Exhibit 10.2


[Seminole, Florida]

[Brandywine, Pennsylvania] 

THIRD AMENDMENT TO MASTER LEASE
(Phase II)

                    THIS
THIRD AMENDMENT TO MASTER LEASE (PHASE II) (this “Amendment”) is made and entered into as of this ___ day of
July, 2004 (the “Effective Date”),
by and between ARC Richmond Place Real Estate Holdings, LLC, a Delaware limited
liability company (“Richmond RealCo”),
ARC Holland Real Estate Holdings, LLC, a Delaware limited liability company (“Holland RealCo”), ARC Sun City Center Real Estate Holdings, LLC, a
Delaware limited liability company (“Sun City
RealCo”), ARC Lake Seminole Square Real Estate Holdings, LLC, a
Delaware limited liability company (“Lake
Seminole RealCo”), and ARC Brandywine Real Estate Holdings, LLC, a
Delaware limited liability company (“Brandywine
RealCo”) (collectively, as their interests may appear, “Lessor”), on the one hand, and ARC Richmond Place, Inc., a Delaware corporation
(“Richmond Lessee”), Freedom
Village of Holland, Michigan, a Michigan general partnership (“Holland Lessee”), Freedom Village of Sun
City Center, Ltd., a Florida limited partnership (“Sun City Lessee”), Lake Seminole Square Management Company,
Inc., a Tennessee corporation and Freedom Group-Lake Seminole Square, Inc., a
Tennessee corporation (collectively, “Lake
Seminole Lessee”), and ARC Brandywine, LLC, a Tennessee limited
liability company (“Brandywine Lessee”)
(collectively and jointly and severally, “Lessee”),
on the other hand, and ARCPI Holdings, Inc., a Delaware corporation (“Guarantor”).

RECITALS

                    A.     Lessor
is the current “Lessor” and  Lessee is
the current “Lessee” pursuant to that certain Master Lease dated September 30,
2002 together with the Addendum to Master Lease (Entrance Fee Facility) of even
date therewith and attached thereto (the “Original
Lease”), as amended by that certain First Amendment to Master Lease
dated September 23, 2003 (the “First Amendment”) and that certain Second
Amendment to Master Lease dated December 31, 2003 (the “Second Amendment”).  The Original Lease, as amended by the First
Amendment and Second Amendment, shall be referred to herein, collectively, as
the “Lease.”  The Lessee’s obligations under the Lease are
guaranteed by Guarantor pursuant to a written Guaranty of Obligations dated as
of September 27, 2002 (as the same has been amended and reaffirmed from time to
time in accordance with the terms thereof, the “Guaranty”).  Lessor,
Lessee and certain Affiliates of each are also parties to that certain
Forbearance and Limited Waiver Agreement (Regarding Insurance) dated as of
January 1, 2004 with respect to the Lease and certain other agreements.

                    B.     The
Original Lease included ARC Santa Catalina Real Estate Holdings, LLC, a
Delaware limited liability company (“Santa Catalina
RealCo”), Fort Austin Real Estate Holdings, LLC, a Delaware limited
liability company (“Fort Austin RealCo”)
and Lessor (as defined herein) as the original “Lessor,” and Fort Austin
Limited Partnership, a Texas limited partnership (“Fort Austin Lessee”), ARC Santa Catalina, Inc., a Tennessee
corporation (“Santa Catalina Lessee”)
and Lessee (as defined herein) as the original “Lessee,” and covered in
addition to the Seminole Facility, the Brandywine Facility and the Separated
Properties (as defined below) four (4) other congregate care retirement centers
located in Tucson, Arizona, Denver, Colorado, Austin, Texas, and Ft. Worth,
Texas, all as more particularly described in the Original Lease.  








