<PAGE>   1
                                                                  Exhibit 10.18

                    FIRST SERIES MASTER INVESTMENT AGREEMENT
                    ----------------------------------------


         THIS FIRST SERIES MASTER INVESTMENT AGREEMENT (this "AGREEMENT") is
made by and between BALANCED CARE CORPORATION ("BCC"), BCC DEVELOPMENT AND
MANAGEMENT CO. ("DEVELOPER"), a Delaware corporation, ELDER CARE OPERATORS, LLC
("ELDER CARE"), a Delaware limited liability company, Oakhaven Elder Living,
Inc. ("OAKHAVEN"), a California corporation (Elder Care and Oakhaven being
hereinafter collectively referred to as "ELDER"), and NATIONWIDE HEALTH
PROPERTIES, INC., a Maryland corporation ("NHP") and MLD DELAWARE TRUST ("MLD"),
a Delaware business trust.

                                    RECITALS:

         A. NHP, MLD, Elder, Developer, and BCC have agreed to enter into a
series of six (6) transactions, two (2) of which are to be entered into by MLD
and four (4) of which are to be entered into by NHP, as specifically set forth
in EXHIBIT "A" attached hereto and included herein for all purposes as though
fully set forth (hereinafter individually referred to as a "TRANSACTION" and
collectively referred to as the "TRANSACTIONS"), each of which will include the
purchase, lease, and development of certain tracts or parcels of real property,
together with all improvements thereon, all personal property to be leased
therewith, and all appurtenances thereto (hereinafter individually referred to
as a "PROPERTY" and collectively referred to as the "PROPERTIES"), with the sum
of the aggregate purchase prices and aggregate development fees and costs for
the Properties ("NHP'S MAXIMUM INVESTMENT") to be limited to Thirty-Six Million
Eight Hundred Fifty Thousand and No/100 Dollars ($36,850,000.00).

         B. The Transactions are generally expected to take the following form:
(A) each of the Properties are to be located, identified, and chosen by BCC or
its Affiliates (defined below), which will enter into option or purchase
agreements (hereinafter individually referred to as a "PURCHASE CONTRACT" and
collectively referred to as the "PURCHASE CONTRACTS") by and between various
third parties, as seller, and BCC, as buyer; (B) following the exercise of an
option or the firm decision by BCC to proceed with a purchase pursuant to a
Purchase Contract, BCC will assign all its rights, duties, and obligations under
such Purchase Contract to NHP or MLD, pursuant to an assignment of purchase
contract agreement (the "PURCHASE CONTRACT ASSIGNMENTS"); (C) NHP or MLD will
purchase the respective Properties upon the terms and conditions set forth in
the applicable Purchase Contracts, and any amendments thereto required by NHP;
(D) simultaneously with the closing of each Purchase Contract, a subsidiary or
other Affiliate of Elder will lease from NHP or MLD the applicable Property,
pursuant to the terms and conditions set forth in a lease and security agreement
(hereinafter individually referred to as a "LEASE" and collectively referred to
as the "LEASES"), which Leases will typically provide for an initial term of
eleven (11) years and for three (3) separate renewal terms of six (6) years
each; (E) Elder Care will guarantee the obligations of any tenant under the
Leases or of any subtenant under a sublease of a Lease (hereinafter individually
referred to as a "TENANT" and collectively referred to as the "TENANTS")
pursuant to a lease guaranty (the "LEASE GUARANTIES"); (F) as additional
security for the obligations of Tenants under each respective Lease, BCC will
enter into working capital assurance agreements with NHP or MLD (the "CAPITAL
AGREEMENTS"), whereby BCC agrees to make 

