**Exhibit10.12**

 

**SECONDAMENDMENT TO AMENDED MASTER LEASE AGREEMENT**

 

**THIS SECOND AMENDMENT TO AMENDED MASTER LEASEAGREEMENT**(this “Amendment”) is made and entered into as of March 1, 2004 by andamong (i) each of the parties identified on the signature page hereof aslandlord (collectively, “Landlord”), and (ii) FS TENANT HOLDING COMPANYTRUST, a Maryland business trust, and FS TENANT POOL III TRUST**,**a Maryland business trust, as tenant (collectively, “Tenant”).

 

W I T N E S S E T H:

 

**WHEREAS**, pursuant to that certain Amended Master Lease, dated as ofJanuary 11, 2002, as amended by that certain First Amendment to Amended MasterLease Agreement dated as of October 1, 2002 (as so amended, the “Lease”),between Landlord and Tenant, Landlord leased to Tenant and Tenant leased fromLandlord the Leased Property (as defined therein) subject to and upon the termsand conditions set forth in the Lease; and

 

**WHEREAS**, Landlord and Tenant now wish to amend the Lease subject to andupon the terms and conditions hereinafter set forth;

 

**NOW, THEREFORE,**in consideration of the mutual covenants herein contained andother good and valuable consideration, the mutual receipt and legal sufficiencyof which are hereby acknowledged, Landlord and Tenant hereby agree that theLease is hereby amended as follows:

 

# 1.             BaseNet Patient Revenues.  Thedefinition of “Base Net Patient Revenues” set forth in Article 1 of the Leaseis hereby deleted in its entirety and replaced with the following:

#  

**“BaseNet Patient Revenues” **shall mean the amount of Net PatientRevenues for the Leased Property for the Base Year in the event the Base Yearconsists of 52 weeks, or, in the event the Base Year consists of 53 weeks, (x)Base Net Patient Revenues for the Leased Property for the Base Year, (y) dividedby 53 and then (z) multiplied by 52; provided, however, that inthe event that, with respect to any Lease Year, or portion thereof, for anyreason (including, without limitation, a casualty or Condemnation) there shallbe a reduction in the number of units available at any Facility located at theLeased Property or in the

 

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servicesprovided at such Facility from the number of such units or the servicesprovided during the Base Year, in determining Additional Rent payable withrespect to such Property for such Lease Year, Base Net Patient Revenues shallbe reduced as follows:  (a) in the eventof the termination of this Agreement with respect to any Property pursuant to Article10, 11 or 12, all Net Patient Revenues for such Property for the periodduring the Base Year equivalent to the period after the termination of thisAgreement with respect to such Property shall be subtracted from Base NetPatient Revenues; (b) in the event of a partial closing of any Facilityaffecting the number of units, or the services provided, at such Facility, NetPatient Revenues attributable to units or services at such Facility shall beratably allocated among all units in service at such Facility during the BaseYear and all such Net Patient Revenues attributable to units no longer inservice shall be subtracted from Base Net Patient Revenues throughout theperiod of such closing; and (c) in the event of any other change incircumstances affecting any Facility, Base Net Patient Revenues shall beequitably adjusted in such manner as Landlord and Tenant shall reasonablyagree.

 

# 2.             BaseYear.  The definition of “Base Year”set forth in Article 1 of the Lease is hereby deleted in its entirety andreplaced with the following:

#  

**“Base Year”** shall mean the 2005 Fiscal Year.

 

 

# 3.             ExcessPatient Revenues.  The definition of“Excess Patient Revenues” set forth in Article 1 of the Lease is hereby deletedin its entirety and replaced with the following:

#  

**“ExcessNet Patient Revenues” **shall mean, with respect to anyLease Year, or portion thereof, the amount of Net Patient Revenues for suchLease Year, or portion thereof, in excess of Base Net Patient Revenues for theequivalent period during the Base Year.

 

# 4.             MinimumRent.  The definition of “MinimumRent” set forth in Article 1 of the Lease is hereby deleted in its entirety andreplaced with the following:

 

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**“Minimum Rent”** shall mean Sixty-Three Million SixHundred Seventy-Four Thousand Three Hundred Forty-Seven and 26/100s Dollars ($63,674,347.26)per annum.