                    C.     Pursuant
to the First Amendment, the Tucson Facility, Austin Facility and Ft. Worth
Facility were separated from the original Leased Property, and the Lease was
terminated with respect to the Denver Facility.  Concurrent therewith, Santa Catalina RealCo and Fort Austin
RealCo (collectively, the “Original Phase III
Lessor”), as the original “Lessor,” and Fort Austin Lessee and Santa
Catalina Lessee (collectively, the “Phase III
Lessee”), as “Lessee,” entered into that certain other Master Lease
dated September 23, 2003 (the “Phase III
Master Lease”) covering the “Leased Property” of the Tucson
Facility, Austin Facility and Ft. Worth Facility (collectively, the “Phase III Leased Property”), as more
particularly described in the Phase III Master Lease.   The current successor to the Original Phase III Lessor’s
interest under the Phase III Master Lease is Health Care Property Investors,
Inc., a Maryland corporation (“HCP”),
Texas HCP Holding, L.P., a Delaware limited partnership and an Affiliate of HCP
(“THCP”) and Texas HCP REVX, L.P.,
a Delaware limited partnership and an Affiliate of HCP and THCP (“Texas REVX”) (collectively, the “Phase III Lessor”).

                    D.     HCP
and Guarantor are the only members of each of the entities comprising the
current Lessor under the Lease.  HCP and
Guarantor are also parties to that certain Master Agreement of even date
herewith (the “Master Agreement”),
pursuant to which HCP and Guarantor have agreed to cause certain transactions
to be consummated, including this Amendment, all as more particularly described
therein and in the other “Transaction
Documents” (as defined in the Master Agreement).

                    E.     In
connection with the transactions contemplated by the Master Agreement and the
other Transaction Documents, Lessor and Lessee desire to execute this Amendment
to separate and remove the Lexington Facility, the Holland Facility and the Sun
City Facility (collectively, the “Separated
Properties”) from the current Leased Property covered by the Lease
and to amend the Lease in certain other particulars.  Richmond RealCo, Holland RealCo, and Sun City RealCo
(collectively, the “Separated Property
Owners”) are the respective fee owners of the Separated Properties
and Richmond Lessee, Holland Lessee and Sun
City Lessee(collectively, the “Separated Property Operators”) are the
respective operators and License Holders for the Separated Properties.  In lieu of executing a New Lease (as defined
in Section 31.2 of the Original Lease) in connection with such
separation and removal of the Separated Properties from the Leased Property,
the Separated Property Owners together with the Phase III Lessor, on the one
hand, and the Separated Property Operators together with the Phase III Lessee,
on the other hand, and Guarantor are concurrently herewith executing that
certain First Amendment to Master Lease (Phase III) of even date herewith (the “Phase III Amendment”) pursuant to which
such Separated Properties shall be added to the Phase III Leased Property and
the Separated Property Owners and Separated Property Operators shall,
respectively, become part of the Phase III Lessor and Phase III Lessee
thereunder, all as more particularly set forth in the Phase III Amendment.  

                    F.     Capitalized
terms used herein and not defined herein shall have the meanings given such
terms in the Lease.

2





AMENDMENT

                    IN
CONSIDERATION OF the foregoing recitals, the mutual promises contained herein,
and other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, Lessor and Lessee hereby agree as follows:


          1.       Separated
Properties.

                    (a)     Separation
of Separated Properties.  Subject to
all of the terms and conditions of this Amendment and the Lease, the Separated
Properties shall be separated and removed from the Lease upon the Effective
Date.  Except as set forth in this
Amendment, neither Lessor nor Lessee shall have any further obligations to the
other pursuant to the Lease with respect to the Separated Properties subsequent
to the Effective Date.

                    (b)     Phase
III Master Lease.  Concurrently
herewith, the Separated Property Owners together with the Phase III Lessor, on
the one hand, and the Separated Property Operators together with the Phase III
Lessee, on the other hand, and Guarantor are executing the Phase III Amendment.