<PAGE>   2

working capital loans to the applicable Tenant, and as further security, NHP or
MLD will be a party to deposit pledge agreements (the "DEPOSIT AGREEMENTS")
whereby each applicable Tenant pledges a minimum amount of capital as a working
capital reserve for its operations; (G) each Property will be developed, used,
and licensed (by the State in which such Property is located) as an assisted
living facility, personal care home, independent living facility, or similar
adult care facility (hereinafter individually referred to as a "FACILITY" and
collectively referred to as the "FACILITIES"), including (at BCC's option) such
ancillary services for independent living, skilled nursing, rehabilitation, or
Alzheimer's or dementia care as are permitted by law and may be necessary or
incidental thereto; (H) Developer will act as developer of each of the
Properties, pursuant to the terms and conditions of development agreements
(hereinafter individually referred to as a "DEVELOPMENT AGREEMENT" and
collectively referred to as the "DEVELOPMENT AGREEMENTS") to be entered into by
and between Developer and NHP or MLD, with the aggregate development fees paid
to Developer under the Development Agreements being funded out of NHP's Maximum
Investment and limited to an amount equal to six and one-half percent (6.5%) of
NHP's Maximum Investment; (I) BCC will guarantee the obligations of Developer
under each respective Development Agreement and the completion of all
improvements contemplated in such Development Agreements, pursuant to a guaranty
agreement with NHP or MLD (the "DEVELOPMENT GUARANTIES"), (j) each of the
Tenants will enter into a management agreement with a newly formed subsidiary of
BCC, whereby such BCC subsidiary agrees to manage the respective Facility on
behalf of the respective Tenant (such BCC subsidiaries being hereinafter
collectively referred to as the "MANAGERS"), (K) BCC will indemnify NHP or MLD
with respect to possible environmental hazards on each applicable Property by
means of environmental indemnification agreements (the "ENVIRONMENTAL
INDEMNIFICATIONS"), and (L) NHP or MLD, as applicable, will grant rights of
first refusal to BCC with respect to any proposed sales of the Properties, by
means of right of first refusal agreements ("REFUSAL AGREEMENTS").

         C. BCC, Elder, and Developer each acknowledges and agrees that this
Agreement is given as an inducement to NHP and MLD to consummate the
Transactions and to enter into the Purchase Contract Assignments, Purchase
Contracts, Leases, Lease Guaranties, Capital Agreements, Deposit Agreements,
Development Agreements, Development Guaranties, Environmental Indemnifications,
and Refusal Agreements, that neither NHP nor MLD would enter into the Purchase
Contract Assignments, Purchase Contracts, Leases, Lease Guaranties, Capital
Agreements, Deposit Agreements, Development Agreements, Development Guaranties,
Environmental Indemnifications, and Refusal Agreements without the execution and
delivery by Elder, BCC and Developer of this Agreement, that such execution and
delivery is a condition precedent to NHP's or MLD's respective obligations under
the Purchase Contract Assignments, Purchase Contracts, Leases, Lease Guaranties,
Capital Agreements, Deposit Agreements, Development Agreements, Development
Guaranties, Environmental Indemnifications, and Refusal Agreements, and that the
Transactions are each subject to final approval by NHP.

         NOW, THEREFORE, taking the foregoing paragraphs A through C (the
"RECITALS") into account, and in consideration of the mutual covenants,
agreements, and conditions set forth herein and in the Purchase Contract
Assignments, Purchase Contracts, Leases, Lease Guaranties, Capital Agreements,
Deposit Agreements, Development Agreements, Development Guaranties,
Environmental Indemnifications, and Refusal Agreements, and for other good and
valuable 


                                      -2-
<PAGE>   3

consideration the receipt and sufficiency of which is hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:

