purchase any Property  pursuant to the
Agency  Agreement,  or if any Property shall be sold in accordance  with Article
XXII  of the  Lease,  then,  upon  satisfaction  by  the  Owner  Trustee  of its
obligation  to make a prepayment  (with the proceeds of such sale) of the Loans,
Holder Advances and all other amounts owing to the Lenders and the Holders under
the Operative Agreements, the Agent is hereby authorized and directed to release
such Properties  from the Liens created by the Security  Documents to the extent
of its  interest  therein.  In  addition,  upon the  termination  of the  Lender
Commitments and the Holder Commitments and the payment in full of the Loans, the
Holder  Advances and all other amounts owing by the Owner Trustee and the Lessee
hereunder or under any other Operative  Agreement the Agent is hereby authorized
and  directed to release  all of the  Properties  from the Liens  created by the
Security  Documents to the extent of its interest  therein.  Upon request of the
Owner Trustee following any such release,  the Agent shall, at the sole cost and
expense of the Lessee,  execute and deliver to the Owner  Trustee and the Lessee
such  documents as the Owner Trustee or the Lessee shall  reasonably  request to
evidence such release.

         SECTION 9. CREDIT AGREEMENT AND TRUST AGREEMENT.

      9.1. The Construction Agent's and the Lessee's Credit Agreement Rights.

      Notwithstanding   anything  to  the  contrary   contained  in  the  Credit
Agreement,  the Agent, the Lenders,  the Holders,  the  Construction  Agent, the
Credit Parties and the Owner Trustee hereby agree that,  prior to the occurrence
and continuation of any Default or Event of Default,  the Construction  Agent or
the Lessee, as the case may be, shall have the following rights:

           (a) the right to designate an account to which  amounts  funded under
      the Operative  Agreements shall be credited  pursuant to Section 2.3(a) of
      the Credit Agreement;

           (b) the right to terminate or change the Lender Commitments  pursuant
      to Section 2.5(a) of the Credit Agreement;

           (c) the right to exercise the  conversion  and  continuation  options
      pursuant to Section 2.7 of the Credit Agreement;

           (d) the right to receive any notice and any certificate, in each case
      issued pursuant to Section 2.11(a) of the Credit Agreement;

           (e) the right to replace any Lender  pursuant  to Section  2.11(b) of
      the Credit Agreement;

           (f) the right to approve any successor  agent pursuant to Section 7.9
      of the Credit Agreement; and

           (g) the right to consent to any  assignment  by a Lender to which the
      Lessor has the right to  consent  pursuant  to  Section  9.8 of the Credit
      Agreement.

      9.2. The Construction Agent's and the Lessee's Trust
Agreement Rights.

      Notwithstanding anything to the contrary contained in the Trust Agreement,
the Credit Parties,  the Owner Trustee and the Holders hereby agree that,  prior
to the  occurrence  and  continuation  of any Default or Event of  Default,  the
Construction  Agent or the Lessee,  as the case may be, shall have the following
rights:

           (a) the right to exercise the  conversion  and  continuation  options
      pursuant to Section 3.8 of the Trust Agreement;

           (b) the right to receive any notice and any certificate, in each case
      issued pursuant to Section 3.9(a) of the Trust Agreement;

           (c) the right to replace any Holder pursuant to Section 3.9(b) of the
      Trust Agreement;

           (d) the right to exercise  the removal  options  contained in Section
      3.9 of the Trust Agreement; and

           (e) no removal of the Owner  Trustee and  appointment  of a successor
      Owner Trustee pursuant to Section 9.1 of the Trust Agreement shall be made
      without the prior  written  consent  (not to be  unreasonably  withheld or
      delayed) of the Lessee.


                 SECTION 10. TRANSFER OF INTEREST.

      10.1.Restrictions on Transfer.

      Each Lender may  participate,  assign or transfer  all or a portion of its
interest  hereunder and under the other Operative  Agreements in accordance with
Sections  9.7 and  9.8 of the  Credit  Agreement;  provided,  each  participant,
assignee or transferee must obtain the same ratable interest in Tranche A Loans,
Tranche A Commitments,  Tranche B Loans, Tranche B Commitments and the loans and
loan  commitments  with regard to the Lessee Credit Agreement (and to the extent
the  selling  Lender  is also a  Holder,  each  such  participant,  assignor  or
transferee  must  also  obtain  the  same  percentage  interest  (regarding  the
percentage  interest  sold by the selling  Lender in and to the Tranche A Loans,
Tranche A Commitments,  Tranche B Loans, Tranche B Commitments and the loans and
loan commitments  with regard to the Lessee Credit  Agreement) of the applicable
Holder's ratable interest in and to the Trust Estate); provided, further, except
after the occurrence  and during the  continuation  of any Event of Default,  no
participant,  assignee or  transferee  shall be a Person in a Permitted  Line of
Business; provided, further, that each Lender that assigns or transfers all or a
portion of its interest hereunder and under the other Operative Agreements shall
deliver to the Agent a copy of each  Assignment and Acceptance (as referenced in
Section 9.8 of the Credit  Agreement) for purposes of maintaining  the Register.
The Holders may, directly or indirectly,  assign,  convey or otherwise  transfer
any of their  right,  title or interest in and to the Trust Estate and the Trust
Agreement  with the prior  written  consent of the Agent and the  Lessee  (which
consent shall not be  unreasonably  withheld or delayed) and in accordance  with
the terms of Section 11.8(b) of the Trust Agreement; provided, to the extent the
selling Holder is also a Lender, each such assignee, receiver of a conveyance or
other  transferee must also obtain the same percentage  interest  (regarding the
percentage  interest  sold by the selling  Holder in and to the Trust Estate and
the Trust  Agreement) of the applicable  Lender's ratable interest in and to the
Tranche A Loans,  Tranche A Commitments,  Tranche B Loans, Tranche B Commitments
and the loans and loan commitments  with regard to the Lessee Credit  Agreement;
provided,  further,  except after the occurrence and during the  continuation of
any Event of Default, no assignee,  receiver of a conveyance or other transferee
shall be a Person  in a  Permitted  Line of  Business.  The Owner  Trustee  may,
subject  to the  rights of the  Lessee  under the Lease and the other  Operative
Agreements  and to the Lien of the applicable  Security  Documents but only with
the prior  written  consent of the Agent  (which  consent may be withheld by the
Agent in its sole discretion) and (provided,  no Default or Event of Default has
occurred  and is  continuing)  with  the  consent  of the  Lessee,  directly  or
indirectly,  assign, convey, appoint an agent with respect to enforcement of, or
otherwise  transfer any of its right,  title or interest in or to any  Property,
the Lease,  the Trust  Agreement and the other Operative  Agreements  (including
without  limitation  any  right to  indemnification  thereunder),  or any  other
document relating to a Property or any interest in a Property as provided in the
Trust  Agreement  and the Lease.  The  provisions of the  immediately  preceding
sentence  shall not apply to the  obligations  of the Owner  Trustee to transfer
Property to the Lessee or a third party  purchaser  pursuant to Article  XXII of
the Lease  upon  payment  for such  Property  in  accordance  with the terms and
conditions  of the  Lease.  No Credit  Party  may  assign  any of the  Operative
Agreements or any of their respective  rights or obligations  thereunder or with
respect  to any  Property  in whole or in part to any Person  without  the prior
written consent of the Agent, the Lenders, the Holders and the Lessor.

      10.2.Effect of Transfer.

      From and after any transfer  effected in accordance  with this Section 10,
the  transferor  shall be  released,  to the extent of such  transfer,  from its
liability  hereunder  and under the  other  documents  to which it is a party in
respect of  obligations  to be performed on or after the date of such  transfer;
provided,  however,  that any transferor shall remain liable hereunder and under
such other  documents to the extent that the  transferee  shall not have assumed
the  obligations  of the transferor  thereunder.  Upon any transfer by the Owner
Trustee,  a Holder  or a Lender as above  provided,  any such  transferee  shall
assume the  obligations of the Owner Trustee,  the Holder or the Lender,  as the
case may be, and shall be deemed an "Owner Trustee",  "Holder",  or "Lender", as
the case may be, for all purposes of such documents and each reference herein to
the transferor shall thereafter be deemed a reference to such transferee for all
purposes,  except as provided in the  preceding  sentence.  Notwithstanding  any
transfer  of all or a portion of the  transferor's  interest as provided in this
Section 10, the  transferor  shall be entitled to all  benefits  accrued and all
rights  vested prior to such transfer  including  without  limitation  rights to
indemnification under any such document.

                   SECTION 11. INDEMNIFICATION.

      11.1.General Indemnity.

      Whether  or not  any of the  transactions  contemplated  hereby  shall  be
consummated,  the Indemnity  Provider hereby assumes liability for and agrees to
defend,  indemnify  and hold harmless  each  Indemnified  Person on an After Tax
Basis from and  against  any  Claims,  which may be imposed  on,  incurred by or
asserted  against an Indemnified  Person by any third party,  including  without
limitation Claims arising from the negligence of an Indemnified  Person (but not
to the extent such Claims arise from the gross negligence or willful  misconduct
of such  Indemnified  Person  itself,  as  determined  by a court  of  competent
jurisdiction,  as opposed to gross negligence or willful  misconduct  imputed to
such  Indemnified  Person) in any way relating to or arising or alleged to arise
out of the execution,  delivery,  performance or enforcement of this  Agreement,
the Lease or any other Operative Agreement or on or with respect to any Property
or any  component  thereof,  including  without  limitation  Claims  in any  way
relating  to  or  arising  or  alleged  to  arise  out  of  (a)  the  financing,
refinancing,  purchase, acceptance,  rejection, ownership, design, construction,
refurbishment,   development,   delivery,  acceptance,   nondelivery,   leasing,
subleasing,   possession,  use,  occupancy,  operation,   maintenance,   repair,
modification,  transportation, condition, sale, return, repossession (whether by
summary  proceedings or otherwise),  or any other disposition of any Property or
any part thereof,  including  without  limitation  the  acquisition,  holding or
disposition  of any interest in the  Property,  lease or agreement  comprising a
portion of any thereof;  (b) any latent or other  defects in any Property or any
portion  thereof  whether or not  discoverable  by an Indemnified  Person or the
Indemnity Provider; (c) a violation of Environmental Laws,  Environmental Claims
or other loss of or damage to any  property or the  environment  relating to the
Property,  the Lease,  the Agency Agreement or the Indemnity  Provider;  (d) the
Operative Agreements, or any transaction contemplated thereby; (e) any breach by
the Indemnity  Provider of any of its  representations  or warranties  under the
Operative  Agreements to which the  Indemnity  Provider is a party or failure by
the  Indemnity  Provider to perform or observe any  covenant or  agreement to be
performed  by it under any of the  Operative  Agreements;  (f) the  transactions
contemplated  hereby or by any other  Operative  Agreement,  in  respect  of the
application of Parts 4 and 5 of Subtitle B of Title I of ERISA; and (g) personal
injury,  death or property damage,  including without limitation Claims based on
strict or absolute liability in tort.

      If a  written  Claim is made  against  any  Indemnified  Person  or if any
proceeding shall be commenced against such Indemnified Person (including without
limitation a written notice of such proceeding), for any Claim, such Indemnified
Person shall  promptly  notify the  Indemnity  Provider in writing and shall not
take action  with  respect to such Claim  without  the consent of the  Indemnity
Provider for thirty (30) days after the receipt of such notice by the  Indemnity
Provider; provided, however, that in the case of any such Claim, if action shall
be required by law or  regulation to be taken prior to the end of such period of
thirty (30) days, such  Indemnified  Person shall endeavor to, in such notice to
the Indemnity  Provider,  inform the Indemnity  Provider of such shorter period,
and no action shall be taken with  respect to such Claim  without the consent of
the  Indemnity  Provider  before  seven (7) days before the end of such  shorter
period;  provided,  further, that the failure of such Indemnified Person to give
the notices  referred  to in this  sentence  shall not  diminish  the  Indemnity
Provider's  obligation  hereunder except to the extent such failure precludes in
all respects the Indemnity Provider from contesting such Claim.

      If, within thirty (30) days of receipt of such notice from the Indemnified
Person  (or such  shorter  period as the  Indemnified  Person has  notified  the
Indemnity  Provider is required by law or regulation for the Indemnified  Person
to respond to such Claim),  the Indemnity Provider shall request in writing that
such Indemnified  Person respond to such Claim, the Indemnified Person shall, at
the expense of the  Indemnity  Provider,  in good faith conduct and control such
action (including without limitation by pursuit of appeals) (provided,  however,
that (A) if such Claim, in the Indemnity Provider's reasonable  discretion,  can
be  pursued  by the  Indemnity  Provider  on  behalf  of or in the  name of such
Indemnified Person, the Indemnified Person, at the Indemnity Provider's request,
shall allow the  Indemnity  Provider to conduct and control the response to such
Claim and (B) in the case of any Claim (and  notwithstanding  the  provisions of
the foregoing  subsection (A)), the Indemnified Person may request the Indemnity
Provider to conduct and control the  response to such Claim (with  counsel to be
selected by the Indemnity Provider and consented to by such Indemnified  Person,
such  consent  not to be  unreasonably  withheld;  provided,  however,  that any
Indemnified  Person may retain separate  counsel at the expense of the Indemnity
Provider in the event of a conflict of interest between such Indemnified  Person
and the Indemnity Provider)) by, in the sole discretion of the Person conducting
and controlling the response to such Claim (1) resisting  payment  thereof,  (2)
not paying the same except under  protest,  if protest is necessary  and proper,
(3) if the payment be made, using reasonable  efforts to obtain a refund thereof
in appropriate administrative and judicial proceedings, or (4) taking such other
action as is reasonably requested by the Indemnity Provider from time to time.

      The party  controlling  the  response to any Claim  shall  consult in good
faith with the non-controlling  party and shall keep the  non-controlling  party
reasonably  informed as to the conduct of the response to such Claim;  provided,
that all decisions ultimately shall be made in the discretion of the controlling
party.  The parties agree that an Indemnified  Person may at any time decline to
take  further  action with  respect to the response to such Claim and may settle
such Claim if such  Indemnified  Person shall waive its rights to any  indemnity
from the Indemnity  Provider that otherwise  would be payable in respect of such
Claim (and any future Claim, the pursuit of which is precluded by reason of such
resolution  of such Claim) and shall pay to the  Indemnity  Provider  any amount
previously paid or advanced by the Indemnity  Provider  pursuant to this Section
11.1 by way of indemnification or advance for the payment of an amount regarding
such Claim.

      Notwithstanding  the  foregoing   provisions  of  this  Section  11.1,  an
Indemnified  Person  shall not be required to take any action and the  Indemnity
Provider  shall not be permitted to respond to any Claim in its own name or that
of the Indemnified Person unless (A) the Indemnity Provider shall have agreed to
pay and shall pay to such Indemnified Person on demand and on an After Tax Basis
all reasonable costs,  losses and expenses that such Indemnified Person actually
incurs  in  connection  with  such  Claim,   including  without  limitation  all
reasonable legal,  accounting and investigatory  fees and disbursements  and, if
the  Indemnified  Person has informed the Indemnity  Provider that it intends to
contest such Claim (whether or not the control of the contest is then assumed by
the Indemnity Provider), the Indemnity Provider shall have agreed that the Claim
is an  indemnifiable  Claim  hereunder,  (B) in the case of a Claim that must be
pursued in the name of an  Indemnified  Person (or an  Affiliate  thereof),  the
amount of the potential  indemnity (taking into account all similar or logically
related  Claims  that  have been or could be  raised  for  which  the  Indemnity
Provider may be liable to pay an  indemnity  under this  Section  11.1)  exceeds
$25,000  (or such  lesser  amount  as may be  subsequently  agreed  between  the
Indemnity Provider and the Indemnified Person), (C) the Indemnified Person shall
have  reasonably  determined  that the action to be taken will not result in any
material danger of sale, forfeiture or loss of the Property, or any part thereof
or interest  therein,  will not interfere with the payment of Rent, and will not
result in risk of  criminal  liability,  (D) if such  Claim  shall  involve  the
payment of any amount  prior to the  resolution  of such  Claim,  the  Indemnity
Provider shall provide to the Indemnified Person an interest-free  advance in an
amount equal to the amount that the Indemnified  Person is required to pay (with
no additional net after-tax cost to such  Indemnified  Person) prior to the date
such payment is due, (E) in the case of a Claim that must be pursued in the name
of an Indemnified Person (or an Affiliate thereof), the Indemnity Provider shall
have  provided  to such  Indemnified  Person an opinion of  independent  counsel
selected  by  the  Indemnity   Provider  and  reasonably   satisfactory  to  the
Indemnified  Person stating that a reasonable basis exists to contest such Claim
(or,  in the case of an appeal of an adverse  determination,  an opinion of such
counsel to the effect that the position asserted in such appeal will more likely
than not  prevail)  and (F) no Event  of  Default  shall  have  occurred  and be
continuing.  In no event  shall an  Indemnified  Person be required to appeal an
adverse judicial  determination to the United States Supreme Court. In addition,
an Indemnified Person shall not be required to contest any Claim in its name (or
that of an  Affiliate)  if the subject  matter  thereof shall be of a continuing
nature and shall have previously been decided  adversely by a court of competent
jurisdiction  pursuant to the contest  provisions of this Section  11.1,  unless
there  shall  have  been a change  in law (or  interpretation  thereof)  and the
Indemnified Person shall have received,  at the Indemnity Provider's expense, an
opinion of independent counsel selected by the Indemnity Provider and reasonably
acceptable to the Indemnified  Person stating that as a result of such change in
law (or interpretation thereof), it is more likely than not that the Indemnified
Person will prevail in such contest. In no event shall the Indemnity Provider be
permitted to adjust or settle any Claim  without the consent of the  Indemnified
Person  to  the  extent  any  such  adjustment  or  settlement  involves,  or is
reasonably likely to involve, any performance by or adverse admission by or with
respect to the Indemnified Person.

      11.2.General Tax Indemnity.

           (a) The Indemnity  Provider  shall pay and assume  liability for, and
      does hereby agree to  indemnify,  protect and defend each Property and all
      Indemnified Persons, and hold them harmless against, all Impositions on an
      After Tax Basis,  and all payments  pursuant to the  Operative  Agreements
      shall be made  free and  clear of and  without  deduction  for any and all
      present and future Impositions.