          2.      Cessation
of Obligations Under Lease and Reservations. 

                    Notwithstanding anything to the contrary herein, the following
obligations of Lessee with respect to the Separated Properties shall be
reserved and continue subsequent to the Effective Date (as used in Sections 2
and 4 of this Amendment, “Lessee” shall have the meaning given to it under the
Lease, without reference to this Amendment):

                    (a)     Lessee
agrees to defend, indemnify and hold harmless Lessor from and against any and
all liens, claims, costs, losses, expenses, damages, actions and causes of
action for which Lessee is responsible under the Lease with respect to the
Separated Properties and which accrue or accrued on or before the Effective
Date or result from a breach of representation or warranty of Lessee as set
forth herein.

                    (b)     Lessee
shall remain liable for (i) the cost of any and all Impositions, insurance
premiums, utilities charges and other expenses incurred in connection with the
operation, maintenance and use of the Separated Properties through and
including the Effective Date until full payment thereof and (ii) all Minimum
Rent and Additional Rent payable under the Lease through and including the
Effective Date (prorating such Minimum Rent and Additional Rent as applicable)
until full payment thereof.  Without
limiting the foregoing, Lessee shall remain responsible for and shall pay all
2003 assessments for real estate taxes due and payable in 2004, and for all
prior years.  Lessee shall also be
responsible for and pay its proportionate share of all real estate taxes which
are assessed in 2004 and which are due and payable in 2004, based upon the
number of days between January 1, 2004 and the Effective Date.

                    (c)     Lessee
shall remain responsible for any personal property tax liens assessed against
the Separated Properties or any personal property of Lessee therein with a lien
date prior to the Effective Date (including all personal property taxes
assessed in 2004 which are due and payable in 2005, and for all prior years),
irrespective of the date of the billing therefor, and shall indemnify and hold
Lessor harmless with respect to any claims for such taxes or resulting from
non-payment thereof.

3









          3.       Modifications
to Certain Provisions of the Lease. 
Effective as of the Effective Date, the Lease shall be amended and
supplemented in the following particulars:



                    (a)     New
Definitions.  Except as otherwise
expressly provided or unless the context otherwise requires, for all purposes
of the Lease, as hereby amended, the terms defined in this Section 3(a) shall
have the meanings assigned to them as provided below and shall be added to
Article II of the Lease to read, in their entireties, as follows:



	
   
	
                      Additional
  Rent Lease Year:  Each period of
  twelve (12) full calendar months from and after the Effective Date of this
  Amendment, unless the Effective Date is a day other than the first (1st) day
  of a calendar month, in which case the first Additional Rent Lease Year shall
  be the period commencing on the Effective Date of this Amendment and ending
  on the last day of the twelfth (12th) month following the month in which the
  Effective Date of this Amendment occurs and each subsequent Additional Rent
  Lease Year shall be each period of twelve (12) full calendar months after the
  last day of the prior Additional Rent Lease Year; provided, however, that the
  last Additional Rent Lease Year during the Term may be a period of less than
  twelve (12) full calendar months and shall end on the last day of the Term.

	
   
	
   

	
   
	
                      Additional
  Rent Quarter:  During each
  applicable Additional Rent Lease Year, the first three (3) calendar month
  period commencing on the first (1st) day of such Additional Rent Lease Year
  and each subsequent three (3) calendar month period within such Additional
  Rent Lease Year; provided, however, that the last Additional Rent Quarter
  during the Term may be a period of less than three (3) calendar months and
  shall end on the last day of the Term.

	
   
	
   

	
   
	
                      Phase
  III Master Lease:  As defined in
  the Recitals of this Amendment.





                    (b)     Amended
and Restated Definitions.  The
following definitions appearing in Article II of the Original Lease shall be
amended and restated, in their entireties, as follows:


	
   
	
                      Base
  Gross Revenues:  Base Gross
  Revenues for each Facility shall be the Gross Revenues for such Facility for
  the period from August 1, 2004 through and including July 31, 2005.  

