Document:

Exhibit 10.12

                              EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT (the "Agreement") effective as of the 1st day of June,
2000 between AMERICAN COMMERCE SOLUTIONS, INC., a Delaware corporation (together
with its successors and assigns referred to herein as the  "Corporation"),  with
principal executive offices located at 1400 Chamber Drive, Bartow, FL 33830; and
Daniel  L.  Hefner  residing  at 1502  N.  Taylor  Rd.,  Brandon,  Florida  (the
"Executive").

                              W I T N E S S E T H:

     WHEREAS,  the Corporation desires to employ Executive as the Executive Vice
President of American Commerce Solutions,  Inc. to engage in such activities and
to render such services under the terms and conditions hereof and has authorized
and approved the execution of this Agreement; and

     WHEREAS,  Executive  desires to be  employed by the  Corporation  under the
terms and conditions hereinafter provided;

NOW, THEREFORE, in consideration of the mutual covenants and undertakings herein
contained, the parties agree as follows:

     1. EMPLOYMENT, DUTIES AND ACCEPTANCE.

          1.1 SERVICES.  The Corporation hereby employs Executive,  for the Term
(as hereinafter defined in Section 2 hereof), to render services to the business
and affairs of the  Corporation in the office  referenced in the recitals hereof
and, in connection therewith, shall perform such duties as directed by the Board
of Directors of the Corporation from time to time, in its reasonable discretion,
and  shall  perform  such  other  duties  as  shall  be   consistent   with  the
responsibilities of such office  (collectively the "Services").  Executive shall
perform  activities related to such office as he shall reasonably be directed or
requested  to so perform by the  Corporation's  Board of  Directors,  to whom he
shall  report.  Executive  shall use his best  efforts,  skill and  abilities to
promote the interests of the Corporation and its subsidiaries.

          1.2 ACCEPTANCE. Executive hereby accepts such employment and agrees to
render the Services.

          1.3  REPRESENTATIONS  OF THE EXECUTIVE.  The Executive  represents and
warrants to the  Corporation  that his execution and delivery of this Agreement,
his  performance  of the  Services  hereunder  and the  observance  of his other
obligations  contemplated  hereby  will not (i)  violate  any  provisions  of or
require the consent or approval of any party to any agreement,  letter of intent
or other  document to which he is a party or (ii)  violate or conflict  with any
arbitration award,  judgment or decree or other restriction of any kind to or by
which he is subject or bound.

          1.4 EXECUTIVE'S  ABILITY TO CONTRACT.  The Executive has no ability to
independently contract unless authorized, in writing, by the Executive Committee
of the  Board  of  Directors  or the  full  Board of  Directors  for a  specific
contract.
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     2. TERM OF EMPLOYMENT.

     The term of Executive's  employment under this Agreement (the "Term") shall
commence on June 1, 2000 and shall  terminate  on May 31,  2003,  unless  sooner
terminated pursuant to Sections 9 or 5.1 of this Agreement;  provided,  however,
if the Corporation  shall fail to give Executive  notice of non-renewal not less
than 60 days prior to the  scheduled  expiration  of the term  hereof,  the Term
shall  automatically  be  extended  for  an  additional  two  (2)  year  period.
Notwithstanding  anything to the contrary  contained  herein,  the provisions of
this Agreement governing  Protection of Confidential  Information shall continue
in effect as specified in Section 10 hereof.

     3. BASE SALARY, EXPENSE REIMBURSEMENT AND STOCK OPTIONS.

          3.1  BASE  SALARY.  During  the  Term,  as full  compensation  for the
Services,  the Corporation  agrees to pay Executive a minimum base salary ("Base
Salary")  at the annual  rate of $60,000 for the period from June 1, 2000 to May
31, 2000.  Such Base Salary shall be (i)  increased  four percent (4%)  annually
effective June 1st of each year during the term of this Agreement, (ii) reviewed
periodically for possible  increases  promptly after each future  acquisition by
the Corporation of any other  corporation or business or other material increase
in the Corporation's  revenues or scope of the Corporation's  business and (iii)
renegotiated  in good faith  effective  as of  December  15,  2002 for  possible
increase based upon the Corporation's historical performance and projections for
future  performance.  Such Base Salary shall be subject to withholding and other
applicable  taxes,  payable during the term of this Agreement in accordance with
the  Corporation's  customary  payment  practices,  but not less frequently than
monthly.

          3.2 BUSINESS EXPENSE  REIMBURSEMENT.  Upon submission to, and approval
by an officer of the  Corporation  designated  by the Board of  Directors of the
Corporation,  of a statement of expenses,  reports, vouchers or other supporting
information,   which  approval  shall  be  granted  or  withheld  based  on  the
Corporation's  policies in effect at such time, the  Corporation  shall promptly
reimburse  Executive for all reasonable  business  expenses actually incurred or
paid by him  during  the Term or  renewals  thereof  in the  performance  of the
Services, including, but not limited to, expenses for entertainment,  travel and
similar items.

          3.3 STOCK  OPTION  AGREEMENT.  In addition  to the salary  hereinabove
provided,  the Executive shall be granted options to purchase  100,000 shares of
the Corporation's Common Stock as of June 1 of each year during the Term of this
Agreement at an exercise price equal to the average of the closing bid and asked
price  of the  Corporation's  Common  Stock  during  month  of  May  immediately
preceding  said June 1,  pursuant  to the terms of the  Stock  Option  Agreement
between the Corporation and the Executive executed concurrently herewith.

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     4. PROFIT SHARING.

          4.1  PROFIT  SHARING  AMOUNT.  In order to  provide  performance-based
incentive  compensation to the Executive,  the Corporation  hereby agrees to pay
the Executive,  in addition to the Base Salary set forth in Section 3 hereof,  a
minimum  cash  bonus for each  fiscal  year  during the  Executive's  employment
hereunder  (the "Bonus")  equal to Fifteen  Thousand  Dollars  ($15,000.00)  per
annum, payable in quarterly installments,  when sufficient cash is available for
the payment.  Additional  profit  sharing or Bonus  methods are available to the
Executive  in terms to be  issued  annually  at the  discretion  of the Board of
Directors.

          4.2 DETERMINATION AND PAYMENT. The final determination with respect to
any fiscal year shall be made promptly,  and in any event within 15 days,  after
the  Corporation has filed its Annual Report on Form 10-K for each year with the
Securities  and  Exchange  Commission.  Within  45  days  after  the  end of the
Corporation's  fiscal year, based on the preliminary  results of the Corporation
for such fiscal year, the Corporation shall pay the Executive an amount equal to
60% of the estimated minimum cash Bonus based on such preliminary  results.  The
balance of the definitive  Bonus so determined,  if any, shall be payable to the
Executive  in a single  lump sum no later  than  thirty  days  after  the  final
determination  has been made. In any event, all matters  pertaining to the Bonus
and  to  the  payment  of  any  Bonus  to  the  Executive  hereunder,  shall  be
administered and determined by the Board of Directors (or a subcommittee thereof
appointed for such purpose) in its  reasonable  discretion  consistent  with the
terms hereof, the determination of which shall be final,  conclusive and binding
for all purposes, absent manifest error.

          4.3 PARTIAL YEARS.  Notwithstanding  anything  contained herein to the
contrary,  no Bonus under this Section 4 shall be deemed  earned or payable with
respect to any  fiscal  year  during  which this  Agreement  or the  Executive's
employment  is  terminated  by the  Corporation  for  Cause  (as  such  term  is
hereinafter defined).

          4.4 Nothing in this Section 4 shall be construed  as  conferring  upon
the  Executive any right (i) normally  associated  with the ownership of capital
stock; (ii) to continue in the employ of the Corporation or any affiliate of the
Corporation;  or (iii) to interfere in any way with the right of the Corporation
to terminate this Agreement in accordance with the provisions hereof. Nothing in
this  Agreement  shall be  construed  to imply that any  specific  assets of the
Corporation  have been set aside to provide for payments  under this  Agreement.
Any payments  under this  Agreement  shall be made solely from general assets of
the Corporation existing at the time such payments are due.

     5. SEVERANCE UPON TERMINATION.

          5.1 TERMINATION.  In the event that Executive's  employment  hereunder
shall be terminated by the Corporation  without Cause (as defined in Section 9.3
hereof) or by the  Executive  for Good Reason (as defined in Section 9.4 hereof)
or upon a Change in Control (as defined in Section 9.5 hereof) or upon the Death
or Disability (as defined in Section 9.1 and 15.1, respectively) of Executive at
any time prior to the end of the Term,  the  Executive  or his  estate  shall be
entitled  to receive from the Corporation, in addition to any Base Salary earned

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to the date of  termination,  a  severance  payment  in an  amount  equal to the
greater of (i) the  balance of the  Executive's  Base  Salary  due  through  the
balance of the Term of this Agreement or (ii) one years salary in the event less
than one year remains in the current contract period.

     6. ADDITIONAL BENEFITS.

          6.1 IN GENERAL. In addition to the compensation, bonuses, expenses and
other  benefits to be paid under  Sections 3, 4 and 5 hereof,  Executive will be
entitled to all rights and  benefits  for which he shall be  eligible  under any
insurance,  health and medical,  incentive,  bonus,  profit-sharing,  pension or
other extra  compensation or "fringe"  benefit plan of the Corporation or any of
its  subsidiaries  now  existing  or  hereafter  adopted  for the benefit of the
executives or employees  generally of the  Corporation.  The  provisions of this
Agreement, which incorporate employee benefit packages, shall change as and when
such employee benefit  packages  change.  In the event that the Corporation does
not  provide  family  health  and  medical  insurance  for  the  benefit  of the
executives and employees  generally of the  Corporation,  the Corporation  shall
provide  Executive  and pay all the costs  associated  with  family  health  and
medical  insurance  for the benefit of Executive as selected by Executive in his
sole discretion.

          6.2  AUTOMOBILE.  The  Corporation  shall lease for the  Executive  an
automobile  of his choice to be used by the  Executive  in  connection  with the
Corporation's  business,  at a monthly rental not to exceed $750 and for a lease
term not to exceed three (3) years. The Corporation shall be responsible for all
reasonable  costs  of  operating,  repairing,   maintaining  and  insuring  such
automobile.

          6.3 LIFE AND DISABILITY  INSURANCE.  The Corporation shall provide the
Executive  with (i) a policy of term life  insurance  in an amount  equal to not
less than  three (3) times his annual  Base  Salary  hereunder,  payable to such
beneficiary or  beneficiaries as shall be designated by him in writing and (b) a
policy of disability insurance that will provide Executive with an annual amount
equal to not less  than  seventy-five  percent  (75%) of his then  current  Base
Salary,  payable  until  Executive  shall reach 70 years of age,  with a waiting
period not to exceed 120 days.