         1. DEFINITION OF AFFILIATE. For purposes of any of the Transactions,
this Agreement, the Purchase Contracts, Purchase Contract Assignments, Leases,
Lease Guaranties, Capital Agreements, Deposit Agreements, Development
Agreements, Development Guaranties, Environmental Indemnifications, and Refusal
Agreements, and any other documents executed by any of the parties hereto, any
Tenants or their respective Affiliates (as defined herein) with respect to the
Transactions:(a) the term "AFFILIATE" is defined to mean with respect to any
person or entity, any other person or entity which controls, is controlled by or
is under common control with the first person or entity, and the term
"AFFILIATES" is defined to mean any group of such persons or entities; (b) the
term "CONTROL" is expressly deemed to include any actual discretion or power to
direct the affairs of the controlled person or entity, either directly or
through a chain of ownership or control (regardless of actual ownership); (c) a
general partner, manager, or managing member of a partnership or limited
liability company, and any owner of thirty percent (30%) or more of such general
partner or managing member, is expressly deemed to control such partnership or
limited liability company; (d) a person or entity owning thirty percent (30%) or
more of the common stock of a corporation or thirty percent (30%) or more of the
voting interest in any other type of entity, is expressly deemed to control such
corporation or other entity; (e) a trustee of a trust is expressly deemed to
control such trust; (f) Tenants and Elder, and any entity which is an Affiliate
of any of the aforementioned entities in this clause (f), are all expressly
deemed to be Affiliates of each other, and (g) BCC, Developer, Managers and any
entity which is an Affiliate of any of the aforementioned entities in this
clause (g) are all expressly deemed to be Affiliates of each other.
Notwithstanding the foregoing, the term "Affiliate" shall not include any person
or entity that is an equity owner or parent entity of Elder Care Operators, LLC,
a Delaware limited liability company; provided, however, this exclusion
provision shall not exclude BCC, Developer, Manager, or Tenant as an Affiliate.

         2. CROSS DEFAULT PROVISIONS. BCC, Elder, and Developer each hereby
acknowledges and agrees that a material default by BCC, Developer, Elder, any
Tenant, or their respective Affiliates under any obligation owed by BCC,
Developer, Elder, any Tenant, or their respective Affiliates to NHP, MLD or any
Affiliate of NHP or MLD arising under or in connection with the Transactions,
including, without limitation, a material default under the Purchase Contract
Assignments, Leases, Lease Guaranties, Capital Agreements, Deposit Agreements,
Development Agreements, Development Guaranties, Environmental Indemnifications,
and Refusal Agreements and any related financing statements, collateral
assignments, or security agreements (hereinafter individually referred to as an
"OBLIGATION" and collectively referred to in this Agreement as the
"OBLIGATIONS"), which default is not cured within any applicable cure period
provided in the documentation for such Obligation, shall, in the NHP's sole,
absolute, and uncontrolled discretion, constitute an event of default for
purposes of and under (A) such Obligation, and (B) any or all of the other
Obligations under the Transactions.

         3. CROSS RENEWAL PROVISIONS. The Lease or Leases (in the case of Leases
with identical effective dates) with the earliest effective date for any of the
Transactions entered into by and between NHP, MLD or their respective Affiliates
and a Tenant are hereinafter sometimes individually referred to 