 

# 5.             NetPatient Revenues.  The definition of“Net Patient Revenues” set forth in Article 1 of the Lease is hereby deleted inits entirety and replaced with the following:

#  

**“NetPatient Revenues” **shall mean, for each Fiscal Year duringthe Term, all revenues and receipts (determined on an accrual basis and in allmaterial respects in accordance with GAAP) of every kind derived from renting,using and/or operating the Leased Property and parts thereof, including, butnot limited to:  all patient, client orresident rents and revenues received or receivable for the use of otherwise byreason of all units, beds and other facilities provided, meals served, servicesperformed, space or facilities subleased or goods sold on the Leased Property,or any portion thereof, including, without limitation, any other arrangementswith third parties relating to the possession or use of any portion of theLeased Property; and proceeds, if any, from business interruption or other lossof income insurance; provided, however, that Net Patient Revenuesshall not include the following: revenue from professional fees or charges by physicians and unaffiliatedproviders of services, when and to the extent such charges are paid over tosuch physicians and unaffiliated providers of services, or are separatelybilled and not included in comprehensive fees; contractual allowances (relatingto any period during the Term) for billings not paid by or received from theappropriate governmental agencies or third party providers; allowancesaccording to GAAP for uncollectible accounts, including credit card accountsand charity care or other administrative discounts; all proper patient billingcredits and adjustments according to GAAP relating to health care accounting;provider discounts for hospital or other medical facility utilization contractsand credit card discounts; any amounts actually paid by Tenant for the cost ofany federal, state or local governmental programs imposed specially to provideor finance indigent patient care; federal, state or municipal excise, sales,use, occupancy or similar taxes collected directly from patients, clients orresidents or included as part of the sales price of any goods or

 

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services;insurance proceeds (other than proceeds from business interruption or otherloss of income insurance); Award proceeds (other than for a temporaryCondemnation); revenues attributable to services actually provided off-site orotherwise away from the Leased Property, such as home health care, to personsthat are not patients, clients or residents at the Leased Property; revenuesattributable to child care services provided primarily to employees of theLeased Property; any proceeds from any sale of the Leased Property or from therefinancing of any debt encumbering the Leased Property; proceeds from thedisposition of furnishings, fixture and equipment no longer necessary for theoperation of the Facility located thereon; any security deposits and otheradvance deposits, until and unless the same are forfeited to Tenant or appliedfor the purpose for which they were collected; and interest income from anybank account or investment of Tenant.

 

# 6.             AdditionalRent.  The first sentence of Section3.1.2(a) of the Lease is hereby deleted in its entirety and replaced withthe following:

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Tenantshall pay additional rent “Additional Rent” with respect to each Lease Yearduring the Term subsequent to the Base Year in an amount, not less than zero,equal to four percent (4%) of Excess Net Patient Revenues at the LeasedProperty.

 

# 7.             SecurityAgreement.  Subtenant herebyconfirms that all references to the “Master Lease” in that certain SecurityAgreement, dated as of January 7, 2002, made by Subtenant in favor of Landlordshall refer to the Lease as amended by this Amendment.

#  

# 8.             StockPledge Agreement.  FS Tenant HoldingCompany Trust hereby confirms that all references to the “Master Lease” in thatcertain Pledge of Shares of Beneficial Interest Agreement, dated as of January7, 2002, made by FS Tenant Holding Company Trust in favor of Landlord shallrefer to the Lease as amended by this Amendment.

 

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# 9.             Asamended hereby, the Lease is hereby ratified and confirmed.

 

 

[Signatures on following pages]

 

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**INWITNESS WHEREOF,**the parties hereto have duly executed this Amendment as of the day and yearfirst above written.

 
|   | **LANDLORD:**                                                        |
|--------|----------------------------------------------------------------------|
|   |                                                                 |
|   | **CCC FINANCING I TRUST,**a Maryland  business trust                 |
|   |                                                                 |
|   | **CCC FINANCING LIMITED,  L.P.,**a Delaware  limited partnership     |
|   |                                                                 |
|   | **CCC INVESTMENTS I,  L.L.C.,**a Delaware  limited liability company |
|   |                                                                 |
|   | **CCC OF KENTUCKY TRUST,**a Maryland  business trust                 |
|   |                                                                 |
|   | **CCC OHIO HEALTHCARE  TRUST,**a Maryland  business trust            |
|   |                                                                 |
|   | **CCC PUEBLO NORTE TRUST,**a Maryland  business trust                |
|   |                                                                 |
|   | **CCC RETIREMENT  COMMUNITIES II, L.P.,**a Delaware  partnership     |
|   |                                                                 |
|   | **CCCP SENIOR LIVING LLC,**a Delaware  limited liability company     |
|   |                                                                 |
|   | **CCDE SENIOR LIVING LLC,**a Delaware  limited liability company     |
|   |                                                                 |
|   | **CCFL SENIOR LIVING LLC,**a Delaware  limited liability company     |
|   |                                                                 |
|   | **CCOP SENIOR LIVING LLC,**a Delaware  limited liability company     |
|   |                                                                 |
|   | **CCSL SENIOR LIVING LLC,**a Delaware  limited liability company     |