          6.4 DIRECTOR'S AND OFFICERS  INSURANCE.  The Corporation shall provide
the Executive  with a policy of director's and officers  liability  insurance in
such amounts and providing  such  coverage as the Executive and the  Corporation
shall reasonably agree, consistent with policies obtained by other publicly held
companies of similar size and engaged in similar businesses.

     7. VACATION.

     The Executive shall be entitled,  during the Term of this  Agreement,  to a
vacation period annually, as follows:

     June 1,  2000  through  May 31,  2003 -- four (4) weeks in each year of the
contract;

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during  which all salary,  compensation,  benefits and other rights to which the
Executive is entitled to hereunder  shall be provided in full. Such vacation may
be  taken  in the  Executive's  discretion,  at such  time or  times  as are not
inconsistent with the reasonable business needs of the Corporation. In addition,
Executive  shall be entitled  to up to eight (8) sick days and two (2)  personal
days for each year  commencing  June 1, during  which all salary,  compensation,
benefits and other rights to which the Executive is entitled to hereunder  shall
be provided in full.

     8.  INSURABILITY;  RIGHT TO INSURE.  Executive  agrees that the Corporation
shall have the right during the Term to insure the life of Executive by a policy
or policies of insurance  in such amount or amounts as it may deem  necessary or
desirable,  and the  Corporation  shall be the beneficiary of any such policy or
policies  and shall pay the  premiums or other costs  thereof.  The  Corporation
shall have the right,  from time to time,  to modify any such policy or policies
of insurance or to take out new  insurance on the life of  Executive.  Executive
agrees,  upon  request,  at any time or times  prior to the  commencement  of or
during the Term to sign and deliver any and all  documents  and to submit to any
physical or other  reasonable  examinations  which may be required in connection
with any such policy or policies of insurance or modifications thereof.

     9. TERMINATION.

          9.1  DEATH.  If  Executive  dies  during  the Term of this  Agreement,
Executive's  employment  hereunder  shall  terminate  upon  his  death  and  all
obligations of the Corporation  hereunder  shall terminate on such date,  except
that  Executive's  estate or his  designated  beneficiary  shall be  entitled to
payment of any unpaid  accrued  Base Salary  through  the date of his death.  In
addition,  any accrued and unpaid Bonus shall be paid in accordance with Section
4 hereof. In addition, Executive's estate or his designated beneficiary shall be
entitled to payment of the severance payments set forth in Section 5.1 hereof.

          9.2 TERMINATION FOR CAUSE.  The Corporation may at any time during the
Term, without any prior notice, terminate this Agreement and discharge Executive
for Cause,  whereupon the Corporation's  obligation to pay compensation or other
amounts payable  hereunder to or for the benefit of Executive shall terminate on
the date of such  discharge.  As used herein the term Cause  shall  mean:  (i) a
willful and material  breach by Executive of the terms of this  Agreement  which
breach  shall not have been cured within  thirty (30) days of written  notice of
such breach;  (ii) willful  violation of specific and lawful  written  direction
from the Board of Directors of the  Corporation,  which violation shall not have
been cured within thirty (30) days of written notice of such violation, provided
such   direction  is  not   inconsistent   with  the   Executive's   duties  and
responsibilities as the President of Rhode Island operations of the Corporation;
or (iii)  conviction of the Executive of a felony by a federal or state court of
competent  jurisdiction,  which felony is directly and materially  related to or
arises out of Executive's  employment with the  Corporation.  The obligations of
the Executive under Section 10 shall continue notwithstanding termination of the
Executive's employment pursuant to this Section 9.2.

          9.3 TERMINATION  WITHOUT CAUSE. The Corporation  shall have the option
to terminate this Agreement Without Cause upon sixty (60) days written notice to
the Executive.  In the event the Corporation  terminates this Agreement  without
Cause as defined above, the Corporation shall pay the Executive upon

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termination, the amount required pursuant to Section 5.1. The obligations of the
Executive under Section 10 hereof shall continue notwithstanding  termination of
the Executive's employment pursuant to this Section 9.3.

          9.4 TERMINATION BY EXECUTIVE FOR GOOD REASON. The Executive shall have
the right to terminate this Agreement for Good Reason,  as hereinafter  defined,
upon  written  notice to the  Corporation.  Good  Reason  shall  mean any of the
following:  (i) the assignment to the Executive of duties  inconsistent with the
Executive's position, duties,  responsibilities,  titles or offices as described
herein; (ii) any material reduction by the Corporation of the Executive's duties
and responsibilities;  (iii) any reduction by the Corporation of the Executive's
compensation or benefits payable hereunder (it being understood that a reduction
of benefits  applicable  to all  executives  of the  Corporation,  including the
Executive,  shall  not be deemed a  reduction  of the  Executive's  compensation
package for purposes of this  definition);  (iv)  requiring  the Executive to be
based without his consent at a location not within reasonable commuting distance
of Lakeland, Florida.

          9.5.  TERMINATION BY EXECUTIVE UPON CHANGE IN CONTROL.  Executive,  at
his option,  shall be able to terminate this Agreement upon written notice given
to the Secretary of the Corporation  within ninety (90) days of an occurrence of
a "Change in  Control".  A "Change in Control" of the  Corporation  shall mean a
change in control of the  Corporation or any entity  controlling the Corporation
(referred to  collectively  in this Section 9.5 as the  Corporation) of a nature
that would be required to be reported in response to Item 1 of a Current  Report
on Form 8-K,  pursuant to Section 13 or 15(d) of the Securities  Exchange Act of
1934 (the "Exchange Act");  provided that, without limitation,  such a Change in
Control  shall be deemed to have  occurred at such time as (a) any  "person" (as
such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than a
person who or which was a shareholder of the  Corporation  immediately  prior to
the Corporation's  secondary  offering (the "SO"), is or becomes the "beneficial
owner"  (as  defined  in  Rule  13d-3  under  the  Exchange  Act),  directly  or
indirectly,  of securities of the Corporation  representing  twenty-five percent
(25%) or more of the  combined  voting  power of the  Corporation's  outstanding
securities ordinarily having the right to vote at elections of directors; or (b)
individuals  who  constitute  the Board  concurrent  with the  execution of this
Agreement  (the  incumbent  Board) cease for any reason to constitute at least a
majority thereof, provided that any person becoming a director subsequent to the
date hereof  whose  election or  nomination  for  election by the  Corporation's
shareholders  was approved by a vote of at least three quarters of the directors
comprising  the  Incumbent  Board,  shall be, for  purposes  of this clause (b),
considered as though he were a member of the Incumbent  Board;  or (c) a sale by
the   Corporation   of  all  or   substantially   all  of  its  assets   occurs.
Notwithstanding  anything in the foregoing to the contrary, no Change in Control
shall be deemed to have occurred for purposes of this Agreement by virtue of any
transactions which result in the acquisition by the Executive,  or by a group of
persons which includes the Executive,  directly or indirectly,  of a majority of
either the  outstanding  shares of common stock of the Corporation or the voting
securities of any  corporation  which acquires all or  substantially  all of the
assets of the Corporation, whether by way of merger, consolidation, sale of such
assets or otherwise.

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     10. PROTECTION OF CONFIDENTIAL INFORMATION.

     In view of the fact that  Executive's  work for the Corporation  will bring
him into  close  contact  with  confidential  information  and plans for  future
developments, Executive agrees to the following:

          10.1 SECRECY.  To keep secret and retain in the  strictest  confidence
all confidential  matters of the  Corporation,  including,  without  limitation,
trade "know how" and trade secrets, customer lists, pricing policies,  marketing
plans, technical processes, formulae, inventions,  research projects, patents or
copyrights and all other proprietary rights owned by or in which the corporation
or  its  subsidiaries  has  an  interest,  and  other  business  affairs  of the
Corporation, learned by him heretofore or hereafter, and not to disclose them to
anyone inside or outside of the Corporation,  except in the course of performing
the  Services  hereunder  or with  the  express  written  consent  of the  Chief
Executive  Officer or Board of  Directors of the  Corporation  and except to the
extent such information is already known to the general public

          10.2 RETURN MEMORANDA,  ETC. To deliver promptly to the Corporation on
termination  of his  employment,  or at any other  time as the  Chief  Executive
Officer  or the  Board of  Directors  of the  Corporation  may so  request,  all
memoranda, notes, records, reports, manuals, drawings, blueprints,  facsimile or
e-mail  copies and other  documents  (and all copies  thereof)  relating  to the
Corporation's business and all property associated therewith,  which he may then
possess or have under his control.

          10.3 COVENANTS.

               10.3.1 NON-COMPETITION.  Executive agrees that at all times while
he is employed by the  Corporation  and regardless of the reason for termination
of his employment or this Agreement, for a period of one (1) year thereafter, he
will not, as a principal, agent, employee,  employer,  consultant,  stockholder,
investor,  director or co-partner of any person,  firm,  corporation or business
entity  other  than the  Corporation,  or in any  individual  or  representative
capacity whatsoever,  directly or indirectly,  without the express prior written
consent of the Corporation:

     (i) engage or participate in any business with customers of the Corporation
     or its  subsidiaries  directly or  indirectly  or make use of the  customer
     lists  directly  or  indirectly  as may  from  time to time be owned by the
     Corporation.

     (ii) aid or counsel any other person, firm,  corporation or business entity
     to do any of the above;

     (iii) become employed by a firm, corporation,  partnership or joint venture
     which  competes with the business of the  Corporation  or from its customer
     lists on the date of termination or resignation within the United States or
     Puerto Rico; or

     (iv) approach, solicit business from, or otherwise do business or deal with
     any customer of the  Corporation in connection  with any product or service
     competitive to any provided by the Corporation.

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               10.3.2 ANTI-RAIDING. Executive agrees that during the term of his
employment hereunder, and, thereafter for a period of two (2) year, he will not,
as a principal, agent, employee,  employer,  consultant,  director or partner of
any person, firm, corporation or business entity other than the Corporation,  or
in any individual or representative  capacity whatsoever directly or indirectly,
without the prior express written consent of the Corporation  approach,  counsel
or attempt to induce any person who is then in the employ of the  Corporation to
leave the  employ of the  Corporation  or employ or  attempt  to employ any such
person or persons  who at any time  during the  preceding  six months was in the
employ of the Corporation.

