Document:

<PAGE>   1
                                                                   EXHIBIT 10.14

                               AMENDMENT NO. 4 TO
                  MASTER CONSTRUCTION LINE OF CREDIT AGREEMENT

           THIS AMENDMENT NO. 4 TO MASTER CONSTRUCTION LINE OF CREDIT
  AGREEMENT, dated as of May 25, 2000 ("THIS AMENDMENT"), among the following:

              (i)   ALTERRA HEALTHCARE CORPORATION, a Delaware corporation
         formerly known as Alternative Living Services, Inc. (herein, together
         with its successors and assigns, the "COMPANY");

              (ii)  ALS NATIONAL, INC., a Delaware corporation (a "BORROWER");

              (iii) the lending institutions listed on the signature pages
         hereof (the "LENDERS");

              (iv)  BANK OF AMERICA, NATIONAL ASSOCIATION, as successor to Bank
         of America National Trust and Savings Association, a national banking
         association, and SOUTHTRUST BANK, NATIONAL ASSOCIATION, a national
         banking association, as Co-Agents; and

              (v)   KEY CORPORATE CAPITAL INC., a Michigan corporation, as
         administrative agent (the "ADMINISTRATIVE AGENT")

         PRELIMINARY STATEMENTS:

         (1)  The parties hereto entered into the Master Construction Line of
Credit Agreement, dated as of October 6,1998, as amended by Amendment No. l
thereto, dated as of January 5, 1999, and Amendment No. 2 thereto, dated as of
May 5, 1999, and Amendment No. 3 thereto, dated as of March 1, 2000 (as so
amended, the "CREDIT AGREEMENT"; with the terms defined therein, or the
definitions of which are incorporated therein, being used herein as so defined).

         (2)  In connection with the satisfaction of the New Capital Funding
Requirement, the parties hereto desire to change certain of the terms and
provisions of the Credit Agreement, all as more fully set forth below.

         NOW, THEREFORE, the parties hereby agree as follows:

         SECTION 1.        AMENDMENTS, ETC.

         1.1. INTEREST.  Effective on the Effective  Date of this Amendment
provided for in section 4 hereof, section 2.9(b) of the Credit Agreement is
amended to read in its entirety as follows:

              (b)   The unpaid principal amount of each Loan which is a
         Eurodollar Loan shall bear interest from the date of the Borrowing
         thereof until maturity (whether by acceleration or otherwise) at a rate
         per annum which shall at all times be the relevant Eurodollar Rate for
         such Loan PLUS (i)

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         200 basis points per annum, at all times during the period from the
         date of this Agreement through December 31, 1999, or (ii) 260 basis
         points per annum, at all times thereafter; PROVIDED that if (A) the
         ratio of (I) Consolidated EBITDAR for any Testing Period, to (II)
         Consolidated Lease and Debt Service Charges for such Testing Period,
         exceeds 1.25 to 1.00 for such Testing Period, with the first eligible
         Testing Period to be measured hereunder being the four consecutive
         fiscal quarters ending December 31, 2000, (B) the Company delivers its
         financial statements pursuant to section 8.1(a) or (b), together with a
         certificate pursuant to section 8.1(c) containing computations
         demonstrating compliance with such condition and a letter addressed to
         the Administrative Agent which specifically refers to this provision of
         this section 2.9(b) of the Credit Agreement, and (C) the Administrative
         Agent notifies the parties hereto that such condition has been
         satisfied (which the Administrative Agent shall issue promptly upon
         review of such financial statements and such computations and
         satisfaction of such condition), then on the effective date of such
         notice from the Administrative Agent, the interest rate margin
         specified in clause (ii) above shall change from 260 basis points to
         237.50 basis points and shall remain at 237.50 basis points until the
         last day of the next Testing Period as of which such ratio does not
         exceed 1.25 to 1.00 at which time the interest rate margin shall revert
         to 260 basis points.

         1.2. REDUCTION IN TOTAL TRANCHE A COMMITMENT. In light of the Tranche A
Commitment Period Termination Date and after giving effect to the qualification
of 14 Projects and approval of their respective Project Summary & Feasibility
Reports pursuant to Section 2.2 of the Credit Agreement, the maximum aggregate
principal amount of Tranche A Loans which can be incurred under the Credit
Agreement is $59,187,084. Accordingly, the Total Tranche A Commitment is
$59,187,084 and Annex I to the Credit Agreement is amended to reflect the
following Tranche A Commitments:

<TABLE>
<CAPTION>

              ========================================================= =============================
                                   NAME OF LENDER                                      TRANCHE A
                                                                                      COMMITMENT
              ========================================================= =============================
<S>                                                                                   <C>

              Key Corporate Capital Inc.                                              $13,810,323.54
              --------------------------------------------------------- -----------------------------
              Bank of America National Trust and Savings                               $7,891,609.23
              Association
              --------------------------------------------------------- -----------------------------
              SouthTrust Bank, National Association                                    $7,891,609.23
              --------------------------------------------------------- -----------------------------
              Fleet National Bank                                                      $7,398,385.50
              --------------------------------------------------------- -----------------------------
              Bank One, Texas, N.A.                                                    $7,398,385.50
              --------------------------------------------------------- -----------------------------
              Comerica Bank                                                            $7,398,385.50
              --------------------------------------------------------- -----------------------------
              U.S. Bank, National Association                                          $7,398,385.50
              --------------------------------------------------------- -----------------------------
                       TOTAL                                                          $59,187,084.00
              ========================================================= =============================
</TABLE>

         1.3. ADDITIONAL SUPPLEMENTAL RESERVE. The Lenders hereby consent to the
execution and delivery of Amendment No. 2 to Supplemental Reserve Pledge
Agreement, substantially in the form attached as Exhibit A hereto ("AMENDMENT
NO. 2 TO SUPPLEMENTAL RESERVE PLEDGE AGREEMENT").

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<PAGE>   3

         1.4. FINANCIAL PROJECTIONS. Effective on the Effective Date of this
Amendment provided for in section 4 hereof, section 7.8 of the Credit Agreement
is amended by deleting the sentence:

         No facts are known to the Company at the date hereof which, if
         reflected in the Recent Financial Projections, would result in a
         material adverse change in the assets, liabilities, results of
         operations or cash flows reflected therein.

and inserting in its place the sentence:

         No facts are known to the Company at the date hereof which, if
         reflected in the May 5, 2000 Model, would result in a material adverse
         change in the assets, liabilities, results of operations or cash flows
         reflected therein.

         1.5. NO MATERIAL ADVERSE CHANGE. Effective on the Effective Date of
this Amendment provided for in section 4 hereof, section 7.9 of the Credit
Agreement is amended to read in its entirety as follows:

              7.9. NO MATERIAL ADVERSE CHANGE. Since December 31, 1999,
         there has been no change in the condition, business or affairs of the
         Company and its Subsidiaries taken as a whole, or their properties and
         assets considered as an entirety, except for changes, none of which,
         individually or in the aggregate, has had or could reasonably be
         expected to have, a Material Adverse Effect, other than changes in the
         condition, business or affairs of the Company described in the
         Company's annual report on form 10K for the fiscal year 1999 and the
         Company's quarterly report on form 10Q for the first quarter of 2000 as
         filed with the SEC and as reflected in the May 5, 2000 Model.

         1.6. PROMPT TAKE-OUT. Effective on the Effective Date of this Amendment
provided for in section 4 hereof, section 8.14(c) of the Credit Agreement is
amended by adding the following text to the end of such section:

         Notwithstanding anything contained in the foregoing to the contrary,
         the Company agrees that it will repay pursuant to a refinance the Loans
         for a Project in accordance with the Project Take-Out Agreement related
         to such Project, or otherwise prepay such Loans, within forty-five (45)
         days of the first anniversary of the earlier to occur of (i) the date a
         Certificate of Occupancy is issued for such Project together with any
         required governmental licenses and permits necessary for the Borrower
         to commence commercial operation of such Project, or (ii) the date such
         Borrower commences commercial operation of such Project.

         1.7. MINIMUM CONSOLIDATED NET WORTH. Effective on the Effective Date of
this Amendment provided for in section 4 hereof, section 9.5 of the Credit
Agreement is amended to read in its entirety as follows:

              9.5. MINIMUM CONSOLIDATED NET WORTH AND NEW CAPITAL. The
         Company will not at any time permit the sum (without duplication) of
         (x) its Consolidated Net Worth, (y) the aggregate liquidation value of
         its outstanding PREFERRED STOCK, if any, which was issued in connection
         with the New Capital Funding Requirement (including any additional
         shares of Redeemable PREFERRED STOCK issued thereafter as an additional
         investment in the Company or as "payment in kind" of accrued
         dividends), and (z) the aggregate principal amount of its outstanding
         subordinated Indebtedness, if any, which was issued in connection with
         the New Capital

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         Funding Requirement and is subordinate to the Obligations (including
         any Additional Debentures (as defined in the Purchase Agreement) or
         other additional subordinated Indebtedness issued thereafter as an
         additional investment in the Company or as "payment in kind" of accrued
         interest), at any time to be less than $105,000,000, EXCEPT that

                   (i) effective as of the end of the Company's fiscal quarter
              ended March 31, 1998, and as of the end of each fiscal quarter
              thereafter, the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be increased by
              50% of the Consolidated Net Income of the Company for the fiscal
              quarter ended on such date, if any (there being no reduction in
              the case of any such Consolidated Net Income which reflects a
              deficit);

                   (ii) the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be increased by
              an amount equal to 75% of the cash proceeds (net of underwriting
              discounts and commissions and other customary fees and costs
              associated therewith) from any sale or issuance by the Company
              after March 31, 1998 of equity (other than any sale or issuance to
              any Subsidiary or to management or employees pursuant to employee
              benefit plans of general application);

                   (iii) the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be increased
              (WITHOUT DUPLICATION OF ANY INCREASES PURSUANT TO SECTIONS 9.5(ii)
              OR (iv)) by an amount equal to 75% of the cash proceeds (net of
              underwriting discounts and placement commissions and other
              customary fees and costs associated therewith) from any sale or
              issuance by the Company of the Initial Securities or any
              Additional Debentures (as such terms are defined in the Purchase
              Agreement);

                   (iv) the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be increased by
              an amount equal to 75% of (x) the principal amount of Indebtedness
              or (y) the higher of stated value or liquidation value of
              Redeemable Stock, as the case may be, which, in either case, is
              converted or exchanged after March 31, 1998 into common stock of
              the Company or any of its Subsidiaries;

                   (v) the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be increased by
              an amount equal to 75% of the increase in Consolidated Net Worth
              attributable to the issuance of common stock or other equity
              interests subsequent to March 31, 1998 as consideration in any
              Acquisition;

                   (vi) the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be decreased by
              an amount, not in excess of $25,000,000 in the aggregate,
              representing 75% of the non-cash losses from the sale of assets
              outside the ordinary course of business subsequent to March 31,
              2000;

                   (vii) the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be decreased by
              an amount, not in excess of $10,000,000 in the aggregate,
              representing 75% of the non-recurring losses or charges incurred
              after March 31, 2000 related to the reduction or elimination of
              overhead or other costs, charges or expenses in connection with a
              restructuring of the Company's stock option program;

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                   (viii) the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be decreased by
              75% of the amount of any reduction made after March 31, 2000 in
              the book or tax carrying cost of any assets as a result of any
              change in GAAP; and

                   (ix) the foregoing amount (as it may from time to time be
              increased or decreased as herein provided), shall be increased
              (WITHOUT DUPLICATION OF ANY INCREASES PURSUANT TO SECTION 9.5(iv)
              by 75% of the amount of interest "paid-in-kind" or otherwise
              treated as an accretion to principal pursuant to the terms of the
              Initial Securities or the Additional Debentures (as such terms are
              defined in the Purchase Agreement).