           (b)  Notwithstanding  anything  to the  contrary  in Section  11.2(a)
      hereof,  the following  shall be excluded  from the indemnity  required by
      Section 11.2(a):

                (i) Taxes  (other  than Taxes that are, or are in the nature of,
           sales, use, rental, value added, transfer or property taxes) that are
           imposed on a  Indemnified  Person  (other than the Lessor,  the Owner
           Trustee and the Trust) by the United States federal  government  that
           are  based  on or  measured  by the  net  income  (including  without
           limitation  taxes based on capital  gains and minimum  taxes) of such
           Person;  provided,  that this clause (i) shall not be  interpreted to
           prevent  a  payment  from  being  made on an After  Tax Basis if such
           payment is otherwise required to be so made;

                (ii) Taxes  (other than Taxes that are, or are in the nature of,
           sales, use, rental, value added, transfer or property taxes) that are
           imposed on any Indemnified  Person (other than the Lessor,  the Owner
           Trustee and the Trust) by any state or local  jurisdiction  or taxing
           authority  within any state or local  jurisdiction and that are based
           upon or  measured  by the net income  (including  without  limitation
           taxes  based on  capital  gains and  minimum  taxes) of such  Person;
           provided   that  such  Taxes  shall  not  be   excluded   under  this
           subparagraph  (ii) to the extent such Taxes  would have been  imposed
           had the location,  possession or use of any Property in, the location
           or the  operation of the Lessee in, or the Lessee's  making  payments
           under the Operative  Agreements from, the jurisdiction  imposing such
           Taxes been the sole connection  between such  Indemnified  Person and
           the jurisdiction  imposing such Taxes;  provided,  further, that this
           clause (ii) shall not be  interpreted to prevent a payment from being
           made on an After Tax Basis if such payment is  otherwise  required to
           be so made;

                (iii)any  Tax to the  extent  it  relates  to any act,  event or
           omission  that  occurs  after  the   termination  of  the  Lease  and
           redelivery  or sale of the Property in  accordance  with the terms of
           the  Lease  (but  not  any Tax  that  relates  to  such  termination,
           redelivery  or sale and/or to any period  prior to such  termination,
           redelivery or sale); and

                (iv) any Taxes which are imposed on an  Indemnified  Person as a
           result  of  the  gross  negligence  or  willful  misconduct  of  such
           Indemnified  Person  itself,  as  determined  by a court of competent
           jurisdiction  (as opposed to gross  negligence or willful  misconduct
           imputed  to such  Indemnified  Person),  but not Taxes  imposed  as a
           result of ordinary negligence of such Indemnified Person;

           (c) (i)  Subject  to the  terms of  Section  11.2(f),  the  Indemnity
           Provider  shall pay or cause to be paid all  Impositions  directly to
           the  taxing   authorities   where   feasible  and  otherwise  to  the
           Indemnified Person, as appropriate,  and the Indemnity Provider shall
           at  its  own  expense,  upon  such  Indemnified  Person's  reasonable
           request,  furnish  to such  Indemnified  Person  copies  of  official
           receipts or other satisfactory proof evidencing such payment.

                (ii)  In the  case  of  Impositions  for  which  no  contest  is
           conducted  pursuant  to  Section  11.2(f)  and  which  the  Indemnity
           Provider  pays  directly  to the taxing  authorities,  the  Indemnity
           Provider  shall  pay  such  Impositions  prior  to  the  latest  time
           permitted by the relevant taxing authority for timely payment. In the
           case of Impositions  for which the Indemnity  Provider  reimburses an
           Indemnified  Person, the Indemnity Provider shall do so within thirty
           (30) days after receipt by the  Indemnity  Provider of demand by such
           Indemnified  Person describing in reasonable detail the nature of the
           Imposition and the basis for the demand (including without limitation
           the  computation of the amount  payable),  accompanied by receipts or
           other reasonable  evidence of such demand. In the case of Impositions
           for which a contest is  conducted  pursuant to Section  11.2(f),  the
           Indemnity  Provider  shall pay such  Impositions  or  reimburse  such
           Indemnified Person for such Impositions, to the extent not previously
           paid or reimbursed  pursuant to subsection  (a),  prior to the latest
           time  permitted by the relevant  taxing  authority for timely payment
           after conclusion of all contests under Section 11.2(f).

                (iii)At  the  Indemnity  Provider's  request,  the amount of any
           indemnification   payment  by  the  Indemnity  Provider  pursuant  to
           subsection  (a) shall be verified  and  certified  by an  independent
           public accounting firm mutually  acceptable to the Indemnity Provider
           and the Indemnified Person. The fees and expenses of such independent
           public accounting firm shall be paid by the Indemnity Provider unless
           such  verification  shall result in an  adjustment  in the  Indemnity
           Provider's  favor of fifteen  percent (15%) or more of the payment as
           computed by the Indemnified  Person,  in which case such fee shall be
           paid by the Indemnified Person.

           (d) The Indemnity  Provider  shall be  responsible  for preparing and
      filing any real and personal property or ad valorem tax returns in respect
      of each Property and any other tax returns  required for the Owner Trustee
      respecting the transactions described in the Operative Agreements. In case
      any other  report or tax return  shall be required to be made with respect
      to any  obligations  of the  Indemnity  Provider  under or arising  out of
      subsection (a) and of which the Indemnity Provider has knowledge or should
      have  knowledge,  the  Indemnity  Provider,  at its sole cost and expense,
      shall  notify the  relevant  Indemnified  Person of such  requirement  and
      (except if such  Indemnified  Person notifies the Indemnity  Provider that
      such Indemnified Person intends to prepare and file such report or return)
      (A) to the extent  required  or  permitted  by and  consistent  with Legal
      Requirements,  make and file in the Indemnity Provider's name such return,
      statement  or  report;  and (B) in the  case  of any  other  such  return,
      statement  or report  required to be made in the name of such  Indemnified
      Person,  advise  such  Indemnified  Person of such fact and  prepare  such
      return,  statement  or report  for filing by such  Indemnified  Person or,
      where such return,  statement or report shall be required to reflect items
      in addition to any obligations of the Indemnity  Provider under or arising
      out of subsection (a),  provide such  Indemnified  Person at the Indemnity
      Provider's  expense  with  information  sufficient  to permit such return,
      statement or report to be properly made with respect to any obligations of
      the  Indemnity  Provider  under or arising  out of  subsection  (a).  Such
      Indemnified Person shall, upon the Indemnity Provider's request and at the
      Indemnity  Provider's  expense,   provide  any  data  maintained  by  such
      Indemnified  Person (and not otherwise  available to or within the control
      of the  Indemnity  Provider)  with  respect  to each  Property  which  the
      Indemnity  Provider  may  reasonably  require to prepare any  required tax
      returns or reports.

           (e) As between the Indemnity Provider on one hand, and each Financing
      Party on the other hand, the Indemnity  Provider shall be responsible for,
      and  the  Indemnity  Provider  shall  indemnify  and  hold  harmless  each
      Financing Party (without  duplication of any  indemnification  required by
      subsection  (a)) on an After Tax Basis against,  any obligation for United
      States or foreign withholding taxes or similar levies,  imposts,  charges,
      fees, deductions or withholdings (collectively, "Withholdings") imposed in
      respect of the interest payable on the Notes,  Holder Yield payable on the
      Certificates  or with respect to any other  payments  under the  Operative
      Agreements  (all  such  payments  being  referred  to  herein  as  "Exempt
      Payments" to be made without  deduction,  withholding or set off) (and, if
      any  Financing  Party  receives a demand for such  payment from any taxing
      authority  or a  Withholding  is  otherwise  required  with respect to any
      Exempt  Payment,  the Indemnity  Provider  shall  discharge such demand on
      behalf of such Financing Party); provided, however, that the obligation of
      the Indemnity Provider under this Section 11.2(e) shall not apply to:

                (i)  Withholdings  on any Exempt Payment to any Financing  Party
           which is a non-U.S.  Person  unless such  Financing  Party is, on the
           date hereof (or on the date it becomes a Financing  Party  hereunder)
           and on the date of any change in the  principal  place of business or
           the lending office of such Financing Party, entitled to submit a Form
           1001 (relating to such Financing Party and entitling it to a complete
           exemption from Withholding on such Exempt Payment) or Form 4224 or is
           otherwise  subject to exemption from Withholding with respect to such
           Exempt  Payment  (except where the failure of the  exemption  results
           from a change  in the  principal  place of  business  of the  Lessee;
           provided if a failure of exemption  for any  Financing  Party results
           from a change in the principal place of business or lending office of
           any other Financing  Party,  then such other Financing Party shall be
           liable for any Withholding or indemnity with respect thereto), or

                (ii) Any U.S. Taxes imposed solely by reason of the failure by a
           non-U.S. Person to comply with applicable certification, information,
           documentation   or  other  reporting   requirements   concerning  the
           nationality,  residence,  identity  or  connections  with the  United
           States of  America  of such  non-U.S.  Person if such  compliance  is
           required by statute or  regulation of the United States of America as
           a precondition to relief or exemption from such U.S. Taxes.

      For the purposes of this Section 11.2(e),  (A) "U.S.  Person" shall mean a
      citizen,  national  or  resident  of  the  United  States  of  America,  a
      corporation,  partnership or other entity created or organized in or under
      any laws of the  United  States of America  or any State  thereof,  or any
      estate or trust that is subject to Federal income  taxation  regardless of
      the source of its  income,  (B) "U.S.  Taxes"  shall  mean any  present or
      future tax,  assessment or other charge or levy imposed by or on behalf of
      the United States of America or any taxing  authority  thereof or therein,
      (C) "Form 1001"  shall mean Form 1001  (Ownership,  Exemption,  or Reduced
      Rate  Certificate)  of the Department of the Treasury of the United States
      of America  and (D) "Form 4224" shall mean Form  4224(R)  (Exemption  from
      Withholding of Tax on Income  Effectively  Connected with the Conduct of a
      Trade or Business in the United  States) of the  Department of Treasury of
      the United  States of America  (or in  relation  to either  such Form such
      successor  and  related  forms as may from time to time be  adopted by the
      relevant taxing  authorities of the United States of America to document a
      claim to which such Form  relates).  Each of the Forms  referred to in the
      foregoing  clauses (C) and (D) shall  include such  successor  and related
      forms  as may  from  time  to  time  be  adopted  by the  relevant  taxing
      authorities  of the United  States of America to document a claim to which
      such Form relates.

           If a Financing  Party or an Affiliate with whom such Financing  Party
      files a consolidated tax return (or equivalent)  subsequently receives the
      benefit in any country of a tax credit or an allowance resulting from U.S.
      Taxes  with  respect to which it has  received a payment of an  additional
      amount under this Section  11.2(e),  such Financing  Party will pay to the
      Indemnity  Provider  such part of that  benefit as in the  opinion of such
      Financing  Party will leave it (after such  payment) in a position no more
      and no less favorable than it would have been in if no additional  payment
      had been  required to be paid,  provided  always  that (i) such  Financing
      Party will be the sole judge of the amount of any such  benefit and of the
      date on which it is  received,  (ii) such  Financing  Party  will have the
      absolute  discretion  as to the order and  manner in which it  employs  or
      claims tax credits and allowances available to it and (iii) such Financing
      Party  will not be obliged  to  disclose  to the  Indemnity  Provider  any
      information regarding its tax affairs or tax computations.

           Each  non-U.S.  Person that shall become a Financing  Party after the
      date hereof  shall,  upon the  effectiveness  of the  related  transfer or
      otherwise  upon  becoming a  Financing  Party  hereunder,  be  required to
      provide  all of  the  forms  and  statements  referenced  above  or  other
      evidences of exemption from Withholdings.

           (f) If a written Claim is made against any  Indemnified  Person or if
      any  proceeding  shall  be  commenced  against  such  Indemnified   Person
      (including  without  limitation a written notice of such proceeding),  for
      any  Impositions,  the provisions in Section 11.1 relating to notification
      and rights to contest shall apply;  provided,  however, that the Indemnity
      Provider  shall have the right to conduct and control such contest only if
      such  contest  involves  a Tax  other  than  a Tax on  net  income  of the
      Indemnified  Person  and  can be  pursued  independently  from  any  other
      proceeding involving a Tax liability of such Indemnified Person.

      11.3.Increased Costs, Illegality, etc.

           (a) If, due to either (i) the  introduction of or any change in or in
      the  interpretation  of any law or regulation or (ii) the compliance  with
      any guideline or request  hereafter  adopted,  promulgated  or made by any
      central bank or other  governmental  authority  (whether or not having the
      force of law),  there shall be any  increase in the cost to any  Financing
      Party of agreeing to make or making, funding or maintaining Advances, then
      the Lessee shall from time to time,  upon demand by such  Financing  Party
      (with a copy of such  demand  to the  Agent  but  subject  to the terms of
      Section 2.11 of the Credit  Agreement and 3.9 of the Trust  Agreement,  as
      the case may be), pay to the Agent for the account of such Financing Party
      additional  amounts sufficient to compensate such Financing Party for such
      increased  cost. A certificate  as to the amount of such  increased  cost,
      submitted to the Lessee and the Agent by such  Financing  Party,  shall be
      conclusive and binding for all purposes, absent manifest error.

           (b) If any Financing Party determines that compliance with any law or
      regulation  or any  guideline  or request  from any central  bank or other
      governmental  authority  (whether  or not having the force of law,  but in
      each case  promulgated  or made  after the date  hereof)  affects or would
      affect the amount of capital required or expected to be maintained by such
      Financing  Party or any corporation  controlling  such Financing Party and
      that  the  amount  of such  capital  is  increased  by or  based  upon the
      existence of such Financing Party's  commitment to make Advances and other
      commitments of this type or upon the Advances,  then,  upon demand by such
      Financing  Party  (with a copy of such  demand to the Agent but subject to
      the terms of  Section  2.11 of the Credit  Agreement  and 3.9 of the Trust
      Agreement),  the  Lessee  shall pay to the Agent for the  account  of such
      Financing  Party,  from time to time as specified by such Financing Party,
      additional  amounts  sufficient to compensate such Financing Party or such
      corporation  in the light of such  circumstances,  to the extent that such
      Financing  Party  reasonably  determines  such  increase  in capital to be
      allocable to the existence of such  Financing  Party's  commitment to make
      such Advances.  A certificate  as to such amounts  submitted to the Lessee
      and the Agent by such Financing  Party shall be conclusive and binding for
      all purposes, absent manifest error.

           (c) Without  limiting the effect of the  foregoing,  the Lessee shall
      pay to  each  Financing  Party  on the  last  day of the  Interest  Period
      therefor so long as such Financing Party is maintaining  reserves  against
      "Eurocurrency   liabilities"  under  Regulation  D  an  additional  amount
      (determined by such Financing Party and notified to the Lessee through the
      Agent) equal to the product of the following for each  Eurodollar  Loan or
      Eurodollar  Holder  Advance,  as the case may be, for each day during such
      Interest Period:

                (i) the principal  amount of such  Eurodollar Loan or Eurodollar
           Holder Advance, as the case may be, outstanding on such day; and

                (ii) the  remainder of (x) a fraction the  numerator of which is
           the rate  (expressed as a decimal) at which interest  accrues on such
           Eurodollar Loan or Eurodollar Holder Advance, as the case may be, for
           such Interest Period as provided in the Credit Agreement or the Trust
           Agreement, as the case may be (less the Applicable  Percentage),  and
           the  denominator  of  which  is one  (1)  minus  the  effective  rate
           (expressed  as a decimal)  at which  such  reserve  requirements  are
           imposed on such Financing Party on such day minus (y) such numerator;
           and

                (iii)1/360.

           (d) Without affecting its rights under Sections  11.3(a),  11.3(b) or
      11.3(c) or any other provision of any Operative Agreement,  each Financing
      Party  agrees that if there is any increase in any cost to or reduction in
      any amount  receivable by such  Financing  Party with respect to which the
      Lessee would be obligated to compensate  such Financing  Party pursuant to
      Sections  11.3(a) or 11.3(b),  such  Financing  Party shall use reasonable
      efforts to select an  alternative  office  for  Advances  which  would not
      result in any such  increase  in any cost to or  reduction  in any  amount
      receivable by such Financing Party;  provided,  however, that no Financing
      Party shall be obligated to select an  alternative  office for Advances if
      such  Financing  Party  determines  that (i) as a result of such selection
      such  Financing  Party  would  be in  violation  of  any  applicable  law,
      regulation,  treaty,  or  guideline,  or would incur  additional  costs or
      expenses  or (ii)  such  selection  would be  inadvisable  for  regulatory
      reasons or materially  inconsistent  with the interests of such  Financing
      Party.

           (e) With  reference  to the  obligations  of the  Lessee set forth in
      Sections 11.3(a) through 11.3(d), the Lessee shall not have any obligation
      to pay to any  Financing  Party  amounts owing under such Sections for any
      period  which is more than one (1) year  prior to the date upon  which the
      request for payment therefor is delivered to the Lessee.

           (f)  Notwithstanding  any other provision of this  Agreement,  if any
      Financing  Party shall  notify the Agent that the  introduction  of or any
      change  in or in the  interpretation  of any law or  regulation  makes  it
      unlawful, or any central bank or other governmental authority asserts that
      it is  unlawful,  for any  Financing  Party  to  perform  its  obligations
      hereunder  to make or  maintain  Eurodollar  Loans  or  Eurodollar  Holder
      Advances,  as the case may be, then (i) each Eurodollar Loan or Eurodollar
      Holder Advance, as the case may be, will automatically,  at the earlier of
      the end of the  Interest  Period for such  Eurodollar  Loan or  Eurodollar
      Holder Advance,  as the case may be, or the date required by law,  convert
      into an ABR Loan or an ABR Holder  Advance,  as the case may be, and (iii)
      the  obligation  of the  Financing  Parties to make,  convert or  continue
      Eurodollar Loans or Eurodollar Holder Advances,  as the case may be, shall
      be suspended  until the Agent shall notify the Lessee that such  Financing
      Party has determined  that the  circumstances  causing such  suspension no
      longer exist.

      11.4.Funding/Contribution Indemnity.

      Subject to the provisions of Section  2.11(a) of the Credit  Agreement and
3.9(a)  of the  Trust  Agreement,  as the  case may be,  the  Lessee  agrees  to
indemnify  each Financing  Party and to hold each Financing  Party harmless from
any loss or reasonable  expense which such Financing  Party may sustain or incur
as a consequence of (a) any default in connection  with the drawing of funds for
any Advance, (b) any default in making any prepayment after a notice thereof has
been given in accordance with the provisions of the Operative  Agreements or (c)
the making of a voluntary  or  involuntary  prepayment  of  Eurodollar  Loans or
Eurodollar  Holder Advances,  as the case may be, on a day which is not the last
day of an Interest Period with respect thereto. Such indemnification shall be in
an amount  equal to the excess,  if any, of (x) the amount of interest or Holder
Yield, as the case may be, which would have accrued on the amount so prepaid, or
not so borrowed,  accepted,  converted or continued for the period from the date
of such prepayment or of such failure to borrow,  accept, convert or continue to
the last day of such  Interest  Period  (or, in the case of a failure to borrow,
accept,  convert or continue,  the Interest  Period that would have commenced on
the date of such failure) in each case at the  applicable  Eurodollar  Rate plus
the Applicable  Percentage for such Loan or Holder Advance,  as the case may be,
for such Interest  Period over (y) the amount of interest (as determined by such
Financing Party in its reasonable  discretion)  which would have accrued to such
Financing  Party on such amount by (i) (in the case of the Lenders)  reemploying
such funds in loans of the same type and amount  during the period from the date
of  prepayment  or  failure  to  borrow  to the last day of the then  applicable
Interest  Period (or, in the case of a failure to borrow,  the  Interest  Period
that would have  commenced on the date of such failure) and (ii) (in the case of
the Holders) placing such amount on deposit for a comparable period with leading
banks in the relevant  interest  rate market.  This  covenant  shall survive the
termination  of the  Operative  Agreements  and the payment of all other amounts
payable hereunder.

      11.5.EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE,
      STRICT LIABILITY, ETC.