	
   
	
   

	
   
	
                      Intangible
  Property:  All accounts, proceeds
  of accounts, rents, profits, income or revenues derived from the use of rooms
  or other space within the Leased Property or the providing of services in or
  from the Leased Property and all Capital Additions; documents, chattel paper,
  instruments, contract rights, deposit accounts, general intangibles,
  commercial tort claims, causes of action, investment property,
  letter-of-credit rights, letters of credit, money, securities entitlements,
  now owned or hereafter acquired by Lessee (including any right to any refund
  of any Impositions and any escrow deposits and reserve accounts required to
  be maintained in connection with any Entrance Fee Facilities (including any
  minimum liquid reserves, operating reserves or renewal and replacement
  reserves) arising from or in connection with Lessee’s operation or use of the
  Leased Property and all Capital Additions; all licenses and permits now owned
  or hereinafter acquired by Lessee, which are necessary or desirable for
  Lessee’s use of the Leased Property and all Capital Additions for the Primary
  Intended Use, including, if applicable, any certificate of need, certificate
  of authority or similar certificate; the right to use any trade name or other
  name associated with the Facility; and any and all third-party provider
  agreements (including Medicare and Medicaid).



4








	
   
	
                      Lessee:  Collectively, and jointly and severally,
  Lake Seminole Square Management Company, Inc., a Tennessee corporation;
  Freedom Group-Lake Seminole Square, Inc., a Tennessee corporation; and ARC
  Brandywine, LLC, a Tennessee limited liability company; provided, however,
  that it is agreed and understood by all parties hereto that, with respect to
  each Facility, only the License Holder with respect to such Facility shall be
  entitled to operate or maintain such Facility, and in no event shall any
  Lessee other than the applicable License Holder with respect to such Facility
  be entitled to operate or maintain such Facility or take other actions with
  respect to such Facility to the extent that such operations or the taking of
  such actions would violate the licensure requirements or other laws or
  regulations of any governmental authority with respect to such Facility.  Notwithstanding the foregoing, nothing
  herein shall affect the joint and several liability of the Lessees.

	
   
	
   

	
   
	
                      Lessor:  Collectively, as their interests may
  appear, ARC Lake Seminole Square Real Estate Holdings, LLC, a Delaware
  limited liability company; and ARC Brandywine Real Estate Holdings, LLC, a
  Delaware limited liability company; provided, however, that with respect to
  any matter as it relates to a particular Facility (including, but not limited
  to, any matter in which Lessor’s consent or approval is required for a
  particular Facility), as used herein, “Lessor” shall mean only that Lessor
  which is the fee owner of such Facility. 
  As of the date hereof, the “Lessor” for each Facility is as set forth
  on Exhibit H attached hereto.






                    (c)     Deleted
Definitions.  The following
definitions appearing in Article II of the Original Lease, as well as all or the
applicable portion of any provisions directly related thereto, shall be
deleted, in their entireties: 
“Applicable Percentage,” “Funding Date,” “HCPI Loan Agreement,” “HCPI
Loan Documents,” “Incremental Amount,” “Lender,” “Letter of Credit Amount” and
“Letter of Credit Date.”

                    (d)     Rent.  

                              (i)      Allocated
Minimum Rent.  

                                        (A)     Notwithstanding
anything to the contrary in Section 3.1.1 of the Original Lease, subject to any
upward adjustments as set forth in Section 3.1.4 of the Original Lease, from
and after the Effective Date and continuing through the expiration of the Term,
Lessee shall pay monthly “Allocated Base Minimum Rent” for all of the
Facilities in the amount as set forth on Exhibit B attached to the
Lease, as amended hereby, and incorporated herein by this reference.  

                                        (B)     Section
3.1.2 of the Original Lease shall be deleted in its entirety. 


