Document:

<PAGE>   1

                                                                    Exhibit 10.6

                              IPC Advisors S.a.r.l.
                            c/o Unsworth & Associates
                                 Herengracht 483
                                     101 BT
                           Amsterdam, The Netherlands

                                November 6, 2000

Balanced Care Corporation
c/o Special Committee of the Board of Directors
1215 Manor Drive
Mechanicsburg, PA 17055

Gentlemen:

                  You have requested that RH Investments Limited, HR Investments
Limited and VXM Investments Limited (collectively, the "Lenders") make loans
("Loans") to Balanced Care Corporation (the "Company") in the amount of $8
million, on the terms set forth on the attached term sheet. You have also
requested that IPC Advisors S.a.r.l. or one of its affiliates (collectively,
"IPC") consider making an offer to purchase the outstanding common stock of the
Company. IPC is pleased to inform you that IPC would be willing to consider
making an offer of $1.00 per common share in cash for the entire equity interest
in the Company not already owned by IPC subject, however, to our completion of
due diligence, the results of which are satisfactory to IPC in its sole
discretion, and to the negotiation and execution of mutually satisfactory
definitive documentation (the "Proposed Offer"), it being acknowledged and
agreed that IPC shall have no obligation to make the Proposed Offer.

                  In consideration of the Lenders making the Loans and IPC
agreeing to incur the time and expense of conducting due diligence, you hereby
agree as follows:

                  1. STANDSTILL AGREEMENT. Section 6.8 of the Subscription
Agreement dated as of October 8, 1999 between the Company and IPC, as amended,
is hereby amended by replacing the words "Six ($6.00) Dollars per share" to read
"One Dollar ($1.00) per share". The Company hereby represents that the foregoing
amendment has been approved by a resolution of the Board of Directors of the
Company and the IPC nominees refrained from voting thereon.

<PAGE>   2

                  2. NO SOLICITATION. The Company shall not, and shall cause its
Subsidiaries not to, and will use its reasonable best efforts to cause its
officers, directors, employees, investment bankers, attorneys and other advisors
and representatives not to, directly or indirectly, (i) solicit, initiate or
encourage the submission of any Acquisition Proposal (as hereinafter defined) or
(ii) participate in any discussions, negotiations or other communications
regarding, or furnish to any person any information with respect to, any
Acquisition Proposal or otherwise cooperate in any way, assist or participate
in, facilitate or encourage any effort or attempt by any other person or entity,
to seek to do any of the foregoing. The Company shall, and shall cause its
Subsidiaries to, immediately cease and cause to be terminated, and will use
reasonable best efforts to cause, and will not authorize, its officers,
directors, employees, investment bankers, attorneys and other advisors and
representatives to, immediately cease and cause to be terminated, any of the
actions specified in (i) and (ii) above. Notwithstanding the provisions of the
preceding two sentences, the Company, any of its Subsidiaries or any officer,
director or employee of, or any investment banker, attorney or other advisor or
representative of, the Company or any of its Subsidiaries may, (i) following
receipt of a request for information which was not solicited, initiated or
encouraged by the Company, any of its Subsidiaries or any officer, director or
employee of, or any investment banker, attorney or other advisor or
representative of, the Company or any of its subsidiaries after the date of this
Agreement, furnish information, provided the person requesting the information
has executed a confidentiality agreement with customary terms and conditions
with the Company , and (ii) following receipt of an unsolicited Acquisition
Proposal, participate in discussions or negotiations regarding, and furnish
information with respect to, and take other actions to facilitate, such
Acquisition Proposal, if, in the case of (i) and (ii) above, the Special
Committee determines in its good faith judgment (after receiving the advice of
counsel) that if the Company fails to participate in such discussions or
negotiations with, or provide such information to, the person or entity making
the Acquisition Proposal or requesting information, there is a reasonable
probability that the Board of Directors of the Company would be in violation of
its fiduciary duties under applicable law. From and after the date hereof, the
Company shall promptly advise IPC orally and in writing of the receipt by it (or
any of the other entities or persons referred to above) of any Acquisition
Proposal, or any inquiry which the Board of Directors determines is reasonably