         1.8. RATIO OF CONSOLIDATED EBITDAR TO CONSOLIDATED LEASE AND DEBT
SERVICE CHARGES. Effective on the Effective Date of this Amendment provided for
in section 4 hereof, section 9.10 of the Credit Agreement is amended to read in
its entirety as follows:

              9.10. RATIO OF CONSOLIDATED EBITDAR TO CONSOLIDATED LEASE AND
         DEBT SERVICE CHARGES. (a) Subject to section 9.10(c) below, the Company
         will not permit the ratio of (i) Consolidated EBITDAR for any Testing
         Period, to (ii) Consolidated Lease and Debt Service Charges for such
         Testing Period to be less than the amount indicated below for such
         Testing Period:
<TABLE>
<CAPTION>

========================================================= ===================
                     TESTING PERIOD                             RATIO
========================================================= ===================
<S>                                                       <C>

Testing Period consisting of the single fiscal            .85 to 1.00
quarter ended March 31, 2000
--------------------------------------------------------- -------------------
Testing Period consisting of the two fiscal               .80 to 1.00
quarters ended June 30, 2000
--------------------------------------------------------- -------------------
Testing Period consisting of the three fiscal             .85 to 1.00
quarters ended September 30, 2000
--------------------------------------------------------- -------------------
Testing Period ended December 31, 2000                    .90 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended March 31, 2001                       .90 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended June 30, 2001                        .97 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended September 30, 2001                   1.05 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended December 31, 2001                    1.10 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended March 31, 2002                       1.15 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended June 30, 2002                        1.20 to 1.00
--------------------------------------------------------- -------------------
Any Testing Period thereafter                             1.25 to 1.00
========================================================= ===================
</TABLE>

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<PAGE>   6

                  (b) Subject to section 9.10(c) below, the Company will not
         permit the ratio of (i) Consolidated EBITDAR for any Testing Period, to
         (ii) Consolidated Lease and Debt Service Charges for such Testing
         Period to be less than the amount indicated below for such Testing
         Period:
<TABLE>
<CAPTION>

========================================================= ===================
                     TESTING PERIOD                             RATIO
========================================================= ===================
<S>                                                       <C>

Testing Period consisting of the single fiscal            .85 to 1.00
quarter ended March 31, 2000
--------------------------------------------------------- -------------------
Testing Period consisting of the two fiscal               .75 to 1.00
quarters ended June 30, 2000
--------------------------------------------------------- -------------------
Testing Period consisting of the three fiscal             .75 to 1.00
quarters ended September 30, 2000
--------------------------------------------------------- -------------------
Testing Period ended December 31, 2000                    .80 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended March 31, 2001                       .85 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended June 30, 2001                        .90 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended September 30, 2001                   .95 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended December 31, 2001                    1.05 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended March 31, 2002                       1.10 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended June 30, 2002                        1.15 to 1.00
--------------------------------------------------------- -------------------
Testing Period ended September 30, 2002                   1.20 to 1.00
--------------------------------------------------------- -------------------
Any Testing Period thereafter                             1.25 to 1.00
========================================================= ===================
</TABLE>

                  (c) If the Company fails to satisfy the ratio set forth in
         section 9.10(a) for any Testing Period but does satisfy the ratio set
         forth in section 9.10(b) for such Testing Period, then such failure
         shall not constitute an Event of Default pursuant to section 10.1(c)
         if, within 45 days following the end of the applicable Testing Period,
         (i) the Company (A) notifies the Administrative Agent and demonstrates
         that it has sufficient Carry-Over QLE Credit such that when such
         Carry-Over QLE Credit is added to and considered part of Consolidated
         EBITDAR for such Testing Period, the ratio set forth in section 9.10(a)
         shall be satisfied, or (B) completes what it believes is a Qualifying
         Liquidity Event resulting in net cash proceeds which, if added to and
         considered to be part of Consolidated EBITDAR for such Testing Period
         would result in the ratio required by section 9.10(a) being complied
         with, and the Company notifies the Administrative Agent and the Lenders
         thereof and provides evidence of the occurrence thereof in reasonable
         detail (including; without limitation, a written description of the
         information provided to the Board of Directors of the Company with
         respect to any sale of residence-level assets, including the location
         of the asset, financial performance of the asset for the most recent
         year and the projected following year, the current financing of the
         asset and anticipated cash proceeds resulting from the sale, and
         further including a representation to the Administrative Agent and the
         Lenders that the sale of such asset would not result in a future
         violation of any covenant contained in the Credit Agreement), together
         with a computation in

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         reasonable detail of the ratio set forth in section 9.10(a) which gives
         effect to the net cash proceeds received from such Qualifying Liquidity
         Event, together with the Carry-Over QLE Credit, if any, and (ii) the
         Administrative Agent confirms its belief that there is a sufficient
         Carry-Over QLE Credit and/or a Qualifying Liquidity Event has occurred
         and that the Company's computations support the conclusion that no
         Event of Default occurred by virtue of this section 9.10(c) and so
         notifies the parties hereto (which notice the Administrative Agent
         shall issue promptly upon confirmation of such conditions).

                  (d) If on a single occasion during any single fiscal quarter
         ended after March 31, 2000, the Company incurs non-recurring losses or
         charges related to the reduction or elimination of overhead or other
         costs, charges or expenses in connection with a restructuring of the
         Company's stock option program, THEN notwithstanding anything to the
         contrary contained in this Agreement, in computing Consolidated EBITDAR
         for any Testing Period which includes such fiscal quarter, for purposes
         of sections 9.10(a) and (b) only, the aggregate amount of such
         non-recurring cash losses and charges, up to a maximum of $2,500,000,
         shall be an addition to and considered part of Consolidated EBITDAR.

                  (e) If during any fiscal quarter ended after March 31, 2000,
         the Company or any Affiliate receives advances of loan proceeds
         pursuant to (i) the Credit Agreement, (ii) the Master Construction Line
         of Credit Agreement dated as of August 31, 1999 among Third Party
         Investors I, LLC, the lending institutions named therein, the co-agents
         named therein and Key Corporate Capital Inc. as administrative agent,
         as amended (the "TPI CREDIT AGREEMENT"), or (iii) the master commitment
         with ALS-Northeast, LLC as guaranteed by the Company and Assisted
         Living Equities LLC (the "PIONEER JOINT VENTURE AGREEMENT"), related to
         project lease-up interest expense or project lease-up operating
         deficits (but only to the extent that such losses would be reflected on
         the financial statements of the Company with respect to such advances
         pursuant to the Pioneer Joint Venture Agreement), THEN notwithstanding
         anything to the contrary contained in this Agreement, in computing
         Consolidated EBITDAR for any Testing Period which includes such fiscal
         quarter, for purposes of sections 9.10(a) and (b) only, the aggregate
         amount of such advances shall be an addition to and considered part of
         Consolidated EBITDAR.

         1.9. MINIMUM CASH & CASH EQUIVALENTS. Effective on the Effective Date
of this Amendment provided for in section 4 hereof, section 9.11 of the Credit
Agreement is amended to read in its entirety as follows:

              9.11. MINIMUM CASH & CASH EQUIVALENTS. (a) The Company will not
         permit the aggregate of its unrestricted cash and Cash Equivalents
         together with the undisbursed funds deposited by the Company pursuant
         to section 4(f) of Amendment No. 4 to Credit Agreement and section 4(e)
         of Amendment No. 2 to the TPI Credit Agreement, at any time, to be less
         than $10,000,000, PROVIDED, HOWEVER, that the covenant contained in
         this section 9.11(a) shall be of no further force or effect upon the
         satisfaction of the ratio of (i) Consolidated EBITDAR for any fiscal
         quarter, to (ii) Consolidated Lease and Debt Service Charges for such
         fiscal quarter, exceeds 1.00 to 1.00 for two consecutive fiscal
         quarters, with the first eligible fiscal quarter to be measured
         hereunder being the fiscal quarter ending June 30, 2000, and continued
         maintenance of such ratio thereafter.

         (b)  The Company will not permit the aggregate of its unrestricted cash
         and Cash Equivalents together with the undisbursed funds deposited by
         the Company pursuant to section 4(f) of

                                       7
<PAGE>   8

         Amendment No. 4 to Credit Agreement and section 4(e) of Amendment No. 2
         to the TPI Credit Agreement, as of the end of any fiscal quarter, to be
         less than $20,000,000, PROVIDED, HOWEVER, that the covenant contained
         in this section 9.11(b) shall be of no further force or effect upon the
         satisfaction of both (i) sale of Additional Debentures (as defined in
         the Purchase Agreement) resulting in cash proceeds of at least
         $50,000,000 (net of underwriting discounts and placement commissions
         and other customary fees and costs associated therewith), and (ii) the
         ratio of (A) Consolidated EBITDAR for any fiscal quarter, to (B)
         Consolidated Lease and Debt Service Charges for such fiscal quarter,
         exceeds 1.20 to 1.00 for two consecutive fiscal quarters, with the
         first eligible fiscal quarter to be measured hereunder being the fiscal
         quarter ending June 30, 2000.

         1.10. QUARTERLY MINIMUM CONSOLIDATED EBIT; MOST FAVORED COVENANT
STATUS. Effective on the Effective Date of this Amendment provided for in
section 4 hereof, SECTIONS 9.13 AND 9.15 of the Credit Agreement shall be of no
further force or effect.