      WITHOUT LIMITING THE GENERALITY OF THE  INDEMNIFICATION  PROVISIONS OF ANY
AND ALL OF THE OPERATIVE  AGREEMENTS,  EACH PERSON PROVIDING  INDEMNIFICATION OF
ANOTHER PERSON UNDER ANY OPERATIVE  AGREEMENT HEREBY FURTHER EXPRESSLY  RELEASES
EACH BENEFICIARY OF ANY SUCH INDEMNIFICATION FROM ALL CLAIMS FOR LOSS OR DAMAGE,
DESCRIBED IN ANY OPERATIVE AGREEMENT,  CAUSED BY ANY ACT OR OMISSION ON THE PART
OF ANY SUCH BENEFICIARY ATTRIBUTABLE TO THE ORDINARY NEGLIGENCE (WHETHER SOLE OR
CONTRIBUTORY)  OR STRICT  LIABILITY OF ANY SUCH  BENEFICIARY,  AND  INDEMNIFIES,
EXONERATES  AND HOLDS EACH SUCH  BENEFICIARY  FREE AND HARMLESS FROM AND AGAINST
ANY  AND  ALL  ACTIONS,   CAUSES  OF  ACTION,  SUITS,  CLAIMS,   LOSSES,  COSTS,
LIABILITIES,  DAMAGES AND EXPENSES (INCLUDING WITHOUT LIMITATION ATTORNEY'S FEES
AND EXPENSES),  DESCRIBED ABOVE, INCURRED BY ANY SUCH BENEFICIARY  (IRRESPECTIVE
OF  WHETHER  ANY  SUCH   BENEFICIARY   IS  A  PARTY  TO  THE  ACTION  FOR  WHICH
INDEMNIFICATION UNDER THIS AGREEMENT OR ANY OTHER OPERATIVE AGREEMENT IS SOUGHT)
ATTRIBUTABLE TO THE ORDINARY NEGLIGENCE (WHETHER SOLE OR CONTRIBUTORY) OR STRICT
LIABILITY OF ANY SUCH BENEFICIARY.
                    SECTION 12. MISCELLANEOUS.

      12.1.Survival of Agreements.

      The representations,  warranties, covenants, indemnities and agreements of
the  parties  provided  for  in  the  Operative  Agreements,  and  the  parties'
obligations under any and all thereof,  shall survive the execution and delivery
of this  Agreement,  the  transfer  of any  Property to the Owner  Trustee,  the
acquisition of any Property (or any of its components),  the construction of any
Improvements, the Completion of any Property, any disposition of any interest of
the Owner  Trustee in any  Property or any  interest of the Holders in the Trust
Estate,  the payment of the Notes and any  disposition  thereof and shall be and
continue in effect  notwithstanding  any investigation made by any party and the
fact that any party may waive compliance with any of the other terms, provisions
or conditions of any of the Operative Agreements.  Except as otherwise expressly
set forth  herein  or in other  Operative  Agreements,  the  indemnities  of the
parties provided for in the Operative Agreements shall survive the expiration or
termination of any thereof.

      12.2.Notices.

      All  notices  required  or  permitted  to be  given  under  any  Operative
Agreement shall be in writing.  Notices may be served by certified or registered
mail, postage paid with return receipt requested;  by private courier,  prepaid;
by telex, facsimile,  or other telecommunication  device capable of transmitting
or creating a written  record;  or  personally.  Mailed  notices shall be deemed
delivered five (5) days after mailing,  properly  addressed.  Couriered  notices
shall be deemed  delivered  when  delivered as  addressed,  or if the  addressee
refuses  delivery,  when  presented for delivery  notwithstanding  such refusal.
Telex or  telecommunicated  notices  shall be deemed  delivered  when receipt is
either  confirmed by confirming  transmission  equipment or  acknowledged by the
addressee or its office. Personal delivery shall be effective when accomplished.
Unless a party  changes  its  address  by giving  notice  to the other  party as
provided  herein,  notices  shall be delivered  to the parties at the  following
addresses:

           If to the  Construction  Agent or the  Lessee,  to such entity at the
      following address:

                Centennial Healthcare Corporation
                400 Perimeter Center Terrace, Suite 650
                Atlanta, Georgia 30346
                Attention:  Alan Dahl, Chief Financial Officer
                Telephone:  (770) 730-1177
                Telecopy:  (770) 730-1377

           If to any  Guarantor,  to such  entity in care of  Centennial  at the
      following address:

                Centennial Healthcare Corporation
                400 Perimeter Center Terrace, Suite 650
                Atlanta, Georgia 30346
                Attention:  Alan Dahl, Chief Financial Officer
                Telephone:  (770) 730-1177
                Telecopy:  (770) 730-1377

           If to the Owner Trustee, to it at the following address:

                First Security Bank, National Association
                79 South Main Street
                Salt Lake City, Utah 84111
                Attention:  Val T. Orton,
                        Vice President
                Telephone:  (801) 246-5300
                Telecopy:  (801) 246-5053

           If to the  Holders,  to each such Holder at the address set forth for
      such Holder on Schedule I of the Trust Agreement.

           If to the Syndication Agent, to it at the following address:

                First Union  Capital  Markets,  a division of Wheat
                First Securities, Inc.
                c/o First Union National Bank
                301 South College Street
                Charlotte, North Carolina  28288
                Attention:  Matt MacIver, Vice-President
                Telephone:  (704) 374-4187
                Telecopy:  (704) 383-9144

           If to the Agent, to it at the following address:

                NationsBank, N.A.
                Atlanta Plaza Building
                600 Peachtree Street, NE, 17th Floor
                Atlanta, Georgia  30303
                Attention:  Chris Jones
                Telephone:   (404) 607-5862
                Telecopy:   (404) 607-6338

           If to any  Lender,  to it at the address set forth for such Lender in
      Schedule 1.1 of the Credit Agreement.

           From time to time any party may designate  additional  parties and/or
      another address for notice purposes by notice to each of the other parties
      hereto.  Each notice  hereunder shall be effective upon receipt or refusal
      thereof.

      12.3.Counterparts.

      This  Agreement  may  be  executed  by  the  parties  hereto  in  separate
counterparts, each of which when so executed and delivered shall be an original,
but all such  counterparts  shall  together  constitute but one (1) and the same
instrument.

      12.4.Terminations, Amendments, Waivers, Etc.; Unanimous Vote
Matters.

      Each Basic Document may be terminated,  amended,  supplemented,  waived or
modified only by an instrument in writing  signed by, subject to Article VIII of
the Trust Agreement regarding  termination of the Trust Agreement,  the Majority
Secured  Parties  and each Credit  Party (to the extent  such Credit  Party is a
party to such Basic  Document);  provided,  to the extent no Default or Event of
Default  shall have occurred and be  continuing,  the Majority  Secured  Parties
shall not amend, supplement, waive or modify any provision of any Basic Document
in such a manner as to adversely  affect the rights of any Credit Party  without
the prior written consent (not to be  unreasonably  withheld or delayed) of such
Credit Party.  Each  Operative  Agreement  which is not a Basic  Document may be
terminated,  amended, supplemented,  waived or modified only by an instrument in
writing  signed by the  parties  thereto and  (without  the consent of any other
Financing  Party) the Agent.  In addition,  (a) the Unanimous Vote Matters shall
require the  consent of each Lender and each Holder  affected by such matter and
(b) any  provision  of any  Operative  Agreement  incorporated  by  reference or
otherwise  referenced in a second Operative  Agreement shall remain,  respecting
such second Operative Agreement, in its original form without regard to any such
termination,   amendment,  supplement,  waiver  or  modification  in  the  first
Operative  Agreement  except  if such has been  agreed  to by an  instrument  in
writing  signed by,  subject to Article  VIII of the Trust  Agreement  regarding
termination of the Trust Agreement, the Majority Secured Parties and each Credit
Party (to the extent such Credit Party is a party to such Operative Agreement).

      Notwithstanding the foregoing, no such termination, amendment, supplement,
waiver or  modification  shall,  without  the  consent of the Agent and,  to the
extent  affected  thereby,  each  Lender  and  each  Holder  (collectively,  the
"Unanimous Vote Matters") (i) reduce the amount of any Note or any  Certificate,
extend  the  scheduled  date of  maturity  of any  Note,  extend  the  scheduled
Expiration Date, extend any payment date of any Note or Certificate,  reduce the
stated  rate of interest  payable on any Note,  reduce the stated  Holder  Yield
payable on any Certificate  (other than as a result of waiving the applicability
of any  post-default  increase in interest rates or Holder  Yields),  modify the
priority  of any  Lien in  favor  of the  Agent  under  any  Security  Document,
subordinate  any  obligation  owed to any  Lender or  Holder,  reduce any Lender
Unused  Fees  or  any  Holder  Unused  Fees  payable  under  this  Participation
Agreement, extend the scheduled date of payment of any Lender Unused Fees or any
Holder Unused Fees or increase the amount or extend the  expiration  date of any
Lender's  Lender  Commitment  or the Holder  Commitment  of any Holder,  or (ii)
terminate, amend, supplement, waive or modify any provision of this Section 12.4
or reduce the  percentages  specified in the  definitions  of Majority  Lenders,
Majority Holders or Majority  Secured  Parties,  or consent to the assignment or
transfer  by the Owner  Trustee of any of its rights and  obligations  under any
Credit  Document  or release a material  portion  of the  Collateral  (except in
accordance  with Section  8.8) or release any Credit Party from its  obligations
under any Operative  Agreement or otherwise alter any payment obligations of any
Credit  Party  to  the  Lessor  or  any  Financing  Party  under  the  Operative
Agreements, or (iii) terminate, amend, supplement, waive or modify any provision
of Section 7 of the Credit  Agreement  (which  shall also require the consent of
the  Agent),  or (iv)  permit  Advances  for Work in excess of the  Construction
Budget, or (v) eliminate the automatic option under Section 5.3(b) of the Agency
Agreement  requiring that the Construction  Agent pay certain liquidated damages
in exchange for the conveyance of a Property to the Construction  Agent, or (vi)
permit the extension of the Construction  Period beyond the date that is two (2)
years  from  the  Initial  Closing  Date.  Any  such   termination,   amendment,
supplement,  waiver or  modification  shall apply equally to each of the Lenders
and the Holders and shall be binding upon all the parties to this Agreement.  In
the case of any waiver,  each party to this  Agreement  shall be restored to its
former  position and rights under the Operative  Agreements,  and any Default or
Event of Default waived shall be deemed to be cured and not  continuing;  but no
such waiver shall extend to any subsequent or other Default or Event of Default,
or impair any right consequent thereon.

      If at a time when the  conditions  precedent  set  forth in the  Operative
Agreements to any Loan are, in the opinion of the Majority  Lenders,  satisfied,
any Lender  shall fail to fulfill  its  obligations  to make such Loan (any such
Lender, a "Defaulting Lender") then, for so long as such failure shall continue,
the  Defaulting  Lender  shall  (unless  the  Lessee and the  Majority  Lenders,
determined  as if the  Defaulting  Lender were not a "Lender",  shall  otherwise
consent  in  writing)  be deemed  for all  purposes  relating  to  terminations,
amendments, supplements, waivers or modifications under the Operative Agreements
to have no  Loans,  shall not be  treated  as a  "Lender"  when  performing  the
computation of Majority Lenders or Majority  Secured Parties,  and shall have no
rights under this Section 12.4;  provided that any action taken  pursuant to the
second  paragraph  of this  Section  12.4 shall not be  effective as against the
Defaulting Lender.

      If at a time when the  conditions  precedent  set  forth in the  Operative
Agreements  to any Holder  Advance are, in the opinion of the Majority  Holders,
satisfied,  any Holder shall fail to fulfill its obligations to make such Holder
Advance (any such  Holder,  a  "Defaulting  Holder")  then,  for so long as such
failure shall continue,  the Defaulting  Holder shall (unless the Lessee and the
Majority  Holders,  determined as if the Defaulting  Holder were not a "Holder",
shall  otherwise  consent in  writing)  be deemed for all  purposes  relating to
terminations,  amendments,  supplements,  waivers  or  modifications  under  the
Operative  Agreements  to have no Holder  Advances,  shall not be  treated  as a
"Holder" when performing the computation of Majority Holders or Majority Secured
Parties,  and shall have no rights under this Section  12.4;  provided  that any
action taken pursuant to the second  paragraph of this Section 12.4 shall not be
effective as against the Defaulting Holder.

      12.5.Headings, etc.

      The Table of Contents and headings of the various Articles and Sections of
this  Agreement  are for  convenience  of  reference  only and shall not modify,
define, expand or limit any of the terms or provisions hereof.

      12.6.Parties in Interest.

      Except  as  expressly  provided  herein,  none of the  provisions  of this
Agreement are intended for the benefit of any Person except the parties hereto.

      12.7.GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF
           JURY TRIAL; VENUE.

           (a) THIS  AGREEMENT  AND THE RIGHTS AND  OBLIGATIONS  OF THE  PARTIES
      HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED,  INTERPRETED AND ENFORCED IN
      ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH CAROLINA.  Any legal action
      or  proceeding  with  respect  to this  Agreement  or any other  Operative
      Agreement  may be brought in the courts of the State of North  Carolina in
      Mecklenburg  County or of the United  States for the  Western  District of
      North Carolina, and, by execution and delivery of this Agreement,  each of
      the parties to this Agreement hereby irrevocably accepts for itself and in
      respect of its property,  generally and unconditionally,  the nonexclusive
      jurisdiction of such courts. Each of the parties to this Agreement further
      irrevocably  consents  to  the  service  of  process  out  of  any  of the
      aforementioned  courts in any such action or  proceeding by the mailing of
      copies thereof by registered or certified mail, postage prepaid,  to it at
      the address set out for notices  pursuant to Section 12.2, such service to
      become  effective three (3) days after such mailing.  Nothing herein shall
      affect  the  right of any  party  to serve  process  in any  other  manner
      permitted by Law or to commence legal  proceedings or to otherwise proceed
      against any party in any other jurisdiction.

           (b) EACH OF THE PARTIES HERETO  IRREVOCABLY AND  UNCONDITIONALLY,  TO
      THE FULLEST EXTENT ALLOWED BY APPLICABLE  LAW, WAIVES TRIAL BY JURY IN ANY
      LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, ANY OTHER OPERATIVE
      AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.

           (c) Each of the parties to this Agreement hereby  irrevocably  waives
      any objection which it may now or hereafter have to the laying of venue of
      any  of  the  aforesaid  actions  or  proceedings  arising  out  of  or in
      connection with this Agreement or any other Operative Agreement brought in
      the  courts  referred  to in  subsection  (a)  above  and  hereby  further
      irrevocably waives and agrees not to plead or claim in any such court that
      any such action or  proceeding  brought in any such court has been brought
      in an inconvenient forum.

      12.8.Severability.

      Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction  shall,  as to such  jurisdiction,  be ineffective to the extent of
such  prohibition  or  unenforceability   without   invalidating  the  remaining
provisions  hereof,  and  any  such  prohibition  or   unenforceability  in  any
jurisdiction shall not invalidate or render  unenforceable such provision in any
other jurisdiction.

      12.9.Liability Limited.

           (a) The Lenders, the Agent, the Credit Parties, the Owner Trustee and
      the Holders each  acknowledge  and agree that the Owner Trustee is (except
      as otherwise  expressly  provided  herein or therein)  entering  into this
      Agreement and the other Operative Agreements to which it is a party (other
      than the Trust Agreement and to the extent  otherwise  provided in Section
      6.1 of this Agreement),  solely in its capacity as trustee under the Trust
      Agreement  and not in its  individual  capacity and that the Trust Company
      shall not be liable or accountable under any  circumstances  whatsoever in
      its   individual   capacity   for  or  on  account   of  any   statements,
      representations,  warranties,  covenants or obligations stated to be those
      of the Owner  Trustee,  except  for its own gross  negligence  or  willful
      misconduct  and as  otherwise  expressly  provided  herein or in the other
      Operative Agreements.

           (b) Anything to the contrary contained in this Agreement,  the Credit
      Agreement, the Notes or in any other Operative Agreement  notwithstanding,
      no  Exculpated  Person shall be  personally  liable in any respect for any
      liability  or  obligation  arising  hereunder  or in any  other  Operative
      Agreement including without limitation the payment of the principal of, or
      interest  on,  the  Notes,  or for  monetary  damages  for the  breach  of
      performance of any of the covenants contained in the Credit Agreement, the
      Notes,  this  Agreement,  the  Security  Agreement  or any  of  the  other
      Operative  Agreements.  The Lenders, the Holders and the Agent agree that,
      in the event any  remedies  under any  Operative  Agreement  are  pursued,
      neither the  Lenders,  the  Holders nor the Agent shall have any  recourse
      against  any  Exculpated  Person,  for any  deficiency,  loss or Claim for
      monetary  damages or otherwise  resulting  therefrom and recourse shall be
      had solely and exclusively  against the Trust Estate  (excluding  Excepted
      Payments)  and the Credit  Parties  (with  respect to the Credit  Parties'
      obligations under the Operative Agreements);  but nothing contained herein
      shall be taken to prevent  recourse against or the enforcement of remedies
      against the Trust Estate (excluding  Excepted  Payments) in respect of any
      and all liabilities,  obligations and undertakings contained herein and/or
      in any other Operative  Agreement.  Notwithstanding the provisions of this
      Section,  nothing in any  Operative  Agreement  shall:  (i)  constitute  a
      waiver,  release or discharge of any indebtedness or obligation  evidenced
      by the Notes and/or the Certificates arising under any Operative Agreement
      or secured by any Operative  Agreement,  but the same shall continue until
      paid or discharged;  (ii) relieve any Exculpated Person from liability and
      responsibility  for (but only to the  extent  of the  damages  arising  by
      reason of): active waste knowingly committed by any Exculpated Person with
      respect to any Property, any fraud, gross negligence or willful misconduct
      on the part of any Exculpated Person;  (iii) relieve any Exculpated Person
      from  liability  and  responsibility  for (but  only to the  extent of the
      moneys  misappropriated,  misapplied  or not  turned  over) (A) except for
      Excepted Payments, misappropriation or misapplication by the Lessor (i.e.,
      application  in a manner  contrary to any of the Operative  Agreements) of
      any  insurance  proceeds or  condemnation  award paid or  delivered to the
      Lessor by any  Person  other  than the  Agent,  (B)  except  for  Excepted
      Payments,  any deposits or any escrows or amounts owed by the Construction
      Agent  under the  Agency  Agreement  held by the  Lessor or (C) except for
      Excepted  Payments,  any rent or other income  received by the Lessor from
      any Credit  Party that is not turned over to the Agent;  or (iv) affect or
      in any way limit the  Agent's  rights  and  remedies  under any  Operative
      Agreement  with  respect  to the Rents and  rights and powers of the Agent
      under  the  Operative  Agreements  or to  obtain a  judgment  against  the
      Lessee's  interest in the  Properties or the Agent's  rights and powers to
      obtain a judgment against the Lessor or any Credit Party  (provided,  that
      no deficiency  judgment or other money judgment shall be enforced  against
      any Exculpated Person except to the extent of the Lessor's interest in the
      Trust Estate (excluding Excepted Payments) or to the extent the Lessor may
      be liable as  otherwise  contemplated  in  clauses  (ii) and (iii) of this
      Section 12.9(b)).

      12.10.    Rights of the Credit Parties.

      If at any time all  obligations  (i) of the Owner Trustee under the Credit
Agreement, the Security Documents and the other Operative Agreements and (ii) of
the  Credit  Parties  under  the  Operative  Agreements  have in each  case been
satisfied or  discharged in full,  then the Credit  Parties shall be entitled to
(a)  terminate  the Lease and  guaranty  obligations  under  Section  6B and (b)
receive all amounts then held under the  Operative  Agreements  and all proceeds
with respect to any of the  Properties.  Upon the  termination  of the Lease and
Section 6B pursuant to the  foregoing  clause (a), the Lessor shall  transfer to
the Lessee all of its right,  title and  interest  free and clear of the Lien of
the Lease, the Lien of the Security Documents and all Lessor Liens in and to any
Properties then subject to the Lease and any amounts or proceeds  referred to in
the foregoing clause (b) shall be paid over to the Lessee.