                                        (C)     If
the Effective Date shall not be the first (1st) day of a calendar
month, then monthly Allocated Minimum Rent payable for the month in which the
Effective Date occurs shall be prorated based upon the monthly Allocated Minimum
Rent in effect before and after the Effective Date based upon the number of
days for which the different rental amounts apply.

5








                              (ii)     Additional
Rent.  

                                        (A)     Section
3.1.3 of the Original Lease shall be amended to read, in its entirety, as
follows:

                                        “3.1.3     Additional
Rent.  In addition to Minimum Rent,
Lessee shall, commencing with the first Additional Rent Quarter of the second
(2nd) Additional Rent Lease Year and continuing through the
expiration of the Term, pay to Lessor annual Allocated Additional Rent for each
Facility in an amount equal to the product of sixteen percent (16%), times the
Incremental Gross Revenues for such Facility for such Additional Rent Lease
Year; provided, however, that there shall be no Allocated Additional Rent
payable with respect to the Brandywine Facility during the Six Year Extended
Term, except to the extent included in Fair Market Rental for the Brandywine
Facility for such Six Year Extended Term as provided on Exhibit B
attached to the Lease, as hereby amended. 
Notwithstanding the foregoing, annual Allocated Additional Rent for each
Facility for each Additional Rent Lease Year commencing with the third (3rd)
Additional Rent Lease Year shall not be less than the highest annual Allocated
Additional Rent payable with respect to such Facility for any prior Additional
Rent Lease Year.”

                                        (B)     All
Allocated Additional Rent payable under the Lease, as hereby amended, prior to
the Effective Date shall be prorated as provided in the Lease.  


                         (e)     Events
of Default.  The following shall be
added as Section 16.1(w) of the Lease: 

	
   
	
                           “(w)     any
  default beyond any applicable cure periods under the Phase III Master Lease
  (including any amendments, modifications and/or restatements thereof).”






                         (f)      Financial
Statements.  Sections 25.1.2(a), (b)
and (c) of the Original Lease shall be amended to read, in their entireties, as
follows: 

	
   
	
                           “(a)     (i)
  within twenty (20) days after the end of each calendar quarter, unaudited
  balance sheets and statements of income of Lessee, ARCPI and its consolidated
  Subsidiaries, and ARC and its consolidated Subsidiaries as of the end of such
  calendar quarter, (ii) when available, following the end of each calendar
  quarter, unaudited changes in common stock and other stockholders’ equity and
  statements of cash flows of ARC and its consolidated Subsidiaries and (iii)
  within ninety (90) days after the end of Lessee’s, ARCPI’s and ARC’s fiscal
  years, (A) a copy of the unaudited balance sheets of Lessee, and audited
  consolidated balance sheets of ARCPI and its consolidated Subsidiaries and
  ARC and its consolidated Subsidiaries as of the end of such fiscal year,
  (B) related audited consolidated statements of income, changes in common
  stock and other stockholders’ equity and statement of cash flows of ARCPI and
  its consolidated Subsidiaries and ARC and its consolidated Subsidiaries for
  such fiscal year, and (C) related unaudited statements of income of Lessee,
  in all cases prepared in accordance with GAAP applied on a basis consistently
  maintained throughout the period involved (such audited consolidated
  financial statements of ARC and ARCPI to be certified by nationally
  recognized certified public accountants);




6









	
   
	
                           “(b)     within
  ninety (90) days after the end of each of Lessee’s, ARCPI’s and ARC’s fiscal
  years, and together with the annual audit report furnished in accordance with
  clause (a) above, an Officer’s Certificate stating that to the best of the
  signer’s knowledge and belief after making due inquiry, Lessee is not in
  default in the performance or observance of any of the terms of this Lease,
  or if Lessee shall be in default, specifying all such defaults, the nature
  thereof, and the steps being taken to remedy the same;

	
   
	
   

	
   