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likely to lead to any Acquisition Proposal, the material terms and conditions of
such Acquisition Proposal or inquiry, and the identity of the person making any
such Acquisition Proposal or inquiry. The Company will keep IPC fully informed
of the status and details of any such Acquisition Proposal or inquiry. If an
Acquisition Proposal is approved by the Board of Directors of the Company prior
to January 31, 2001, the Company shall concurrently therewith reimburse IPC all
of its documented costs and expenses (including, without limitation, reasonable
attorneys' fees) in connection with the transactions contemplated by this letter
(including the Loans and the Proposed Offer), provided that in no event shall
the Company be obligated to reimburse IPC for more than $500,000 of such costs
and expenses in the aggregate. For purposes of this Agreement, "Acquisition
Proposal" means any proposal with respect to a merger, consolidation, share
exchange, tender offer or similar transaction involving the Company or any
significant portion of the assets of the Company and its Subsidiaries, taken as
a whole, other than the transactions contemplated hereby. The provisions of this
paragraph 2 shall terminate on the earlier of the termination of this letter
agreement pursuant to paragraph 7 hereof and January 15, 2001.

                  3. DUE DILIGENCE. The Company shall (and shall cause each of
its Subsidiaries to) afford to the officers, employees, accountants, counsel,
financing sources and other representatives of IPC, reasonable access, during
normal business hours, to all of its and its Subsidiaries' properties, books,
contracts, commitments and records and, during such period, the Company shall
use its commercially reasonable efforts to afford IPC access to its lessors and
lenders and shall (and shall cause each of its Subsidiaries to) furnish promptly
to IPC (i) a copy of each report, schedule, registration statement and other
document filed or received by it pursuant to the requirements of the federal
securities laws and (ii) all other information concerning its business,
properties and personnel as IPC may reasonably request. IPC will hold any such
information which is nonpublic in confidence in accordance with the provisions
of the confidentiality agreement, dated November 6, 2000, between the Company
and IPC Advisors S.a.r.l.

                  4. PUBLICITY. So long as this letter is in effect, neither the
Company nor IPC nor their affiliates shall issue or cause the publication of any
press release or other public statement or announcement with respect to this
letter, the Proposed Offer or the other matters contemplated hereby without

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prior consultation with the other party, except as may be required by law or by
obligations pursuant to any listing agreement with a national securities
exchange, and in such case shall use all reasonable efforts to consult with the
other party prior to such release or announcement being issued.

                  5. FAIRNESS OPINION. The Special Committee confirms that it
has received an oral opinion (which will be confirmed in writing) from an
independent investment bank that, subject to stated assumptions, limitations and
qualifications, including, without limitation, assumptions regarding the terms
and conditions of definitive agreements relating to the Proposed Offer, the
Proposed Offer is fair to the stockholders of the Company (other than IPC and
its affiliates) from a financial point of view. The Special Committee further
confirms that it has determined that the consideration of $1.00 per share in
cash for each share of the Company's outstanding common stock not owned by IPC
and its affiliates is advisable and fair to the stockholders of the Company and,
subject to negotiation of definitive agreements relating to the Proposed Offer
acceptable to the Special Committee, the Special Committee will recommend that
the Board of Directors of the Company approve and adopt such definitive
agreements and the Special Committee will recommend that stockholders of the
Company tender into and/or vote to approve and adopt such definitive agreements,
as applicable, and once recommended, the Special Committee will not modify,
amend or withdraw such recommendations, unless the Special Committee determines,
in its good faith judgment (after receiving the advice of counsel), that if the
Special Committee fails to modify, amend or withdraw such recommendations, there
is a reasonable probability that the Special Committee would be in violation of
its fiduciary duties under applicable law.

                  6. BINDING EFFECT. This letter is intended to be legally
binding and enforceable upon the parties hereto. Notwithstanding the foregoing,
no legally binding agreement shall arise or exist with respect to any Proposed
Offer unless and until a definitive agreement is executed and delivered
containing such terms, provisions, representations, warranties, covenants and
conditions, as are approved by IPC and the Company.

                  7. TERMINATION. This letter may be terminated at any time upon
mutual written consent of the parties. In addition, numbered paragraphs 2
through 5 of this letter may be terminated at the option of the Company or IPC,
if a definitive agreement reflecting the Proposed Offer shall not have been

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executed on or prior to January 31, 2001, unless the Company and IPC agree to an
extension of such date.

                  8. GOVERNING LAW. This letter shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to the principles of conflict of laws thereof.