      12.11.    Further Assurances.

      The  parties  hereto  shall   promptly   cause  to  be  taken,   executed,
acknowledged or delivered,  at the sole expense of the Lessee,  all such further
acts,  conveyances,  documents and assurances as the other parties may from time
to time  reasonably  request in order to carry out and effectuate the intent and
purposes of this Participation Agreement, the other Operative Agreements and the
transactions  contemplated  hereby and thereby (including without limitation the
preparation,  execution  and  filing  of any and  all  Uniform  Commercial  Code
financing  statements,  filings of  Mortgage  Instruments  and other  filings or
registrations which the parties hereto may from time to time request to be filed
or  effected).  The Lessee,  at its own  expense  and without  need of any prior
request  from any  other  party,  shall  take such  action  as may be  necessary
(including without  limitation any action specified in the preceding  sentence),
or (if the Owner Trustee shall so request) as so requested, in order to maintain
and protect all security  interests  provided  for  hereunder or under any other
Operative  Agreement.  In  addition,  in  connection  with  the  sale  or  other
disposition of any Property or any portion thereof, the Lessee agrees to execute
such  instruments  of  conveyance  as may be  reasonably  required in connection
therewith.

      12.12.    Calculations under Operative Agreements.

      The   parties   hereto   agree  that  all   calculations   and   numerical
determinations  to be made under the  Operative  Agreements by the Owner Trustee
shall be made by the Agent and that such calculations and  determinations  shall
be  conclusive  and  binding on the  parties  hereto in the  absence of manifest
error.

      12.13.    Confidentiality.

      Each Financing Party agrees to keep confidential any information furnished
or made available to it by any Credit Party or any of its Subsidiaries  pursuant
to this  Agreement  that is marked  confidential;  provided that nothing  herein
shall prevent any Financing Party from  disclosing  such  information (a) to any
other Financing  Party or any Affiliate of any Financing  Party, or any officer,
director, employee, agent, or advisor of any Financing Party or Affiliate of any
Financing  Party,  (b) to any  other  Person  if  reasonably  incidental  to the
administration  of the credit facility  provided herein,  (c) as required by any
law,  rule,  or  regulation,  (d) upon the order of any court or  administrative
agency,  (e) upon the request or demand of any  regulatory  agency or authority,
(f) that is or becomes  available to the public or that is or becomes  available
to any  Financing  Party other than as a result of a disclosure by any Financing
Party  prohibited by this  Agreement,  (g) in connection  with any litigation to
which such Financing  Party or any of its Affiliates may be a party,  (h) to the
extent  necessary  in  connection  with the  exercise  of any remedy  under this
Agreement  or any other  Operative  Agreement,  and (i)  subject  to  provisions
substantially  similar  to those  contained  in this  Section,  to any actual or
proposed participant or assignee.

      12.14.    Financial Reporting/Tax Characterization.

      Lessee  agrees to obtain advice from its own  accountants  and tax counsel
regarding the financial reporting treatment and the tax  characterization of the
transactions  described in the Operative Agreements.  Lessee further agrees that
Lessee shall not rely upon any statement of any Financing  Party or any of their
respective Affiliates and/or Subsidiaries regarding any such financial reporting
treatment and/or tax characterization.

      12.15.    Set-off.

      In addition to any rights now or hereafter  granted under  applicable  Law
and not by way of limitation of any such rights,  upon and after the  occurrence
of any Event of Default and during the continuation  thereof,  the Lenders,  the
Holders, their respective Affiliates and any assignee or participant of a Lender
or a Holder  in  accordance  with the  applicable  provisions  of the  Operative
Agreements are hereby  authorized by the Credit Parties at any time or from time
to time,  without notice to the Credit Parties or to any other Person,  any such
notice being hereby expressly waived, to set-off and to appropriate and to apply
any and all  deposits  (general or special,  time or demand,  including  without
limitation indebtedness evidenced by certificates of deposit, whether matured or
unmatured) and any other  indebtedness at any time held or owing by the Lenders,
the Holders,  their  respective  Affiliates or any assignee or  participant of a
Lender or a Holder in accordance with the applicable provisions of the Operative
Agreements  to or for the credit or the account of any Credit Party  against and
on account of the obligations of any Credit Party under the Operative Agreements
irrespective  of whether or not (a) the Lenders or the  Holders  shall have made
any demand under any  Operative  Agreement or (b) the Agent shall have  declared
any or all of the obligations of any Credit Party under the Operative Agreements
to be due and payable and  although  such  obligations  shall be  contingent  or
unmatured.  Notwithstanding  the  foregoing,  neither  the  Agent  nor any other
Financing  Party shall  exercise,  or attempt to exercise,  any right of setoff,
banker's  lien,  or the like,  against  any  deposit  account or property of any
Credit Party held by the Agent or any other Financing  Party,  without the prior
written  consent  of the  Majority  Secured  Parties,  and any  Financing  Party
violating  this  provision  shall  indemnify  the Agent and the other  Financing
Parties  from any and all costs,  expenses,  liabilities  and damages  resulting
therefrom. The contractual restriction on the exercise of setoff rights provided
in the  foregoing  sentence  is  solely  for the  benefit  of the  Agent and the
Financing Parties and may not be enforced by any Credit Party.


                     [signature pages follow]


<PAGE>



                                            Participation Agreement
                       Centennial Real Estate Trust 1998-1
      IN WITNESS  WHEREOF,  the parties  hereto have caused this Agreement to be
duly executed by their respective  officers  thereunto duly authorized as of the
day and year first above written.


CONSTRUCTION AGENT
AND LESSEE:                    CENTENNIAL HEALTHCARE CORPORATION,
                               as the Construction Agent and as
                               the Lessee


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

                    [Signature Pages Continue]


<PAGE>



GUARANTORS:                    CENTENNIAL/ASHTON PROPERTIES
CORPORATION, a Georgia corporation


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


                               CENTENNIAL HEALTHCARE PROPERTIES
CORPORATION, a Georgia corporation


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


                               CENTENNIAL HEALTHCARE MANAGEMENT
CORPORATION, a Georgia corporation


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


                       CENTENNIAL ACQUISITION CORPORATION,
a Georgia corporation


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


                    [Signature Pages Continue]



<PAGE>



                               CENTENNIAL PROFESSIONAL THERAPY
SERVICES CORPORATION, a Georgia
corporation


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


                               CENTENNIAL HEALTHCARE INVESTMENT
CORPORATION, a Georgia corporation


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


                               CENTENNIAL HEALTHCARE HOSPITAL
CORPORATION, a Georgia corporation


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


                       TRANSITIONAL HEALTH SERVICES, INC.,
a                                   Delaware corporation


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


                               TRANSITIONAL FINANCIAL SERVICES,
INC.,                                     a Delaware corporation

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


                    [Signature Pages Continue]
                               PARAGON REHABILITATION, INC., a
Delaware                            corporation

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


                               THS PARTNERS I, INC., a Delaware
corporation


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


                        THS PARTNERS II, INC., a Delaware
corporation


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


                       TRANSITIONAL HEALTH PARTNERS d/b/a
TRANSITIONAL HEALTH SERVICES, a
Delaware general partnership

                               By:  THS PARTNERS I, INC., its
general partner

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


                               By:  THS PARTNERS II, INC., its
general partner

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


                    [Signature Pages Continue]



<PAGE>



                               PARKVIEW PARTNERSHIP, a Delaware
general                                   partnership

                               By:  THS PARTNERS I, INC., its
general partner

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


                               By:  THS PARTNERS II, INC., its
general partner

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


                               TOTAL CARE CONSOLIDATED, INC., a
North                                     Carolina corporation


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


                       TOTAL CARE, INC., a North Carolina
corporation


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


                       TOTAL HEALTH CARE SERVICES, INC., a
North Carolina corporation


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


                    [Signature Pages Continue]



<PAGE>




                       TOTAL CARE OF THE CAROLINAS, INC.,
a                                   North Carolina corporation


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


                       HCC HOME HEALTH OF LOUISIANA, INC.,
a                                   Louisiana corporation


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


                    [Signature Pages Continue]



<PAGE>




OWNER TRUSTEE AND
LESSOR:                        FIRST SECURITY BANK, NATIONAL
                               ASSOCIATION, not individually,
                               except as expressly stated herein,
                               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.


                    [Signature Pages Continue]



<PAGE>



SYNDICATION AGENT:             FIRST UNION CAPITAL MARKETS, A
                       DIVISION OF WHEAT FIRST SECURITIES,
                               INC.,  as the Syndication Agent


                               By: /s/    Joseph H. Towell
                               Name:      Joseph H. Towell
                               Title:     Sen. V.P.


                    [Signature Pages Continue]



<PAGE>



AGENT AND LENDERS:             NATIONSBANK, N.A., as an Agent and
                               as a Lender


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


                    [Signature Pages Continue]



<PAGE>



                               FIRST UNION NATIONAL BANK, as a
                               Lender


                               By: /s/    Joseph H. Towell
                               Name:      Joseph H. Towell
                               Title:     Sen. V.P,


                    [Signature Pages Continue]



<PAGE>



                               AMSOUTH BANK, as a Lender


                               By: /s/    J.          Ken
                               Diafatta
                               Name:      J. Ken Diafatta
                               Title:     Asst. V.P.


                    [Signature Pages Continue]



<PAGE>



                       CREDIT LYONNAIS NEW YORK BRANCH, as
                               a Lender


                               By:/s/     John Oberle
                               Name:John Oberle
                               Title:     V.P.


                    [Signature Pages Continue]



<PAGE>



                               COOPERATIVE CENTRALE
                               RAIFFEISEN-BOERENLEENBANK, B.A.
                               "RABOBANK NEDERLAND", NEW YORK
                               BRANCH, as a Lender


                               By:/s/     Terrell Boyle; Robert B.
                               Benoit
                               Name:Terrell Boyle;  Robert B.
                               Benoit
                               Title:     V.P.;     Sen. V.P.


                    [Signature Pages Continue]



<PAGE>



                               COMERICA BANK, as a Lender


                               By: /s/    Craig F. Durno
                               Name:      Craig F. Durno
                               Title:     Account Officer


                    [Signature Pages Continue]



<PAGE>



                       NATIONAL CITY BANK OF KENTUCKY, as
                               a Lender


                               By: /s/    Charles F. Denny
                               Name:      Charles F. Denny
                               Title:     Sen. V.P.


                    [Signature Pages Continue]



<PAGE>



                               WACHOVIA BANK, N.A., as a Lender


                               By:/s/     Gary C. Gaskill
                               Name:Gary C. Gaskill
                               Title:     V.P.


                    [Signature Pages Continue]



<PAGE>



                               SCOTIABANC INC., as a Lender


                               By:/s/     William E. Zarrett
                               Name:William E. Zarrett
                               Title:     Sen. Reationship Mgr.


                    [Signature Pages Continue]



<PAGE>



HOLDERS:                       FIRST UNION NATIONAL BANK, as a
Holder


                               By: /s/    Joseph H. Towell
                               Name:      Joseph H. Towell
                               Title:     Sen. V.P.


                    [Signature Pages Continue]



<PAGE>



                               NATIONSBANK, N.A., as a Holder


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


                    [Signature Pages Continue]



<PAGE>



                               AMSOUTH BANK, as a Holder


                               By: /s/    J. Ken Difatta
                               Name:      J. Ken Difatta
                               Title:     Asst. V.P.


                    [Signature Pages Continue]



<PAGE>



                        WACHOVIA BANK, N.A., as a Holder


                               By:/s/     Gary C. Gaskill
                               Name:Gary C. Gaskill
                               Title:     Vice President


                    [Signature Pages Continue]



<PAGE>



                               SCOTIABANC INC., as a Holder


                               By:/s/     William E. Zarrett
                               Name:William E. Zarrett
                               Title:     Sen Relationship Mgr.


                        [End of Signatures]



<PAGE>





                             EXHIBIT A


                         REQUISITION FORM
                             (OMITTED)
                             EXHIBIT B


             [Outside Counsel Opinion for the Lessee]
                (Pursuant to Section 5.3(j) of the
                     Participation Agreement)
                              OMITTED

                             EXHIBIT C

                       OFFICER'S CERTIFICATE

                              OMITTED


                             EXHIBIT D

                    CENTENNIAL HEALTHCARE CORPORATION

                      SECRETARY'S CERTIFICATE

                              OMITTED


                             EXHIBIT E

                    CENTENNIAL HEALTHCARE CORPORATION

                       OFFICER'S CERTIFICATE

                              OMITTED

                             EXHIBIT F


             FIRST SECURITY BANK, NATIONAL ASSOCIATION

                      SECRETARY'S CERTIFICATE

                              OMITTED

                             EXHIBIT G


          [Outside Counsel Opinion for the Owner Trustee]
                (Pursuant to Section 5.3(ee) of the
                     Participation Agreement)

                              OMITTED

                             EXHIBIT H


             [Outside Counsel Opinion for the Lessee]
   (Pursuant to Section 5.3(ff) of the Participation Agreement)

                              OMITTED
                             EXHIBIT I


                 CENTENNIAL HEALTHCARE CORPORATION

                       OFFICER'S CERTIFICATE

                              OMITTED

                             EXHIBIT K


                              OMITTED




<PAGE>




                             EXHIBIT L

                              OMITTED






<PAGE>




                             EXHIBIT M


                 CENTENNIAL HEALTHCARE CORPORATION

                 OFFICER'S COMPLIANCE CERTIFICATE

                              OMITTED

                             EXHIBIT N


                [Legal Description of Arkansas Property]
                              OMITTED

<PAGE>




-
                            Appendix A
-------------------------------------------------------------------
                  Rules of Usage and Definitions


                         I. Rules of Usage


The  following  rules of usage shall apply to this  Appendix A and the Operative
Agreements  (and each  appendix,  schedule,  exhibit and annex to the foregoing)
unless otherwise required by the context or unless otherwise defined therein:

      (a) Except as otherwise  expressly  provided,  any  definitions  set forth
herein or in any other document shall be equally  applicable to the singular and
plural forms of the terms defined.

      (b) Except as otherwise expressly provided,  references in any document to
articles,  sections,  paragraphs,  clauses,  annexes,  appendices,  schedules or
exhibits are references to articles,  sections,  paragraphs,  clauses,  annexes,
appendices, schedules or exhibits in or to such document.

      (c) The headings,  subheadings  and table of contents used in any document
are solely for  convenience  of reference and shall not constitute a part of any
such document nor shall they affect the meaning,  construction  or effect of any
provision thereof.

      (d)  References to any Person shall include such Person,  its  successors,
permitted assigns and permitted transferees.

      (e) Except as otherwise  expressly  provided,  reference to any  agreement
means such  agreement as amended,  modified,  extended,  supplemented,  restated
and/or replaced from time to time in accordance  with the applicable  provisions
thereof.

      (f) Except as otherwise expressly provided, references to any law includes
any amendment or  modification  to such law and any rules or regulations  issued
thereunder or any law enacted in substitution or replacement therefor.

      (g)  When  used in any  document,  words  such as  "hereunder",  "hereto",
"hereof" and "herein" and other words of like import  shall,  unless the context
clearly indicates to the contrary, refer to the whole of the applicable document
and not to any  particular  article,  section,  subsection,  paragraph or clause
thereof.

      (h)  References  to  "including"  means  including  without  limiting  the
generality of any  description  preceding such term and for purposes  hereof the
rule of ejusdem  generis shall not be  applicable to limit a general  statement,
followed by or  referable  to an  enumeration  of specific  matters,  to matters
similar to those specifically mentioned.

      (i)  References  herein to  "attorney's  fees",  "legal  fees",  "costs of
counsel" or other such references  shall be deemed to include the allocated cost
of in-house counsel.

      (j) Each of the parties to the Operative Agreements and their counsel have
reviewed and revised, or requested revisions to, the Operative  Agreements,  and
the usual rule of construction  that any ambiguities are to be resolved  against
the drafting party shall be inapplicable in the construing and interpretation of
the Operative Agreements and any amendments or exhibits thereto.

      (k)  Capitalized  terms  used in any  Operative  Agreements  which are not
defined in this Appendix A but are defined in another Operative  Agreement shall
have the meaning so ascribed to such term in the applicable Operative Agreement.


                          II. Definitions

      "ABR"  shall  mean,  for any day, a rate per annum equal to the greater of
(a) the Prime  Lending  Rate in effect on such day,  and (b) the  Federal  Funds
Effective  Rate in effect on such day plus one-half of one percent  (0.5%).  For
purposes  hereof:  "Prime  Lending  Rate"  shall  mean the rate  which the Agent
announces  from time to time as its prime lending rate as in effect from time to
time.  The  Prime  Lending  Rate is a  reference  rate and does not  necessarily
represent the lowest or best rate actually  charged to any customer.  Any Lender
may make commercial loans or other loans at rates of interest at, above or below
the Prime Lending Rate.  The Prime Lending Rate shall change  automatically  and
without notice from time to time as and when the prime lending rate of the Agent
changes.   "Federal  Funds  Effective  Rate"  shall  mean,  for  any  period,  a
fluctuating interest rate per annum equal for each day during such period to the
weighted  average of the rates on  overnight  Federal  funds  transactions  with
members or the Federal  Reserve  System  arranged by Federal funds  brokers,  as
published  for such day (or,  if such day is not a  Business  Day,  for the next
preceding  Business  Day) by the Federal  Reserve Bank of New York,  or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations  for such day on such  transactions  received by the Agent from three
(3) Federal funds brokers of recognized  standing  selected by it. Any change in
the ABR due to a change in the Prime Lending Rate or the Federal Funds Effective
Rate shall be  effective as of the opening of business on the  effective  day of
such change in the Prime  Lending  Rate or the  Federal  Funds  Effective  Rate,
respectively.

      "ABR Holder  Advance" shall mean a Holder  Advance  bearing a Holder Yield
based on the ABR.

      "ABR Loans" shall mean Loans the rate of interest  applicable  to which is
based upon the ABR.

      "Acceleration"  shall have the meaning  given to such term in Section 6 of
the Credit Agreement.

      "Accounts"  shall have the meaning  given to such term in Section 1 of the
Security Agreement.

      "Acquisition Advance" shall have the meaning given to such term in Section
5.3 of the Participation Agreement.

      "Acquisition  Loan"  shall  mean  any  Loan  made  in  connection  with an
Acquisition Advance.

      "Additional  Incorporated Terms" shall have the meaning given to such term
in Section 28.1 of the Lease.

      "Adjusted  EBITDAR" shall mean EBITDAR for the Lessee and its Consolidated
Subsidiaries for the most-recently ended Rolling Period;  provided,  that in the
event that any Permitted  Acquisition has been  consummated  during such Rolling
Period and the Credit  Parties have delivered to the Lenders and the Holders pro
forma   combined   historical   financial   statements  in  form  and  substance
satisfactory to the Majority Secured  Parties,  then for purposes of calculating
Adjusted EBITDAR hereunder,  EBITDAR for such Rolling Period shall be calculated
for the  Lessee  and its  Consolidated  Subsidiaries  including  such  Permitted
Acquisition, based on such pro forma combined historical financial statements.

      "Adjusted Eurodollar Rate" shall mean, for any Interest Period, as applied
to a  Eurodollar  Loan or a  Eurodollar  Holder  Advance,  the rate per  annum (
rounded upwards,  if necessary,  to the next 1/16 of 1%) determined  pursuant to
the following formula:

      Adjusted     Eurodollar    Rate    =     ______Eurodollar
Rate_____

[1 - Reserve Percentage]

      "Adjusted Total Debt" shall mean, as of any date of determination, the sum
of (a) all Funded  Debt of the Lessee and its  Consolidated  Subsidiaries  as of
such date,  plus (b) the amount of all operating  leases  (other than  operating
leases financed through the Operative Agreements), based on the present value of
all payments  required under such operating  leases  calculated using a discount
rate of ten percent (10%) per annum.

      "Advance"   shall   mean  a   Construction   Advance   or  an
Acquisition Advance.