                                      -3-
<PAGE>   4

as an "INITIAL LEASE" and sometimes collectively referred to as the "INITIAL
LEASES". All other Leases (excluding the Initial Leases) and all subleases of
such other Leases (not including subleases to residents of Facilities) for any
of the Transactions are hereinafter sometimes individually referred to as an
"OTHER Lease" and collectively referred to as the "OTHER LEASES". Any renewal or
extension options at any time made a part of any of the Leases for any of the
Transactions are hereinafter sometimes individually referred to as a "RENEWAL
OPTION" and collectively referred to as the "RENEWAL OPTIONS". BCC, Elder, and
Developer each hereby agrees that: (A) if any Renewal Option under any Initial
Lease or any sublease of an Initial Lease is exercised by any person having the
legal authority to exercise such Renewal Option (hereinafter referred to as the
"EXERCISED RENEWAL OPTION"), then all Specified Renewal Options (defined below)
in the other Initial Leases and Other Leases (whether or not previously
exercised) for any of the Transactions shall be deemed to have been
automatically exercised, without any additional actions being required to be
taken by BCC, Elder, Developer, any Tenants, NHP, MLD, or their respective
Affiliates; and (B) if any Renewal Option under any Initial Lease or any
sublease of an Initial Lease is not timely exercised by a person having the
legal authority to exercise such Renewal Option or has not been automatically
deemed exercised pursuant to Section 3(a) hereof (hereinafter referred to as an
"UNEXERCISED RENEWAL OPTION"), then all Specified Renewal Options in the other
Initial Leases and Other Leases (whether or not previously exercised) and all
subsequent Renewal Options contained in any of the Leases for any of the
Transactions shall be deemed to have automatically terminated and shall
thereupon be null and void. For purposes of this Agreement, and with regard to
the Transactions, "SPECIFIED RENEWAL OPTIONS" means all Renewal Options in the
other Initial Leases and Other Leases which by their terms may be exercised
within three (3) years prior to or following the beginning date of the renewal
term of the Initial Lease to which the Exercised Renewal Option or an
Unexercised Renewal Option, as applicable, relates. Upon the occurrence of an
Exercised Renewal Option, BCC, Elder, Developer, the Tenants and any of their
Affiliates each hereby irrevocably appoints NHP as their true and lawful
attorney-in-fact for the sole purpose of executing any documents necessary,
advisable or convenient, in NHP's sole discretion, to evidence the exercise of
any and all Specified Renewal Options under this Agreement, and, more
specifically, they each hereby (AA) authorize NHP to execute on their behalf all
documents necessary to exercise any or all of the Specified Renewal Options,
(BB) agree this power of attorney shall be irrevocable and uncontestable by the
BCC, Elder, Developer, the Tenants, or their respective Affiliates, successors,
or assigns, and (CC) acknowledge and agree this power of attorney is given as
security and coupled with an interest.

         4. RENEWAL OPTION CURE PROVISIONS. Notwithstanding anything else in
this Agreement to the contrary, in the event of an Unexercised Renewal Option,
the Specified Renewal Options in the other Initial Leases and the Other Leases
(whether or not previously exercised) for any of the Transactions shall not be
deemed to have automatically terminated and shall not thereupon be null and
void, until and unless: (A) NHP gives written notice (in the manner required
under Section 8 hereof) to BCC and Elder of the occurrence of an Unexercised
Renewal Option, and (B) NHP does not receive, within ten (10) calendar days from
the deemed receipt date of the notice required under Section 4(a) hereof, a
written and signed notice (in the manner required under Section 8 hereof)
(hereinafter referred to as a "LATE RENEWAL NOTICE") from BCC, Elder or the
Tenant under the applicable Initial Lease which states that the Tenant under the
applicable Initial Lease desires to exercise the Renewal Option to which such
Unexercised Renewal Option relates. Nothing in this Section 3 shall be construed
as extending the time period set forth 


                                      -4-
<PAGE>   5

in any Initial Lease or Other Lease for exercising a Renewal Option. In the
event NHP receives a Late Renewal Notice, then (AA) NHP (as applicable) shall
have the option, at its sole discretion, to either renew or not renew any or all
Expired Leases, and (BB) all Specified Renewal Options shall be deemed to have
been automatically exercised (as otherwise provided in Section 2 hereof). For
purposes of this Agreement and with regard to the Transactions, the term
"EXPIRED LEASES" means the Initial Lease and all Other Leases for which the
otherwise applicable Renewal Option has expired, whether or not the Term (as
defined in each Initial Lease or Other Lease) has expired.