         1.11. EVENTS OF DEFAULT. Effective on the Effective Date of this
Amendment provided for in section 4 hereof, sections 10.1 (c) and (k) of the
Credit Agreement are amended to read in their entirety as follows:

               (C)  CERTAIN NEGATIVE COVENANTS: the Company shall default in
         the due performance or observance by it of any term, covenant or
         agreement contained in sections 9.3, 9.4, 9.5, 9.6, 9.10, 9.11, 9.14,
         9.16 OR 9.17 of this Agreement; or any Borrower shall default in the
         due performance or observance by it of any term, covenant or agreement
         contained in sections 5, 10, 16(a)(i) or 16(c) of any Mortgage; or

               (K)  MATERIAL ADVERSE EFFECT: (i) any event or circumstance
         shall occur or exist which has a Material Adverse Effect upon the
         Company, as compared to the business, operations, property, assets,
         liabilities or condition (financial or otherwise) of the Company and
         its Subsidiaries as reflected in the financial statements and the
         Financial Projections referred to in section 7.8 other than changes in
         the condition of the Company described in the Company's annual report
         on form 10K for the fiscal year 1999 and the Company's quarterly report
         on form 10Q for the first quarter of 2000 as filed with the SEC and as
         reflected in the May 5, 2000 Model; or

               (ii) any representation or warranty contained in section 2.6
         of Amendment No. 4 to this Credit Agreement, dated as of May 25, 2000,
         with respected to the May 5, 2000 Model referred to therein, shall
         prove to be untrue in any material respect as of the date when made or
         deemed made.

         1.12. ADDITIONAL COVENANTS. Effective on the Effective Date of this
Amendment provided for in section 4 hereof, new sections 9.13, 9.16 AND 9.17 are
added to the Credit Agreement, reading in their entirety as follows:

               9.13. NEW DEVELOPMENT PROHIBITION. Neither the Company nor any
         of its Subsidiaries will (i) commence construction of the three
         so-called land-only Devco 11 projects, (ii) continue construction of
         the six halted and secured so-called Devco II projects commonly known
         as Clare Bridge Cottage of Valley Station (Valley Station I), Sterling
         House of Valley Station (Valley Station II), Clare Bridge of Frederick
         (Frederick I), Sterling House of Frederick (Frederick II), Clare Bridge
         of Irving VRI, and Clare Bridge of New Castle (New Castle I) or (iii)
         begin any other construction or development projects, unless
         appropriate financing for such project(s) has been arranged and closed
         and information with respect to such financing has been forwarded to
         the Administrative

                                       8
<PAGE>   9

         Agent prior to the commencement of construction, including projections
         demonstrating compliance with the financial covenants contained in this
         Credit Agreement throughout the construction period.

               9.16. CASH PAYMENTS ON INITIAL SECURITIES, ETC.; PREPAYMENTS AND
         REFINANCINGS OF SUBORDINATED AND OTHER DEBT, ETC. (a) The Company will
         not make any payment or prepayment in cash in respect of the principal,
         liquidation or stated value of, or the interest or dividends or premium
         or "make whole" on, or the repurchase, redemption or prepayment price
         of, or the sinking or similar fund in respect of, any of the Initial
         Securities or the Additional Debentures (as such terms are defined in
         the Purchase Agreement), whether now outstanding or hereafter incurred
         or arising,

               (i)      prior to May 31, 2004; or

               (ii)     thereafter if a Default or Event of Default has occurred
         and is  continuing  or would result therefrom;

         OTHER than any nominal cash payments (A), for fractional shares in
         connection with the conversion or exchange of any of the Initial
         Securities or the Additional Debentures or the PAY-IN-KIND SECURITIES
         ISSUED WITH RESPECT TO THE INITIAL SECURITIES OR THE ADDITIONAL
         DEBENTURES into common stock of the Company OR THE ISSUANCE OF
         PAY-IN-KIND SECURITIES IN PAYMENT OF DIVIDENDS ON THE INITIAL
         SECURITIES OR THE PAY-IN-KIND SECURITIES ISSUED WITH RESPECT TO THE
         INITIAL SECURITIES, AND (B) FOR FRACTIONAL PRINCIPAL AMOUNTS OF
         ADDITIONAL SUBORDINATED INDEBTEDNESS ISSUED AS "PAYMENT-IN-KIND" OF
         ACCRUED INTEREST OR COUPON PAYMENTS ON THE INITIAL SECURITIES OR THE
         ADDITIONAL DEBENTURES OR THE PAY-IN-KIND SECURITIES ISSUED WITH RESPECT
         TO THE INITIAL SECURITIES OR THE ADDITIONAL DEBENTURES.

               (b)      The Company will not, and will not permit any of its
         Subsidiaries to, make (or give any notice in respect thereof) any
         voluntary or optional prepayment or redemption or acquisition for value
         of (including, without limitation, by way of depositing with the
         trustee with respect thereto money or securities before due for the
         purpose of paying when due) or exchange of, or refinance or refund, any
         of the Initial Securities or the Additional Debentures (as such terms
         are defined in the Purchase Agreement), whether now outstanding or
         hereafter incurred or arising (OTHER THAN EXCHANGES, REFINANCINGS OR
         REFUNDS FOR EQUITY OR DEBT WHICH IS AT LEAST AS SUBORDINATE AS THE
         DEBENTURES WHICH ARE INITIAL SECURITIES AND THE ADDITIONAL DEBENTURES

               9.17.    MODIFICATION OF INDENTURE, PREFERRED STOCK TERMS OR
         RELATED DOCUMENTS THE COMPANY WILL NOT ENTER INTO AMENDMENT TO, OR
         MODIFICATION OR CHANGE OF, THE TERMS OF THE INDENTURE OR THE PREFERRED
         STOCK (EACH AS DEFINED IN THE PURCHASE AGREEMENT) OR ANY OTHER
         DOCUMENTS RELATED THERETO, EACH AS IN EFFECT ON THE EFFECTIVE DATE OF
         THIS SECTION OR ANY DOCUMENTS ENTERED INTO IN CONNECTION WITH ANY
         REFINANCING OR REFUNDING RELATED THERETO, UNLESS IN ANY SUCH CASE, (I)
         SUCH AMENDMENT, MODIFICATION OR CHANGE WOULD NOT MATERIALLY AND
         ADVERSELY AFFECT THE INTEREST OF THE LENDERS AS SENIOR CREDITORS OF THE
         COMPANY, AND (II) PRIOR TO THE EFFECTIVENESS THEREOF, THE COMPANY SHALL
         HAVE NOTIFIED THE ADMINISTRATIVE AGENT OF SUCH AMENDMENT, MODIFICATION
         OR CHANGE AND PROVIDED COPIES OF ANY DOCUMENTS RELATED THERETO TO THE
         ADMINISTRATIVE AGENT.

         1.13. CONSOLIDATED EBIT. Effective on the Effective Date of this
Amendment provided for in section 4 hereof, the definition of Consolidated EBIT
contained in section 1.1 of the Credit Agreement is amended to read in its
entirety as follows:

                                       9
<PAGE>   10

                   "CONSOLIDATED EBIT" shall mean, for any period, Consolidated
         Net Income for such period, PLUS (A) the sum of the amounts for such
         period included in determining such Consolidated Net Income of (i)
         Consolidated Interest Expense, (ii) Consolidated Income Tax Expense,
         and (iii) extraordinary and other non-recurring non-cash losses and
         charges (including non-cash losses and charges attributable to the sale
         of assets by the Company which may not qualify as extraordinary or
         non-recurring in accordance with GAAP), LESS (B) gains on sales of
         assets and other extraordinary gains and other non-recurring non-cash
         gains, all as determined for the Company and its Subsidiaries on a
         consolidated basis in accordance with GAAP (except as otherwise
         explicitly provided herein).

         1.14. ADDITIONAL DEFINITIONS. Effective on the Effective Date of this
Amendment provided for in section 4 hereof, the following definitions shall be
added to section 1.1 of the Credit Agreement in appropriate alphabetic order:

         "CARRY-OVER QLE CREDIT" shall mean excess net cash proceeds resulting
from a Qualifying Liquidity Event which have not been previously utilized in
accordance with section 9.10(c) to cause compliance with section 9.10(a).

         "MAY 5, 2000 MODEL" shall have the meaning provided in section 2.6 of
this Amendment No. 4 to Credit Agreement.

         "PURCHASE AGREEMENT" shall mean the Purchase Agreement dated as of
April 26, 2000 by and among the Company as seller and RDVEPCO, L.L.C., Group One
Investors L.L.C. and Holiday Retirement 2000 L.L.C. as purchasers, as amended by
the First Amendment thereto.

         "QUALIFYING LIQUIDITY EVENT" shall mean the completion of one or more
of the following types of transactions which are not contemplated in the May 5,
2000 Model, resulting in net cash proceeds received after May 31, 2000:

         (i)   the sale of Additional Debentures (as defined in the Purchase
         Agreement) pursuant to section 2.2 of the Purchase Agreement;

         (ii)  the sale of assets of the Company, with a limit on net cash
         proceeds from the sale of residence-level assets of $25,000,000 and
         which sale of residence-level assets shall (A) exclude any Projects,
         any projects financed under the TPI Credit Agreement and any projects
         financed under the Pioneer Joint Venture Agreement, and (B) be sold at
         not less than fair market value;

         (iii) the sale of shares of capital stock of the Company (other than
         Redeemable Stock and other than pursuant to the Purchase Agreement);

         (iv)  the sale of subordinated debt securities of the Company, provided
         such subordinated debt securities (A) have a maturity of at least five
         years and no sinking fund or similar requirements, (B) are subordinated
         to the Obligations on terms satisfactory to the Required Lenders, and
         (C) such subordinated debt securities are not in replacement of
         Indebtedness of the Company or any of its Affiliates;

         (v)   the refinance of assets of the Company to the extent that actual
         cash is made available to the Company in excess of that reflected in
         the May 5, 2000 Model; and

                                       10
<PAGE>   11

         (vi)  the procurement of bridge financing (other than the debt
         evidenced by the Amended and Restated Loan Agreement dated as of
         February 3, 2000 between the Company and RDVEPCO, L.L.C., a Michigan
         limited liability company, in the original principal amount of
         $15,000,000 as thereafter increased to $35,000,000 and other than
         bridge financing referenced in the Purchase Agreement) on terms
         satisfactory to the Required Lenders, which terms shall include, but
         not be limited to, (A) subordination of such bridge financing to the
         Obligations, (B) the Company will not make any payments pursuant to
         such bridge financing until such time as the ratio of (I) Consolidated
         EBITDAR for any Testing Period consisting of the immediately preceding
         4 fiscal quarters, to (II) Consolidated Lease and Debt Service Charges
         for such Testing Period, shall exceed 1.25 to 1.00 for such Testing
         Period, and such ratio shall have been achieved for two consecutive
         Testing Periods, and (C) the amount of such payments shall be limited
         to the amount which if included in Consolidated Lease and Debt Service
         Charges for the most recent Testing Period, the ratio of (1)
         Consolidated EBITDAR for such Testing Period consisting of the
         immediately preceding 4 fiscal quarters, to (II) Consolidated Lease and
         Debt Service Charges for such Testing Period, shall exceed 1.10 to 1.00
         for such Testing Period.