      "Affiliate"  shall mean,  with respect to any Person,  any Person or group
acting in  concert  in  respect of the  Person in  question  that,  directly  or
indirectly,  controls or is controlled  by or is under common  control with such
Person.

      "After Tax Basis" shall mean,  with respect to any payment to be received,
the amount of such payment  increased so that,  after deduction of the amount of
all taxes  required to be paid by the  recipient  calculated at the then maximum
marginal  rates  generally  applicable  to  Persons  of  the  same  type  as the
recipients  with respect to the receipt by the  recipient of such amounts  (less
any tax savings realized as a result of the payment of the indemnified  amount),
such  increased  payment  (as so  reduced)  is  equal to the  payment  otherwise
required to be made.

      "Agency Agreement" shall mean the Agency Agreement,  dated on or about the
Initial Closing Date between the Construction Agent and the Lessor.

      "Agency  Agreement  Event of Default"  shall mean an "Event of Default" as
defined in Section 5.1 of the Agency Agreement.

      "Agent" shall mean NationsBank, N.A., as agent for the Lenders pursuant to
the Credit  Agreement,  or any successor  agent appointed in accordance with the
terms of the Credit  Agreement and  respecting the Security  Documents,  for the
Lenders and the Holders, to the extent of their interests.

      "Applicable  Percentage"  shall mean for Loans,  Holder  Advances  and the
Unused Fee, the appropriate applicable percentage  corresponding to the ratio of
Adjusted Total Debt to Adjusted  EBITDAR (the  Applicable  Percentage  being the
lowest  applicable  percentage per annum as to which the ratio  requirement  has
been attained): <TABLE> <CAPTION>
                                                  Applicable
                       Applicable                 Percentage    Applicable   Applicable  Applicable
                       Percentage     Applicable      for       Percentage   Percentage   Percentage
Pricing                   for         Percentage  Eurodollar       for          for         for
Level  Ratio of        Eurodollar     for ABR        Holder       ABR          Lender      Holder
    Adjusted Total        Loans         Loans       Advances      Holder       Unused      Unused
     Debt/Adjusted                                               Advances       Fee         Fee
        EBITDAR
<S>                     <C>             <C>        <C>           <C>            <C>       <C>

Tier I Less than or     0.950%          0.075%     1.450%        0.575%         0.200%    0.200%
     equal to 3.50 to
     1.00
Tier II Less than or    1.200%          0.075%     1.700%        0.575%         0.250%    0.250%
     equal to 4.00 to
     1.00 but greater
     than 3.50 to 1.00
Tier III Less than or   1.450%          0.075%     1.950%        0.575%         0.250%    0.250%
     equal to 4.50 to
     1.00 but  greater
     than 4.00 to 1.00
Tier IV Greater than    1.700%          0.200%     2.200%        0.700%         0.375%    0.375%
     4.50 to 1.00

</TABLE>

The initial Applicable  Percentage,  which shall be applicable commencing on the
Initial Closing Date,  shall be based on the Lessee's  financial  statements for
the fiscal period ended March 31, 1998 and the Officer's Compliance  Certificate
delivered pursuant to Paragraph 4.1 of the Lessee Credit Agreement;  thereafter,
the Applicable Percentage shall adjust automatically, as appropriate, on the day
following delivery of each Officer's Compliance  Certificate  provided,  that in
the event that an Officer's  Compliance  Certificate  has not been  delivered as
required by Section 8.3(1) of the Participation  Agreement,  then the Applicable
Percentage  shall  adjust to Level IV provided  above as of the date of required
delivery;  provided, further, however, the Applicable Percentage shall adjust on
the day after delivery of such delinquent Officer's Compliance Certificate based
on the ratio set forth in such Officer's Compliance Certificate. Notwithstanding
the  foregoing,  at any time that the default rate of interest or yield,  as the
case may be,  shall  apply in  accordance  with  Section  2.8(b)  of the  Credit
Agreement and Section 3.2(b) of the Trust Agreement,  the Applicable  Percentage
shall be the highest margin provided above with respect to ABR Loans, Eurodollar
Loans, ABR Holder Advances and Eurodollar Holder Advances, respectively.

      "Appraisal"  shall mean, with respect to any Property,  an appraisal to be
delivered in connection with the  Participation  Agreement or in accordance with
the  terms  of the  Lease,  in  each  case  prepared  by a  reputable  appraiser
reasonably  acceptable  to the Agent,  which in the  judgment  of counsel to the
Agent, complies with all of the provisions of the Financial Institutions Reform,
Recovery and  Enforcement  Act of 1989,  as amended,  the rules and  regulations
adopted pursuant thereto, and all other applicable Legal Requirements.

      "Appraisal  Procedure"  shall have the meaning  given such term in Section
22.4 of the Lease.

      "Approved  State"  shall mean each state  within  the  continental  United
States.

      "Appurtenant Rights" shall mean (a) all agreements,  easements,  rights of
way or use, rights of ingress or egress, privileges,  appurtenances,  tenements,
hereditaments  and other rights and benefits at any time belonging or pertaining
to the Land underlying the Improvements or the  Improvements,  including without
limitation  the use of any  streets,  ways,  alleys,  vaults  or  strips of land
adjoining,  abutting,  adjacent or  contiguous  to the Land and (b) all permits,
licenses and rights,  whether or not of record,  appurtenant to such Land or the
Improvements.

      "Assignment  and  Acceptance"  shall mean the Assignment and Acceptance in
the form attached to the Credit Agreement as Exhibit B.

      "Available Commitment" shall mean, as to any Lender at any time, an amount
equal  to the  excess,  if  any,  of (a) the  amount  of  such  Lender's  Lender
Commitment  over (b) the  aggregate  principal  amount of all Loans made by such
Lender  as  of  such  date  after  giving  effect  to  Section   5.2(d)  of  the
Participation  Agreement (but without  giving effect to any other  repayments or
prepayments of any Loans hereunder).

      "Available Holder  Commitments"  shall mean an amount equal to the excess,
if any,  of (a) the  aggregate  amount of the  Holder  Commitments  over (b) the
aggregate  amount of the Holder  Advances  made since the Initial  Closing  Date
after  giving  effect to  Section  5.2(d) of the  Participation  Agreement  (but
without  giving  effect to any other  repayments  or  prepayments  of any Holder
Advances).

      "Bankruptcy  Code"  shall  mean  Title  11 of the U. S.  Code
entitled  "Bankruptcy,"  as  now  or  hereafter  in  effect  or any
successor thereto.

      "Basic    Documents"   shall   mean   the   following:    the
Participation   Agreement,   the   Agency   Agreement,   the  Trust
Agreement,  the Certificates,  the Credit Agreement, the Notes, the
Lease and the Security Agreement.

      "Basic  Rent" shall  mean,  the sum of (a) the Loan Basic Rent and (b) the
Lessor Basic Rent,  calculated as of the applicable  date on which Basic Rent is
due.

      "Basic Term" shall have the meaning  specified in Section 2.2
of the Lease.

      "Basic Term Commencement Date" shall have the meaning specified in Section
2.2 of the Lease.

      "Basic Term Expiration  Date" shall have the meaning  specified in Section
2.2 of the Lease.

      "Benefitted Lender" shall have the meaning specified in Section 9.10(a) of
the Credit Agreement.

      "Bill of Sale" shall mean a Bill of Sale  regarding  Equipment in form and
substance satisfactory to the Agent.

      "Board" shall mean the Board of Governors of the Federal Reserve System of
the United States (or any successor).

      "Borrower"  shall mean the Owner Trustee,  not in its individual  capacity
but as Borrower under the Credit Agreement.

      "Borrowing  Date"  shall  mean  any  Business  Day  specified  in a notice
delivered pursuant to Section 2.3 of the Credit Agreement as a date on which the
Lessor requests the Lenders to make Loans hereunder.

      "Budgeted  Total Property  Cost" shall mean, at any date of  determination
with  respect  to any  Construction  Period  Property,  an  amount  equal to the
aggregate  amount  which the  Construction  Agent in good  faith  expects  to be
expended in order to achieve Completion with respect to such Property.

      "Business Day" shall mean a day other than a Saturday, Sunday or other day
on which commercial  banks in Charlotte,  North Carolina,  Atlanta,  Georgia and
Philadelphia,  Pennsylvania or any other states from which the Agent, any Lender
or any Holder funds or engages in administrative  activities with respect to the
transactions under the Operative Agreements are authorized or required by law to
close; provided, however, that when used in connection with a Eurodollar Loan or
Eurodollar Holder Advance, the term "Business Day" shall also exclude any day on
which banks are not open for dealings in dollar deposits in the London interbank
market.

      "Capitalized  Lease"  shall mean,  as applied to any Person,  any lease of
property (whether real, personal, tangible,  intangible or mixed of such Person)
by such Person as the lessee which would be  capitalized  on a balance  sheet of
such Person prepared in accordance with GAAP.

      "Capital Stock" shall mean any  nonredeemable  capital stock of any Credit
Party or any of its Subsidiaries, whether common or preferred.

      "Casualty"  shall mean any damage or  destruction of all or any portion of
the Property as a result of a fire or other casualty.

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

      "Centennial Real Estate Trust 1998-1" shall mean the grantor trust created
pursuant to the terms and conditions of the Trust Agreement.

      "CERCLA"   shall   mean   the   Comprehensive    Environmental   Response,
Compensation,  and Liability Act of 1980, 42 U.S.C. ss. 9601 et seq., as amended
by the Superfund Amendments and Reauthorization Act of 1986.

      "Certificate"  shall mean a Certificate in favor of each Holder  regarding
the Holder Commitment of such Holder issued pursuant to the terms and conditions
of the Trust Agreement in favor of each Holder.

      "Chattel  Paper" shall have the meaning given to such term in Section 1 of
the Security Agreement.

      "Claims" shall mean any and all obligations, liabilities, losses, actions,
suits,  penalties,  claims,  demands,  costs  and  expenses  (including  without
limitation reasonable attorney's fees and expenses) of any nature whatsoever.

      "Closing  Date"  shall mean the  Initial  Closing  Date and each  Property
Closing Date.

      "Code" shall mean the Internal  Revenue Code of 1986  together  with rules
and  regulations  promulgated  thereunder,  as amended from time to time, or any
successor statute thereto.

      "Collateral"  shall mean all assets now owned or hereafter acquired by the
Lessor,  the Construction Agent and/or the Lessee upon which a Lien is purported
to be created by one or more of the Security Documents.

      "Commitment"   shall  mean  the   aggregate   of  the  Holder
Commitment plus the Lender Commitment.

      "Commitment  Percentage"  shall  mean,  as to any Lender at any time,  the
percentage  which  such  Lender's  Lender  Commitment  then  constitutes  of the
aggregate Lender Commitments (or, at any time after the Lender Commitments shall
have expired or terminated,  the percentage which the aggregate principal amount
of such Lender's Loans then outstanding  constitutes of the aggregate  principal
amount of all of the Loans then  outstanding),  and such  Commitment  Percentage
shall take into account both the Lender's  Tranche A Commitment and the Lender's
Tranche B Commitment.

      "Commitment  Period"  shall mean the period from and including the Initial
Closing Date to and including the Construction  Period Termination Date, or such
earlier date as the Lender Commitments shall terminate as provided in the Credit
Agreement  or the Holder  Commitment  shall  terminate  as provided in the Trust
Agreement.

      "Company Obligations" shall mean the obligations of Centennial, in any and
all  capacities  under and with  respect to the  Operative  Agreements  and each
Property.

      "Completion"  shall mean,  with  respect to a  Property,  such time as the
acquisition,  installation,  testing and final completion of the Improvements on
such Property has been achieved  substantially  in accordance with the Plans and
Specifications,  the Agency  Agreement  and/or the Lease, and in compliance with
all Legal Requirements and Insurance Requirements and a certificate of occupancy
has been issued with respect to such  Property by the  appropriate  governmental
entity (except if  non-compliance,  individually or in the aggregate,  shall not
have and could not reasonably be expected to have a Material Adverse Effect). If
(i) the Lessor purchases a Property that includes existing Improvements that are
to be  immediately  occupied  by the Lessee  without any  improvements  financed
pursuant  to the  Operative  Agreements,  the  date of  Completion  and the Rent
Commencement  Date for such Property shall be the Property Closing Date and (ii)
the  Lessor  receives  an Advance in  connection  with a Property  that is being
purchased pursuant to an Escrowed Closing (as described in Section 5.2(d) of the
Participation Agreement),  the date of completion and the Rent Commencement Rate
of such Property shall be the date of the Advance that is placed in such escrow.

      "Completion  Date" shall mean, with respect to a Property,  the earlier of
(a) the date on which  Completion  for such  Property  has  occurred  or (b) the
Construction Period Termination Date.

      "Condemnation"  shall  mean  any  taking  or  sale  of  the  use,  access,
occupancy,  easement rights or title to any Property or any part thereof, wholly
or partially  (temporarily  or  permanently),  by or on account of any actual or
threatened  eminent  domain  proceeding  or other taking of action by any Person
having the power of eminent domain,  including without limitation an action by a
Governmental Authority to change the grade of, or widen the streets adjacent to,
any Property or alter the  pedestrian or vehicular  traffic flow to any Property
so as to result in a change in access to such  Property,  or by or on account of
an  eviction  by  paramount  title  or any  transfer  made in  lieu of any  such
proceeding or action.

      "Consolidated  Subsidiary" shall mean, as to any Person, any Subsidiary of
such Person which under the rules of GAAP  consistently  applied should have its
financial  results  consolidated  with  those of such  Person  for  purposes  of
financial accounting statements.

      "Construction  Advance"  shall mean an  advance  of funds to pay  Property
Costs pursuant to Section 5.4 of the Participation Agreement.

      "Construction Agent" shall mean Centennial, a Georgia corporation,  as the
construction agent under the Agency Agreement.

      "Construction  Budget" shall mean the cost of  acquisition,  installation,
testing,   constructing  and  developing  any  Property  as  determined  by  the
Construction Agent in its reasonable, good faith judgment.

      "Construction Commencement Date" shall mean, with respect to Improvements,
the date on which  construction of such Improvements  commences  pursuant to the
Agency Agreement.

      "Construction  Contract" shall mean any contract  entered into between the
Construction  Agent or the Lessee  with a  Contractor  for the  construction  of
Improvements or any portion thereof on the Property.

      "Construction  Loan"  shall  mean  any  Loan  made  in  connection  with a
Construction Advance.

      "Construction  Loan  Property  Cost"  shall  mean  with  respect  to  each
Construction  Period Property at the date of  determination,  an amount equal to
(a) the aggregate  principal  amount of  Construction  Loans made on or prior to
such date with respect to the Property minus (b) the aggregate  principal amount
of prepayments or repayments of the Loans  allocated to reduce the  Construction
Loan  Property Cost of such  Property  pursuant to Section  2.6(c) of the Credit
Agreement.

      "Construction  Period" shall mean, with respect to a Property,  the period
commencing on the Construction Commencement Date for such Property and ending on
the Completion Date for such Property.

      "Construction  Period Property" means, at any date of  determination,  any
Property as to which the Rent  Commencement Date has not occurred on or prior to
such date.

      "Construction  Period  Termination Date" shall mean (a) the earlier of (i)
the date that the Lender  Commitments  have been terminated in their entirety in
accordance with the terms of Section 2.5(a) of the Credit Agreement, or (ii) the
second  anniversary of the Initial Closing Date or (b) such later date as may be
agreed to by the Majority Secured Parties.

      "Contractor"  shall mean each entity with whom the  Construction  Agent or
the Lessee contracts to construct any Improvements or any portion thereof on the
Property.

      "Controlled  Group"  shall  mean  all  members  of a  controlled  group of
corporations and all trades or businesses  (whether or not  incorporated)  under
common  control which,  together with any Credit Party,  are treated as a single
employer under Section 414 of the Code.

      "Controlling  Person"  shall have the  meaning  specified  in
Section 17.1(n) of the Lease.

      "Co-Owner  Trustee" shall have the meaning specified in Section 9.2 of the
Trust Agreement.

      "Credit Agreement" shall mean the Credit Agreement,  dated on or about the
Initial Closing Date, among the Lessor, the Agent and the Lenders,  as specified
therein.

      "Credit  Agreement  Default" shall mean any event or condition which, with
the lapse of time or the giving of notice,  or both,  would  constitute a Credit
Agreement Event of Default.

      "Credit  Agreement  Event of  Default"  shall mean any event or  condition
defined as an "Event of Default" in Section 6 of the Credit Agreement.

      "Credit  Documents"  shall mean the  Participation  Agreement,  the Agency
Agreement, the Credit Agreement, the Notes and the Security Documents.

      "Credit  Parties"  shall  mean the  Construction  Agent,  the
Lessee and each Guarantor.

      "Deed" shall mean a warranty deed  regarding the Land and/or  Improvements
in form and substance satisfactory to the Agent.

      "Default"  shall mean any event,  act or  condition  which with  notice or
lapse of time, or both, would constitute an Event of Default.

      "Defaulting  Holder"  shall have the meaning given to such term in Section
12.4 of the Participation Agreement.

      "Defaulting  Lender"  shall have the meaning given to such term in Section
12.4 of the Participation Agreement.

      "Deficiency  Balance"  shall have the meaning given in Section  22.1(b) of
the Lease Agreement.

      "Documents"  shall have the meaning given to such term in Section 1 of the
Security Agreement.

      "Dollars"  and "$" shall  mean  dollars in lawful  currency  of the United
States of America.

      "Domestic  Subsidiary"  shall  mean,  with  respect  to  any  Person,  any
Subsidiary of such Person which is  incorporated  or organized under the laws of
any State of the United States or the District of Columbia.

      "Early  Purchase Cap" shall have the meaning given to such term in Section
20.1 of the Lease.

      "EBITDA"  shall  mean,  for any  period,  Net Income of the Lessee and its
Consolidated  Subsidiaries  for such  period plus (to the extent  deducted  from
revenue in calculating net income) depreciation,  amortization and non-recurring
non-cash charges and expenses associated with a sale of assets or refinancing of
Indebtedness  or  leases  permitted   hereunder,   taxes  and  interest  expense
(including  interest  expense  on  Capitalized  Leases)  for the  Lessee and its
Consolidated Subsidiaries for such period.

      "EBITDAR"  shall  mean  for  any  period,  EBITDA  of the  Lessee  and its
Consolidated  Subsidiaries  for such period plus operating lease expense for the
Lessee and its Consolidated Subsidiaries for such period.

      "Escrowed  Closing"  shall have the meaning  given to such term in Section
5.2(d) of the Participation Agreement.

      "Election  Date" shall have the meaning given to such term in Section 20.1
of the Lease.

      "Election  Notice"  shall have the  meaning  given to such term in Section
20.1 of the Lease.

      "Eligible  Assignee" shall mean (i) a Lender or a Holder,  as the case may
be; (ii) an Affiliate of a Lender or a Holder, as the case may be; and (iii) any
other Person  approved by the Agent and, unless an Event of Default has occurred
and is continuing at the time any assignment is effected in accordance  with the
Operative Agreements, the Lessee or the Construction Agent, such approval not to
be unreasonably  withheld or delayed by the Lessee or the Construction Agent and
such approval to be deemed given by the Lessee or the  Construction  Agent if no
objection is received by the  assigning  Lender or Holder and the Agent from the
Lessee or the  Construction  Agent within two Business Days after notice of such
proposed  assignment has been provided by the assigning  Lender or Holder to the
Lessee or the Construction Agent; provided,  however, that neither the Lessee or
the Construction  Agent nor an Affiliate of the Lessee or the Construction Agent
shall qualify as an Eligible Assignee.