               10.3.3 EXECUTIVE'S  ACKNOWLEDGEMENTS.  Executive acknowledges (i)
that his position  with the  Corporation  requires the  performance  of services
which are special,  unique,  and  extraordinary in character and places him in a
position  of  confidence  and trust  with the  Customers  and  employees  of the
Corporation, through which, among other things, he shall obtain knowledge of the
Corporation's  "technical information" and "know-how" and become acquainted with
its customers,  in which matters the  Corporation  has  substantial  proprietary
interests;  (ii) that the restrictive covenants set forth above are necessary in
order  to  protect  and  maintain  such  proprietary  interests  and  the  other
legitimate business interests of the Corporation; and (iii) that the Corporation
would not have entered into this  Agreement  unless such covenants were included
herein.

               Executive also  acknowledges that the business of the Corporation
     presently  will  extend  throughout  the  United  States,  and that he will
     personally  supervise and engage in such business on behalf of  Corporation
     and, accordingly, it is reasonable that the restrictive covenants set forth
     above are not more limited as to geographic area than is set forth therein.
     Executive also represents to the  Corporation  that the enforcement of such
     covenants will not prevent Executive from earning a livelihood or impose an
     undue hardship on the Executive.

          10.4 SEVERABILITY. If any of the provisions of this Section 10, or any
part thereof, is hereinafter construed to be invalid or unenforceable,  the same
shall not affect the remainder of such provision or  provisions,  which shall be
given  full  effect,  without  regard  to the  invalid  portions.  If any of the
provisions of this Section 10, or any part thereof,  is held to be unenforceable
because of the duration of such provision,  the area covered thereby or the type
of conduct  restricted  therein,  the parties  agree that the court  making such
determination  shall  have the power to modify  the  duration,  geographic  area
and/or  other terms of such  provision  and, as so modified,  said  provision(s)
shall  then be  enforceable.  In the  event  that the  courts of any one or more
jurisdictions  shall hold such provisions  wholly or partially  unenforceable by
reason of the scope  thereof or  otherwise,  it is the  intention of the parties
hereto that such  determination  not bar or in any way affect the  Corporation's
right to the relief provided for herein in the courts of any other jurisdictions
as to  breaches  or  threatened  breaches  of  such  provisions  in  such  other
jurisdictions,  the above provisions as they relate to each jurisdiction  being,
for this purpose, sever able into diverse and independent covenants.

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          10.5  INJUNCTIVE  RELIEF.  Executive  acknowledges  and  agrees  that,
because of the unique and  extraordinary  nature of his services,  any breach or
threatened  breach of the provisions of Sections 10.1, 10.2, or 10.3 hereof will
cause  irreparable  injury and  incalculable  harm to the  Corporation,  and the
Corporation  shall,  accordingly,  be entitled to injunctive and other equitable
relief for such breach or threatened  breach and that resort by the  Corporation
to such injunctive or other equitable  relief shall not be deemed to waive or to
limit in any respect  any right or remedy  which the  Corporation  may have with
respect to such breach or threatened breach. The Corporation and Executive agree
that any such action for  injunctive  or  equitable  relief  shall be heard in a
state or federal  court  situated  in Florida  and each of the  parties  hereto,
hereby agrees to accept  service of process by registered  mail and to otherwise
consent to the jurisdiction of such courts.

          10.6  EXPENSES  OF  ENFORCEMENT  OF  COVENANTS.  In the event that any
action,  suit or  proceeding  at law or in  equity is  brought  to  enforce  the
covenants  contained in Sections  10.1,  10.2, or 10.3 hereof or to obtain money
damages for the breach thereof, the party prevailing in any such action, suit or
other proceeding shall be entitled upon demand, to reimbursement  from the other
party for all expenses  (including,  without limitation,  reasonable  attorneys'
fees and disbursements) incurred in connection therewith.

          10.7 SEPARATE  AGREEMENT.  The  provisions of this Section 10 shall be
construed as an agreement on the part of the Executive  independent of any other
part of this Agreement or any other agreement, and the existence of any claim or
cause of action of the Executive against the Corporation,  whether predicated on
this Agreement or otherwise,  shall not constitute a defense to the  enforcement
by the Corporation of the provisions of this Section 10.

     11. INDEMNIFICATION.

     The Corporation shall provide the Executive (including his heirs, executors
and  administrators)  with  coverage  under a standard  directors  and  officers
liability  insurance policy at the  Corporation's  expense to the same extent as
provided  for any other  director,  officer or trustee  of the  Corporation.  In
addition,  the  Corporation  shall  indemnify  the  Executive  (and  his  heirs,
executors and  administrators)  to the fullest extent permitted under the law of
its state of  incorporation  against all  expenses  and  liabilities  reasonably
incurred  by him in  connection  with  or  arising  out of any  action,  suit or
proceeding in which the Executive may be involved by reason of his having been a
director or officer of the Corporation or any subsidiary thereof.  Such expenses
and liabilities shall include, but not be limited to, judgments, court costs and
attorneys' fees and the cost of reasonable  settlements,  such settlements to be
approved by the Board if such action is brought  against  the  Executive  in his
capacity as a director or officer of the Corporation or any subsidiary  thereof.
The  Corporation  shall,  upon the  request  of the  Executive,  advance  to the
Executive  such  amounts  as  necessary  to cover  expenses,  including  without
limitation legal fees and expenses, incurred by the Executive in connection with
any suit or  proceeding  in which the Executive may be involved by reason of his
being  or  having  been a  director  or  officer  of the  Corporation  or of any
subsidiary thereof. Such indemnity and advance of expenses,  however,  shall not
extend to matters as to which the Executive is finally adjudged to be liable for
willful misconduct in the performance of his duties.

                                        9
<PAGE>
     12. ARBITRATION.

     Except with respect to any proceeding  brought under Section 10 hereof, any
controversy,  claim,  or dispute  between the parties,  directly or  indirectly,
concerning this Employment Agreement or the breach hereof, or the subject matter
hereof,  including  questions  concerning  the scope and  applicability  of this
arbitration  clause,  shall be finally  settled by  arbitration  in Polk County,
Florida  pursuant  to  the  rules  then  applying  of the  American  Arbitration
Association. The arbitrators shall consist of one representative selected by the
Corporation, one representative selected by the Executive and one representative
selected  by the  first two  arbitrators.  The  parties  agree to  expedite  the
arbitration proceeding in every way, so that the arbitration proceeding shall be
commenced  within  thirty (30) days after request  therefore is made,  and shall
continue  thereafter,  without  interruption,  and  that  the  decision  of  the
arbitrators  shall be handed down within  thirty (30) days after the hearings in
the arbitration proceedings are closed. The arbitrators shall have the right and
authority to assess the cost of the arbitration proceedings and to determine how
their  decision  or  determination  as to each issue or matter in dispute may be
implemented or enforced.  The decision in writing of any two of the  arbitrators
shall be binding and conclusive on all of the parties to this Agreement.  Should
either  the  Corporation  or the  Executive  fail to appoint  an  arbitrator  as
required  by this  Section 12 within  thirty (30) days after  receiving  written
notice  from the other  party to do so, the  arbitrator  appointed  by the other
party  shall act for all of the parties  and his  decision  in writing  shall be
binding and conclusive on all of the parties to this Employment  Agreement.  Any
decision  or award of the  arbitrators  shall be  final  and  conclusive  on the
parties to this  Agreement;  judgment upon such decision or award may be entered
in any competent Federal or state court located in the United States of America;
and application  may be made to such court for  confirmation of such decision or
award or for  enforcement and for any other legal remedies that may be necessary
to effectuate such decision or award.

     13. NOTICES.

     All  notices,  requests,  consents  and other  communications  required  or
permitted to be given hereunder, shall be in writing and shall be deemed to have
been duly given if delivered personally or sent by prepaid telegram, telecopy or
mailed  first-class,  postage prepaid,  by registered or certified mail (notices
sent by telegram or mailed shall be deemed to have been given on the date sent),
to the parties at their  respective  addresses  hereinabove set forth or to such
other address as either party shall  designate by notice in writing to the other
in  accordance  herewith.  Copies of all notices  shall be sent to the  attorney
selected by the Executive and noticed in writing to the Corporation from time to
time.

     14. GENERAL.

          14.1 GOVERNING LAW. This Agreement  shall be governed by and construed
and enforced in accordance with the local laws of the State in which the primary
corporate offices of the parent corporation are located at the time either party
seeks remedies or to enforce this contract.  The venue shall be in the county in
which the primary corporate  offices of the parent  corporation are then located
at the time either party seeks remedies or to enforce this contract.

                                       10
<PAGE>
          14.2 CAPTIONS. The section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or  interpretation  of
this Agreement.

          14.3 ENTIRE AGREEMENT.  This Agreement sets forth the entire agreement
and  understanding  of the parties  relating to the subject matter  hereof,  and
supersedes all prior  agreements,  arrangements and  understandings,  written or
oral,  relating to the subject  matter  hereof.  No  representation,  promise or
inducement has been made by either party that is not embodied in this Agreement,
and neither  party  shall be bound by or liable for any alleged  representation,
promise or inducement not so set forth.

          14.4 SEVERABILITY. If any of the provisions of this Agreement shall be
unlawful, void, or for any reason, unenforceable, such provision shall be deemed
sever able from, and shall in no way affect the validity or  enforceability  of,
the remaining portions of this Agreement.

          14.5  WAIVER.  The  waiver  by any  party  hereto  of a breach  of any
provision of this Agreement by any other party shall not operate or be construed
as a  waiver  of any  subsequent  breach  of the  same  provision  or any  other
provision hereof.

          14.6  COUNTERPARTS.  This  Agreement  may be  executed  in one or more
counterparts,  each of which shall be deemed an original, but all of which taken
together shall constitute one and the same Agreement.

          14.7  ASSIGNABILITY.   This  Agreement,  and  Executive's  rights  and
obligations  hereunder,  may not be assigned by Executive.  The  Corporation may
assign its rights,  together with its obligations,  hereunder in connection with
any sale,  transfer  or other  disposition  of all or  substantially  all of its
business or assets;  in any event the rights and  obligations of the Corporation
hereunder  shall be binding on its  successors  or  assigns,  whether by merger,
consolidation  or  acquisition  of all or  substantially  all of its business or
assets;  provided,  however,  that any such  assignment  shall not  release  the
Corporation  from its obligations  hereunder.  This Agreement shall inure to the
benefit  of,  and  be  binding   upon,   the   Executive   and  his   executors,
administrators, heirs and legal representatives.