         1.15. LENDERS' ACKNOWLEDGMENT. Effective on the Effective Date of this
Amendment provided for in section 4 hereof, the Lenders party hereto acknowledge
and agree that:

               (a)   (i) Completion of the New Capital Funding Requirement, as
               well as,

                     (ii) any event or circumstances in which RDVEPCO, L.L.C.,
               Group One Investors, L.L.C., and/or Holiday Retirement 2000, LLC
               (any such person, together with any person who through the
               ownership of securities or other equity interests controls any
               such person, collectively the "PURCHASERS") acquires or holds,
               pursuant to the Purchase Agreement, or any subsequent agreement
               among some or all of the Purchasers and the Company, or
               otherwise, convertible or exchangeable debt and/or convertible or
               exchangeable preferred stock, or warrants, rights or options to
               acquire capital stock of or other equity interests in the
               Company, or any common stock or other securities of or equity
               interests in the Company issuable upon conversion or exchange of
               any of the foregoing, representing beneficial ownership (within
               the meaning of Rule 13d-3 and 13d-5 of the 1934 Act) of more than
               50%, on a fully diluted basis, of the economic or voting interest
               in the Company's capital stock,

         shall BE DEEMED to constitute a Change of Control hereunder but shall
         not constitute or result in a Change of Control Prepayment Event; and

               (b)   That the execution and delivery of the Purchase Agreement
         and the consummation of the sale of the Initial Securities as
         contemplated thereunder shall satisfy the obligations of the Borrower
         set forth in section 9.12, and such section 9.12 shall be deemed
         amended to reflect that the requirements thereof are already satisfied.

                                       11
<PAGE>   12

         SECTION 2. REPRESENTATIONS AND WARRANTIES.

         The Company represents and warrants as follows:

         2.1. AUTHORIZATION AND VALIDITY OF AMENDMENT, ETC. This Amendment has
been duly authorized by all necessary corporate action on the part of the
Company, has been duly executed and delivered by a duly authorized officer of
the Company, and constitutes the valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except to the
extent that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws generally affecting
creditors' rights and by equitable principles (regardless of whether enforcement
is sought in equity or at law).

         2.2. REPRESENTATIONS AND WARRANTIES. The representations and warranties
of the Credit Parties contained in the Credit Agreement, as amended hereby, or
in the other Credit Documents are true and correct in all material respects on
and as of the date hereof as though made on and as of the date hereof, except to
the extent that such representations and warranties expressly relate to an
earlier specified date, in which case such representations and warranties are
hereby reaffirmed as true and correct in all material respects as of the date
when made.

         2.3. NO EVENT OF DEFAULT. No condition or event has occurred or exists
which constitutes or which, after notice or lapse of time or both, would
constitute an Event of Default under the Credit Agreement as amended hereby, or
under the other Credit Documents.

         2.4. COMPLIANCE. The Company is in full compliance with all covenants
and agreements contained in the Credit Agreement, as amended hereby, and the
other Credit Documents to which it is a party. The Company acknowledges that the
Obligations are outstanding without offset, defense or counterclaim.

         2.5. FINANCIAL STATEMENTS, ETC. The Company has furnished to the
Lenders and the Administrative Agent complete and correct copies of

              (a) the audited consolidated balance sheets of the Company and
         its consolidated subsidiaries as of (December 31, 1999, and the related
         audited consolidated statements of income, stockholders' equity, and
         cash flows of the Company and its consolidated subsidiaries for the
         fiscal year then ended, accompanied by the unqualified report thereon
         of the Company's independent accountants; and

              (b) the unaudited consolidated balance sheets of the Company
         and its consolidated subsidiaries as of March 31, 2000, and the related
         unaudited consolidated statements of income, stockholders' equity and
         cash flows of the Company and its consolidated subsidiaries for the
         fiscal quarter or quarters then ended.

All such financial statements have been prepared in accordance with GAAP,
consistently applied (except as stated therein), and fairly present the
financial position of the Company and its consolidated subsidiaries as of the
respective dates indicated and the consolidated results of their operations and
cash flows for the respective periods indicated, subject in the case of any such
financial statements which are unaudited, to the absence of footnotes and to
normal audit adjustments which the Company reasonably believes will not involve
a Material Adverse Effect.

                                       12
<PAGE>   13

         2.6. MAY 5, 2000 MODEL. The Company delivered or caused to be delivered
to the Lenders, under cover dated May 5, 2000, financial projections prepared by
management of the Company for the Company and its Subsidiaries consisting of,
among other things, a projected balance sheet, income statement and cash flow
statement for its fiscal years ended December 31, 1999 through December 31, 2002
(the "MAY 5, 2000 MODEL"). The May 5, 2000 Model was prepared on behalf of the
Company in good faith after taking into account the existing and historical
levels of business activity of the Company and its Subsidiaries, trends known to
the Company, including general economic trends, and all other information,
assumptions and estimates considered by management of the Company and its
Subsidiaries to be pertinent thereto. The May 5, 2000 Model was considered by
management of the Company, as of such date of preparation, to be realistically
achievable; PROVIDED, that no representation or warranty is made as to the
impact of future general economic conditions or as to whether the Company's
projected consolidated results as set forth in the May 5, 2000 Model will
actually be realized. No material facts have become known to the Company
subsequent to the date of preparation of the May 5, 2000 Model and prior to the
date hereof which, if they had been appropriately reflected in the May 5, 2000
Model, would have resulted in a material adverse change in the assets,
liabilities, results of operations or cash flows reflected therein.

         SECTION 3. RATIFICATIONS.

         Except as expressly modified and superseded by this Amendment, the
terms and provisions of the Credit Agreement are ratified and confirmed and
shall continue in full force and effect.

         SECTION 4. BINDING EFFECT.

         This Amendment shall become effective on a date (the "EFFECTIVE DATE"),
on or before June 2, 2000, if the following conditions shall have been satisfied
on and as of such date:

              (A) EXECUTION OF AMENDMENT. This Amendment shall have been
         executed by the Company and the Administrative Agent, and counterparts
         hereof as so executed shall have been delivered to the Administrative
         Agent; and the Administrative Agent shall have been notified by the
         Required Lenders that such Lenders have executed this Amendment (which
         notification may be by facsimile or other written confirmation of such
         execution).

              (B) NEW CAPITAL FUNDING REQUIREMENT. The Company shall have
         provided reasonable evidence to the Administrative Agent and the
         Lenders that it has received net cash proceeds of at least $53,000,000
         (INCLUDING ANY AMOUNTS, NOT IN EXCESS OF $14,000,000, FUNDED ON OR
         AFTER APRIL 26, 2000 UNDER THE BRIDGE FINANCING REFERENCED IN THE
         PURCHASE AGREEMENT) in connection with satisfaction of the New Capital
         Funding Requirement.

              (C) SUPPLEMENTAL RESERVE PLEDGE AGREEMENT. Amendment No. 2 to
         Supplemental Reserve Pledge Agreement shall have been executed by the
         Company and the Collateral Agent, and counterparts thereof as so
         executed shall have been delivered to the Administrative Agent.

              (D) CONSENT OF DEUTSCHE BANK. The Company and the Permanent Lender
         shall have modified or permanently waived section 6.01(d) and/or other
         applicable provisions of the Permanent Credit Agreement, in a manner
         satisfactory to the Required Lenders, such that no Event of Default
         under the Permanent Credit Agreement could reasonable be expected to
         occur because of a Change

                                       13
<PAGE>   14

         of Control related to the acquisition or ownership of equity interests
         in the Company by the purchasers of the Initial Securities.

              (E) FEES. The Company shall have paid to the Administrative Agent,
         in immediately available funds, for the pro rata account of the Lenders
         who become a signatory hereto on or prior to the date established by
         the Administrative Agent, such nonrefundable amendment fees as have
         previously been agreed to by the Company and communicated to the
         Lenders (the Administrative Agent shall promptly distribute to such
         Lender its pro rata portion of such amendment fees).

              (F) OPERATING DEFICITS. The Company shall have paid to the
         Administrative Agent, in immediately available funds, to be held as
         part of the Collateral, the amount of $200,000 allocable to the
         so-called Galloway I Project in Galloway, New Jersey with such amount
         to be disbursed from time to time, provided that no Event of Default
         has occurred and is continuing, by the Administrative Agent pursuant to
         Draw Requests in accordance with section 23(f) to fund actual operating
         deficits which exceed the amount of operating deficits identified as
         part of the estimated total Project costs included in the Project
         Summary & Feasibility Report. Any undisbursed funds remaining after
         application to fund operating deficits in accordance with section 23(f)
         shall be released upon repayment or prepayment of the Loans for the
         Galloway I Project, provided that no Event of Default has occurred and
         is continuing.

Thereafter this Amendment shall be binding upon and inure to the benefit of the
Company, the Administrative Agent, and each Lender and their respective
permitted successors and assigns. After this Amendment becomes effective, the
Administrative Agent will promptly furnish a copy of this Amendment and
Amendment No. 2 to Supplemental Reserve Pledge Agreement to each Lender and the
Company and advise them of the Effective Date.

         SECTION 5. MISCELLANEOUS.

         5.1. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made in this Amendment shall survive the execution and delivery
of this Amendment, and no investigation by the Administrative Agent or any
Lender or any subsequent Loan shall affect the representations and warranties or
the right of the Administrative Agent or any Lender to rely upon them.

         5.2. REFERENCE TO CREDIT AGREEMENT. The Credit Agreement and any and
all other agreements, instruments or documentation now or hereafter executed and
delivered pursuant to the terms of the Credit Agreement as amended hereby, are
hereby amended so that any reference therein to the Credit Agreement shall mean
a reference to the Credit Agreement as amended hereby.

         5.3. EXPENSES. As provided in the Credit Agreement, but without
limiting any terms or provisions thereof, the Company shall pay on demand all
reasonable costs and expenses incurred by the Administrative Agent in connection
with the preparation, negotiation, and execution of this Amendment, including
without limitation the reasonable costs and fees of the Administrative Agent's
special legal counsel, regardless of whether this Amendment becomes effective in
accordance with the terms hereof, and all reasonable costs and expenses incurred
by the Administrative Agent or any Lender in connection with the enforcement or
preservation of any rights under the Credit Agreement, as amended hereby.