      "Environmental  Claims" shall mean any investigation,  notice,  violation,
demand, allegation,  action, suit, injunction,  judgment, order, consent decree,
penalty, fine, lien, proceeding, or claim (whether administrative,  judicial, or
private in nature) arising (a) pursuant to, or in connection  with, an actual or
alleged  violation  of,  any  Environmental  Law,  (b) in  connection  with  any
Hazardous Substance, (c) from any abatement,  removal, remedial,  corrective, or
other response  action in connection with a Hazardous  Substance,  Environmental
Law,  or other  order of a Tribunal  or (d) from any  actual or alleged  damage,
injury,  threat,  or  harm  to  health,   safety,  natural  resources,   or  the
environment.

      "Environmental  Control  Statutes" shall mean all federal,  state or local
laws and regulations  regarding  environmental or pollution  concerns  including
without limitation the Comprehensive  Environmental  Response,  Compensation and
Liability Act of 1980 (as amended,  "CERCLA"), the Solid Waste Disposal Act, the
Clean Water Act and the Clean Air Act,  the Resource  Conservation  and Recovery
Act of 1976, the Federal Water Pollution  Control Act Amendments of 1972 and the
Occupational  Safety and Health Act, each as amended from time to time,  and all
regulations,  directives,  policies or interpretations issued in connection with
any such statute.

      "Environmental  Laws"  shall  mean any  Law,  permit,  consent,  approval,
license,  award, or other  authorization or requirement of any Tribunal relating
to  emissions,  discharges,  releases,  threatened  releases  of  any  Hazardous
Substance  into  ambient  air,  surface  water,  ground  water,  publicly  owned
treatment works,  septic system, or land, or otherwise relating to the handling,
storage,  treatment,  generation,  use,  or disposal  of  Hazardous  Substances,
pollution or to the protection of health or the environment,  including  without
limitation  CERCLA,  the Resource  Conservation  and Recovery Act, 42 U.S.C. ss.
6901, et seq., and state statutes analogous thereto.

      "Environmental Violation" shall mean any activity, occurrence or condition
that  violates  or  threatens  (if the  threat  requires  remediation  under any
Environmental  Law and is not  remediated  during any grace period allowed under
such  Environmental  Law) to violate or results in or  threatens  (if the threat
requires  remediation  under any  Environmental Law and is not remediated during
any  grace  period   allowed  under  such   Environmental   Law)  to  result  in
noncompliance with any Environmental Law.

      "Equipment"  shall mean equipment,  apparatus,  furnishings,  fittings and
personal  property  of every kind and  nature  whatsoever  purchased,  leased or
otherwise acquired using the proceeds of the Loans or the Holder Advances by the
Construction   Agent,  the  Lessee  or  the  Lessor  and  all  improvements  and
modifications  thereto  and  replacements  thereof,  whether or not now owned or
hereafter  acquired or now or subsequently  attached to, contained in or used or
usable  in  any  way in  connection  with  any  operation  of any  Improvements,
including but without  limiting the generality of the  foregoing,  all equipment
described in the Appraisal including without limitation all heating, electrical,
and mechanical equipment,  lighting,  switchboards,  plumbing,  ventilation, air
conditioning  and  air-cooling   apparatus,   refrigerating,   and  incinerating
equipment,  escalators,  elevators, loading and unloading equipment and systems,
cleaning  systems  (including  without  limitation  window cleaning  apparatus),
telephones, communication systems (including without limitation satellite dishes
and  antennae),  televisions,   computers,  sprinkler  systems  and  other  fire
prevention and extinguishing apparatus and materials,  security systems, motors,
engines,  machinery,  pipes, pumps, tanks,  conduits,  appliances,  fittings and
fixtures of every kind and description.

      "Equipment  Schedule" shall mean (a) each Equipment  Schedule  attached to
the  applicable  Requisition  and (b) each  Equipment  Schedule  attached to the
applicable Lease Supplement.

      "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.

      "Eurocurrency Reserve Requirements" shall mean for any day as applied to a
Eurodollar  Loan,  the  aggregate  (without  duplication)  of the maximum  rates
(expressed  as a  decimal)  of  reserve  requirements  in  effect  on  such  day
(including  without  limitation  basic,  supplemental,  marginal  and  emergency
reserves  under any  regulations  of the Board or other  Governmental  Authority
having  jurisdiction  with respect  thereto)  dealing with reserve  requirements
prescribed  on  eurocurrency  funding  (currently  referred to as  "Eurocurrency
liabilities" in Regulation D) maintained by a member bank of the Federal Reserve
System.

      "Eurodollar  Holder  Advance" shall mean a Holder Advance bearing a Holder
Yield based on the Eurodollar Rate.

      "Eurodollar  Loans"  shall mean Loans the rate of interest  applicable  to
which is based upon the Eurodollar Rate.

      "Eurodollar  Rate"  shall  mean,  as  applied  to any  Eurodollar  Loan or
Eurodollar  Holder  Advance,  the rate which  appears on  Telerate  Page 3750 at
approximately 9:00 a.m.  (Philadelphia  time) two (2) London Business Days prior
to commencement of such Interest Period for the offering to leading banks in the
London Interbank Market of deposits in United States dollars  (Eurodollars)  or,
if such rate does not appear on the Telerate  Page 3750,  the rate which appears
(or, if two (2) or more such rates appear, the average rounded up to the nearest
1/16 of 1 % of the rates  which  appear) on the  Reuters  Screen LIBO Page as of
9:00  a.m.  Philadelphia  time  two  (2)  London  Business  Days  prior  to  the
commencement of the Interest Period, in either case for an amount  substantially
equal to such  Eurodollar  Loan or  Eurodollar  Holder  Advance  as to which the
Borrower may elect the Adjusted Eurodollar Rate to be applicable with a maturity
of comparable  duration to the Interest Period selected by the Borrower for such
Eurodollar Loan or Eurodollar Holder Advance, as may be adjusted from time to in
accordance with the applicable  provisions of the Operative Agreements including
without limitation Section 11.3 of the Participation Agreement.

      "Event  of  Default"  shall  mean a Lease  Event  of  Default,  an  Agency
Agreement Event of Default or a Credit Agreement Event of Default.

      "Excepted Payments" shall mean:

           (a) all indemnity payments  (including  without limitation  indemnity
      payments  made  pursuant  to Section 11 of the  Participation  Agreement),
      whether made by adjustment to Basic Rent or otherwise,  to which the Owner
      Trustee,  any  Holder  or  any of  their  respective  Affiliates,  agents,
      officers, directors or employees is entitled;

           (b) any amounts (other than Basic Rent or Termination  Value) payable
      under any Operative  Agreement to reimburse the Owner Trustee,  any Holder
      or any of their respective  Affiliates  (including  without limitation the
      reasonable  expenses  of the  Owner  Trustee,  the Trust  Company  and the
      Holders  incurred in connection  with any such payment) for  performing or
      complying  with any of the  obligations  of any Credit  Party under and as
      permitted by any Operative Agreement;

           (c) any amount payable to a Holder by any transferee of such interest
      of a Holder as the purchase  price of such Holder's  interest in the Trust
      Estate (or a portion thereof);

           (d) any  insurance  proceeds  (or  payments  with  respect  to  risks
      self-insured or policy  deductibles)  under liability  policies other than
      such proceeds or payments payable to the Agent or any Lender;

           (e) any insurance  proceeds  under  policies  maintained by the Owner
      Trustee or any Holder;

           (f) Transaction  Expenses or other amounts,  fees,  disbursements  or
      expenses paid or payable to or for the benefit of the Owner Trustee or any
      Holder;

           (g) all right,  title and interest of any Holder or the Owner Trustee
      to any Property or any portion thereof or any other property to the extent
      any of the  foregoing  has been  released  from the Liens of the  Security
      Documents and the Lease pursuant to the terms thereof;

           (h) upon  termination of the Credit  Agreement  pursuant to the terms
      thereof,   all  remaining  property  covered  by  the  Lease  or  Security
      Documents;

           (i)  all payments in respect of the Holder Yield;

           (j) any payments in respect of interest to the extent attributable to
      payments referred to in clauses (a) through (i) above; and

           (k) any  rights of either the Owner  Trustee or the Trust  Company to
      demand,  collect,  sue for or otherwise receive and enforce payment of any
      of the foregoing amounts,  provided that such rights shall not include the
      right to terminate the Lease.

      "Excess  Proceeds" shall mean the excess,  if any, of the aggregate of all
awards, compensation or insurance proceeds payable in connection with a Casualty
or Condemnation  over the  Termination  Value paid by the Lessee pursuant to the
Lease with respect to such Casualty or Condemnation.

      "Exculpated  Persons" shall mean the Trust Company (except with respect to
the  representations  and  warranties  and the  other  obligations  of the Trust
Company  pursuant  to  the  Operative  Agreements  expressly  undertaken  in its
individual  capacity,  including  without  limitation  the  representations  and
warranties  of the Trust  Company  pursuant to Section 6.1 of the  Participation
Agreement,  the obligations of the Trust Company  pursuant to Section 8.2 of the
Participation Agreement and the obligations of the Trust Company pursuant to the
Trust  Agreement),  the Holders  (except with respect to the  obligations of the
Holders  pursuant  to  the  Participation  Agreement  and  the  Trust  Agreement
expressly undertaken in their respective individual capacities), their officers,
directors, shareholders and partners.

      "Exempt  Payments" shall have the meaning  specified in Section 11.2(e) of
the Participation Agreement.

      "Expiration  Date" shall mean either (a) the Basic Term Expiration Date or
(b) the last day of the applicable Renewal Term; provided, in no event shall the
Expiration Date be later than the annual anniversary of the Initial Closing Date
occurring in the year 2003,  unless such later date has been expressly agreed to
in writing by each of the  Lessor,  the Lessee,  the Agent,  the Lenders and the
Holders.

      "Fair Market Sales Value" shall mean,  with respect to any  Property,  the
amount  (determined in accordance  with the Appraisal  Procedure),  which in any
event,  shall  not be less  than  zero  (0),  that  would  be paid in cash in an
arms-length  transaction  between  an  informed  and  willing  purchaser  and an
informed and willing seller, neither of whom is under any compulsion to purchase
or sell,  respectively,  such Property.  Fair Market Sales Value of any Property
shall be determined based on the assumption that, except for purposes of Section
17 of the Lease,  such Property is in the condition and state of repair required
under Section 10.1 of the Lease and each Credit Party is in compliance  with the
other requirements of the Operative Agreements.

      "Federal Funds  Effective  Rate" shall have the meaning given to such term
in the definition of ABR.

      "Financing Parties" shall mean the Lessor, the Owner Trustee, in its trust
capacity, the Agent, the Syndication Agent, the Holders and the Lenders.

      "Fixtures" shall mean all fixtures relating to the Improvements, including
without  limitation all components  thereof,  located in or on the Improvements,
together  with  all  replacements,   modifications,  alterations  and  additions
thereto.

      "Force  Majeure  Event"  shall mean any event  beyond  the  control of the
Construction  Agent,  other than a Casualty or Condemnation,  including  without
limitation  strikes,  lockouts,  adverse soil  conditions,  acts of God, adverse
weather  conditions,  inability  to  obtain  labor  or  materials,  governmental
activities,  civil commotion and enemy action; but excluding any event, cause or
condition that results from the Construction Agent's financial condition.

      "Form  1001" shall have the meaning  specified  in Section  11.2(e) of the
Participation Agreement.

      "Form  4224" shall have the meaning  specified  in Section  11.2(e) of the
Participation Agreement.

      "Funded  Debt"  shall  mean,  as of any  date of  determination,  the sum,
without  duplication,  of (a) the aggregate  amount  available to be drawn under
Letters of Credit and the aggregate  amount of unreimbursed  draws under Letters
of Credit;  plus (b) the aggregate  principal amount of all Indebtedness for (i)
borrowed money other than trade indebtedness incurred in the normal and ordinary
course of business for value  received,  (ii)  installment  purchases of real or
personal property,  (iii) Capitalized Leases, and (iv) guaranties of Funded Debt
of others; and plus (c) the aggregate  outstanding balance of all Advances under
the Operative Agreements.

      "GAAP" shall mean generally  accepted  accounting  principles set forth in
the  opinions  and  pronouncements  of the  accounting  principles  board of the
American  Institute  of  Certified  Public   Accountants,   and  statements  and
pronouncements  of the  Financial  Accounting  Standards  Board or in such other
statements by such other entity as may be approved by a  significant  segment of
the accounting  profession,  that are applicable to the  circumstances as of the
date of determination.

      "Governmental   Action"   shall   mean   all   permits,    authorizations,
registrations,  consents,  approvals,  waivers,  exceptions,  variances, orders,
judgments, written interpretations, decrees, licenses, exemptions, publications,
filings,   notices  to  and  declarations  of  or  with,  or  required  by,  any
Governmental Authority, or required by any Legal Requirement, and shall include,
without  limitation,  all  environmental and operating permits and licenses that
are required for the full use,  occupancy,  zoning and operating of the Property
substantially  in accordance  with the actual and intended uses by the Lessee or
any other  Person  using any  applicable  Property,  or portion  thereof,  by or
through the Lessee.

      "Governmental Authority" shall mean any nation or government, any state or
other  political  subdivision  thereof  and  any  entity  exercising  executive,
legislative,  judicial,  regulatory or administrative functions of or pertaining
to government.

      "Ground   Lease"  shall  mean  a  ground  lease  (in  form  and  substance
satisfactory to the Agent) respecting any Property (a) owned by any Credit Party
(or a parent  corporation  or any  Subsidiary of any Credit Party) and leased to
the  Lessor  where  such  lease  has at least a  ninety-nine  (99) year term and
payments set at no more than $1.00 per year,  or (b) where such lease is subject
to such other terms and conditions as are satisfactory to the Agent.

      "Guarantors" shall mean the various parties to the Participation Agreement
from time to time, as guarantors of the  Construction  Agent and the Lessee with
respect to the Operative Agreements and the Properties.

      "Hard  Costs"  shall mean all costs and  expenses  payable  for  supplies,
materials,  labor  and  profit  with  respect  to  the  Improvements  under  any
Construction Contract.

      "Hazardous  Substance" shall mean any of the following:  (a) any petroleum
or petroleum product, explosives, radioactive materials, asbestos, formaldehyde,
polychlorinated  biphenyls,  lead and radon gas;  (b) any  substance,  material,
product, derivative, compound or mixture, mineral, chemical, waste, gas, medical
waste, or pollutant,  in each case whether naturally occurring,  man-made or the
by-product  of  any  process,  that  is  toxic,  harmful  or  hazardous  to  the
environment  or human  health or safety as  determined  in  accordance  with any
Environmental Law; or (c) any substance, material, product, derivative, compound
or mixture, mineral, chemical, waste, gas, medical waste or pollutant that would
support the assertion of any claim under any  Environmental  Law, whether or not
defined as hazardous as such under any Environmental Law.

      "HCFA"  shall mean the Health Care  Financing  Administration
of the United States  Department  of Health and Human  Services and
any successor thereto.

      "Health Care Facility" shall mean any Nursing Home,  Permitted Hospital or
other  property or facility which any Credit Party or Subsidiary  owns,  leases,
operates or manages on or after the date hereof.

      "Holder  Advance"  shall mean any advance  made by any Holder to the Owner
Trustee  pursuant  to the  terms of the  Trust  Agreement  or the  Participation
Agreement.

      "Holder Amount" shall mean as of any date, the aggregate  amount of Holder
Advances  made by each Holder to the Trust  Estate  pursuant to Section 2 of the
Participation Agreement and Section 3.1 of the Trust Agreement less any payments
of any Holder  Advances  received by the Holders  pursuant to Section 3.4 of the
Trust Agreement.

      "Holder  Commitments"  shall  mean  $1,200,000.00,  as such  amount may be
increased or reduced from time to time in accordance  with the provisions of the
Operative Agreements;  provided, if there shall be more than one (1) Holder, the
Holder  Commitment  of each  Holder  shall be as set forth in  Schedule I to the
Trust Agreement as such amounts may be increased or reduced from time to time in
accordance with the provisions of the Operative Agreements.

      "Holder  Construction  Property  Cost"  shall mean,  with  respect to each
Construction Period Property,  at any date of determination,  an amount equal to
the  outstanding  Holder  Advances  made with  respect  thereto  under the Trust
Agreement.

      "Holder  Overdue  Rate" shall mean the lesser of (a) the then current rate
of Holder Yield  respecting the  particular  amount in question plus two percent
(2%) and (b) the highest rate permitted by applicable law.

      "Holder  Property  Cost"  shall mean with  respect to a Property an amount
equal to the outstanding Holder Advances with respect thereto.

      "Holder  Unused Fee" shall have the meaning  given to such term in Section
7.4 of the Participation Agreement.

      "Holder  Yield"  shall mean with respect to Holder  Advances  from time to
time either the Eurodollar  Rate plus the Applicable  Percentage or the ABR plus
the Applicable Percentage as elected by the Owner Trustee from time to time with
respect  to such  Holder  Advances  in  accordance  with the  terms of the Trust
Agreement;  provided,  however,  (a) upon  delivery of the notice  described  in
Section 3.7(c) of the Trust Agreement,  the outstanding  Holder Advances of each
Holder shall bear a yield at the ABR plus the Applicable  Percentage  applicable
from time to time from and after the dates and during the periods  specified  in
Section 3.7(c) of the Trust Agreement,  and (b) upon the delivery by a Holder of
the notice  described in Section  11.3(f) of the  Participation  Agreement,  the
Holder Advances of such Holder shall bear a yield at the ABR plus the Applicable
Percentage  applicable  from time to time after the dates and during the periods
specified in Section 11.3(f) of the Participation Agreement.

      "Holders"  shall mean the banks and  financial  institutions  which may be
from time to time holders of Certificates in connection with the Centennial Real
Estate Trust 1998-1.

      "Impositions" shall mean any and all liabilities, losses, expenses, costs,
charges  and Liens of any kind  whatsoever  for fees,  taxes,  levies,  imposts,
duties, charges, assessments or withholdings ("Taxes") including but not limited
to (i) real and personal property taxes,  including without limitation  personal
property  taxes on any  property  covered  by the Lease  that is  classified  by
Governmental  Authorities  as personal  property,  and real estate or ad valorem
taxes in the nature of property  taxes;  (ii) sales  taxes,  use taxes and other
similar taxes (including rent taxes and intangibles taxes);  (iii) excise taxes;
(iv) real estate transfer taxes,  conveyance taxes,  stamp taxes and documentary
recording  taxes and fees; (v) taxes that are or are in the nature of franchise,
income,   value  added,   privilege  and  doing  business  taxes,   license  and
registration   fees;  (vi)  assessments  on  any  Property,   including  without
limitation all assessments for public  Improvements or benefits,  whether or not
such  improvements  are commenced or completed within the Term; and (vii) taxes,
Liens,  assessments or charges asserted,  imposed or assessed by the PBGC or any
governmental  authority  succeeding to or performing  functions  similar to, the
PBGC;  and in each case all interest,  additions to tax and  penalties  thereon,
which at any time prior to,  during or with respect to the Term or in respect of
any period for which the Lessee shall be obligated to pay Supplemental Rent, may
be  levied,  assessed  or  imposed by any  Governmental  Authority  upon or with
respect to (a) any  Property or any part  thereof or interest  therein;  (b) the
leasing,  financing,  refinancing,   demolition,   construction,   substitution,
subleasing,  assignment, control, condition, occupancy, servicing,  maintenance,
repair, ownership,  possession,  activity conducted on, delivery, insuring, use,
operation,  improvement, sale, transfer of title, return or other disposition of
such  Property or any part  thereof or interest  therein;  (c) the Notes,  other
indebtedness  with respect to any  Property,  or the  Certificates,  or any part
thereof or interest therein; (d) the rentals,  receipts or earnings arising from
any  Property  or any  part  thereof  or  interest  therein;  (e) the  Operative
Agreements,  the performance  thereof,  or any payment made or accrued  pursuant
thereto;  (f) the income or other proceeds received with respect to any Property
or any part thereof or interest  therein upon the sale or  disposition  thereof;
(g) any contract  (including the Agency Agreement) relating to the construction,
acquisition  or delivery  of the  Improvements  or any part  thereof or interest
therein;  (h) the  issuance  of the  Notes or the  Certificates;  (i) the  Owner
Trustee,  the Trust or the Trust Estate; or (j) otherwise in connection with the
transactions contemplated by the Operative Agreements.