          14.8 AMENDMENT. This Agreement may be amended,  modified,  superseded,
cancelled,  renewed or extended and the terms or covenants hereof may be waived,
only by a written  instrument  executed by both of the parties hereto, or in the
case of a waiver, by the party waiving  compliance.  No superseding  instrument,
amendment, modification, cancellation, renewal or extension hereof shall require
the consent or approval of any person other than the parties hereto. The failure
of either  party at any time or times to require  performance  of any  provision
hereof shall in no matter  affect the right at a later time to enforce the same.
No waiver by either  party of the breach of any term or  covenant  contained  in
this Agreement,  whether by conduct or otherwise,  in any one or more instances,
shall be deemed to be, or construed  as, a further or  continuing  waiver of any
such breach,  or a waiver of the breach of any other term or covenant  contained
in this Agreement.

                                       11
<PAGE>
     15. ADDITIONAL PROVISIONS

          15.1 DISABILITY. If Executive shall be unable to perform a significant
part of his duties and  responsibilities  in connection  with the conduct of the
business  and  affairs of the  Corporation  and such  inability  lasts for (i) a
period of at least one hundred  twenty (120)  consecutive  days, or (ii) periods
aggregating  at least one hundred  eighty  (180) days  during any three  hundred
sixty-five (365) consecutive  days, by reason of Executive's  physical or mental
disability,  whether by reason of injury,  illness or similar  cause,  Executive
shall be  deemed  disabled,  and the  Corporation  may,  at any time  thereafter
terminate  Executive's  employment  hereunder by reason of the Corporation being
required to replace the position. Upon delivery to Executive of such notice, all
obligations of the Corporation hereunder shall terminate,  except that Executive
shall be entitled to payment of any unpaid  accrued Base Salary through the date
of  termination.  In  addition,  any accrued  and unpaid  Bonus shall be paid in
accordance with Section 4 hereof.  In addition,  the Executive shall be entitled
to those severance  payments set forth in Section 5.1 hereof. The obligations of
Executive under Section 10 hereof shall continue notwithstanding  termination of
Executive's employment pursuant to this Section 15.1.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.

ATTEST: AMERICAN COMMERCE SOLUTIONS, INC.

By: /s/ Norman J. Birmingham            By: /s/ David N. DeBaene
    -------------------------------         ------------------------------------
    Name: Norman J. Birmingham              Name: David N. DeBaene
    Title: Chief Financial Officer          Title: President

WITNESS:

/s/ Robert Maxwell Jr.                  /s/ Daniel L. Hefner
-----------------------------------     ----------------------------------------
                                        DANIEL L. HEFNER, individually

                                       12<PAGE>

                                                                    Exhibit 10.1

================================================================================

                               AMENDMENT NO. 1 TO
                       AMENDED AND RESTATED LOAN AGREEMENT

                                  BY AND AMONG

                             HEALTH CARE REIT, INC.
                        AND CERTAIN OF ITS SUBSIDIARIES,

                           THE BANKS SIGNATORY HERETO

                                       AND

                          KEYBANK NATIONAL ASSOCIATION,
                     AS ADMINISTRATIVE AGENT FOR SUCH BANKS,

                         DEUTSCHE BANK SECURITIES INC.,
                              AS SYNDICATION AGENT

                                       AND

                                UBS WARBURG LLC,
                             AS DOCUMENTATION AGENT

                                  MAY 15, 2003

================================================================================

                          KEYBANK NATIONAL ASSOCIATION
                                       AND
                         DEUTSCHE BANK SECURITIES INC.,
                 AS JOINT LEAD ARRANGERS AND JOINT BOOK MANAGERS

<PAGE>

         AMENDMENT NO. 1 TO AMENDED AND RESTATED LOAN AGREEMENT

         AGREEMENT (this "AMENDMENT NO. 1"), made as of the 15th day of May,
2003, by and among:

         HEALTH CARE REIT, INC., a Delaware corporation, and each of the other
entities listed on Exhibit 1 annexed hereto (individually, a "BORROWER" and
collectively, THE "BORROWERS");

         The Banks that have executed the signature pages hereto (individually,
a "BANK" and, collectively, the "BANKS"); and

         KEYBANK NATIONAL ASSOCIATION, a national banking association, as
Administrative Agent for the Banks (in such capacity, together with its
successors in such capacity, the "AGENT");

                              W I T N E S S E T H:

         WHEREAS:

         (A)      The "Original Borrowers" set forth on Exhibit 1 annexed hereto
(the "ORIGINAL BORROWERS"), the Agent, Deutsche Bank Securities Inc., as
Syndication Agent, UBS Warburg LLC, as Documentation Agent and the banks
signatory thereto entered into a certain Amended and Restated Loan Agreement
dated August 23, 2002 (the "ORIGINAL LOAN AGREEMENT"; the Original Loan
Agreement, as amended hereby, and as it may hereafter be further amended,
modified or supplemented, is hereinafter referred to as the "LOAN AGREEMENT");

         (B)      Pursuant to subsection 7.8(b) of the Original Loan Agreement,
HCRI is required to cause each newly-created Subsidiary to become a party to the
Loan Agreement and in connection therewith, the Original Borrowers desire that
each such newly-created Subsidiary listed on Exhibit 1 under the caption
"ADDITIONAL BORROWERS" be added as a "Borrower" under the Loan Agreement;

         (C)      The Borrowers wish to amend the Original Loan Agreement to,
among other things, (i) increase the Total Revolving Credit Commitment, and (ii)
extend the Revolving Credit Commitment Termination Date, and the Banks and the
Agent are willing to amend the Original Loan Agreement on the terms and
conditions hereinafter set forth;

         (D)      Certain of the Banks desire to increase their respective
Revolving Credit Commitment to the amount set forth opposite their name on their
respective signature page hereto and the Borrowers desire to accept such
increased Revolving Credit Commitments; and

         (E)      All capitalized terms used herein which are not otherwise
defined herein shall have the respective meanings ascribed thereto in the
Original Loan Agreement;

         NOW, THEREFORE, the parties hereto agree as follows:

<PAGE>

         ARTICLE 1. CHANGE IN REVOLVING CREDIT COMMITMENTS; ADDITIONAL
                    BORROWERS.

                  SECTION 1.1       REVOLVING CREDIT COMMITMENTS. From and after
the date hereof, for purposes of the Loan Agreement, the Revolving Credit
Commitment of each Bank shall be the amount set forth opposite such Bank's name
on the signature pages hereto under the caption "Revolving Credit Commitment" as
such amount may be increased or reduced pursuant to the terms of the Loan
Agreement, and such amount (if changed) shall supersede and be deemed to amend
the amount of its respective Revolving Credit Commitment as set forth opposite
its name on the signature pages to the Original Loan Agreement.

                  SECTION 1.2       ADJUSTMENT OF OUTSTANDING LOANS. If any
Loans are outstanding under the Original Loan Agreement on the date hereof, the
Banks shall on the date hereof, at the direction of the Agent, make appropriate
adjustments among themselves in order to insure that the amount (and type) of
the Loans outstanding to the Borrowers from each Bank under the Loan Agreement
(as of the date hereof) are proportionate to the aggregate amount of all of the
Revolving Credit Commitments, after giving effect to the increased amount of the
Revolving Credit Commitments of certain of the Banks hereunder. The Borrowers
agree and consent to the terms of this Section 1.2.

                  SECTION 1.3       ASSUMPTION BY ADDITIONAL BORROWERS. The
Additional Borrowers hereby: (i) agree to be a party to the Original Loan
Agreement as amended hereby; (ii) assume, on a joint and several basis with the
Original Borrowers, all of the Obligations of a "Borrower" under the Loan
Agreement; (iii) agree to be bound as a "Borrower" by all of the terms of the
Loan Agreement and to perform and discharge all of the obligations of a Borrower
contained in or arising under the terms of the Loan Agreement; and (iv) agree
that the terms "Borrower(s)" and "Loan Party(ies)" are deemed to include each of
the Additional Borrowers.

                  SECTION 1.4       RELEASE OF CERTAIN ORIGINAL BORROWERS. From
and after the date hereof, each of HCRI Broadview, Inc., HCRI Westlake, Inc.,
HCRI Beachwood, Inc. and HCRI Westmoreland, Inc. (i) shall no longer be bound as
a "Borrower" under the Loan Agreement, (ii) each such entity is hereby released
and discharged from all of the obligations of a "Borrower" contained in and
arising under the terms of the Loan Agreement and the other Loan Documents to
which each is a party, and (iii) none of the foregoing entities may receive the
benefit, directly or indirectly, of any of the proceeds of the Loans under the
Loan Agreement.

         ARTICLE 2. AMENDMENTS TO ORIGINAL LOAN AGREEMENT; SUBSTITUTED NOTES.

                  SECTION 2.1       The Original Loan Agreement is hereby
amended as follows:

                  (a)      The second "WHEREAS" clause appearing on page one of
the Original Loan Agreement is amended by deleting the amount "One Hundred
Seventy-Five Million ($175,000,000) Dollars" appearing therein and substituting
therefor the amount "Two Hundred Twenty-Five Million ($225,000,000) Dollars".

                                       2

<PAGE>

                  (b)      The phrase "the aggregate amount set forth opposite
such Bank's name on the signature pages hereof under the caption 'Revolving
Credit Commitment'" appearing in the definition of the term "Revolving Credit
Commitment" in Article 1 shall be deemed to refer to the amount set forth
opposite each Bank's name on the signature pages hereto.

                  (c)      The definition of "Revolving Credit Commitment
Termination Date" appearing in Article 1 is deleted in its entirety and the
following is substituted therefor:

                                    "'Revolving Credit Commitment Termination
         Date' - initially, May 15, 2006, or any later date established in
         accordance with Section 2.23 hereof."

                  (d)      The definition of "Total Revolving Credit Commitment"
appearing in Article 1 is deleted in its entirety and the following is
substituted therefor:

                           "'Total Revolving Credit Commitment' - the aggregate
         obligation of the Banks to make Loans hereunder up to the aggregate
         amount of Two Hundred Twenty-Five Million ($225,000,000) Dollars."

                  (e)      Subsection 2.4(a) is deleted in its entirety and the
following is substituted therefor:

                                    "(a)     The Loans made by each Bank shall
         be evidenced by a single joint and several promissory note of the
         Borrowers in substantially the form of Exhibit A annexed to Amendment
         No. 1 to Amended and Restated Loan Agreement dated as of May 15, 2003
         ("AMENDMENT NO. 1") by and among the Borrowers, the Agent and the Banks
         party thereto (each, a "SUBSTITUTED NOTE" and, collectively, the
         "SUBSTITUTED NOTES"). Each Substituted Note shall be dated the date of
         Amendment No. 1, shall be payable to the order of such Bank in a
         principal amount equal to such Bank's Revolving Credit Commitment as in
         effect on the date of Amendment No. 1, and shall otherwise be duly
         completed. The Substituted Notes shall be payable as provided in
         Sections 2.1 and 2.5 hereof."