                                       14
<PAGE>   15

         5.4. SEVERABILITY. Any term or provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable shall not impair
or invalidate the remainder of this Amendment and the effect thereof shall be
confined to the term or provision so held to be invalid or unenforceable.

         5.5. APPLICABLE LAW. This Amendment shall be governed by and construed
in accordance with the laws of the State of Ohio.

         5.6. HEADINGS. The headings, captions and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment.

         5.7. ENTIRE AGREEMENT. This Amendment is specifically limited to the
matters expressly set forth herein. This Amendment and all other instruments,
agreements and documentation executed and delivered in connection with this
Amendment embody the final, entire agreement among the parties hereto with
respect to the subject matter hereof and supersede any and all prior
commitments, agreements, representations and understandings, whether written or
oral, relating to the matters covered by this Amendment, and may not be
contradicted or varied by evidence of prior, contemporaneous or subsequent oral
agreements or discussions of the parties hereto. There are no oral agreements
among the parties hereto relating to the subject matter hereof or any other
subject matter relating to the Credit Agreement.

         5.8. JURY TRIAL WAIVER. EACH OF THE PARTIES TO THIS AMENDMENT HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AMENDMENT, THE OTHER CREDIT
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY HERETO
HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AMENDMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

         5.9. COUNTERPARTS. This Amendment may be executed by the parties hereto
separately in one or more counterparts, each of which when so executed shall be
deemed to be an original, but all of which when taken together shall constitute
one and the same agreement.

                                       15
<PAGE>   16

         IN WITNESS WHEREOF, this Amendment has been duly executed and delivered
as of the date first above written.

ALTERRA HEALTHCARE                               ALS NATIONAL, INC.
CORPORATION, FORMERLY KNOWN AS
ALTERNATIVE LIVING SERVICES, INC.

BY:  /s/ Mark W. Ohlendorf                      BY:  /s/ Mark W. Ohlendorf
   ------------------------------                  -----------------------------
     SENIOR VICE PRESIDENT                           VICE PRESIDENT

KEY CORPORATE CAPITAL INC.,                      COMERICA BANK
  INDIVIDUALLY AS A LENDER AND
  AS ADMINISTRATIVE AGENT
                                                BY:  /s/ Charles L. Weddell
                                                   -----------------------------
                                                     VICE PRESIDENT
BY:  /s/ David A. MacVicar
   ------------------------------
     VICE PRESIDENT

BANK OF AMERICA, NATIONAL ASSOCIATION            U.S. BANK, NATIONAL ASSOCIATION
AS SUCCESSOR TO BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION,
  INDIVIDUALLY AS A LENDER AND AS CO AGENT      BY:  /s/ J. H. Lawrence
                                                   -----------------------------
                                                     VICE PRESIDENT

BY:  /s/ Kent Horiuchi
   ------------------------------
     VICE PRESIDENT

SOUTHTRUST BANK, NATIONAL                        BANK ONE, TEXAS, N. A.
ASSOCIATION,
  INDIVIDUALLY AS A LENDER AND AS CO AGENT
                                                BY:  /s/ Jeffrey Etton
                                                   -----------------------------
BY:  /s/ Leesa Lewis                                 SENIOR VICE PRESIDENT
   ------------------------------
     VICE PRESIDENT

FLEET NATIONAL BANK

BY:  /s/ Dorene Conlon
   ------------------------------
     VICE PRESIDENT<PAGE>   1

                                                                   EXHIBIT 10.15

                             THIRD MASTER AMENDMENT

    THIRD MASTER AMENDMENT (this "MASTER AMENDMENT") dated as of May 31, 2000,
by PITA GENERAL CORPORATION, an Illinois corporation ("BORROWER"), ZC SPECIALTY
INSURANCE COMPANY, a Texas corporation ("SURETY"), GREENWICH CAPITAL FINANCIAL
PRODUCTS, INC., a Delaware corporation ("LENDER"), ALTERRA HEALTHCARE
CORPORATION, a Delaware corporation ("GUARANTOR"), AHC TENANT, INC., a Delaware
corporation ("LESSEE"), ALS-CLARE BRIDGE, INC., a Delaware corporation
("ALS-CLARE BRIDGE"), ALI PALMER RANCH EAST, INC., a Delaware corporation ("ALI
PALMER Ranch"), SELCO SERVICE CORPORATION, an Ohio corporation ("SELCO"), BANK
ONE, NATIONAL ASSOCIATION, a national banking association duly established with
its principal corporate trust office located in Chicago, Illinois (formerly
known as THE FIRST NATIONAL BANK OF CHICAGO) ("TRUSTEE"), CLARE BRIDGE OF CITRUS
HEIGHTS L.P., CLARE BRIDGE OF COBB COUNTY L.P., CLARE BRIDGE OF COLORADO SPRINGS
L.P., CLARE BRIDGE OF DECATUR L.P., CLARE BRIDGE OF EAST MESA L.P., CLARE BRIDGE
OF OVERLAND PARK L.P., CLARE BRIDGE OF PEORIA L.P., CLARE BRIDGE OF RENO L.P.,
CLARE BRIDGE OF ROANOKE L.P., CLARE BRIDGE OF SOUTH PARK L.P., CLARE BRIDGE OF
SUN CITY WEST DEER VALLEY L.P., WYNWOOD OF BOYNTON BEACH WEST L.P., WYNWOOD OF
BREA L.P., WYNWOOD OF DUNEDIN L.P., WYNWOOD OF EMERSON L.P., WYNWOOD OF TUCSON
L.P., WYNWOOD OF WAYNE L.P., WYNWOOD OF WESTLAKE L.P., WYNWOOD OF WEST ORANGE,
L.P. AND WYNWOOD OF WHITTIER L.P. (collectively, the "INITIAL JOINT VENTURES")
and CLARE BRIDGE OF DENVER L.P., WYNWOOD OF BOYNTON BEACH CONGRESS L.P., WYNWOOD
OF PALMER RANCH EAST L.P., WYNWOOD OF SARASOTA L.P., CLARE BRIDGE OF FULTON
COUNTY L.P. AND WYNWOOD OF FULTON COUNTY L.P. (the "ADDITIONAL JOINT VENTURES",
and together with the Initial Joint Ventures, the "JOINT VENTURES").

                                 R E C I T A L S

         WHEREAS, Borrower, Lessee, Surety, Lender, Guarantor, SELCO, and
Trustee are parties to that certain Amended and Restated Trust Agreement, dated
as of December 20, 1999 (as amended, restated, supplemented or otherwise
modified from time to time, the "TRUST AGREEMENT"), pursuant to which the
parties thereto have, among other things, appointed Trustee to act as trustee.

         WHEREAS, Borrower, Lessee and Lender are parties to that certain
Amended and Restated Loan Agreement, dated as of December 20, 1999 (as amended,
restated, supplemented or otherwise modified from time to time, the "LOAN
AGREEMENT"), pursuant to which the Lender has made the Loans (as defined
therein) to Borrower.

         WHEREAS, Borrower, Lessee, Surety, Lender, Guarantor, SELCO and Trustee
are parties to that certain Participation Agreement, dated as of July 16, 1999,
as amended by that

<PAGE>   2

certain Master Amendment, Confirmation and Acknowledgment Agreement, dated as of
September 28, 1999, and further amended by that certain Second Master Amendment,
dated as of December 20, 1999, each among the parties (as amended, restated,
supplemented or otherwise modified from time to time, the "PARTICIPATION
AGREEMENT").

         WHEREAS, Guarantor is not in compliance with certain financial
covenants under Section 9.5 of the Participation Agreement, which compliance has
been waived by Surety and Lender through June 30, 2000 pursuant to a waiver
letter dated as of March 29, 2000, but which noncompliance will constitute an
Event of Default under the Transaction Documents after June 30, 2000
(collectively, the "EXISTING DEFAULTS").

         WHEREAS, in connection with such Existing Default, the parties hereto
desire to amend certain of the Transaction Documents upon the terms and subject
to the conditions hereinafter set forth.

         NOW, THEREFORE, in consideration of the foregoing and the agreements
contained herein, the parties hereto agree as follows:

                                   ARTICLE I
                                  DEFINITIONS

         Section 1.1 DEFINITIONS. Capitalized terms used but not otherwise
defined herein shall have the respective meanings given thereto in that certain
Amended and Restated Master Glossary of Definitions dated as of December 20,
1999 (as amended, restated, supplemented or otherwise modified from time to
time, the "MASTER GLOSSARY").

                                   ARTICLE II
                       AMENDMENT OF TRANSACTION DOCUMENTS

         Section 2.1 AMENDMENT OF THE MASTER GLOSSARY OF DEFINITIONS. The Master
Glossary of Definitions is hereby amended as follows:

              (a)    The following definitions are hereby added to the Master
         Glossary of Definitions:

                     (i)   "CONTROLLING NOTEHOLDER" is defined in Section 1.1 of
           the Loan Agreement.

                     (ii)  "EQUITY TRANSACTION" is defined in Section 4.1(a) of
           the Third Master Amendment.

                     (iii) "INITIAL JV INTERESTS" is defined in Section 4.1(g)
           of the Third Master Amendment.

                     (iv)  "REMAINING JV INTERESTS" is defined in Section 4.1(g)
           of the Third Master Amendment.

                                       2
<PAGE>   3

                        (v)   "THIRD MASTER AMENDMENT" shall mean that certain
           Third Master Amendment, dated as of May 31, 2000, among Borrower,
           Surety, Lender, Guarantor, Lessee, Trustee and certain other parties
           thereto.

              (b)       The definition of "Lease Coverage Period" is hereby
    deleted in its entirety and replaced with the following:

           "`LEASE COVERAGE PERIOD' means, as of the date of determination, a
           period consisting of four consecutive calendar quarters."

              (c)       The definition of "Net Worth" is hereby deleted in its
    entirety and replaced with the following:

           "NET WORTH" shall mean, as of any date, on a consolidated basis,
           shareholder's equity or net worth, as determined in accordance with
           GAAP excluding the impact of non-recurring losses.

              (d)       The definition of "Termination Premium" is hereby
    amended by deleting the reference to "$29,000,000" in the second line
    thereof and replacing same with "$31,500,000."

           Section 2.2  AMENDMENT OF TRUST AGREEMENT.