	
                           “(c)     within
  thirty (30) days after the end of each of the first twelve (12) months of the
  Term and the last eighteen (18) months of the Term, all consolidated
  financial reports that Lessor may reasonably request containing, among other
  things, detailed statements of income and detailed operational statistics
  regarding occupancy rates, patient and resident mix and patient and resident
  rates by type for each Facility; and otherwise within thirty (30) days after
  the end of each of Lessee’s quarters, all quarterly consolidated financial
  reports Lessor may reasonably request containing, among other things,
  detailed statements of income and detailed operational statistics regarding
  occupancy rates, patient and resident mix and patient and resident rates by
  type for each Facility;”




                         (g)     Letter
of Credit.  Article XXI of the Lease
shall be deleted in its entirety.

                         (h)     Addendum
– Maximum Entrance Fee Facility Liabilities.  Notwithstanding anything to the contrary in Section 48.2 of the
Addendum attached to the Original Lease, Lessor and Lessee acknowledge and
agree that the Maximum Entrance Fee Facility Liabilities for the Lease Year
ending September 30, 2004, for each Entrance Fee Facility remaining under the
Lease, as hereby amended, shall be as follows: 

	
   
	
  Seminole Facility:
	
   
	
  $ 
	
  32,396,568
	
   

	
   
	
  Brandywine
  Facility:
	
   
	
  $ 
	
  48,897,402
	
   

	
   
	
   
	
   
	
  



  	
  



  	
   

	
   
	
   
	
  Total:
	
   
	
  $ 
	
  81,293,970
	
   

	
   
	
   
	
   
	
  



  	
  



  	
   

							



Lessee
represents and warrants that the above amounts do not exceed One Hundred Five
Percent (105%) of the sum of (i) the current actual Entrance Fee Facility
Liabilities for the applicable Facility as of the Effective Date, plus (ii) the
unsold inventory of such Facility as of the Effective Date, at the current
market sales price therefor.  For each
Lease Year after September 30, 2004, the “Maximum Entrance Fee Facility
Liabilities” shall be determined pursuant to the second sentence of the
definition of “Maximum Entrance Fee Facility Liabilities” set forth in Section
48.2 of the Addendum. 

                      (i)     Exhibits
and Schedules.  Exhibits A-4,
A-5, and A-6 shall be deleted in their entirety.  Exhibit B shall be amended and
restated with the information on Schedule 1 attached hereto.  Exhibit C shall be amended and
restated with the information on Schedule 2 attached hereto.  Exhibit D shall be deleted in its
entirety.  Exhibit F shall be
amended and restated with the information on Schedule 3 attached
hereto.  Exhibit G shall be
deleted in its entirety.  Exhibit H,
as amended and restated with the information contained on Schedule 1 of
the Second Amendment, shall be amended and restated with the information on Schedule
4 attached hereto.  Exhibit K
shall be amended and restated with the information on Schedule 5 attached
hereto.  Exhibit M shall be
amended and restated with the information on Schedule 6 attached
hereto.  Exhibit N shall be
amended and restated with the information on Schedule 7 attached hereto.
 Exhibit O shall be deleted in
its entirety.  


7







                    4.       Release.  Effective as of the Effective Date, the
Separated Property Operators shall be released from any duties, obligations and
liabilities under the Lease, as hereby amended, as to the balance of the Leased
Property (i.e., all Leased
Property other than the Separated Properties) first accruing after the
Effective Date; provided, however, that the foregoing shall not be construed to
release the Separated Property Operators from (a) any duties, obligations
and liabilities under the Lease, as hereby amended, or the Phase III Master
Lease, as amended by the Phase III Amendment, relating to the Separated
Properties (including, without limitation, the duties, obligations and
liabilities relating to the Separated Properties resulting pursuant to Section
2 above) or (b) any duties, obligations and liabilities under the Lease, as
hereby amended, as to all of the Leased Property, to the extent any such
duties, obligations and liabilities relate to the period prior to the Effective
Date.