                  (f)      Section 2.23 is amended by deleting the first
sentence thereof in its entirety and substituting therefor the following:

                           "Subject to the following provisions, the Borrowers
shall have the option to extend the Revolving Credit Commitment Termination Date
to May 15, 2007."

                  (g)      A new Section 2.24 is added reading as follows:

                  "SECTION 2.24      INCREASE IN TOTAL REVOLVING CREDIT
COMMITMENT.

                           "(a)     The Borrowers may one time, at their sole
         expense and effort and after consulting with the Agent, request: (i)
         one or more Banks acceptable to the Agent to increase (in the sole and
         absolute discretion of each such Bank) the amount of their respective
         Revolving Credit Commitments, and/or (ii) one or more other lending
         institutions acceptable to the Agent (each, a "NEW

                                       3

<PAGE>

         LENDER") to become "Banks" and extend Revolving Credit Commitments
         hereunder (each such existing Bank and each New Lender being referred
         to as a "PROPOSED LENDER"). To request an increase pursuant to this
         Section 2.24 (the "COMMITMENT INCREASE"), the Borrowers shall submit to
         the Agent a written increase request signed by the Borrowers and in
         form approved by the Agent (the "INCREASE REQUEST"), which shall
         specify, as the case may be: (A) each such existing Bank and the amount
         of the proposed increase to its Revolving Credit Commitment, or (B) the
         proposed Revolving Credit Commitment for each New Lender. Promptly
         following receipt of the Increase Request, the Agent shall advise each
         Proposed Lender of the details thereof.

                           (b)      If one or more Proposed Lender(s) shall have
         unconditionally agreed to such Increase Request in a writing delivered
         to the Borrowers and the Agent at any time prior to the 30th day
         following the date of the delivery to such Proposed Lenders(s) of the
         Increase Request (each such Proposed Lender being hereinafter referred
         to as an "INCREMENTAL LENDER"), then: (x) each such Incremental Lender
         which shall then be an existing Bank shall have its Revolving Credit
         Commitment increased by the amount set forth in the Increase Request,
         and (y) each such Incremental Lender which shall then be a New Lender
         shall be and become a "Bank" hereunder having a Revolving Credit
         Commitment equal to the amount set forth in such Increase Request,
         provided, however, that (1) immediately before and after giving effect
         thereto, no Default shall or would exist, (2) each such Incremental
         Lender shall have executed and delivered to the Agent a supplement to
         this Agreement providing for its increased Revolving Credit Commitment
         or its Revolving Credit Commitment, as applicable, in form approved by
         the Agent, (3) immediately after giving effect thereto, the aggregate
         amount of the Total Revolving Credit Commitment shall not exceed
         $300,000,000, (4) the increase of the Total Revolving Credit Commitment
         specified in the Increase Request shall be in an aggregate amount that
         is an integral multiple of $1,000,000 and not less than $5,000,000, (5)
         the Revolving Credit Commitment extended by each Incremental Lender
         which is a New Lender shall be in a minimum amount of $5,000,000 or an
         integral multiple of $1,000,000 in excess thereof, and (6) the
         Commitment Increase shall not be permitted hereunder unless consummated
         on or prior to December 31, 2003.

                           (c)      Simultaneously with the Commitment Increase
         under this Section 2.24, each Incremental Lender shall, to the extent
         necessary, purchase from each other existing Bank, and each other
         existing Bank shall sell to each Incremental Lender, in each case at
         par and without representation, warranty, or recourse (in accordance
         with and subject to the restrictions contained in Section 10.13), such
         principal amount of Loans of such other existing Bank(s), together with
         all accrued and unpaid interest thereon, as will result, after giving
         effect to such transaction, in each Bank's pro rata share of Loans
         outstanding being equal to such Lender's pro rata share of the Total
         Revolving Credit Commitment, provided that each such assignor Bank
         shall have received (to the extent of the interests, rights and
         obligations assigned) payment then due and owing of the outstanding
         principal amount of its Loans, accrued interest thereon, accrued fees,

                                       4

<PAGE>

         commissions and all other amounts payable to it under the Loan
         Documents from the applicable assignee Banks (to the extent of such
         outstanding principal and accrued interest, fees and commissions) or
         the Borrowers (in the case of all other amounts)."

                  SECTION 2.2       In order to evidence the Loans, as amended
hereby, the Borrowers shall execute and deliver to each Bank, simultaneously
with the execution and delivery hereof, a substituted promissory note payable to
the order of such Bank in substantially the form of Exhibit A annexed hereto
(each a "SUBSTITUTED NOTE" and collectively the "SUBSTITUTED NOTES"). Each of
the Banks shall, upon the execution and delivery by the Borrowers of its
applicable Substituted Note as herein provided, mark the Note delivered to it in
connection with the Original Loan Agreement "Replaced by Substituted Note" and
return it to the Borrowers.

                  SECTION 2.3       (a) All references in the Original Loan
Agreement or any other Loan Document to the "Revolving Credit Commitment(s)",
the "Note(s)" and the "Loan Documents" shall be deemed to refer respectively, to
the Revolving Credit Commitment(s) as amended hereby, the Substituted Note(s)
and the Loan Documents as defined in the Original Loan Agreement together with,
and as amended by this Amendment No. 1, the Substituted Notes and all
agreements, documents and instruments delivered pursuant thereto or in
connection therewith.

                           (b)      All references in the Original Loan
Agreement and the other Loan Documents to the "Loan Agreement", and also in the
case of the Original Loan Agreement to "this Agreement", shall be deemed to
refer to the Original Loan Agreement, as amended hereby.

                           (c)      All references in the Substituted Notes to
the "Revolving Credit Commitment Termination Date" shall be deemed to refer to
the Revolving Credit Commitment Termination Date as defined in this Amendment
No. 1.

                  SECTION 2.4       The Original Loan Agreement and the other
Loan Documents shall each be deemed amended and supplemented hereby to the
extent necessary, if any, to give effect to the provisions of this Agreement.

                  ARTICLE 3. REPRESENTATIONS AND WARRANTIES.

                  (a)      (i)      The Borrowers hereby confirm, reaffirm and
restate to each of the Banks and the Agent all of the representations and
warranties set forth in Article 3 of the Original Loan Agreement as if such
representations and warranties were made as of the date hereof, except for
changes in the ordinary course of business which, either singly or in the
aggregate, would not have a Material Adverse Effect.

                           (ii)     Schedule 3.1 to the Original Loan Agreement
is hereby amended as set forth in the Addendum to Schedule 3.1 annexed hereto.
Schedules 3.6 and 3.16 to the Original Loan Agreement are hereby deleted in
their entirety and Schedules 3.6 and 3.16 annexed hereto are substituted
therefor.

                                       5

<PAGE>

                  (b)      (i)      The execution, delivery and performance by
each Borrower of this Amendment No. 1 and the Substituted Notes are within its
organizational powers and have been duly authorized by all necessary action
(corporate or otherwise) on the part of each Borrower, (ii) this Amendment No. 1
and the Substituted Notes are the legal, valid and binding obligation of each
Borrower, enforceable against each Borrower in accordance with its respective
terms, and (iii) the execution, delivery and performance by each Borrower of
this Amendment No. 1 and the Substituted Notes do not: (A) contravene the terms
of any Borrower's organizational documents, (B) conflict with or result in a
breach or contravention of, or the creation of any lien under, any document
evidencing any contractual obligation to which any Borrower is a party or any
order, injunction, writ or decree to which any Borrower or its property is
subject, or (C) violate any requirement of law.

                  ARTICLE 4.  CONDITIONS TO EFFECTIVENESS OF THIS AGREEMENT.

                  This Amendment No. 1 shall become effective on the date of the
fulfillment (to the satisfaction of the Agent) of the following conditions
precedent:

                  (a)      This Amendment No. 1 shall have been executed and
delivered to the Agent by a duly authorized representative of the Borrowers, the
Agent and each Bank.

                  (b)      The Borrowers shall have executed and delivered to
each of the Banks its Substituted Note.

                  (c)      The Borrowers shall pay to the Agents (i) all fees
provided for in the fee letter dated April 14, 2003, and (ii) all other fees
payable to the Banks in connection with this Amendment No. 1.

                  (d)      The Agent shall have received a Compliance
Certificate from the Borrowers dated the date hereof and the matters certified
therein, including, without limitation, that after giving effect to the terms
and conditions of this Amendment No. 1, no Default or Event of Default shall
exist, shall be true.

                  (e)      The Agent shall have received copies of the
following:

                           (i)      Copies of all action, corporate or
otherwise, taken by each of the Borrowers to authorize the execution, delivery
and performance of this Amendment No. 1, the Substituted Notes and the
transactions contemplated hereby, certified by its Secretary;

                           (ii)     A certificate from the Secretary of each
Original Borrower to the effect that its organizational documents delivered to
the Agent pursuant to the Original Loan Agreement have not been amended since
the date of such delivery and that each such document is in full force and
effect and is true and correct as of the date hereof;

                           (iii)    The organizational documents of the
Additional Borrowers, certified by the Secretary of State of their respective
states of organization;

                                       6

<PAGE>

                           (iv)     Good standing certificates as of a recent
date, with respect to each of the Additional Borrowers from the Secretary of
State of their respective states of incorporation and each state in which each
of them is qualified to do business; and

                           (v)      An incumbency certificate (with specimen
signatures) with respect to each of the Borrowers.

                  (f)      All legal matters incident hereto shall be
satisfactory to the Agent and its counsel.

         ARTICLE 5. MISCELLANEOUS.

                  SECTION 5.1       ARTICLE 10 OF THE ORIGINAL LOAN AGREEMENT.
The miscellaneous provisions under Article 10 of the Original Loan Agreement,
together with the definition of all terms used therein, and all other sections
of the Original Loan Agreement to which Article 10 refers are hereby
incorporated by reference as if the provisions thereof were set forth in full
herein, except that (i) the terms "Loan Agreement" and "Note(s)" shall be deemed
to refer, respectively, to the Original Loan Agreement, as amended by this
Amendment No. 1 and the Substituted Note(s), (ii) the term "this Agreement"
shall be deemed to refer to this Amendment No. 1; and (iii) the terms
"hereunder" and "hereto" shall be deemed to refer to this Amendment No. 1.