              (a)       Amendment of Section 3.2 of the Trust Agreement. Within
    fourteen (14) days after the date hereof, Lessee shall be required to
    deliver to Trustee, Lender and Surety a reasonably detailed report in form
    acceptable to Lender and Surety setting forth on a line-by-line basis the
    status of completion (including an estimate of the cost to complete such
    work) of the Initial Capital Improvements and the capital improvements
    required to be performed for the Additional Properties all as described in
    Section 3.2(a) of the Trust Agreement, and within such reasonable period as
    may be required by Lender, but in no event later than July 31, 2000, Lessee
    shall be required to complete all of such work and deliver evidence thereof
    acceptable to Lender and Surety. Lessee's failure to deliver such status
    report or complete the Initial Capital Improvements and such capital
    improvements with respect to the Additional Properties and deliver evidence
    thereof acceptable to Lender and Surety on or before the respective dates
    set forth above shall constitute an Event of Default.

              (b)       Amendment to Section 3.14 of the Trust Agreement.
    Section 3.14 of the Trust Agreement is hereby amended by adding the
    following paragraph at the end of said Section:

              "(c) Purchase of JV Interests. Guarantor consummated the purchase
              of the Initial JV Interests (as defined in the Third Master
              Amendment) for certain debt securities of Guarantor on the date of
              closing of the Equity Transaction. Guarantor covenants and agrees
              to purchase the Remaining JV Interests (as defined in the Third
              Master Amendment) in each of the Joint Ventures, for cash

                                       3
<PAGE>   4

              or stock or debt securities of Guarantor and upon terms reasonably
              acceptable to Lender and Surety, on or before December 31, 2000.
              In the event that Guarantor shall fail to purchase the Remaining
              JV Interests in accordance with the foregoing terms and conditions
              on or prior to December 31, 2000, such failure shall constitute a
              JV Triggering Event whereupon, at the direction of the Controlling
              Party, Guarantor shall be required to fund the JV Springing
              Collateral Account in accordance with Section 3.14(a) above."

              (c)       Amendment to Section 3.15(a) of the Trust Agreement.
    Section 3.15(a) of the Trust Agreement is hereby amended by adding the
    following sentence immediately after the third sentence of such paragraph:

              "Upon the closing of the Equity Transaction, Guarantor shall
              deposit into the Operating Reserve Account, from the proceeds
              thereof, an amount (the "ADDITIONAL DEPOSIT") equal to the
              difference between (i) $12,000,000 and (ii) the balance of the
              Operating Reserve Account immediately prior to such additional
              deposit by Guarantor."

              (d)       Amendment to Section 3.15(c)(i) of the Trust Agreement.
    Section 3.15(c)(i) of the Trust Agreement is hereby deleted in its entirety
    and replaced with the following:

                        (i)  So long as no Event of Default exists, Lessee shall
         be permitted to withdraw funds from the Operating Reserve Account to
         fund Actual Monthly Operating Losses in any month at the Properties
         upon delivery to Trustee, the Controlling Noteholder and Surety of an
         Operating Reserve Account Certificate in the form attached hereto as
         Exhibit A, the monthly operating statements required under Sections
         4.5(c) and (f) of the Loan Agreement and Lessee's written calculation
         of the Actual Monthly Operating Loss for such month, which funds shall
         be applied in accordance with Article II of the Flow of Funds
         Agreement; provided that (A) the amount withdrawn by Lessee for the
         first and second months of each calendar quarter shall not exceed the
         lesser of (1) the Actual Monthly Operating Loss for such month and (2)
         the projected operating loss for such month as set forth in Schedule
         4.10 to the Loan Agreement and (B) the amount withdrawn for the third
         month of each calendar quarter (which may be withdrawn on the last day
         of such calendar quarter and prior to delivery of the monthly operating
         statements required under Sections 4.5(c) and (f) of the Loan
         Agreement) shall equal the positive difference (if any) between (1) the
         projected operating losses for the Properties for such calendar quarter
         as set forth in Schedule 4.10 of the Loan Agreement and (2) the Actual
         Monthly Operating Losses withdrawn from the Operating Reserve Account
         for the first two months of such calendar quarter; and provided further
         that Lessee shall not be

                                       4

<PAGE>   5

              permitted to withdraw funds from the Operating Reserve Account if
              the remaining balance in the Operating Reserve Account after such
              requested withdrawal would be less than $5,000,000 (the "Operating
              Reserve Minimum Balance"). The Operating Reserve Minimum Balance
              shall be reduced to $3,000,000 upon the later to occur of (A)
              Guarantor's purchase of 100% of the JV Interests and (B) Lessee's
              achieving a LCR of at least 1.00:1.00 for any two consecutive
              calendar quarters. If an Event of Default exists at any time,
              Lessee shall have no right to withdraw funds from the Operating
              Reserve Account and funds therein shall be disbursed by Trustee,
              after Trustee's receipt of a Written Direction, in accordance with
              Section 4.2 of this Trust Agreement.

                   (e)     Amendment to Section 3.15(c)(ii) of the Trust
    Agreement.  Section 3.15(c)(ii) of the Trust Agreement is hereby amended by
    inserting the following language immediately after the words "Lease Coverage
    Period" in the fourth line thereof:

              "(provided that, for purposes of determining the LCR in the
              immediately foregoing test only, Net Operating Income shall be
              calculated assuming minimum Management Fees of 4% of Operating
              Revenues for the applicable period)."

                   (f)     The form of Operating Reserve Account Certificate
    attached as Exhibit A to the Trust Agreement is hereby deleted in its
    entirety and replaced with Exhibit A attached hereto.

              Section 2.3  AMENDMENT OF PARTICIPATION AGREEMENT.

                   (a)     Section 9.5 (a) of the Participation Agreement is
    hereby deleted in its entirety and replaced with the following:

              "(a) Invested Equity. Guarantor shall maintain at all times the
              sum of (i) Net Worth plus (ii) the outstanding amount of the
              Debentures (as defined in the Purchase Agreement, dated as of
              April 26, 2000, among Guarantor, RDVEPCO, L.L.C., Group One
              Investors, L.L.C. and Holiday Retirement 2000, L.L.C.) greater
              than or equal to $110,000,000, increased on a cumulative basis as
              of the end of each fiscal quarter of Guarantor commencing with the
              fiscal quarter ending March 31, 2000 by (A) an amount equal to 50%
              of net income (to the extent positive) for the fiscal quarter then
              ended plus (B) an amount equal to 75% of the proceeds from any
              equity capital (or equity equivalent) securities offering
              subsequent to December 31, 1999, and 75% of the amount of any
              pay-in-kind dividends or coupons issued subsequent to December 31,
              1999".

                   (b)     Section 9.5(b) of the Participation Agreement is
    hereby amended by deleting the reference to "seventy percent (70%)" in the
    last line thereof and replacing same with "seventy-five percent (75%)".

                                       5
<PAGE>   6

                   (c)     Section 9.5(c) of the Participation Agreement is
    hereby amended by deleting the following language from the last line
    thereof:  "commencing September 30, 1999, of 1.5 to 1.0" and replacing same
    with the following:

                      ", shall be greater than or equal to:
<TABLE>
<CAPTION>
Fiscal Year         1st Quarter      2nd Quarter      3rd Quarter      4th Quarter
-----------         -----------      -----------      -----------      -----------
<S>                 <C>              <C>              <C>              <C>

2000                0.75 to 1.0      0.75 to 1.0      0.75 to 1.0      0.75 to 1.0
2001                0.75 to 1.0      0.82 to 1.0      0.91 to 1.0      1.0 to 1.0
2002                1.06 to 1.0      1.13 to 1.0      1.19 to 1.0      1.25 to 1.0"
</TABLE>

                   (d)     The following new paragraphs are hereby added to
    Section 9.5 of the Participation Agreement immediately after Section 9.5(c):

              "(d) Liquidity Ratio. Guarantor shall maintain, on a consolidated
              basis with all subsidiaries, during the Term of the Master Lease,
              measured at the end of each fiscal quarter, Liquidity of not less
              than $15,000,000. For purposes hereof, the term "Liquidity" shall
              mean, at any time, the sum of (i) all cash plus (ii) all cash
              equivalents owned or held plus (iii) all available credit capacity
              which Guarantor could have drawn upon on the last day of any
              fiscal quarter.

              (e) Most Favored Nation. Guarantor hereby represents and warrants
              that none of the credit agreements, loan agreements or other
              documents evidencing and/or securing any Indebtedness of Guarantor
              to any other lender existing as of the date hereof (other than the
              loan documents set forth in Schedule 2.3 to the Third Master
              Amendment (collectively, the "KEY LOAN DOCUMENTS")) includes any
              corporate level financial covenant of Guarantor less favorable to
              Guarantor than the corporate level financial covenants contained
              in this Section 9.5. In the event that any corporate level
              financial covenant contained in any loan document evidencing
              and/or securing any third party Indebtedness of Guarantor (other
              than any corporate level financial covenant contained in the Key
              Loan Documents) is found to be less favorable to Guarantor than
              those contained in this Section 9.5, then the comparable corporate
              level financial covenant of this Section 9.5 shall be
              automatically deemed amended so that such corporate level
              financial covenant thereafter conforms in all material respects to
              the financial covenant of such other Indebtedness, or if no
              comparable corporate level financial covenant is included in this
              Section 9.5, then the corporate level financial covenant of such
              third party Indebtedness shall automatically be deemed to have
              been incorporated herein as if fully set forth herein. In such
              event, at the request of Lender or Surety, Guarantor (and the
              other parties hereto) shall promptly execute and deliver an
              amendment of this Agreement evidencing such amendment of this
              Section 9.15."

                                       6
<PAGE>   7

              Section 2.4  AMENDMENT OF LOAN AGREEMENT.

                   (a)     Amendment of Section 4.5 of the Loan Agreement.
         Sections 4.5(c), (f) and (l) of the Loan Agreement are hereby amended
         by deleting the references to "thirty (30) days" in the first line of
         each of such provisions and replacing same with "twenty-one (21) days."
         Section 4.5 of the Loan Agreement is hereby further amended by adding
         the following new paragraph immediately after Section 4.5(n) thereof:

                   "(o) Within twenty-one (21) days after the end of each month,
                   the monthly operating level reports listed on Schedule 4.5
                   attached hereto, which reports shall be in form and substance
                   satisfactory to the Noteholders."

                   (b)     Amendment of Section 7.1(u) of the Loan Agreement.
         Section 7.1(u) of the Loan Agreement is hereby amended by (i) adding
         the words "or performance" immediately after the words "payment" in
         each place that it appears in the first line thereof and (ii) adding
         the words "document or agreement evidencing and/or securing"
         immediately prior to the words "any Indebtedness" in the second line
         thereof.