                    5.       Representations
and Covenants of Lessee. 


                              Lessee
represents, warrants and covenants as follows:

                              (a)     That
Lessee shall neither take any action nor fail to take any action the result of
which will be the imposition of any liens upon the Separated Properties or the
improvements or fixtures thereon or therein or the creation of any claims
against Lessor.  It is hereby mutually
agreed that this provision is not intended to bestow any benefit upon any person
who is not a party to this Amendment.

                              (b)     The
Separated Properties and all improvements and fixtures therein are free and
clear of any liens, claims or encumbrances created or suffered by, through or
under Lessee, or its Affiliates, sublessees or other third parties for whom
Lessee is responsible.

                              (c)     Neither
Lessor nor Lessee is in default under the Lease, and Lessee does not claim any
offsets, credits or defenses against rents or other amounts payable under the
Lease or the calculation thereof, nor does Lessee have any other claim against
Lessor under the Lease or with respect to the Leased Property.

                    6.       Consent
and Reaffirmation of Guarantor. 
Guarantor hereby (a) consents to this Amendment, including the
separation of the Separated Properties and release of the Separated Property
Operators as provided in Section 4 above, and (b) re-affirms its obligations
under the Guaranty and agrees that the same extends to the Lease, as hereby
amended.

                    7.       Consent
of Lessor.  Lessor hereby consents
to (a) Lessee entering into, and causing its Affiliates to enter into, each of
the Transaction Documents, (b) the consummation of the transactions contemplated
thereby in accordance with the terms thereof, and (c) all amendments of the
organizational documents of each Lessee that are being executed in connection
with the Transaction Documents, copies of which have been delivered to Lessor
together with an Officer’s Certificate relating thereto on or prior to the
Effective Date of this Amendment.  The
parties acknowledge that this Amendment is one of the Transaction Documents
contemplated by the Master Agreement.


                    8.       Reaffirmation
of Master Lease.  Lessor and Lessee
hereby acknowledge, agree and reaffirm that the Lease, as hereby amended, is
and the parties intend the same for all purposes to be treated as a single,
integrated and indivisible agreement.  

                    9.       Governing
Law.  THIS AMENDMENT WAS NEGOTIATED
IN THE STATE OF CALIFORNIA, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL
RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY.  ACCORDINGLY, IN ALL RESPECTS THIS AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE
OF CALIFORNIA (WITHOUT REGARD OF PRINCIPLES OR CONFLICTS OF LAW) AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.

8








                    10.    Full
Force and Effect; Counterparts; Facsimile Signatures.  Except as hereby amended, the Lease shall
remain in full force and effect.  In
other words, nothing herein shall affect the validity of the Lease or Lessee’s
(as the definition of Lessee has been amended hereby) continued obligations
thereunder with respect to the Seminole Facility and the Brandywine
Facility.  This Amendment may be
executed in any number of counterparts, all of which shall constitute one and
the same instrument.  Telecopied
signatures may be used in place of original signatures on this Amendment, and
Lessor and Lessee both intend to be bound by the signatures of the telecopied
document.

[SIGNATURE PAGE FOLLOWS]


9








                    IN
WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day
and year first above written. 

	
   
	
   
	
  “Lessor”
	
   

	
   
	
   
	
   

	
   
	
   
	
  ARC RICHMOND
  PLACE REAL ESTATE 

       HOLDINGS, LLC

	
   
	
   
	
  ARC HOLLAND
  REAL ESTATE

       HOLDINGS, LLC

	
   
	
   
	
  ARC SUN CITY
  CENTER REAL ESTATE 

       HOLDINGS, LLC

	
   
	
   
	
  ARC LAKE
  SEMINOLE SQUARE REAL 
     ESTATE
  HOLDINGS, LLC

	
   
	
   
	
  ARC
  BRANDYWINE REAL ESTATE

       HOLDINGS, LLC

	
   