                  SECTION 5.2       CONTINUED EFFECTIVENESS. Except as amended
hereby, the Original Loan Agreement and the other Loan Documents are hereby
ratified and confirmed in all respects and shall remain in full force and effect
in accordance with their respective terms.

                  SECTION 5.3       COUNTERPARTS. This Amendment No. 1 may be
executed by the parties hereto in one or more counterparts, each of which shall
be an original and all of which shall constitute one and the same agreement.

                           [SIGNATURE PAGES TO FOLLOW]

                                       7

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1
to be duly executed on the date first above written.

                           HEALTH CARE REIT, INC.
                           HCRI PENNSYLVANIA PROPERTIES, INC.
                           HCRI TEXAS PROPERTIES, INC.
                           HCRI TEXAS PROPERTIES, LTD.
                               BY HEALTH CARE REIT, INC.,
                               ITS GENERAL PARTNER
                           HCRI NEVADA PROPERTIES, INC.
                           HCRI LOUISIANA PROPERTIES, L.P.
                               BY HCRI SOUTHERN INVESTMENTS I, INC.,
                               ITS GENERAL PARTNER
                           HEALTH CARE REIT INTERNATIONAL, INC.
                           HCN ATLANTIC GP, INC.
                           HCN ATLANTIC LP, INC.
                           HCN BCC HOLDINGS, INC.
                           HCRI INDIANA PROPERTIES, INC.
                           HCRI INDIANA PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.,
                               ITS MEMBER
                           HCRI LIMITED HOLDINGS, INC.
                           HCRI MASSACHUSETTS PROPERTIES, INC.
                           HCRI MASSACHUSETTS PROPERTIES TRUST
                               BY HCRI MASSACHUSETTS PROPERTIES, INC.
                               ITS TRUSTEE
                           HCRI HOLDINGS TRUST
                               BY HCRI MASSACHUSETTS PROPERTIES, INC.
                               ITS TRUSTEE
                           HCRI NORTH CAROLINA PROPERTIES, LLC
                               BY NORTH CAROLINA PROPERTIES I, INC.
                               ITS MEMBER
                           HCRI SOUTHERN INVESTMENTS I, INC.
                           HCRI TENNESSEE PROPERTIES, INC.
                           PENNSYLVANIA BCC PROPERTIES, INC.
                           HCRI KENTUCKY PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI MASSACHUSETTS PROPERTIES TRUST II
                               BY HCRI MASSACHUSETTS PROPERTIES, INC.
                               ITS TRUSTEE
                           HCRI SATYR HILL, LLC
                               BY HEALTH CARE REIT, INC., AS THE MEMBER OF
                               HCRI MARYLAND PROPERTIES, LLC
                               ITS MEMBER
                           HCRI FRIENDSHIP, LLC
                               BY HEALTH CARE REIT, INC., AS THE MEMBER OF
                                  HCRI MARYLAND PROPERTIES, LLC
                               ITS MEMBER
                           HCRI ST. CHARLES, LLC
                               BY HEALTH CARE REIT, INC., AS THE MEMBER OF
                                  HCRI MARYLAND PROPERTIES, LLC
                                  ITS MEMBER

                     [BORROWERS CONTINUED ON FOLLOWING PAGE]

<PAGE>

                           HCRI MARYLAND PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI LAUREL, LLC
                               BY HEALTH CARE REIT, INC., AS THE MEMBER OF
                                  HCRI MARYLAND PROPERTIES, LLC
                                  ITS MEMBER
                           HCRI NORTH CAROLINA PROPERTIES I, INC.
                           HCRI NORTH CAROLINA PROPERTIES III, LP
                               BY HCRI NORTH CAROLINA PROPERTIES II, INC.
                               ITS GENERAL PARTNER
                           HCRI NORTH CAROLINA PROPERTIES II, INC.
                           HCRI WISCONSIN PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI MISSISSIPPI PROPERTIES, INC.
                           HCRI ILLINOIS PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI MISSOURI PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI SURGICAL PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI TUCSON PROPERTIES, INC.

                           BY /S/ GEORGE L. CHAPMAN
                              --------------------------------------------------
                              CHIEF EXECUTIVE OFFICER

         GEORGE L. CHAPMAN, as Chief Executive Officer of all of the
aforementioned entities, has executed this Amendment No. 1 to Amended and
Restated Loan Agreement and intending that all entities above named are bound
and are to be bound by the one signature as if he had executed this Amendment
No. 1 to Amended and Restated Loan Agreement separately for each of the above
named entities.

                             Health Care REIT, Inc.
    Signature Page to Amendment No. 1 to Amended and Restated Loan Agreement
                            Dated as of May 15, 2003

<PAGE>

REVOLVING CREDIT COMMITMENT:

$52,500,000                       KEY CORPORATE CAPITAL INC.,
                                    AS A BANK

PRO RATA SHARE OF AGGREGATE       By: /s/ F. Donald Kelly III
REVOLVING CREDIT COMMITMENTS:         ------------------------------------------
                                      Name:  F. Donald Kelly III
                                      Title: Vice President
23.333333333%
                                  KEYBANK NATIONAL ASSOCIATION,
                                    AS ADMINISTRATIVE AGENT

                                  By: /s/ F. Donald Kelly III
                                      ------------------------------------------
                                      Name:  F. Donald Kelly III
                                      Title: Vice President

                                  Lending Office for Base Rate Loans
                                  and LIBOR Loans:
                                  Key Corporate Capital Inc.

                                  127 Public Square, MC:OH-01-27-0605
                                  Cleveland, Ohio 44114
                                  Attention: Healthcare Administrative Assistant

                                  Address for Notices:

                                  Key Corporate Capital Inc.
                                  127 Public Square, MC:OH-01-27-0605
                                  Cleveland, Ohio 44114
                                  Attention: Mr. F. Donald Kelly III

                                  Telecopier: (216) 689-5970

                             Health Care REIT, Inc.
    Signature Page to Amendment No. 1 to Amended and Restated Loan Agreement
                            Dated as of May 15, 2003

<PAGE>

REVOLVING CREDIT COMMITMENT:

$52,500,000                       DEUTSCHE BANK TRUST COMPANY
                                      AMERICAS

PRO RATA SHARE OF AGGREGATE       By: /s/ Diane F. Rolfe
REVOLVING CREDIT COMMITMENTS:         ------------------------------------------
                                      Name: Diane F. Rolfe
                                      Title: Vice President
23.333333333%
                                  Lending Office for Base Rate Loans
                                  and LIBOR Loans:

                                  Deutsche Bank Trust Company Americas
                                  31 West 52nd Street
                                  New York, New York 10019
                                  Attention: Diane F. Rolfe
                                             Vice President

                                  Address for Notices:
                                  Deutsche Bank Trust Company Americas
                                  90 Hudson Street
                                  Jersey City, New Jersey 07302
                                  Attention: Roy Castrmonte

                                  Telecopier: (201) 593-2310

                             Health Care REIT, Inc.
    Signature Page to Amendment No. 1 to Amended and Restated Loan Agreement
                            Dated as of May 15, 2003

<PAGE>

REVOLVING CREDIT COMMITMENT:

$40,000,000                       BANK OF AMERICA, N.A.

PRO RATA SHARE OF AGGREGATE       By: /s/ Kevin Wagley
REVOLVING CREDIT COMMITMENTS:         ------------------------------------------
                                      Name:  Kevin Wagley
                                      Title: Principal
17.777777778%
                                  Lending Office for Base Rate Loans
                                  and LIBOR Loans:

                                  Bank of America, N.A.
                                  1850 Gateway Boulevard
                                  CA4-706-05-11
                                  Concord, California 94520-32282
                                  Ref: Credit Services, Health Care REIT
                                  Attention: Lynne Famularcano

                                  Address for Notices:

                                  Bank of America, N.A.
                                  1850 Gateway Boulevard
                                  CA4-706-05-11
                                  Concord, California 94520-32282
                                  Ref: Credit Services, Health Care REIT
                                  Attention: Lynne Famularcano

                                  Telecopier: (888) 969-9232

                             Health Care REIT, Inc.
    Signature Page to Amendment No. 1 to Amended and Restated Loan Agreement
                            Dated as of May 15, 2003

<PAGE>

REVOLVING CREDIT COMMITMENT:

$25,000,000                       BANK ONE, N.A.

PRO RATA SHARE OF AGGREGATE       By: /s/ Jan E. Petrik
REVOLVING CREDIT COMMITMENTS:         ------------------------------------------
                                      Name:  Jan E. Petrik
                                      Title: First Vice President
11.111111111%
                                  Lending Office for Base Rate Loans
                                  and LIBOR Loans:

                                  Bank One, N.A.
                                  600 Superior
                                  Cleveland, Ohio 44114
                                  Attention: Commercial Loan Operations

                                  Address for Notices:

                                  Bank One, N.A.
                                  Commercial Banking
                                  600 Superior
                                  Cleveland, Ohio 44114
                                  Attention: Ms. Jan Petrik

                                  Telecopier: (216) 781-4567

                             Health Care REIT, Inc.
    Signature Page to Amendment No. 1 to Amended and Restated Loan Agreement
                            Dated as of May 15, 2003

<PAGE>

REVOLVING CREDIT COMMITMENT:

$40,000,000                       UBS AG, CAYMAN ISLANDS BRANCH

PRO RATA SHARE OF AGGREGATE       By: /s/ Wilfred V. Saint
REVOLVING CREDIT COMMITMENTS:         ------------------------------------------
                                      Name:  Wilfred V. Saint
17.777777778%                         Title: Associate Director
                                             Banking Products
                                             Services, US

                                  By: /s/ Patricia O'Kicki
                                      ------------------------------------------
                                      Name:  Patricia O'Kicki
                                      Title: Director

                                  Lending Office for Base Rate Loans
                                  and LIBOR Loans:

                                  UBS AG, Cayman Islands Branch
                                  c/o UBS AG, Stamford Branch
                                  677 Washington Boulevard
                                  Stamford, Connecticut 06901
                                  Attention: Sailoz Sikka

                                  Address for Notices:
                                  UBS Warburg LLC
                                  677 Washington Boulevard
                                  Stamford, Connecticut 06901
                                  Attention: Sailoz Sikka

                                  Telecopier: (203) 719-3888

                             Health Care REIT, Inc.
    Signature Page to Amendment No. 1 to Amended and Restated Loan Agreement
                            Dated as of May 15, 2003

<PAGE>

REVOLVING CREDIT COMMITMENT:

$15,000,000                       COMERICA BANK

PRO RATA SHARE OF AGGREGATE       By: /s/ Alicia R. Thornwell-Autry
REVOLVING CREDIT COMMITMENTS:         ------------------------------------------
                                      Name:  Alicia R. Thornwell-Autry
6.666666667%                          Title: Assistant Vice President

                                  Lending Office for Base Rate Loans
                                  and LIBOR Loans:

                                  Comerica Bank
                                  Comerica Tower at Detroit Center
                                  500 Woodward Avenue
                                  Detroit, Michigan 48226
                                  Attention: Dawn Morgulec

                                  Address for Notices:

                                  Comerica Bank
                                  Comerica Tower at Detroit Center
                                  500 Woodward Avenue
                                  Detroit, Michigan 48226
                                  Attention: Dawn Morgulec

                                  Telecopier: (313) 222-3420

                             Health Care REIT, Inc.
    Signature Page to Amendment No. 1 to Amended and Restated Loan Agreement
                            Dated as of May 15, 2003

<PAGE>

                                    EXHIBIT 1
            TO AMENDMENT NO. 1 TO AMENDED AND RESTATED LOAN AGREEMENT
                                  BY AND AMONG
                  HEALTH CARE REIT, INC. AND ITS SUBSIDIARIES,
                           THE BANKS SIGNATORY HERETO
                                       AND
                     KEYBANK NATIONAL ASSOCIATION, AS AGENT

                                LIST OF BORROWERS

                               ORIGINAL BORROWERS

<TABLE>
<CAPTION>
NAME OF ORIGINAL BORROWER                                              STATE OF ORGANIZATION
-------------------------                                              ---------------------
<S>                                                                    <C>
Health Care REIT, Inc.                                                        Delaware
HCRI Pennsylvania Properties, Inc.                                          Pennsylvania
HCRI Texas Properties, Inc.                                                   Delaware
HCRI Texas Properties, Ltd.                                                    Texas
HCRI Nevada Properties, Inc.                                                   Nevada
HCRI Louisiana Properties, L.P.                                               Delaware
Health Care REIT International, Inc.                                          Delaware
HCN Atlantic GP, Inc.                                                         Delaware
HCN Atlantic LP, Inc.                                                         Delaware
HCN BCC Holdings, Inc.                                                        Delaware
HCRI Indiana Properties, Inc.                                                 Delaware
HCRI Indiana Properties, LLC                                                  Indiana
HCRI Limited Holdings, Inc.                                                   Delaware
HCRI Massachusetts Properties Trust                                        Massachusetts
HCRI Massachusetts Properties, Inc.                                           Delaware
HCRI Holdings Trust                                                        Massachusetts
HCRI North Carolina Properties, LLC                                           Delaware
HCRI Southern Investments I, Inc.                                             Delaware
HCRI Tennessee Properties, Inc.                                               Delaware
Pennsylvania BCC Properties, Inc.                                           Pennsylvania
HCRI Broadview, Inc.*                                                           Ohio
HCRI Westlake, Inc.*                                                            Ohio
HCRI Beachwood, Inc.*                                                           Ohio
HCRI Kentucky Properties, LLC                                                 Kentucky
HCRI Massachusetts Properties II                                           Massachusetts
HCRI Satyr Hill, LLC                                                          Virginia
HCRI Friendship, LLC                                                          Virginia
HCRI St. Charles, LLC                                                         Virginia
HCRI Maryland Properties, LLC                                                 Maryland
HCRI Laurel, LLC                                                              Maryland
HCRI North Carolina Properties I, Inc.                                     North Carolina
HCRI North Carolina Properties III, LP                                     North Carolina
HCRI North Carolina Properties II, Inc.                                    North Carolina
HCRI Wisconsin Properties, LLC                                               Wisconsin
HCRI Westmoreland, Inc.*                                                      Delaware
HCRI Mississippi Properties, Inc.                                           Mississippi
</TABLE>

<PAGE>

                              ADDITIONAL BORROWERS

<TABLE>
<CAPTION>
NAME OF ADDITIONAL BORROWER                                            STATE OF ORGANIZATION
---------------------------                                            ---------------------
<S>                                                                    <C>
HCRI Illinois Properties, LLC                                                 Delaware
HCRI Missouri Properties, LLC                                                 Delaware
HCRI Surgical Properties, LLC                                                   Ohio
HCRI Tucson Properties, Inc.                                                  Delaware
</TABLE>

* Released as a "Borrower" pursuant to the terms of Section 1.4 of this
Amendment No. 1.

<PAGE>

                           ADDENDUM TO SCHEDULE 3.1 TO
             AMENDMENT NO. 1 TO AMENDED AND RESTATED LOAN AGREEMENT
                                  BY AND AMONG
                  HEALTH CARE REIT, INC. AND ITS SUBSIDIARIES,
                           THE BANKS SIGNATORY HERETO
                                       AND
                     KEYBANK NATIONAL ASSOCIATION, AS AGENT

                    STATES OF ORGANIZATION AND QUALIFICATION,
                   AND CAPITALIZATION OF ADDITIONAL BORROWERS

HCRI ILLINOIS PROPERTIES, LLC

         (i)      State of Organization: Delaware

         (ii)     Capitalization: N/A

         (iii)    Business: Investments in health care facilities

         (iv)     States of Qualification: Illinois

         (v)      Subsidiaries: None

HCRI MISSOURI PROPERTIES, LLC

         (i)      State of Organization: Delaware

         (ii)     Capitalization: N/A

         (iii)    Business: Investments in health care facilities

         (iv)     States of Qualification: Missouri

         (v)      Subsidiaries: None

HCRI SURGICAL PROPERTIES, LLC

         (i)      State of Organization: Ohio

         (ii)     Capitalization: N/A

         (iii)    Business: Investments in health care facilities

         (iv)     States of Qualification: None

         (v)      Subsidiaries: None

HCRI TUCSON PROPERTIES, INC.

         (i)      State of Incorporation: Delaware

         (ii)     Capitalization: Authorized Common Stock - 100 shares
                                  Issued Common Stock - 100 shares

         (iii)    Business: Investments in health care facilities

         (iv)     States of Qualification: Arizona

         (v)      Subsidiaries: None

<PAGE>

                                  SCHEDULE 3.6
                                       TO
                       AMENDED AND RESTATED LOAN AGREEMENT
                                  BY AND AMONG
                             HEALTH CARE REIT, INC.
                              AND ITS SUBSIDIARIES,
                           THE BANKS SIGNATORY HERETO
                                       AND
              KEYBANK NATIONAL ASSOCIATION, AS ADMINISTATIVE AGENT

                         JUDGMENTS, ACTIONS, PROCEEDINGS

-        Harry Young - HCRI has been named as a defendant in a suit in the Third
         Judicial Circuit, Madison County, Illinois in a case captioned Harry
         Young, Special Administrator of the Estate of Hazel Young vs. Cathedral
         Rock of West Granite City, Inc., d/b/a The Colonnades, et al., Case No.
         01-L-1441. The Complaint alleges negligence and breaches of duty of
         care concerning care and treatment of a resident by a Tenant in the
         Tenant's facility. The Tenant is providing indemnification and a
         defense to HCRI. HCRI is being defended in this matter by Peter Krane,
         Esq., Armstrong Teasdale LLP, One Metropolitan Square, Suite 2600, St.
         Louis, MO 63102-2740. HCRI has moved to dismiss the Complaint because
         HCRI does not provide any care or treatment and did not owe a duty to
         the resident. HCRI believes plaintiffs' claims as to HCRI are meritless
         and HCRI will vigorously defend the suit.

-        Carl Rutherford - HCRI has been named as a defendant in a suit in the
         Circuit Court for Roane County, Tennessee in a case captioned Carl
         Rutherford, as Administrator of the Estate of Mary Reid, Deceased vs.
         Royal Care of Harriman, Inc., aka Harriman Care & Rehabilitation
         Center, et al., Docket No. 12684. The Complaint alleges negligence and
         breaches of duty of care concerning care and treatment of a resident by
         a Tenant in the Tenant's facility. The Tenant is providing
         indemnification and a defense to HCRI. The HCRI is being defended in
         this matter by Richard C. May, Esq. and Loring Justice, Esq., Whelchel,
         May & Associates, P.O. Box 11407, Knoxville, TN 37939-1407. HCRI
         believes plaintiffs' claims as to HCRI are meritless and HCRI will
         vigorously defend the suit.

-        Janace Ogle - HCRI has been named as a defendant in a suit in the
         Circuit Court for Sevier County, Tennessee in a case captioned Janace
         F. Ogle bnf Vicki Suttles vs. HQM of Pigeon Forge, LLC dba Pigeon Forge
         Care & Rehabilitation Center, et al., Docket No. 2002-0741. The
         Complaint alleges negligence and breaches of duty of care concerning
         care and treatment of a resident by a Tenant in the Tenant's facility.
         The Tenant is providing indemnification and a defense to HCRI. HCRI is
         being defended in this matter by Richard C. May, Esq. and Loring
         Justice, Esq., Whelchel, May & Associates, P.O. Box 11407, Knoxville,
         TN 37939-1407. HCRI believes plaintiffs' claims as to HCRI are
         meritless and HCRI will vigorously defend the suit.

-        Sylvia Perkins - HCRI has been named as a defendant in a suit in the
         Superior Court of the Commonwealth of Massachusetts in a case captioned
         Sylvia Ure Tietjen-Perkins vs. Daniel J. Kane, et al., Case No.
         02-1776-B. The Complaint alleges negligence and breaches of duty of
         care concerning care and treatment of a resident by a Tenant in the
         Tenant's facility. The Tenant is providing indemnification and a
         defense to HCRI. HCRI is being defended in this

<PAGE>

         matter by Peter McCormick, Esq., Law Office of Peter Feeherry, 25 New
         Chardon Street, Boston, MA 02114. HCRI believes plaintiffs' claims as
         to HCRI are meritless and HCRI will vigorously defend the suit.

-        Royal Care Litigation - HCRI has been named as a defendant in six
         separate suits filed in State Court in Tennessee filed by a seller of
         six facilities against HCRI and several other defendants. Each of the
         suits was filed in the Circuit Court for Bradley County, Tennessee on
         October 25, 2002 (Docket No. V02-923; Docket No. V02-920; Docket No.
         V02-939; Docket No. V02-921; Docket No. V02-922; and Docket No.
         V02-926). The Tenant is providing indemnity and a defense to HCRI. The
         plaintiff and Tenant have allowed all defendants to have extensions of
         time to answer the complaints because the plaintiffs and Tenant are
         attempting to negotiate a settlement of the dispute. HCRI believes
         plaintiffs' claims as to HCRI are meritless and HCRI will vigorously
         defend each of the suits.