 

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|   | **LEISURE PARK VENTURE  LIMITED PARTNERSHIP,**a Delaware  limited partnership |
|--------|-------------------------------------------------------------------------------|
|   |                                                                          |
|   | **LTJ SENIOR COMMUNITIES  LLC,**a Delaware  limited liability company         |
|   |                                                                          |
|   | **PANTHER HOLDINGS LEVEL  I, L.P.,**a Delaware  limited partnership           |
|   |                                                                          |
|   |                                                                          |
|   | By:                                                                           | PANTHER GENPAR TRUST, its  General Partner |
|   |                                                                          |
|   | By:                                                                           | /s/ John R. Hoadley |   |
|   |                                                                          | John R. Hoadley |
|   |                                                                          | Treasurer of each of the foregoing entities |
|   |                                                                          |
|   |                                                                          |
|   | **TENANT****:**                                                               |
|   |                                                                          |
|   | **FS TENANT HOLDING  COMPANY TRUST,**a Maryland  business trust               |
|   |                                                                          |
|   | **FS TENANT POOL III  TRUST,**a Maryland  business trust                      |
|   |                                                                          |
|   | By:                                                                           | /s/ Bruce J. Mackey Jr. |   |
|   |                                                                          | Bruce J. Mackey Jr. |
|   |                                                                          | Treasurer of each of the foregoing entities |
|        |                                                                               |  |  |  |

 

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**ACKNOWLEDGMENTSAND CONSENTS**

 

The undersignedsubtenants under the Lease hereby join in the execution and delivery of thisAmendment for the limited purpose of acknowledging their consent to theexecution and delivery of this Amendment.

 
|   | **FS TENANT POOL I TRUST,**a Maryland  business trust        |
|--------|--------------------------------------------------------------|
|   |                                                         |
|   | **FS TENANT POOL II TRUST,**a Maryland  business trust       |
|   |                                                         |
|   | **FS TENANT POOL III  TRUST,**a Maryland  business trust     |
|   |                                                         |
|   | **FS TENANT POOL IV TRUST,**a Maryland  business trust       |
|   |                                                         |
|   | **FS LAFAYETTE TENANT  TRUST,**a Maryland  business trust    |
|   |                                                         |
|   | **FS LEISURE PARK TENANT  TRUST,**a Maryland  business trust |
|   |                                                         |
|   | **FS LEXINGTON TENANT  TRUST,**a Maryland  business trust    |
|   |                                                         |
|   | By:                                                          | /s/ Bruce J. Mackey Jr. |   |
|   |                                                         | Bruce J. Mackey Jr. |
|   |                                                         | Treasurer of each of the foregoing entities |

 

 

FSQ, Inc. herebyjoins in the execution and delivery of this Amendment for the limited purposesof (i) acknowledging its consent to the execution and delivery of thisAmendment and (ii) confirming that all references to the “Master Lease” in thatcertain Pledge of Shares of Beneficial Interest Agreement, dated as of January11, 2002, made by FSQ, Inc. in favor of Landlord shall refer to the Lease asamended by this Amendment.

 
|   | **FSQ, INC.,**a Maryland corporation |
|--------|--------------------------------------|
|   |                                 |
|   | By:                                  | /s/ Bruce J. Mackey Jr. |   |
|   |                                 | Bruce J. Mackey Jr. |

 

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|   |   | Treasurer |
|--------|--------|-----------|

 

Five Star herebyjoins in the execution and delivery of this Amendment for the limited purposesof (i) acknowledging its consent to the execution and delivery of thisAmendment and (ii) confirming that all references to the “Master Lease” in thatcertain Guaranty Agreement, dated as of January 11, 2002, made by Five Star infavor of Landlord shall refer to the Lease as amended by this Amendment.

 
|   | **FIVE STAR QUALITY CARE,  INC.,**a Maryland  corporation |
|--------|-----------------------------------------------------------|
|   |                                                      |
|   | By:                                                       | Bruce J. Mackey Jr. |   |
|   |                                                      | Bruce J. Mackey Jr. |
|   |                                                      | Treasurer |

 

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