         5. BCC PURCHASE OPTION. Provided that (i) all the Leases are still in
effect, and (ii) no Event of Default (as defined in the respective Leases and
subject to Section 2 hereof) under any of the Leases remains uncured as of (A)
BCC's exercise of its option to purchase the Properties pursuant to this Section
5, and (B) the closing date established to consummate the purchase of the
Properties pursuant to BCC's exercise of such option, BCC shall have the option
to purchase (or cause a BCC Affiliate to purchase) all but not less than all of
the Properties upon the following terms and conditions:

                  (a) Not more than thirty (30) days before or after the date
         which is twelve (12) months prior to the end of the then current Term
         (as defined in the Initial Leases) of the Initial Leases, BCC may, but
         is not obligated to, exercise an option to purchase all but not less
         than all of the Properties by giving NHP written notice thereof;

                  (b) The purchase price for the Properties shall be payable in
         cash by BCC and shall be equal to the greater of (i) the aggregate fair
         market value of the Properties on the date of BCC's exercise of its
         option pursuant to this Section 5 (the "OPTION DATE"), or (ii) the
         aggregate Landlord's Investment (as defined in each Lease) for all the
         Leases on the Option Date. If within ten (10) days of the date of BCC's
         exercise of its option under this Section 5 BCC and NHP are unable to
         agree on the fair market value of the Properties, such fair market
         value shall be established by the appraisal process prescribed in each
         of the Leases with respect to the setting of fair market value for
         purposes of determining Minimum Rent (as defined in each Lease) for any
         Renewal Term (as defined in each Lease). Such fair market value must be
         finally determined no later than ninety (90) calendar days after BCC's
         exercise of its option under this Section 5 or BCC shall lose its right
         to purchase the Properties unless the failure to determine value was
         caused by the willful acts or omissions of NHP;

                  (c) Once the purchase price is established pursuant to the
         above, NHP, as seller (hereinafter sometimes collectively referred to
         as "SELLERS"), and BCC and/or its designated Affiliates, as buyer
         (hereinafter sometimes collectively referred to as "BUYERS"), shall
         immediately open an escrow to consummate such purchase at a national
         title company selected by NHP on the following terms: (i) the form of
         such instructions to be then signed by Sellers and Buyers shall be such
         title company's standard sale escrow instructions without any
         representations or warranties and without due diligence or other
         contingencies in favor of Buyers, (ii) the purchase price shall be
         payable in cash by Buyers upon the expiration of the then current Term
         of the Initial Leases (as defined therein), (iii) Buyers shall pay all
         transaction costs, (iv) at close, Sellers shall deliver title to the
         Properties subject only to those title exceptions agreed to by NHP and
         free and clear of any 


                                      -5-
<PAGE>   6


         liens created by Sellers (other than liens, Leases, subleases, and
         related instruments entered into, caused, or created in whole or in
         part by BCC, Elder, Developer, Manager, Buyers, Tenants, or their
         respective Affiliates), (v) the sale escrow instructions shall provide
         for a deposit equal to five percent (5%) of the purchase price and
         shall provide that the deposit may be retained by Sellers as liquidated
         damages in the event of any breach by Buyers of the terms of the escrow
         instructions (provided, however, such liquidated damages shall relate
         only to Sellers' damages by reason of a breach of the escrow
         instructions and shall in no way liquidate or limit Sellers' damages by
         reason of a breach of this Lease), (vi) the escrow shall close on the
         last day of the then current Term or the Initial Lease, and (vii) the
         escrow instructions shall otherwise be in form and substance reasonably
         satisfactory to NHP;

                  (d) If BCC fails to close the escrow for any reason other than
         a breach by NHP, then NHP shall have the right to extend the then
         current Term (as defined in each Lease) of each of the Leases for the
         Transactions for an additional year. The Additional Rent (as defined in
         each Lease) and Minimum Rent (as defined in each Lease) during such
         year extension period shall be calculated as if on the Option Date BCC
         had instead exercised its right under each Lease to extend the Term for
         a Renewal Term; and

                  (e) On such terms as may be mutually agreed to by and between
         NHP and BCC, and subject to the requirement that all of the Properties
         in connection with the Transaction be purchased in the event BCC
         exercises its option under this Section 5, NHP agrees to permit BCC to
         designate (i) pools of Properties ("POOLS") to be purchased, and (ii)
         joint venture partners to invest with BCC in such Pools. Each of such
         Pools shall be subject to the requirements otherwise set forth in this
         Section 5.