	
   
	
  each, a
  Delaware limited liability company

	
   
	
   
	
   

	
   
	
   
	
   
	
   

	
   
	
   
	
   
	
   

	
  WITNESSED:
	
   
	
  By:
	
  ARCPI
  Holdings, Inc., a Delaware

  corporation, its member

	
   
	
   
	
   
	
   

	
   
	
   
	
   
	
   

	
  



  	
   
	
   
	
  By:

	
  Witness
	
   
	
   
	
   
	
  



  
	
   
	
   
	
   
	
  Title:

	
   



  	
   
	
   
	
   
	
  



  
	
   
	
   
	
   
	
   

	

	
   
	
   
	
   

	
  Witness
	
   
	
   
	
   
	
   



  
	
   
	
   
	
   
	
   

	
  WITNESSED:
	
   
	
  By:
	
  Health Care
  Property Investors, Inc., a

   Maryland corporation, its member

	
   
	
   
	
   
	
   

	
  



  	
   
	
   
	
  By:

	
  Witness
	
   
	
   
	
   
	
  



  
	
   
	
   
	
   
	
  Title:

	
   



  	
   
	
   
	
   
	
  



  
	
   
	
   
	
   
	
   

	

	
   
	
   
	
   

	
  Witness
	
   
	
   
	
   
	
   



  
								







[Signature pages continue]


10











	
   
	
   
	
  “Lessee”
	
   

	
   
	
   
	
   

	
   
	
   
	
  ARC RICHMOND
  PLACE, INC., a Delaware

       corporation

	
   
	
   
	
  LAKE
  SEMINOLE SQUARE 

       MANAGEMENT COMPANY, INC., a

	
   
	
   
	
       Tennessee
  corporation

	
   
	
   
	
  FREEDOM
  GROUP-LAKE SEMINOLE 

       SQUARE, INC., a Tennessee corporation

	
   
	
   
	
  ABC
  BRANDYWINE, LLC, a Tennessee

       limited liability company

	
  WITNESSED:
	
   
	
   
	
   

	
   
	
   
	
   
	
   

	
   
	
   
	
  By:

	
   
	
   
	
   
	
  



  
	
   
	
   
	
  Title:

	
   
	
   
	
   
	
  



  
	
  



  	
   
	
   

	
  Witness
	
   
	
   

	
   
	
   
	
   

	
   
	
   
	
   

	
  



  	
   
	
   

	
  Witness
	
   
	
   

	
   
	
   
	
   

	
   
	
   
	
  FREEDOM
  VILLAGE OF HOLLAND,

       MICHIGAN, a Michigan general partnership

	
   
	
   
	
  FREEDOM
  VILLAGE OF SUN CITY CENTER,

       LTD., a Florida limited partnership

	
  WITNESSED:
	
   
	
   

	
   
	
   
	
  By:
	
  ARC Freedom,
  LLC, managing partner

	
   
	
   
	
   
	
   

	
  



  	
   
	
   
	
  By:

	
  Witness
	
   
	
   
	
   
	
  



  
	
   
	
   
	
   
	
  Title:

	
   
	
   
	
   
	
   
	
  



  
	
  



  	
   
	
   
	
   

	
  Witness
	
   
	
   
	
   

								






[Signature pages continue]

11










	
   
	
   
	
  “Guarantor”
	
   

	
   
	
   
	
   

	
   
	
   
	
   
	
   

	
  WITNESSED:
	
   
	
  ARCPI HOLDINGS,
  INC., a Delaware corporation

	
   
	
   
	
   

	
   
	
   
	
   
	
   

	
  



  	
   
	
  By:
	
   

	
  Witness
	
   
	
   
	
  



  
	
   
	
   
	
  Title:
	
   

	
   
	
   
	
   
	
  



  
	
  



  	
   
	
   
	
   

	
  Witness
	
   
	
   
	
   

						



12