                   (c)     Schedule 4.5 of the Loan Agreement (attached hereto
         as Exhibit B) is hereby attached to and made a part of the Loan
         Agreement.  Schedule 4.10 of the Loan Agreement (Financial Projections)
         is hereby deleted in its entirety and is replaced with Exhibit C
         attached hereto.

              Section 2.5  AMENDMENT OF FLOW OF FUNDS AGREEMENT. Section 2.1 of
the Flow of Funds Agreement is hereby amended by (a) adding the following
language at the end of clause (i) thereof: "(provided, however, that Management
Fees which would otherwise be included in Operating Expenses in the foregoing
shall be subordinated in priority of payment as provided in the last paragraph
of this Section 2.1)"; (b) deleting clause (xvi) thereof in its entirety and
replacing same with the following: "(xvi) [RESERVED];" and (c) adding the
following new paragraph at the end of said Section 2.1:

         "Notwithstanding anything to the contrary contained in this Agreement,
         all Management Fees shall be subordinated in priority of payment to
         below Category (xvi) hereof unless and until Lessee has achieved a LCR
         of at least 1.00:1.00 for any consecutive six month period (it being
         acknowledged that for purposes of determining the LCR in the foregoing
         test only, Net Operating Income shall be calculated based upon minimum
         Management Fees of 4% of Operating Revenues for such period). From and
         after the date that the foregoing LCR test has been satisfied, seventy
         percent (70%) of the Management Fees (other than Deferred Management
         Fees) will again be payable as part of Operating Expenses under
         Category (i) of this Section 2.1 but thirty percent (30%) of the
         Management Fees (other than Deferred Management Fees) will continue to
         be subordinated to below Category (xvi) hereof. Deferred Management
         Fees will continue to have the same priority of payment under Section
         2.1 as such fees have on the date of the Third Master Amendment.
         Notwithstanding the

                                       7
<PAGE>   8

         foregoing (and whether or not such LCR test has been satisfied), no
         Management Fees of any level of priority will be paid to Manager unless
         and until Guarantor has purchased 100% of the JV Interests in
         accordance with Section 3.14 of the Trust Agreement."

         Section 2.6   AMENDMENT OF THE REIMBURSEMENT AGREEMENT. Sections
7.05(c), (f) and (l) of the Reimbursement Agreement are hereby amended by
deleting the references to "thirty (30) days" in the first line of each of such
provisions and replacing same with "twenty-one (21) days." Section 7.05 of the
Reimbursement Agreement is hereby further amended by adding the following new
paragraph immediately after Section 7.05(n) thereof:

         "(o) Within twenty-one (21) days after the end of each month, the
         monthly operating level reports listed on Schedule 4.5 attached to the
         Loan Agreement, which reports shall be in form and substance
         satisfactory to Surety."

                                  ARTICLE III
             REPRESENTATIONS AND WARRANTIES OF LESSEE AND GUARANTOR

    To induce Lender, Borrower, SELCO and Surety to amend the Transaction
Documents upon the terms and conditions of this Master Amendment, each of Lessee
and Guarantor represents and warrants that the following statements are true,
correct and complete as of the date hereof and shall be true and correct as of
the Effective Date (hereinafter defined):

         Section 3.1   ORGANIZATION, POWERS, CAPITALIZATION, GOOD STANDING,
 BUSINESS.

              (a)      Organization and Powers. Each of Guarantor and Lessee is
    a corporation duly organized, validly existing and in good standing under
    the laws of the State of Delaware. Guarantor is the sole stockholder of
    Lessee.  Each of Guarantor and Lessee has all requisite power and authority
    to own and operate its properties, to carry on its business as now conducted
    and proposed to be conducted, and to enter into this Master Amendment and to
    perform the terms hereof.

              (b)      Capitalization; Ownership. All issued and outstanding
    shares of capital stock of Lessee and Guarantor are duly authorized and
    validly issued, fully paid, nonassessable, free and clear of all Liens
    (other than Permitted Liens), and such shares were issued in compliance with
    all applicable state and federal laws concerning the issuance of securities.
    There are no preemptive or other outstanding rights, options, warrants,
    conversion rights or similar agreements or understandings for the purchase
    or acquisition of any shares of capital stock or other securities of such
    entities (except, in the case of Guarantor, as described in Sections 4.1(a)
    and 4.1(b) below or as disclosed in its most recent quarterly report on Form
    10-Q filed with the SEC).

              (c)      Qualification. Each of Guarantor and Lessee is duly
    qualified and in good standing in the state of its formation. Guarantor and
    Lessee are also duly qualified and in good standing in the states where the
    Properties are located, and in each state where it is necessary to carry on
    its present business and operations, except in

                                       8
<PAGE>   9

    jurisdictions in which the failure to be qualified and in good standing
    could not reasonably be expected to have a Material Adverse Effect.

              (d)      Business; Assets. The sole assets of Lessee are its
    leasehold interests in and to the Properties, Improvements and Assisted
    Living Facilities and Equipment under the Master Lease, its sublessor's
    interest in the Subleases and its right, title and interest, if any, in and
    to the Permits, if any, and personal property appurtenant or related thereto
    and the Excluded Collateral.

         Section 3.2   AUTHORIZATION.

              (a)      Authorization. The execution, delivery and performance by
    Guarantor and Lessee of this Master Amendment (and each of the Transaction
    Documents to which it is a party as amended hereby) and the consummation of
    the transactions contemplated hereby, have been duly authorized by all
    necessary corporate action.

              (b)      No Conflicts; No Consents or Approvals. The execution,
    delivery and performance by each of Guarantor and Lessee of this Master
    Amendment and the consummation of the transactions contemplated hereby, do
    not and will not: (1) violate (x) any provision of law applicable to it; (y)
    its Charter Documents; or (z) any order, judgment or decree of any court or
    other agency of government binding on either of them or any of their
    Affiliates; (2) conflict with, result in a breach of or constitute (with due
    notice or lapse of time or both) a default under any material Contractual
    Obligation of Guarantor or Lessee or any of their Affiliates; (3) result in
    or require the creation or imposition of any material Lien (other than the
    Lien of the Transaction Documents and the Lien or other interest of SELCO or
    its Affiliates in and to the Excluded Collateral) upon the Property or
    assets of Guarantor or Lessee or any of their Affiliates; or (4) except as
    set forth on Schedule 3.2(b), require any approval or consent of any Person
    under any material Contractual Obligation of any Borrower Party, which
    approvals or consents have been obtained on or before the dates required
    under such Contractual Obligation, but in no event later than the Effective
    Date.

              (c)      Governmental Consents. The execution, delivery and
    performance by each of Guarantor and Lessee of this Master Amendment and the
    consummation of the transactions contemplated hereby, do not and will not
    require any registration with, consent or approval of, or notice to, or
    other action to, with or by, any federal, state or other governmental
    authority or regulatory body.

              (d)      Binding Obligations . This Master Amendment (and the
    other Transaction Documents each, as amended hereby) are the legally valid
    and binding obligations of Guarantor and Lessee, as applicable, enforceable
    against Guarantor and Lessee, as applicable, in accordance with their
    respective terms, subject to bankruptcy, insolvency, moratorium,
    reorganization and other similar laws affecting creditor's rights. Neither
    Guarantor nor Lessee has any defense or offset to any of its obligations
    under this Master Amendment or the Transaction Documents.

                                       9
<PAGE>   10

         Section 3.3   PENDING MATTERS. Except as set forth on Schedule 3.3
attached hereto, there are no judgments outstanding against Guarantor or Lessee
nor is there any action, charge, claim, demand, suit, petition, inquiry or
investigation pending or, to the best knowledge of Guarantor and Lessee, after
due inquiry, threatened against them; which, in the case of Guarantor, if
adversely determined, could have a Material Adverse Effect on Guarantor.

         Section 3.4   BANKRUPTCY. Neither Guarantor nor Lessee is a debtor, and
no property of either of them (including any Property) is property of the
estate, in any voluntary or involuntary case under the Bankruptcy Code or under
any applicable bankruptcy, insolvency or other similar law now or hereafter in
effect. Neither Guarantor nor Lessee and no property of either of them is under
the possession or control of a receiver, trustee or other custodian. Neither
Guarantor nor Lessee has made any assignment for the benefit of creditors. No
such assignment or bankruptcy or similar case or proceeding is now contemplated.

         Section 3.5   DISCLOSURE. No financial statements, financial document
or any other document, certificate or written statement heretofore furnished to
Lender or Surety by or on behalf of Lessee or Guarantor, contains any untrue
representation, warranty or statement of a material fact, and none omits or will
omit to state a material fact necessary in order to make the statements
contained herein or therein not materially misleading.

                                   ARTICLE IV
                              CONDITIONS PRECEDENT

             Section 4.1   CONDITION PRECEDENT. The effectiveness of this Master
Amendment shall be subject to the satisfaction of each of the following
conditions precedent on or before the closing of the Equity Transaction (but in
no event later than June 9, 2000) (the "EFFECTIVE DATE"), or such date as may be
provided below, and, in the event that any of such conditions are not satisfied
in a manner acceptable to Lender, Borrower, SELCO and Surety each in their sole
and absolute discretion on or before the Effective Date (or such other date as
provided below), this Master Amendment shall be void and of no further force or
effect:

              (a)      Guarantor's Equity Closing. Guarantor shall have
         consummated the closing of its private placement of at least
         $135,000,000 of debt and preferred stock (comprised of convertible
         debentures in the amount of at least $130,000,000 and convertible
         preferred stock in the amount of $5,000,000) with certain third parties
         (the "EQUITY TRANSACTION").  Guarantor shall have delivered
         documentation acceptable to Lender and Surety evidencing the closing of
         the Equity Transaction.

              (b)      Issuance of Guarantor Warrants to Surety. Within seven
         (7) days after the closing of the Equity Transaction, Guarantor shall
         execute and deliver to the Surety 100,000 five (5) year common stock
         warrants of Guarantor, having an exercise price equal to the exercise
         price under the convertible debentures and convertible preferred stock
         referred to above and in form and substance acceptable to Surety.

              (c)      Additional Deposit into Operating Reserve Account.
         Guarantor shall have deposited the Additional Deposit into the
         Operating Reserve Account in accordance with Section 2.2(b) above.

                                       10
<PAGE>   11

              (d)      Consents and Approvals. Guarantor shall have obtained any
         and all consents and approvals required in connection with the
         execution, delivery and performance by Guarantor and Lessee of this
         Master Amendment and the consummation of the transactions contemplated
         hereby (including, without limitation, any consents or approvals listed
         on Schedule 3.2(b) hereto) required from any Person (including, without
         limitation, any lender holding any other Indebtedness of Guarantor or
         its Affiliates) and Guarantor shall have obtained waivers and/or
         amendments as may be required from any third party lenders of Guarantor
         (including, without limitation, the lenders listed on Schedule 4.1(d)
         hereto) in connection with any defaults which occurred prior to the
         date hereof and/or the funding of the Equity Transaction under any
         documents or agreements evidencing and/or securing any Indebtedness of
         Guarantor or its Affiliates, which waivers and/or amendments shall each
         be in form and substance acceptable to Lender and Surety.