         6. DEVELOPMENT FEES AND BUDGETS.

                  (a) Notwithstanding any provisions of the Development
         Agreements to the contrary, BCC and Developer hereby acknowledge and
         agree that the aggregate development fees (the "DEVELOPMENT FEES") paid
         to Developer by NHP and MLD with respect to the development of the
         Properties in connection with the Transaction pursuant to the
         Development Agreements, shall be a part of NHP's Maximum Investment and
         shall be limited to six and one-half percent (6.5%) of NHP's Maximum
         Investment. In the event the aggregate Development Fees paid by NHP and
         its Affiliates ever exceeds NHP's Maximum Investment, Developer hereby
         agrees to refund the amount of such excess to NHP within ten (10)
         calendar days of Developer's deemed receipt of written notice from NHP
         of the fact and amount of such excess (the "REFUND AMOUNT"); provided,
         further, in the event Developer fails to refund the Refund Amount to
         NHP within the Refund Period, BCC hereby agrees to reimburse to NHP the
         Refund Amount, within ten (10) days of BCC's receipt of written notice
         from NHP of the facts of Developer's failure to refund the Refund
         Amount, which payment shall directly offset the Refund Amount due from
         Developer.

                  (b) Notwithstanding any provisions of this Agreement or the
         Development Agreements for any of the Transactions to the contrary, if
         the Development Advance amount defined in a Development Agreement is
         greater than the aggregate amounts paid 


                                      -6-
<PAGE>   7

         by NHP with respect to all Applications for Payment made by Developer
         pursuant to such Development Agreement (the "TOTAL FACILITY FUNDINGS"),
         then any such excess (the "UNDER BUDGET AMOUNT") may be applied, to the
         extent of such Under Budget Amount, in payment of any Over Budget
         Application for Payment submitted to NHP or its Affiliate with respect
         to another Development Agreement. For purposes of this Agreement, the
         term "OVER BUDGET APPLICATION FOR PAYMENT" shall mean any Application
         for Payment (as defined in the applicable Development Agreement) which,
         if paid, would cause the Total Facility Fundings paid pursuant to a
         Development Agreement to exceed the Development Advance amount defined
         in such Development Agreement. To determine whether there is an
         available Under Budget Amount, the Total Facility Fundings may only be
         calculated following the later of (i) the date on which the
         Improvements are deemed substantially complete (as determined under the
         applicable Development Agreement), (ii) the deemed receipt date by NHP
         or its Affiliate of the Final Application for Payment. For purposes of
         this Agreement, the term "FINAL APPLICATION FOR PAYMENT" shall mean an
         Application for Payment identified by the Developer as the final
         Application for Payment to be submitted by Developer with respect to
         the applicable Development Agreement. Nothing in this Paragraph 6 shall
         be construed so as to require NHP and its Affiliates to pay any amount
         which would cause the aggregate payments made by them (pursuant to this
         Agreement and the Development Agreements) to exceed NHP's Maximum
         Investment.

         7. ESTOPPEL CERTIFICATES. All the Properties in connection with the
Transactions shall be subject to this Master Agreement. Prior to entering into
any Lease or sublease of a Lease (except with respect to any resident
agreements), the proposed Tenant under such Lease or sublease, must execute an
estoppel certificate in the form attached hereto as EXHIBIT "B", acknowledging
and agreeing that Tenant's leasehold interest under the applicable Lease is
subject to the terms and conditions of this Agreement, and the proposed Manager
of any Facility located on the Property which is the subject of such Lease or
sublease must execute an estoppel certificate in the form attached hereto as
EXHIBIT "C", acknowledging and agreeing that Manager shall comply with and not
take any actions which violate the terms and conditions of this Agreement or the
applicable Lease.