      "Improvements"  shall mean, with respect to the construction,  renovations
and/or Modifications on any Land, all buildings, structures, Fixtures, and other
improvements  of every  kind  existing  at any time and from  time to time on or
under the Land  purchased or otherwise  acquired using the proceeds of the Loans
or the Holder Advances or which is subject to a Ground Lease,  together with any
and all appurtenances to such buildings,  structures or improvements,  including
without limitation  sidewalks,  utility pipes, conduits and lines, parking areas
and roadways,  and including  without  limitation  all  Modifications  and other
additions  to or  changes in the  Improvements  at any time,  including  without
limitation (a) any Improvements existing as of the Property Closing Date as such
Improvements  may be  referenced  on the  applicable  Requisition  and  (b)  any
Improvements made subsequent to such Property Closing Date.

      "Incorporated  Covenants"  shall  have the  meaning  given to such term in
Section 28.1 of the Lease.

      "Incorporated Representations and Warranties" shall have the meaning given
to such term in Section 28.1 of the Lease.

      "Indebtedness"  shall mean, for any Person, all obligations of such Person
which in  accordance  with GAAP shall be  classified  on a balance sheet of such
Person as  liabilities  of such Person and in any event shall  include,  without
duplication, all (a) obligations of such Person for borrowed money or which have
been  incurred in connection  with the  acquisition  of property or assets;  (b)
obligations  secured by any lien upon  property or assets  owned by such Person,
notwithstanding  that such  Person  has not  assumed  or become  liable  for the
payment of such  obligations;  (c)  obligations  created  or  arising  under any
conditional  sale or other title  retention  agreement  with respect to property
acquired by such Person,  notwithstanding  the fact that the rights and remedies
of the seller, lender or lessor under such agreement in the event of default are
limited  to  repossession  or sale of  property;  (d)  Capitalized  Leases;  (e)
guarantees;  and (f)  letters  of credit  and  letter  of  credit  reimbursement
obligations.

      "Indemnified  Person"  shall mean the Lessor,  the Owner  Trustee,  in its
individual and its trust capacity,  the Trust, the Trust Company, the Agent, the
Holders,  the Lenders,  the Syndication  Agent and their respective  successors,
assigns,  directors,  shareholders,  partners,  officers,  employees, agents and
Affiliates.

      "Indemnity  Provider"  shall mean,  respecting each Property,
the Lessee.

      "Initial Closing Date" shall mean July 31, 1998.

      "Initial  Construction Advance" shall mean any initial Advance to pay for:
(a) Property Costs for  construction of any  Improvements;  and (b) the Property
Costs of restoring or repairing any Property which is required to be restored or
repaired in accordance with Section 15.1(e) of the Lease.

      "Instruments"  shall have the  meaning  given to such term in Section 1 of
the Security Agreement.

      "Insurance  Requirements"  shall  mean all  terms  and  conditions  of any
insurance  policy either required by the Lease to be maintained by the Lessee or
required by the Agency Agreement to be maintained by the Construction Agent, and
all requirements of the issuer of any such policy and, regarding self insurance,
any other requirements of the Lessee.

      "Interest  Period"  shall mean,  as to any  Eurodollar  Loan or Eurodollar
Holder  Advance  a period  of one (1),  two (2),  three  (3) or six (6)  months'
duration,  as the Owner Trustee may elect,  during which the Adjusted Eurodollar
Rate is applicable;  provided,  however,  that (a) if any Interest  Period would
otherwise  end on a day which shall not be a London  Business Day, such Interest
Period  shall be  extended  to the next  succeeding  Business  Day,  unless such
Business Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding  Business Day,  subject to clause (c) below, (b)
interest  shall accrue from and including the first day of each Interest  Period
to but excluding the day on which any Interest Period expires,  (c) with respect
to an Interest  Period which begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period),  the Interest Period shall end on the
last  Business  Day of a calendar  month,  (d) no Interest  Period  shall extent
beyond the Maturity Date or the  Expiration  Date, as the case may be, (e) there
shall not be more  than four (4)  Interest  Periods  outstanding  at any one (1)
time,  and (f)  respecting  each  Interest  Period  which is six (6)  months  in
duration,  interest  and/or Holder Yield on the applicable  obligation  shall be
payable three (3) months after the  commencement of such Interest Period and six
(6) months after the commencement of such Interest Period.

      "Investment Company Act" shall mean the Investment Company Act of 1940, as
amended, together with the rules and regulations promulgated thereunder.

      "Joinder Agreement" shall mean a joinder agreement, in the form of Exhibit
J to the Participation Agreement,  executed from time to time between a Domestic
Subsidiary and the Agent.

      "Knowledge"  shall mean the actual  knowledge of any senior officer of any
Credit Party,  or knowledge  which any senior  officers should have possessed in
the ordinary  course of managing the business and affairs of any Credit Party in
a manner  consistent with the standards of a reasonably  prudent business person
in the long-term care industry.

      "Land"  shall  mean a  parcel  of  real  property  described  on  (a)  the
Requisition  issued  by the  Construction  Agent on the  Property  Closing  Date
relating  to such  parcel  and  (b)  the  schedules  to  each  applicable  Lease
Supplement executed and delivered in accordance with the requirements of Section
2.4 of the Lease.

      "Law" shall mean any statute, law, ordinance, regulation, rule, directive,
order, writ, injunction or decree of any Tribunal.

      "Lease" or "Lease  Agreement"  shall mean the Lease  Agreement dated on or
about the Initial Closing Date, between the Lessor and the Lessee, together with
any Lease Supplements thereto.

      "Lease Default" shall mean any event or condition which, with the lapse of
time or the  giving  of  notice,  or both,  would  constitute  a Lease  Event of
Default.

      "Lease Event of Default" shall have the meaning  specified in Section 17.1
of the Lease.

      "Lease  Supplement" shall mean each Lease Supplement  substantially in the
form of Exhibit A to the Lease,  together  with all  attachments  and  schedules
thereto.

      "Legal  Requirements"  shall mean all  foreign,  federal,  state,  county,
municipal and other governmental  statutes,  laws, rules,  orders,  regulations,
ordinances,  judgments, decrees and injunctions affecting the Owner Trustee, any
Holder,  the Lessor,  any Credit Party,  the Agent,  any Lender or any Property,
Land, Improvement,  Equipment or the taxation, demolition,  construction, use or
alteration of such Improvements,  whether now or hereafter enacted and in force,
including  without  limitation  any  that  require  repairs,   modifications  or
alterations  in or to any  Property  or in any way limit  the use and  enjoyment
thereof (including  without  limitation all building,  zoning and fire codes and
the Americans with  Disabilities  Act of 1990, 42 U.S.C. ss. 12101 et. seq., and
any other similar federal, state or local laws or ordinances and the regulations
promulgated  thereunder) and any that may relate to  environmental  requirements
(including  without  limitation  all  Environmental   Laws),  and  all  permits,
certificates of occupancy,  licenses,  authorizations  and regulations  relating
thereto, and all covenants, agreements,  restrictions and encumbrances contained
in any  instruments  which are  either of  record or known to any  Credit  Party
affecting any Property or the Appurtenant Rights.

      "Lender  Commitments"  shall mean  $38,800,000.00,  as such  amount may be
increased or reduced from time to time in accordance  with the provisions of the
Operative Agreements;  provided, if there shall be more than one (1) Lender, the
Lender  Commitment  of each Lender  shall be as set forth in Schedule 1.1 to the
Credit  Agreement  as such amounts may be increased or reduced from time to time
in accordance with the provisions of the Operative Agreements.

      "Lender  Financing  Statements"  shall mean UCC financing  statements  and
fixture  filings  appropriately   completed  and  executed  for  filing  in  the
applicable  jurisdiction in order to procure a security interest in favor of the
Agent in the Collateral subject to the Security Documents.

      "Lender  Unused Fee" shall have the meaning  given to such term in Section
7.4 of the Participation Agreement.

      "Lenders"  shall mean the banks and  financial  institutions  which may be
from time to time party to the Participation Agreement and the Credit Agreement.

      "Lessee" shall have the meaning set forth in the Lease.

      "Lessee  Credit  Agreement"  shall mean that  certain  Third  Amended  and
Restated  Credit  Agreement  dated as of or about the Initial Closing Date among
the Lessee,  the lenders  referenced  therein,  First Union  National  Bank,  as
administrative  agent, and NationsBank,  N.A. as syndication  agent, as such may
hereafter be amended, modified, supplemented, restated and/or replaced from time
to time.

      "Lessee Credit Agreement  Commitment  Amount" shall mean the Commitment as
defined in the Lessee Credit Agreement.

      "Lessee Credit  Agreement Event of Default" shall mean an Event of Default
as defined in Section 8.1 of the Lessee Credit Agreement.

      "Lessor" shall mean the Owner Trustee, not in its individual capacity, but
as the Lessor under the Lease.

      "Lessor  Basic  Rent"  shall mean the  scheduled  Holder  Yield due on the
Holder  Advances on any  Scheduled  Interest  Payment Date pursuant to the Trust
Agreement (but not including interest on (a) any such scheduled Holder Yield due
on the Holder Advances prior to the Rent  Commencement  Date with respect to the
Property to which such Holder  Advances  relate or (b) overdue amounts under the
Trust Agreement or otherwise).

      "Lessor  Financing  Statements"  shall mean UCC financing  statements  and
fixture  filings  appropriately   completed  and  executed  for  filing  in  the
applicable  jurisdictions  in order to protect the Lessor's  interest  under the
Lease to the extent the Lease is a security agreement or a mortgage.

      "Lessor Lien" shall mean any Lien,  true lease or sublease or  disposition
of title  arising as a result of (a) any claim  against  the Lessor or the Trust
Company,  in its  individual  capacity,  not  resulting  from  the  transactions
contemplated by the Operative Agreements,  (b) any act or omission of the Lessor
or the Trust Company, in its individual  capacity,  which is not required by the
Operative  Agreements  or is in violation  of any of the terms of the  Operative
Agreements,  (c) any claim  against  the  Lessor or the  Trust  Company,  in its
individual capacity, with respect to Taxes or Transaction Expenses against which
the Lessee is not required to indemnify the Lessor or the Trust Company,  in its
individual  capacity,  pursuant to Section 11 of the Participation  Agreement or
(d) any claim  against the Lessor  arising out of any  transfer by the Lessor of
all or any portion of the  interest of the Lessor in the  Properties,  the Trust
Estate  or the  Operative  Agreements  other  than the  transfer  of title to or
possession of any  Properties by the Lessor  pursuant to and in accordance  with
the Lease, the Credit  Agreement,  the Security  Agreement or the  Participation
Agreement  or pursuant to the exercise of the remedies set forth in Article XVII
of the Lease.

      "Letter of Credit" shall have the meaning given to such term in the Lessee
Credit Agreement.

      "Licenses"  shall mean all licenses,  permits or other grants of authority
obtained or required to be obtained by any Credit  Party from the United  States
government,  HCFA or any Local  Authority in  connection  with the  ownership or
operation of any Health Care Facility or other business of any Credit Party.

      "Lien" shall mean any mortgage,  pledge,  security interest,  encumbrance,
lien, option or charge of any kind.

      "Limited Recourse Amount" shall mean with respect to all the Properties on
an aggregate  basis, an amount equal to the sum of the  Termination  Values with
respect to all the Properties on an aggregate  basis on each Payment Date,  less
the Maximum  Residual  Guarantee  Amount as of such date with respect to all the
Properties on an aggregate basis.

      "Loan Basic Rent" shall mean the  scheduled  interest  due on the Loans on
any Scheduled  Interest  Payment Date pursuant to the Credit  Agreement (but not
including  interest on (a) any such Loan due prior to the Rent Commencement Date
with  respect  to the  Property  to which such Loan  relates or (b) any  overdue
amounts under Section 2.8(c) of the Credit Agreement or otherwise).

      "Loan Property Cost" shall mean, with respect to each Property at any date
of  determination,  an amount equal to (a) the  aggregate  principal  amount all
Loans  (including  without  limitation all  Acquisition  Loans and  Construction
Loans) made on or prior to such date with respect to such Property minus (b) the
aggregate  amount of  prepayments  or repayments as the case may be of the Loans
allocated to reduce the Loan Property Cost of such Property  pursuant to Section
2.6(c) of the Credit Agreement.

      "Loans" shall mean the loans extended pursuant to the Credit Agreement and
shall include both the Tranche A Loans and the Tranche B Loans.

      "Local Authorities" shall mean individually and collectively all state and
local  governmental   authorities  and  administrative  agencies  which  possess
statutory or regulatory  authority over the ownership or operation of any Health
Care Facility or other business of any Credit Party.

      "Majority  Holders" shall mean at any time,  Holders whose Holder Advances
outstanding  represent more than fifty percent (50%) of (a) the aggregate Holder
Advances  outstanding  or  (b) to  the  extent  there  are  no  Holder  Advances
outstanding, the aggregate Holder Commitments.

      "Majority Lenders" shall mean at any time, Lenders whose Loans outstanding
represent more than fifty percent (50%) of (a) the aggregate  Loans  outstanding
or (b) to the extent there are no Loans outstanding, the aggregate of the Lender
Commitments.

      "Majority  Secured  Parties"  shall mean at any time,  Lenders and Holders
whose Loans and Holder  Advances  outstanding  represent more than fifty percent
(50%) of (a) the aggregate  Advances  outstanding or (b) to the extent there are
no Advances  outstanding,  the sum of the aggregate Holder  Commitments plus the
aggregate Lender Commitments.

      "Margin  Certificate" shall have the meaning given to such term in Section
8.3(l) of the Participation Agreement.

      "Marketing  Period"  shall mean,  if the Lessee has given a Sale Notice in
accordance  with Section 20.1 of the Lease,  the period  commencing  on the date
such Sale Notice is given and ending on the Expiration Date.

      "Material Adverse Effect" shall, mean a material adverse effect on (a) the
business,  financial  condition,  assets,  or  prospects  of the  Lessee and its
Subsidiaries taken as a whole as a result of any event, condition,  circumstance
or contingency, (b) the validity or enforceability of any Operative Agreement or
the rights and remedies of the Agent,  the Lenders,  the Holders,  or the Lessor
thereunder,  (c) the  validity,  priority or  enforceability  of any Lien on any
Property created by any of the Operative  Agreements,  or (d) the value, utility
or useful life of any  Property or the use, or ability of the Lessee to use, any
Property for the purpose for which it was intended.

      "Maturity Date" shall mean the Expiration Date.

      "Maximum  Residual  Guarantee  Amount"  shall mean an amount  equal to the
product of the aggregate  Property Cost for all of Properties times eighty-eight
percent (88%).

      "Minimum  Appraisal  Level"  shall have the meaning  given to such term in
Section 8.3(e) of the Participation Agreement.

      "Modifications"  shall have the meaning  specified in Section
11.1(a) of the Lease.

      "Mortgage Instrument" shall mean any mortgage,  deed of trust or any other
instrument  executed  by the Owner  Trustee  and the  Lessee (or  regarding  any
Property subject to a Ground Lease,  the applicable  Affiliate of the Lessee) in
favor  of the  Agent  (for the  benefit  of the  Lenders  and the  Holders)  and
evidencing a Lien on the Property,  in form and substance reasonably  acceptable
to the Agent.

      "Net Income" shall mean,  for any period,  the net income (or loss) of the
Lessee and its  Consolidated  Subsidiaries  for such period,  as  determined  in
accordance with GAAP.

      "New  Facility"  shall have the meaning given to such term in Section 28.1
of the Lease.

      "1934 Act" shall have the meaning given to such term in Section 17.1(n) of
the Lease.

      "Non-Integral  Equipment"  shall  mean  Equipment  which  (a) is  personal
property  that is  readily  removable  without  causing  material  damage to the
applicable  Property  and  (b) is not  integral  or  necessary,  respecting  the
applicable  Property,  for compliance with Section 8.3 of the Lease or otherwise
to the structure  thereof,  the  mechanical  operation  thereof,  the electrical
systems  thereof or otherwise  with respect to any aspect of the physical  plant
thereof.

      "Notes"  shall mean those  notes  issued to the  Lenders  pursuant  to the
Credit  Agreement  and shall  include both the Tranche A Notes and the Tranche B
Notes.

      "Nursing  Home" shall mean  individually  and  "Nursing  Homes" shall mean
individually  and  collectively  the nursing  homes owned,  leased,  operated or
managed by any Credit Party on or after the date hereof.

      "Obligations"  shall have the  meaning  given to such term in Section 1 of
the Security Agreement.

      "Officer's   Certificate"   with  respect  to  any  person  shall  mean  a
certificate  executed on behalf of such person by a Responsible  Officer who has
made or caused to be made such  examination or  investigation as is necessary to
enable such  Responsible  Officer to express an informed opinion with respect to
the subject matter of such Officer's Certificate.

      "Officer's  Compliance  Certificate"  shall have the meaning given to such
term in Section 8.3(l) of the Participation Agreement.

      "Operative  Agreements"  shall  mean  the  following:   the  Participation
Agreement,  the Agency Agreement,  the Trust Agreement,  the  Certificates,  the
Credit Agreement,  the Notes, the Lease, the Lease Supplements (and memoranda of
the Lease and each  Lease  Supplement  in a form  reasonably  acceptable  to the
Agent),  the  Joinder   Agreements,   the  Security   Agreement,   the  Mortgage
Instruments,  the other Security Documents, the Ground Leases, the Deeds and the
Bills  of Sale  and any and all  other  agreements,  documents  and  instruments
executed in connection with any of the foregoing.

      "Original Executed  Counterpart" shall have the meaning given to such term
in Section 5 of Exhibit A to the Lease.

      "Overdue  Interest"  shall mean any interest  payable  pursuant to Section
2.8(b) of the Credit Agreement.

      "Overdue Rate" shall mean (a) with respect to the Loan Basic Rent, and any
other amount owed under or with respect to the Credit  Agreement or the Security
Documents,  the rate  specified in Section 2.8(b) of the Credit  Agreement,  (b)
with  respect to the Lessor  Basic Rent,  the Holder  Yield and any other amount
owed under or with respect to the Trust Agreement,  the Holder Overdue Rate, and
(c) with respect to any other  amount,  the amount  referred to in clause (y) of
Section 2.8(b) of the Credit Agreement.

      "Owner  Trustee,"  "Borrower" or "Lessor"  shall mean First Security Bank,
National  Association,  not  individually,  except  as  expressly  stated in the
various  Operative  Agreements,  but  solely  as the  Owner  Trustee  under  the
Centennial  Real Estate Trust  1998-1,  and any  successor,  replacement  and/or
additional Owner Trustee expressly permitted under the Operative Agreements.

      "Participant"  shall have the meaning given to such term in Section 9.7 of
the Credit Agreement.

      "Participation  Agreement" shall mean the Participation Agreement dated on
or about the Initial Closing Date, among the Lessee,  the Guarantors,  the Owner
Trustee,  not in its individual capacity except as expressly stated therein, the
Holders, the Lenders and the Agent.