              (e)      Key Loan Documents. Guarantor shall have delivered to
         Lender and Surety true and correct copies of the amendments (and/or
         waivers) of the Key Loan Documents being executed simultaneously
         herewith.

              (f)      Delivery of Missing Closing Documents. Within 14 days
         after the date hereof, Guarantor shall have delivered to Lender and
         Surety the missing closing documents from each of the Closing Dates as
         set forth on Schedule 4.1(f) attached hereto. In the event Guarantor
         fails to deliver such closing documents within the above time period,
         Lessee shall no longer have the right to make withdrawals from the
         Operating Reserve Account for so long as such failure continues.

              (g)      Purchase of JV Interests. Guarantor shall have purchased
         the JV Interests listed as "Initial JV Interests" on Schedule 4.1(g)
         attached hereto (the "INITIAL JV INTERESTS"). In addition, Lender and
         Surety shall have each reviewed and approved (each in their sole
         discretion) draft documents for Guarantor's proposed purchase of the JV
         Interests listed as "Remaining JV Interests" on Schedule 4.1(g) hereto
         (the "REMAINING JV INTERESTS"). The Remaining JV Interests shall be
         purchased for cash or stock or debt securities of Guarantor in amounts
         and otherwise on terms acceptable to Lender and Surety.

              (h)      Representations and Warranties. Except as set forth on
         Schedule 3.3 attached hereto, all of the representations and warranties
         of Lessee and Guarantor contained herein and in the Transaction
         Documents (as amended hereby) shall be true and correct in all material
         respects.

              (i)      No Defaults. No Defaults or Events of Default (other than
         the Existing Default) shall have occurred and be continuing under any
         of the Transaction Documents.

              (j)      Fees and Expenses. Lessee and/or Guarantor shall have
         paid all of the costs and expenses of Lender, Borrower, SELCO, Surety
         and Trustee in accordance with Section 5.6 hereof.

                                   ARTICLE V

                                       11
<PAGE>   12

                                  MISCELLANEOUS

         Section 5.1   REFERENCES. Upon the effectiveness of this Master
Amendment, all references in any of the Transaction Documents and in all other
agreements, documents, certificates, exhibits and instruments executed pursuant
thereto, including, without limitation, references to "this Agreement,"
"hereunder," "hereof," "herein" and words of like import contained in any such
Transaction Documents shall, except where the context otherwise requires, mean
and be a reference to the applicable Transaction Document as amended hereby.

         Section 5.2   COUNTERPARTS, SEVERABILITY AND EFFECTIVENESS. This Master
Amendment may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which when taken together shall constitute one and
the same agreement. Any provisions of this Master Amendment which are 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. This Master Amendment
shall become effective upon the execution of a copy hereof, whether by the same
or different copies, by the parties hereto.

         Section 5.3   TRUSTEE. The parties hereto acknowledge and agree that
Trustee is acting not in its individual capacity, but solely in its capacity as
Trustee under the Trust Agreement, and that where there is any reference herein
to Trustee performing any activity, making any decision or determination,
approving or consenting to any matter, exercising any rights, fulfilling any
obligation, exercising any discretion or otherwise acting in any capacity,
Trustee will not take such action unless it is specifically authorized and
directed to do so in each instance pursuant to the Trust Agreement.

         Section 5.4   GOVERNING LAW. THIS MASTER AMENDMENT SHALL BE GOVERNED BY
AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS.

         Section 5.5   NO WAIVERS. Except as otherwise expressly set forth
herein, nothing herein, nor any actions taken or omitted to be taken by Surety,
Borrower, SELCO or Lender pursuant hereto or pursuant to the Transaction
Documents shall, or shall be deemed to, (i) constitute a waiver or amendment of
any other covenant, term or agreement set forth in the Transaction Documents,
(ii) constitute a waiver of any Default or Event of Default now or hereafter
existing under any of the Transaction Documents (other than the Existing
Defaults), (iii) constitute a waiver of any rights or remedies of Surety,
Borrower, SELCO or Lender under any of the Transaction Documents or at law or in
equity, each of such rights and remedies being hereby expressly reserved by
Surety, Borrower, SELCO and Lender or (iv) constitute a course of dealing among
the parties.

         Section 5.6 EXPENSES. Guarantor shall be required to pay all reasonable
out-of-pocket costs and expenses (including, without limitation, reasonable
attorneys' fees and disbursements) incurred by Lender, Borrower, SELCO, Surety
and Trustee in connection with

                                       12
<PAGE>   13

the preparation, negotiation, execution and delivery of that certain waiver
letter among the parties, dated as of March 29, 2000, this Master Amendment and
any and all other documents and agreements executed and delivered in connection
with this Master Amendment and the consummation of the transactions contemplated
hereby. In addition, (i) SELCO shall have received an amendment fee in the
amount of $7,500; (ii) SELCO shall have received evidence that the fees and
expenses in the amount of $7,356 due to CT Corporation have been paid by the
Lessee or the Guarantor.

         Section 5.7   RATIFICATION AND REAFFIRMATION. Guarantor's obligations
under the Guaranty and the Excluded Collateral Agreement are hereby reaffirmed
and ratified and shall continue in full force and effect notwithstanding (a) the
transactions contemplated by this Master Amendment, and (b) the execution and
delivery of (i) this Master Amendment and any other documents to be delivered in
connection with the transactions contemplated hereby and (ii) any amendments to
the Transaction Documents and related documents by the parties thereto.

         Section 5.8   TRUSTEE. The parties hereto acknowledge and agree that
Trustee is acting not in its individual capacity, but solely in its capacity as
Trustee under the Trust Agreement and at the direction of the Controlling Party,
as evidenced by the Controlling Party's execution hereof.

                                       13

<PAGE>   14

                  IN WITNESS WHEREOF, the parties hereto have caused this Master
Amendment to be executed by their respective officers thereunto duly authorized,
as of the date first above written.

                                   "BORROWER":

                                   PITA GENERAL CORPORATION,
                                   an Illinois corporation

                                   By:  /s/ Mindy Berman
                                        ----------------------------------------
                                        Mindy Berman
                                        Vice President

                                   "SURETY":

                                   ZC SPECIALTY INSURANCE COMPANY,
                                   a Texas corporation

                                   By:  /s/ Lynn Finkel
                                        ----------------------------------------
                                        Lynn Finkel
                                        Vice President

                                       14
<PAGE>   15

                                   "LENDER":

                                   GREENWICH CAPITAL FINANCIAL PRODUCTS, INC.,
                                   a Delaware corporation

                                   By:  /s/ Warren Ashenmil
                                        ----------------------------------------
                                        Warren Ashenmil
                                        Senior Vice President

                                   "GUARANTOR":

                                   ALTERRA HEALTHCARE CORPORATION,
                                   a Delaware corporation

                                   By:  /s/ Mark W. Ohlendorf
                                        ----------------------------------------
                                        Mark W. Ohlendorf
                                        Chief Financial Officer

                                   "LESSEE":

                                   AHC TENANT, INC.,
                                   a Delaware corporation

                                   By:  /s/ Mark W. Ohlendorf
                                        ----------------------------------------
                                        Mark W. Ohlendorf
                                        Vice President

                                       15

<PAGE>   16

                               "SELCO":

                               SELCO SERVICE CORPORATION,
                               an Ohio corporation

                               By:  /s/ Donald C. Davis
                                    --------------------------------------------
                                    Donald C. Davis
                                    Vice President

                               "TRUSTEE":
                               BANK ONE, NATIONAL ASSOCIATION, with
                               its principal office located in Chicago, Illinois
                               (formerly known as THE FIRST NATIONAL
                               BANK OF CHICAGO),
                               as Trustee

                               By:  /s/ Jeffrey L. Kinney
                                    --------------------------------------------
                                    Jeffrey L. Kinney
                                    Vice President

                                       16

<PAGE>   17

                               "JOINT VENTURES"
                               CLARE BRIDGE OF CITRUS HEIGHTS L.P., CLARE BRIDGE
                               OF COBB COUNTY L.P., CLARE BRIDGE OF COLORADO
                               SPRINGS L.P., CLARE BRIDGE OF DECATUR L.P., CLARE
                               BRIDGE OF EAST MESA L.P., CLARE BRIDGE OF
                               OVERLAND PARK L.P., CLARE BRIDGE OF PEORIA L.P.,
                               CLARE BRIDGE OF RENO L.P., CLARE BRIDGE OF
                               ROANOKE L.P., CLARE BRIDGE OF SOUTH PARK L.P.,
                               CLARE BRIDGE OF SUN CITY WEST DEER VALLEY L.P.,
                               WYNWOOD OF BOYNTON BEACH WEST L.P., WYNWOOD OF
                               BREA L.P., WYNWOOD OF DUNEDIN L.P., WYNWOOD OF
                               EMERSON L.P., WYNWOOD OF TUCSON L.P., WYNWOOD OF
                               WAYNE L.P., WYNWOOD OF WESTLAKE L.P., WYNWOOD OF
                               WEST ORANGE, L.P. AND WYNWOOD OF WHITTIER L.P.,
                               CLARE BRIDGE OF DENVER L.P., WYNWOOD OF BOYNTON
                               BEACH CONGRESS L.P., WYNWOOD OF PALMER RANCH EAST
                               L.P., WYNWOOD OF SARASOTA L.P., CLARE BRIDGE OF
                               FULTON COUNTY L.P. AND WYNWOOD OF FULTON COUNTY
                               L.P.

                               By:  Alterra Healthcare Corporation, the sole
                                    general partner of each of the foregoing
                                    limited partnerships

                               By:  /s/ Mark W. Ohlendorf
                                    --------------------------------------------
                                    Mark W. Ohlendorf
                                    Chief Financial Officer

                                       17
<PAGE>   18

                               "ALS-CLARE BRIDGE":

                               ALS-CLARE BRIDGE INC.,
                               a Delaware corporation

                               By:   /s/ Mark W. Ohlendorf
                                     -------------------------------------------
                                     Mark W. Ohlendorf
                                     Vice President

                               "ALI PALMER RANCH":

                               ALI PALMER RANCH EAST, INC.,
                               a Delaware corporation

                               By:   /s/ Mark W. Ohlendorf
                                     -------------------------------------------
                                     Mark W. Ohlendorf
                                     Vice President

                                       18

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