         8. NOTICE. All notices and demands, certificates, requests, consents,
approvals, and other similar instruments under this Agreement shall be in
writing and shall be deemed to have been properly given upon actual receipt
thereof or within three (3) business days of being placed in the United States
certified or registered mail, return receipt requested, postage prepaid (a) if
to BCC, Elder, or Developer, addressed to: Balanced Care Corporation, 5021
Louise Drive, Suite 200, Mechanicsburg, PA 17055, Attn: President, Facsimile No.
(717) 796-6150; with a copy to Balanced Care Corporation, 5021 Louise Drive,
Suite 200, Mechanicsburg, PA 17055, Attn: Legal Department; with a copy to Elder
Care Operators, LLC, 1350 Bayshore Highway, Suite 300, Burlingame, CA 94010,
Attn: President and General Counsel, Facsimile No. (415) 348-6943; with a copy
to Kirkpatrick & Lockhart, LLP, 1500 Oliver Building, Philadelphia, PA 15222,
Attn: Steven J. Adelkoff, Facsimile No. (412) 355-6501; and with a copy to
Cooley Godward LLP, One Maritime Plaza, 20th Floor, San Francisco, California
94111, Attn: Barry Graynar, Facsimile No. (415) 951-3699; or at such other
address as BCC, Elder, or Developer from time to time may have designated by
written notice to NHP, and (b) if to NHP, addressed to Nationwide Health
Properties, Inc., 610 Newport Center Drive, Suite 1150, Newport Beach, CA 92660,
Attention: President, Fax No. (714) 759-6876 with a copy to Cordray & Goodrich,



                                      -7-
<PAGE>   8

3306 Sul Ross, Houston, Texas 77098, Attention: Howard F. Cordray, Jr., Fax No.
(713) 630-0017, or at such address as NHP may from time to time have designated
by written notice to Developer. Refusal to accept delivery shall be deemed
delivery. If the addressee is not an individual, notice may be made to any
officer, general partner or principal of such addressee.

         9. REPRESENTATIONS AND WARRANTIES. BCC, Elder, and Developer each
understands and acknowledges that NHP is relying upon the respective
representations of such parties set forth in this Agreement, and that NHP may
rely on such party's representations for all purposes, including without
limitation all the Transactions, all the Development Agreements, and all the
Leases. The Recitals set forth above are hereby incorporated by this reference
and made a part of this Agreement. BCC, Elder, and Developer each hereby
acknowledges, represents and warrants that the Recitals are true and correct.

         10. MISCELLANEOUS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same document. This Agreement shall be binding upon the
successors and permitted assigns of the parties hereto (and the Affiliates of
such parties, successors, and permitted assigns). For purposes of the
Transactions and this Agreement, the term "NHP" shall include NHP or its
Affiliates and any subsequent owner of NHP's or its Affiliate's interest in any
of the Leases or Properties, or any assignee of NHP's or its Affiliate's rights
under any instruments or agreements memorializing or evidencing the Obligations
in connection with the Transactions. This Agreement shall be construed and
enforced in accordance with the internal laws of the State of Texas, without
regard to the rules governing choice of law. The parties hereto agree that venue
for any and all lawsuits related to this Agreement shall be in Harris County,
Texas.

         11. NO JOINT VENTURE. The parties to this Agreement do not intend by
this Agreement to in any way or for any purpose become partners of each other or
in the conduct of any business, joint venturers of each other, or members of a
joint enterprise with each other, it being understood and agreed between the
parties that each party is and shall be, for all purposes of this Agreement,
acting independently of each other and/or as independent contractors.