-        Windmoor - HCRI has been notified that it and other parties are the
         subject of a federal "qui tam" whistleblower lawsuit filed by an
         undisclosed relator in the Middle District of Florida, Tampa Division,
         under the federal False Claims Act, which claim relates to the
         appropriateness of Medicare reimbursement in the amount of
         approximately $2.6M resulting from the sale of two facilities in 1997.
         Possible penalties under the False Claims Act include treble damages.
         The action was filed under seal, which is the normal procedure for such
         "qui tam" cases, and further information is unavailable at this time.
         The United States Attorney's office is investigating the allegations,
         and has not made a decision whether the United States will join in the
         action. HCRI's attorneys are working with the federal government
         representatives to give them the information necessary to assess the
         allegations. It is HCRI's belief that the payments were appropriate and
         that the allegations are baseless. HCRI intends to fully defend against
         these claims.

<PAGE>

                                  SCHEDULE 3.16
                                       TO
                       AMENDED AND RESTATED LOAN AGREEMENT
                                  BY AND AMONG
                             HEALTH CARE REIT, INC.
                              AND ITS SUBSIDIARIES,
                           THE BANKS SIGNATORY HERETO
                                       AND
              KEYBANK NATIONAL ASSOCIATION, AS ADMINISTRATIVE AGENT

                             EMPLOYEE BENEFIT PLANS

         Health Care REIT, Inc. retirement and trust (401(k)) plan

         Health Care REIT, Inc. money purchase pension plan (merged into the
         retirement plan effective September 30, 2002)

         Health Care REIT, Inc. supplemental executive retirement plan

         Health Care REIT, Inc. group insurance benefit plan

<PAGE>

                                    EXHIBIT A
            TO AMENDMENT NO. 1 TO AMENDED AND RESTATED LOAN AGREEMENT
                                  BY AND AMONG
                  HEALTH CARE REIT, INC. AND ITS SUBSIDIARIES,
                           THE BANKS SIGNATORY HERETO
                                       AND
                     KEYBANK NATIONAL ASSOCIATION, AS AGENT

                            FORM OF SUBSTITUTED NOTE

$____________                                           DATED: MAY 15, 2003

                  FOR VALUE RECEIVED, each of the undersigned (collectively, the
"BORROWERS"), hereby jointly and severally promises to pay to the order of
___________________________ (the "BANK") on the Revolving Credit Commitment
Termination Date, the principal sum of _____________________ ($__________)
Dollars, or such lesser amount as shall be equal to the aggregate unpaid
principal amount of the Loans outstanding on the close of business on the
Revolving Credit Commitment Termination Date made by the Bank to the Borrowers;
and to pay interest on the unpaid principal amount of each Loan from the date
thereof at the rates per annum and for the periods set forth in or established
by the Agreement and calculated as provided therein.

                  All indebtedness outstanding under this Substituted Note shall
bear interest (computed in the same manner as interest on this Substituted Note
prior to the relevant due date) at the applicable Post-Default Rate for all
periods when an Event of Default has occurred and is continuing, commencing on
the occurrence of such Event of Default until such Event of Default has been
cured or waived as acknowledged in writing by the Agent, and all of such
interest shall be payable on demand.

                  Anything herein to the contrary notwithstanding, the
obligation of the Borrowers to make payments of interest shall be subject to the
limitation that payments of interest shall not be required to be made to the
Bank to the extent that the Bank's receipt thereof would not be permissible
under the law or laws applicable to the Bank limiting rates of interest which
may be charged or collected by the Bank. Any such payments of interest which are
not made as a result of the limitation referred to in the preceding sentence
shall be made by the Borrowers to the Bank on the earliest interest payment date
or dates on which the receipt thereof would be permissible under the laws
applicable to the Bank limiting rates of interest which may be charged or
collected by the Bank.

                  Payments of both principal and interest on this Substituted
Note are to be made to the office of KeyBank National Association, as Agent, at
127 Public Square, Cleveland, Ohio 44114-1306 or such other place as the holder
hereof shall designate to the Borrowers in writing, in lawful money of the
United States of America in immediately available funds.

<PAGE>

                  This Substituted Note is one of the Substituted Notes referred
to in, and is entitled to the benefits of, the Amended and Restated Loan
Agreement dated August 23, 2002, as amended by Amendment No. 1 to Amended and
Restated Loan Agreement dated of even date herewith by and among the Borrowers,
the Banks signatory thereto (including the Bank) and the Agent (as so amended
and as it may be further amended, modified or supplemented from time to time,
the "AGREEMENT"). This Substituted Note supersedes and is given in substitution
for the Note dated August 23, 2002 made by the Borrowers to the order of the
Bank in the original principal amount of $___________ but does not constitute a
novation, extinguishment or termination of the obligations evidenced thereby.
Capitalized terms used but not otherwise defined herein shall have the
respective meanings ascribed thereto in the Agreement.

                  The Bank is hereby authorized by the Borrowers to record on
the schedule to this Substituted Note (or on a supplemental schedule thereto)
the amount of each Loan made by the Bank to the Borrowers and the amount of each
payment or repayment of principal of such Loans received by the Bank, it being
understood, however, that failure to make any such notation shall not affect the
rights of the Bank or the obligations of the Borrowers hereunder in respect of
this Substituted Note. The Bank may, at its option, record such matters in its
internal records rather than on such schedule.

                  Upon the occurrence of any Event of Default, the principal
amount and accrued interest on this Substituted Note may be declared due and
payable in the manner and with the effect provided in the Loan Agreement.

                  The Borrowers shall pay costs and expenses of collection,
including, without limitation, attorneys' fees and disbursements in the event
that any action, suit or proceeding is brought by the holder hereof to collect
this Substituted Note.

                  THIS SUBSTITUTED NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
ITS RULES PERTAINING TO CONFLICTS OF LAWS.

                         [Signatures on Following Page]

                                        2
<PAGE>

                           HEALTH CARE REIT, INC.
                           HCRI PENNSYLVANIA PROPERTIES, INC.
                           HCRI TEXAS PROPERTIES, INC.
                           HCRI TEXAS PROPERTIES, LTD.
                               BY HEALTH CARE REIT, INC.,
                               ITS GENERAL PARTNER
                           HCRI NEVADA PROPERTIES, INC.
                           HCRI LOUISIANA PROPERTIES, L.P.
                               BY HCRI SOUTHERN INVESTMENTS I, INC.,
                               ITS GENERAL PARTNER
                           HEALTH CARE REIT INTERNATIONAL, INC.
                           HCN ATLANTIC GP, INC.
                           HCN ATLANTIC LP, INC.
                           HCN BCC HOLDINGS, INC.
                           HCRI INDIANA PROPERTIES, INC.
                           HCRI INDIANA PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.,
                               ITS MEMBER
                           HCRI LIMITED HOLDINGS, INC.
                           HCRI MASSACHUSETTS PROPERTIES, INC.
                           HCRI MASSACHUSETTS PROPERTIES TRUST
                               BY HCRI MASSACHUSETTS PROPERTIES, INC.
                               ITS TRUSTEE
                           HCRI HOLDINGS TRUST
                               BY HCRI MASSACHUSETTS PROPERTIES, INC.
                               ITS TRUSTEE
                           HCRI NORTH CAROLINA PROPERTIES, LLC
                               BY NORTH CAROLINA PROPERTIES I, INC.
                               ITS MEMBER
                           HCRI SOUTHERN INVESTMENTS I, INC.
                           HCRI TENNESSEE PROPERTIES, INC.
                           PENNSYLVANIA BCC PROPERTIES, INC.
                           HCRI KENTUCKY PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI MASSACHUSETTS PROPERTIES TRUST II
                               BY HCRI MASSACHUSETTS PROPERTIES, INC.
                               ITS TRUSTEE
                           HCRI SATYR HILL, LLC
                               BY HEALTH CARE REIT, INC., AS THE MEMBER OF
                               HCRI MARYLAND PROPERTIES, LLC
                               ITS MEMBER
                           HCRI FRIENDSHIP, LLC
                               BY HEALTH CARE REIT, INC., AS THE MEMBER OF
                               HCRI MARYLAND PROPERTIES, LLC
                               ITS MEMBER
                           HCRI ST. CHARLES, LLC
                               BY HEALTH CARE REIT, INC., AS THE MEMBER OF
                               HCRI MARYLAND PROPERTIES, LLC
                               ITS MEMBER
                           HCRI MARYLAND PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER

                     [BORROWERS CONTINUED ON FOLLOWING PAGE]

                                       3

<PAGE>

                           HCRI LAUREL, LLC
                               BY HEALTH CARE REIT, INC., AS THE MEMBER OF
                                  HCRI MARYLAND PROPERTIES, LLC
                                  ITS MEMBER
                           HCRI NORTH CAROLINA PROPERTIES I, INC.
                           HCRI NORTH CAROLINA PROPERTIES III, LP
                               BY HCRI NORTH CAROLINA PROPERTIES II, INC.
                               ITS GENERAL PARTNER
                           HCRI NORTH CAROLINA PROPERTIES II, INC.
                           HCRI WISCONSIN PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI MISSISSIPPI PROPERTIES, INC.
                           HCRI ILLINOIS PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI MISSOURI PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI SURGICAL PROPERTIES, LLC
                               BY HEALTH CARE REIT, INC.
                               ITS MEMBER
                           HCRI TUCSON PROPERTIES, INC.

                           BY _________________________________________
                              CHIEF EXECUTIVE OFFICER

         GEORGE L. CHAPMAN, as Chief Executive Officer of all of the
aforementioned entities, has executed this Substituted Note intending that all
entities above named are bound and are to be bound by the one signature as if he
had executed this Substituted Note separately for each of the above named
entities.

                                       4

<PAGE>

                                                                      SCHEDULE A

                               PRINCIPAL PAYMENTS

                       Substituted Note dated May 15, 2003
                             payable to the order of

<TABLE>
<CAPTION>
============================================================================================
                            Interest Period
                           (if other than a
             Principal         Base Rate            Amount           Unpaid
             Amount of         Loan) and         of Principal       Principal       Notation
Date           Loan          Interest Rate          Repaid           Balance        Made By
--------------------------------------------------------------------------------------------
<S>          <C>           <C>                   <C>                <C>             <C>
--------------------------------------------------------------------------------------------

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============================================================================================
</TABLE>

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00052-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00052-of-00352.parquet"}]]