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

                  10. SECURITY. The Company hereby agrees to provide the
Lenders, if requested by the Lenders, with additional security for the Loans and
all other existing and future obligations of the Company or any of its
subsidiaries to the Lenders, IPC or any of their respective affiliates
(including, without limitation, the $14 million 9.5% convertible debentures), in
the form of (i) a pledge of the shares in the capital of the owners of
properties to be designated by IPC, subject to the approval of Heller Healthcare
Finance Inc. ("Heller"), and (ii) a second charge on the Meditrust Tranche I
properties after Heller has been repaid out of a refinancing of these
properties.

                                        Very truly yours,

                                        /S/ J.B. Unsworth
                                        ------------------
                                        J.B. Unsworth, Manager

Accepted and agreed this 6th day of November, 2000:

BALANCED CARE CORPORATION

By: /s/ Brad E. Hollinger
Its: Chairman

SPECIAL COMMITTEE OF THE
BOARD OF DIRECTORS OF
BALANCED CARE CORPORATION

By: /s/ David L. Goldsmith
Its: Chairman

                                       5<PAGE>   1

                                                                    Exhibit 10.7

                                                           Loan Number 99-407

                        THIRD AMENDMENT TO LOAN DOCUMENTS

                  This THIRD AMENDMENT TO LOAN DOCUMENTS (this "Amendment") is
made this 6th day of November, 2000, among HELLER HEALTHCARE FINANCE, INC., a
Delaware corporation formerly known as HCFP FUNDING, INC. ("Lender") and
BALANCED CARE CORPORATION, a Delaware corporation (referred to herein as
"Guarantor"), and BALANCED CARE REALTY AT STATE COLLEGE, INC., a Delaware
corporation, BALANCED CARE REALTY AT ALTOONA, INC., a Delaware corporation,
BALANCED CARE REALTY AT LEWISTOWN, INC., a Delaware corporation, BALANCED CARE
REALTY AT READING, INC., a Delaware corporation, BALANCED CARE REALTY AT
BERWICK, INC., a Delaware corporation, BALANCED CARE REALTY AT PECKVILLE, INC.,
a Delaware corporation, BALANCED CARE REALTY AT SCRANTON, INC., a Delaware
corporation, BALANCED CARE REALTY AT MARTINSBURG, INC., a Delaware corporation,
BALANCED CARE REALTY AT MAUMELLE, INC., a Delaware corporation, BALANCED CARE
REALTY AT SHERWOOD, INC., a Delaware corporation, BALANCED CARE REALTY AT
MOUNTAIN HOME, INC., a Delaware corporation, and BALANCED CARE REALTY AT
MANSFIELD, INC., a Delaware corporation (collectively referred to herein as
"Outlook Pointe Borrowers"), and BCC AT DARLINGTON, INC., a Delaware
corporation, BALANCED CARE AT EYERS GROVE, INC., a Delaware corporation,
BALANCED CARE AT BUTLER, INC., a Delaware corporation, BALANCED CARE AT SARVER,
INC., a Delaware corporation, and BALANCED CARE AT NORTH RIDGE, INC., a Delaware
corporation (collectively referred to herein as "BCC Borrowers"). The Outlook
Pointe Borrowers and BCC Borrowers are collectively referred to herein as
"Borrowers."

                                    RECITALS:

                  A. Lender has made available to BCC Borrowers a revolving
credit facility in the maximum principal amount of Twelve Million and No/100
Dollars ($12,000,000) (the "Revolving Credit Facility") subject to the terms and
conditions contained in a Loan and Security Agreement dated April 22, 1999, as
amended by an Amendment No. 1 to Loan and Security Agreement dated July 1, 1999
(the "First Amendment"), an Amendment No. 2 to Loan and Security Agreement dated
July 29, 1999 (the "Second Amendment"), and an Amendment No. 3 to Loan and
Security Agreement dated December 31, 1999 (the "Third Amendment"), all among
the Lender and BCC Borrowers (as well as other entities that have since been
released from the terms and conditions of the Loan and Security

<PAGE>   2

Agreement as amended). The Loan and Security Agreement, as amended by the First
Amendment, the Second Amendment, and the Third Amendment, is referred to herein
as the "Loan and Security Agreement." The Loan and Security Agreement and all
other loan documents executed in connection with the Loan and Security Agreement
and the Revolving Credit Facility are collectively referred to herein as the
"Revolving Credit Facility Loan Documents."