      "Payment Date" shall mean any Scheduled Interest Payment Date and any date
on which  interest or Holder Yield in connection  with a prepayment of principal
on the Loans or of the Holder Advances is due under the Credit  Agreement or the
Trust Agreement.

      "PBGC"  shall mean the Pension  Benefit  Guaranty  Corporation  created by
Section 4002(a) of ERISA or any successor thereto.

      "Permitted  Acquisition" shall mean any acquisition by any Credit Party of
a business,  by merger or by purchase of stock or assets, if: (a) such business,
when  acquired,  would be within the Permitted  Lines of Business;  and (b) such
transaction  otherwise is in compliance  with Paragraph 6.8 of the Lessee Credit
Agreement (as such provision is  incorporated  by reference  pursuant to Section
28.1 of the Lease Agreement).

      "Permitted  Facility"  shall mean a health  care  facility of the type and
size  customarily  used and  operated  by the Lessee in its  ordinary  course of
business as of the Initial Closing Date.

      "Permitted  Hospital"  shall mean a health  care  facility  licensed  as a
hospital  which (a) is located  in a market in which any Credit  Party has other
operations within a Permitted Line of Business, (b) has no more than one hundred
twenty-five  (125)  licensed  hospital  beds and (c) engages in the provision of
health care services at any acuity level  comparable to other  operations of any
Credit Party as of the Initial Closing Date.

      "Permitted Liens" shall mean:

           (a)  the respective rights and interests of the parties
      to the Operative Agreements as provided in the Operative
      Agreements;

           (b) the rights of any  sublessee  or assignee  under a sublease or an
      assignment  expressly  permitted by the terms of the Operative  Agreements
      for no longer than the duration of the Lease;

           (c)  Liens  for  Taxes  that  either  are not  yet  due or are  being
      contested in accordance with the provisions of Section 13.1 of the Lease;

           (d) Liens  arising by  operation of law,  materialmen's,  mechanics',
      workmen's, repairmen's,  employees',  carriers',  warehousemen's and other
      like  Liens  relating  to  the  construction  of  the  Improvements  or in
      connection  with any  Modifications  or arising in the ordinary  course of
      business  for amounts  that either are not more than thirty (30) days past
      due or are  being  diligently  contested  in  good  faith  by  appropriate
      proceedings,  so long as such  proceedings  satisfy the conditions for the
      continuation  of proceedings to contest Taxes set forth in Section 13.1 of
      the Lease;

           (e) Liens of any of the types  referred  to in clause  (d) above that
      have been  bonded for not less than the full  amount in dispute  (or as to
      which other security arrangements satisfactory to the Lessor and the Agent
      have been  made),  which  bonding  (or  arrangements)  shall  comply  with
      applicable  Legal  Requirements,  and shall  have  effectively  stayed any
      execution or enforcement of such Liens;

           (f) Liens  arising out of  judgments  or awards with respect to which
      appeals or other proceedings for review are being prosecuted in good faith
      and for the  payment of which  adequate  reserves  have been  provided  as
      required by GAAP or other  appropriate  provisions have been made, so long
      as such  proceedings  have the effect of  staying  the  execution  of such
      judgments or awards and satisfy the  conditions  for the  continuation  of
      proceedings to contest Taxes set forth in Section 13.1 of the Lease;

           (g) Liens in favor of  municipalities  to the extent agreed to by the
      Lessor; and

           (h) easements, rights of way, reservations,  servitudes and rights of
      others against Property to the extent agreed to by the Lessor.

      "Permitted  Lines of Business"  shall mean the  provision of nursing care,
home health, speech therapy,  occupational therapy, pharmacy,  respiratory, pain
and intravenous  therapy,  enterals and urological  therapy or physical  therapy
services and products and all other ancillary  services related to the operation
of a Nursing Home or Permitted  Hospital  (subject to the restrictions set forth
in the  definition  thereof),  and the  ownership,  management,  or operation of
facilities related thereto.

      "Person"  shall mean any  individual,  corporation,  partnership,  limited
liability  company,  joint venture,  association,  joint stock  company,  trust,
unincorporated organization, governmental authority or any other entity.

      "Plans and Specifications"  shall mean, with respect to Improvements,  the
plans and  specifications  for such  Improvements  to be  constructed or already
existing,  as  such  Plans  and  Specifications  may  be  amended,  modified  or
supplemented  from time to time in  accordance  with the terms of the  Operative
Agreements.

      "Prime  Lending  Rate"  shall have the  meaning  given to such term in the
definition of ABR.

      "Property" shall mean, with respect to each Permitted Facility that is (or
is to be) acquired,  constructed  and/or renovated  pursuant to the terms of the
Operative  Agreements,  the Land  and each  item of  Equipment  and the  various
Improvements,  in each case located on such Land,  including without  limitation
each Construction  Period Property,  each Property subject to a Ground Lease and
each Property for which the Basic Term has commenced.

      "Property  Acquisition Cost" shall mean the cost to the Lessor to purchase
a Property on a Property Closing Date.

      "Property  Closing Date" shall mean the date on which the Lessor purchases
a Property or, with respect to the first  Advance,  the date on which the Lessor
seeks reimbursement for Property previously purchased by the Lessor.

      "Property Cost" shall mean with respect to a Property the aggregate amount
(and/or the various  items and  occurrences  giving rise to such amounts) of the
Loan  Property  Cost plus the Holder  Property  Cost for such  Property (as such
amounts shall be increased  equally among all  Properties  respecting the Holder
Advances  and the Loans  extended  from time to time to pay for the  Transaction
Expenses,  fees, expenses and other disbursements  referenced in Sections 7.1(a)
and 7.1(b) of the Participation Agreement).

      "Purchase  Option"  shall have the  meaning  given to such term in Section
20.1 of the Lease.

      "Purchasing  Lender"  shall have the meaning given to such term in Section
9.8(a) of the Credit Agreement.

      "Register"  shall have the meaning given to such term in Section 9.9(a) of
the Credit Agreement.

      "Regulation  D" shall mean  Regulation  D of the Board of Governors of the
Federal  Reserve  System (or any  successor),  as the same may be  modified  and
supplemented and in effect from time to time.

      "Release" shall mean any release, pumping, pouring,  emptying,  injecting,
escaping, leaching, dumping, seepage, spill, leak, flow, discharge,  disposal or
emission of a Hazardous Substance.

      "Renewal  Term" shall have the meaning  specified  in Section
2.2 of the Lease.

      "Rent" shall mean, collectively, the Basic Rent and the Supplemental Rent,
in each case payable under the Lease.

      "Rent  Commencement  Date"  shall  mean,  regarding  each  Property,   the
Completion Date.

      "Requested  Funds"  shall  mean any funds  requested  by the Lessee or the
Construction  Agent,  as  applicable,  in  accordance  with  Section  5  of  the
Participation Agreement.

      "Requisition"  shall have the  meaning  specified  in Section
4.2 of the Participation Agreement.

      "Responsible  Officer"  shall mean the  Chairman  or Vice  Chairman of the
Board of Directors,  the Chairman or Vice Chairman of the Executive Committee of
the Board of Directors,  the  President,  any Senior Vice President or Executive
Vice President,  any Vice President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer, except that when used with respect to the
Trust Company or the Owner Trustee, "Responsible Officer" shall also include the
Cashier,  any Assistant  Cashier,  any Trust Officer or Assistant Trust Officer,
the  Controller  and any Assistant  Controller or any other officer of the Trust
Company or the Owner Trustee customarily  performing  functions similar to those
performed by any of the above designated  officers and also means,  with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred  because  of his  knowledge  of and  familiarity  with  the  particular
subject.

      "Rolling  Period"  shall  mean a period  of four  consecutive
fiscal quarters.

      "Sale Date" shall have the meaning  given to such term in Section  22.1(a)
of the Lease.

      "Sale Notice"  shall mean a notice given to the Lessor in connection  with
the election by the Lessee of its Sale Option.

      "Sale Option" shall have the meaning given to such term in Section 20.1 of
the Lease.

      "Sale Proceeds Shortfall" shall mean the amount by which the proceeds of a
sale  described in Section 22.1 of the Lease are less than the Limited  Recourse
Amount with respect to the  Properties if it has been  determined  that the Fair
Market Sales Value of the  Properties at the expiration of the term of the Lease
has been  impaired by greater than ordinary wear and tear during the Term of the
Lease.

      "Scheduled Interest Payment Date" shall mean (a) as to any Eurodollar Loan
or Eurodollar Holder Advance,  the last day of the Interest Period applicable to
such Eurodollar Loan or Eurodollar Holder Advance, (b) as to any ABR Loan or any
ABR Holder Advance,  the fifteenth day of each month and (c) as to all Loans and
Holder Advances,  the date of any voluntary or involuntary payment,  prepayment,
return or redemption,  and the Maturity Date or the Expiration Date, as the case
may be.

      "Secured  Parties"  shall  have  the  meaning  given  to such  term in the
Security Agreement.

      "Securities  Act"  shall  mean the  Securities  Act of 1933,  as  amended,
together with the rules and regulations promulgated thereunder.

      "Security  Agreement" shall mean the Security  Agreement dated on or about
the Initial  Closing Date  between the Lessor and the Agent,  for the benefit of
the Secured Parties, and accepted and agreed to by the Lessee.

      "Security  Documents" shall mean the collective  reference to the Security
Agreement, the Mortgage Instruments,  (to the extent the Lease is construed as a
security  instrument)  the  Lease  and all other  security  documents  hereafter
delivered  to the Agent  granting a lien on any asset or assets of any Person to
secure the obligations and liabilities of the Lessor under the Credit  Agreement
and/or under any of the other Credit Documents or to secure any guarantee of any
such obligations and liabilities.

      "Soft  Costs"  shall mean all costs which are  ordinarily  and  reasonably
incurred   in   relation   to  the   acquisition,   development,   installation,
construction,  improvement and testing of the Properties  other than Hard Costs,
including without limitation structuring fees,  administrative fees, legal fees,
upfront fees, fees and expenses related to appraisals, title examinations, title
insurance,  document  recordation,   surveys,  environmental  site  assessments,
geotechnical  soil  investigations  and  similar  costs  and  professional  fees
customarily  associated with a real estate  closing,  the Lender Unused Fee, the
Holder  Unused  Fee,  fees  and  expenses  of  the  Owner  Trustee   payable  or
reimbursable  under the  Operative  Agreements  and costs and expenses  incurred
pursuant to Sections 7.3(a) and 7.3(b) of the Participation Agreement.

      "Subsidiary"  shall mean, as to any Person,  any  corporation  of which at
least a majority of the outstanding  stock having by the terms thereof  ordinary
voting power to elect a majority of the board of  directors of such  corporation
(irrespective  of whether or not at the time stock of any other class or classes
of such  corporation  shall  have or might  have  voting  power by reason of the
happening of any contingency) is at the time owned by such Person, or by one (1)
or more Subsidiaries, or by such Person and one (1) or more Subsidiaries.

      "Substitute Property" shall have the meaning given to such term in Section
5.13 of the Participation Agreement.

      "Supplemental  Amounts"  shall  have the  meaning  given  to such  term in
Section 9.18 of the Credit Agreement.

      "Supplemental  Rent" shall mean all amounts,  liabilities  and obligations
(other than Basic Rent) which the Lessee assumes or agrees to pay to the Lessor,
the Trust Company, the Holders, the Agent, the Lenders or any other Person under
the Lease or under  any of the  other  Operative  Agreements  including  without
limitation  payments of the Termination Value and the Maximum Residual Guarantee
Amount and all indemnification amounts, liabilities and obligations.

      "Syndication  Agent" shall mean First Union Capital  Markets,
a  division   of  Wheat   First   Securities,   Inc.,   a  Virginia
corporation.

      "Taxes"  shall have the meaning  specified in the  definition
of "Impositions".

      "Term"  shall mean the Basic Term and each Renewal  Term,  if
any.

      "Terminated  Property" shall have the meaning specified in Section 5.13 of
the Participation Agreement.

      "Termination  Date"  shall  have  the  meaning  specified  in
Section 16.2(a) of the Lease.

      "Termination  Notice"  shall have the  meaning  specified  in
Section 16.1 of the Lease.

      "Termination  Value"  shall mean the sum of (a) either (i) with respect to
all Properties,  an amount equal to the aggregate  outstanding Property Cost for
all the Properties,  in each case as of the last occurring Payment Date, or (ii)
with respect to a  particular  Property,  an amount  equal to the Property  Cost
allocable to such Property, plus (b) respecting the amounts described in each of
the  foregoing  subclause (i) or (ii),  as  applicable,  any and all accrued but
unpaid interest on the Loans and any and all Holder Yield on the Holder Advances
related to the applicable  Property Cost, plus (c) to the extent the same is not
duplicative  of the amounts  payable under clause (b) above,  all other Rent and
other amounts then due and payable or accrued under the Agency Agreement,  Lease
and/or under any other Operative Agreement (including without limitation amounts
under  Sections 11.1 and 11.2 of the  Participation  Agreement and all costs and
expenses referred to in clause FIRST of Section 22.2 of the Lease).

      "Tranche A Commitments" shall mean the obligation of the Tranche A Lenders
to make the Tranche A Loans to the Lessor in an  aggregate  principal  amount at
any one (1) time  outstanding  not to exceed the  aggregate  of the  amounts set
forth  opposite  each  Tranche A  Lender's  name on  Schedule  1.1 to the Credit
Agreement,  as such amount may be reduced from time to time in  accordance  with
the provisions of the Operative Agreements;  provided, no Tranche A Lender shall
be obligated to make Tranche A Loans in excess of such Tranche A Lender's  share
of the Tranche A  Commitments  as set forth  adjacent to such Tranche A Lender's
name on Schedule 1.1 to Credit Agreement.

      "Tranche  A  Lenders"  shall mean the  several  banks and other  financial
institutions from time to time party to the Credit Agreement that commit to make
the Tranche A Loans.

      "Tranche  A Loans"  shall mean the Loans made  pursuant  to the  Tranche A
Commitment.

      "Tranche A Note" shall have the meaning  given to it in Section 2.2 of the
Credit Agreement.

      "Tranche B Commitments" shall mean the obligation of the Tranche B Lenders
to make the Tranche B Loans to the Lessor in an  aggregate  principal  amount at
any one (1) time  outstanding  not to exceed the  aggregate  of the  amounts set
forth  opposite  each  Tranche B  Lender's  name on  Schedule  1.1 to the Credit
Agreement,  as such amount may be reduced from time to time in  accordance  with
the provisions of the Operative Agreements;  provided, no Tranche B Lender shall
be obligated to make Tranche B Loans in excess of such Tranche B Lender's  share
of the Tranche B  Commitments  as set forth  adjacent to such Tranche B Lender's
name on Schedule 1.1 to Credit Agreement.

      "Tranche  B  Lenders"  shall mean the  several  banks and other  financial
institutions from time to time party to the Credit Agreement that commit to make
the Tranche B Loans.

      "Tranche  B Loan"  shall  mean the Loans made  pursuant  to the  Tranche B
Commitment.

      "Tranche B Note" shall have the meaning  given to it in Section 2.2 of the
Credit Agreement.

      "Transaction  Expenses"  shall mean all Soft Costs and all other costs and
expenses incurred in connection with the preparation,  execution and delivery of
the Operative  Agreements  and the  transactions  contemplated  by the Operative
Agreements  including  without  limitation  all costs and expenses  described in
Section 7.1 of the Participation Agreement and the following:

           (a) the reasonable fees,  out-of-pocket expenses and disbursements of
      counsel in negotiating the terms of the Operative Agreements and the other
      transaction  documents,  preparing for the closings  under,  and rendering
      opinions in connection  with,  such  transactions  and in rendering  other
      services customary for counsel representing parties to transactions of the
      types  involved  in  the   transactions   contemplated  by  the  Operative
      Agreements;

           (b) the reasonable fees,  out-of-pocket expenses and disbursements of
      accountants  for any  Credit  Party in  connection  with  the  transaction
      contemplated by the Operative Agreements;

           (c) any and all  other  reasonable  fees,  charges  or other  amounts
      payable to the Lenders,  the Agent, the Holders,  the Owner Trustee or any
      broker which arises under any of the Operative Agreements;

           (d) any other reasonable fee, out-of-pocket expenses, disbursement or
      cost  of  any  party  to the  Operative  Agreements  or  any of the  other
      transaction documents; and

           (e) any and all Taxes and fees  incurred in  recording  or filing any
      Operative  Agreement  or  any  other  transaction   document,   any  deed,
      declaration,  mortgage,  security agreement, notice or financing statement
      with any public office, registry or governmental agency in connection with
      the transactions contemplated by the Operative Agreement.

      "Tribunal"  shall  mean  any  state,   commonwealth,   federal,   foreign,
territorial,  or other court or government body, subdivision agency, department,
commission, board, bureau or instrumentality of a governmental body.

      "Trust" shall mean the Centennial Real Estate Trust 1998-1.

      "Trust  Agreement"  shall mean the Trust  Agreement  dated on or about the
Initial Closing Date between the Holders and the Owner Trustee.

      "Trust Company" shall mean First Security Bank, National  Association,  in
its  individual  capacity,  and any  successor  owner  trustee  under  the Trust
Agreement in its individual capacity.

      "Trust  Estate"  shall have the  meaning  specified  in Section 2.2 of the
Trust Agreement.

      "Type" shall mean, as to any Loan,  whether it is an ABR Loan
or a Eurodollar Loan.

      "UCC Financing  Statements"  shall mean  collectively the Lender Financing
Statements and the Lessor Financing Statements.

      "Unanimous  Vote Matters"  shall have the meaning given it in Section 12.4
of the Participation Agreement.

      "Unfunded  Amount" shall have the meaning  specified in Section 3.2 of the
Agency Agreement.

      "Uniform Commercial Code" and "UCC" shall mean the Uniform Commercial Code
as in effect in any applicable jurisdiction.

      "United States  Bankruptcy  Code" shall mean Title 11 of the United States
Code.

      "Unused  Fee" shall  mean,  collectively,  the  Holder  Unused Fee and the
Lender Unused Fee.

      "Unused Fee Payment Date" shall mean October 1, 1998,  and  thereafter the
first day of each January,  April, July and October,  as billed by the Agent and
the last  Business  Day of the  Commitment  Period,  or such earlier date as the
Lender  Commitments  shall terminate as provided in the Credit  Agreement or the
Holder Commitment shall terminate as provided in the Trust Agreement.

      "U.S.  Person"  shall have the meaning  specified  in Section
11.2(e) of the Participation Agreement.

      "U.S.  Taxes"  shall have the  meaning  specified  in Section
11.2(e) of the Participation Agreement.

      "Wholly-Owned  Entity"  shall  mean a Person  all of the shares of capital
stock or other ownership interest of which are owned by Centennial and/or one of
its wholly-owned Subsidiaries or other wholly-owned entities.

      "Withholdings"  shall have the meaning  specified  in Section
11.2(e) of the Participation Agreement.

      "Work"  shall  mean  the  furnishing  of  labor,  materials,   components,
furniture,  furnishings,  fixtures,  appliances,  machinery,  equipment,  tools,
power, water, fuel, lubricants,  supplies, goods and/or services with respect to
any Property.

      "Year 2000 Compliant"  shall have the meaning  specified in Section 6.2(x)
of the Participation Agreement.

      "Year 2000 Problem" shall mean the risk that computer applications used by
any Credit Party, any Subsidiary of any Credit Party or any supplier,  vendor or
customer of any Credit Party or any Subsidiary of any Credit Party may be unable
to recognize and perform properly  date-sensitive  functions  involving  certain
dates prior to and any date after December 31, 1999.