         12. INCREASES IN NHP'S MAXIMUM INVESTMENT. The parties may in the
future mutually agree in writing, by amendment of this Agreement, to (i)
increase the number of Properties or Facilities governed by this Agreement (ii)
apply any Under Budget Amount to the development of improvements on such
additional Properties or Facilities, and/or (iii) increase NHP's Maximum
Investment; provided, however, if and when BCC or its Affiliates have received
assignment of and/or assumed the rights, duties, and obligations of the Tenants
under all the Leases for all the Transactions, then (A) BCC and its Affiliates
hereby agree that all similar transactions by and between NHP and its Affiliates
and BCC and its Affiliates, shall be defined as Transactions for purposes of
this Agreement and be subject to this Agreement for all purposes, and (B) for
purposes of this sentence, Elder Care, Oakhaven, and such Tenants shall cease to
be parties to this Agreement. NHP's Maximum Investment shall not be increased
for any reason without the express written consent of NHP, which consent shall
be at the sole discretion of NHP, and no application of an Under Budget Amount
as contemplated in Paragraph 6(b) above shall constitute a consent to increase
NHP's Maximum Investment.

         This Agreement is made effective as of March 27, 1998.


                                      -8-
<PAGE>   9

                      "NHP"

                      NATIONWIDE HEATH PROPERTIES, INC., 
                      a Maryland corporation


                      By: /s/ GARY E. STARK
                          --------------------------------
                           Gary E. Stark, Vice President


                      "MLD"

                      MLD DELAWARE TRUST,  a Delaware business trust


                      By: /s/ MARK L. DESMOND
                          --------------------------------
                           Mark L. Desmond, Trustee


                      "BCC"

                      BALANCED CARE CORPORATION,
                      a Delaware corporation


                      By: /s/ ROBIN L. BARBER
                         ----------------------------------
                      Name:   Robin L. Barber
                           --------------------------------
                      Title:  Assistant Secretary
                            -------------------------------


                      "DEVELOPER"

                      BCC DEVELOPMENT AND MANAGEMENT CO., a Delaware
                      corporation


                      By: /s/ ROBIN L. BARBER
                         -----------------------------------
                      Name:   Robin L. Barber
                           ---------------------------------
                      Title:  Secretary
                            --------------------------------




                                      -9-
<PAGE>   10

                      "ELDER CARE"

                      ELDER CARE OPERATORS, LLC,
                      a Delaware limited liability company


                      By:  /s/ signature missing
                         -----------------------------------
                      Name:
                           ---------------------------------
                      Title:
                            --------------------------------


                      "OAKHAVEN"

                      OAKHAVEN ELDER LIVING, INC.



                      By:  /s/ signature missing
                         -----------------------------------
                      Name:
                           ---------------------------------
                      Title:
                            --------------------------------








                                      -10-
<PAGE>   11


                                   EXHIBIT "A"
                              SCHEDULE OF PROJECTS

<TABLE>
<CAPTION>

                                                                           Maximum NHP
         Name of Facility                   Location                       Investment
    ------------------------           ------------------                 ------------

<S>                               <C>                                    <C>          
Outlook Pointe at York            Knob Hill Road, York Township          $4,450,000.00
                                  York County, Pennsylvania

Outlook Point at Lakemont         Washington Pike, South Fayette         $8,600,000.00
Farms                             Township, Allegheny County,
                                  Pennsylvania

Outlook Pointe at Murfreesboro    U.S. Hwy 231, Murfreesboro,            $4,500,000.00
                                  Rutherford County, Tennessee

Outlook Pointe at Bristol         Meadow View Road, Bristol,             $4,550,000.00
                                  Sullivan County, Tennessee

Outlook Pointe at Hilliard        Constitution Blvd., Hilliard,          $7,700,000.00
                                  Franklin County, Ohio

Outlook Pointe at Akron           South Hawkins Avenue, Akron            $7,050,000.00
                                  Summit County, Ohio


TOTAL:                                                                  $36,850,000.00
                                                                        ==============
</TABLE>



                                      -11-
<PAGE>   12

                                OMITTED EXHIBITS


     Exhibit B        Tenant Estoppel Certificate

     Exhibit C        Manager Estoppel Certificate