                  B. Lender has also made a loan (the "Outlook Pointe Loan") of
Thirty-Two Million and No/100 Dollars ($32,000,000.00) to Outlook Pointe
Borrowers subject to the terms and conditions contained in a Loan Agreement
dated December 30, 1999, between Lender and Outlook Pointe Borrowers (the Loan
Agreement, including all exhibits thereto and the Senior Housing Rider of even
date therewith, as amended from time to time, is referred to herein as the "Loan
Agreement"). The Outlook Pointe Loan is evidenced by a Promissory Note A of even
date with the Loan Agreement in the original principal amount of Twenty-Five
Million Six Hundred Thousand and No/100 Dollars ($25,600,000.00) ("Note A") and
by a Subordinated Promissory Note B of even date with the Loan Agreement in the
original principal amount of Six Million Four Hundred Thousand and No/100
Dollars ($6,400,000.00) ("Note B") (Note A and Note B and all amendments thereto
and substitutions therefor are hereinafter referred to collectively as the
"Note").

                  C. As additional security for the Outlook Pointe Loan,
Guarantor has executed and delivered a Guaranty dated December 30, 1999, in
favor of Lender (as amended from time to time, the "Guaranty").

                  D. Also in connection with the Outlook Pointe Loan, Guarantor
and Outlook Pointe Borrowers have executed and delivered a Hazardous Materials
Indemnity Agreement dated December 30, 1999, in favor of Lender (as amended from
time to time, the "Environmental Indemnity"). The Loan Agreement, the Guaranty,
and the Environmental Indemnity, the New Note (as defined below), together with
all mortgages, deeds of trust and other documents and instruments executed and
delivered by one or more of the Outlook Pointe Borrowers or the Guarantor in
connection the Outlook Pointe Loan, are collectively referred to herein as the
"Outlook Pointe Loan Documents," and the Outlook Pointe Loan Documents,
collectively with the Revolving Credit Facility Loan Documents, are referred to
herein as the "Loan Documents." Capitalized terms used herein without definition
shall have the meanings provided in the Loan Agreement.

                                      -2-
<PAGE>   3

                  E. Also in connection with the Outlook Pointe Loan, Lender,
Guarantor, Outlook Pointe Borrowers, and various other entities have entered
into a Subordination Agreement dated April 18, 2000 (the "Subordination
Agreement"), addressing debt that is junior to the Outlook Pointe Loan.

                  F. On or about April 27, 2000, Lender increased the Outlook
Pointe Loan to Thirty-Seven Million and No/100 Dollars ($37,000,000.00) (the
"Amended Loan"), as evidenced by an Amended and Restated Promissory Note A dated
April 27, 2000 in the original principal amount of Thirty Million Six Hundred
Thousand and No/100 Dollars ($30,600,000.00) ("Amended Note A"), and an Amended
and Restated Subordinated Promissory Note B dated April 27, 2000 in the original
principal amount of Six Million Four Hundred Thousand and No/100 Dollars
($6,400,000.00) ("Amended Note B"), and amendments to the mortgages and deeds of
trust constituting Outlook Pointe Loan Documents dated April 27, 2000 (the
"Outlook Pointe Mortgages"). In connection with the Amended Loan, BCC Borrowers
have executed and delivered to Lender amendments to the mortgages and deeds of
trust constituting Revolving Credit Facility Loan Documents dated April 27, 2000
(the "Revolving Credit Facility Mortgages").

                  G. On or about September 20, 2000, Lender increased the
Amended Loan by Five Million and No/100 Dollars ($5,000,000.00) to Forty-Two
Million and No/100 Dollars ($42,000,000.00) (the "Second Amended Loan"), as
evidenced by a Second Amended and Restated Promissory Note A in the original
principal amount of Amended Note A (the "Second Amended Note A"), a Second
Amended and Restated Subordinated Promissory Note B in the original principal
amount of Amended Note B (the "Second Amended Note B"), and a Promissory Note C
in the original principal amount of Five Million and No/100 Dollars
($5,000,000.00) (the "Note C"), and amendments to the Outlook Pointe Mortgages
dated September 20, 2000. In conjunction with the Second Amended Loan, BCC
Borrowers have executed and delivered to Lender amendments to the Revolving
Credit Facility Mortgages dated September 20, 2000.

                  H. Pursuant to Section 1.11 of the Loan Agreement, Lender has
applied the funds in the Reserve Account to repay a portion of Note C.

                  I. HR Investments Limited, a Cayman Islands corporation, RH
Investments Limited, a Cayman Islands corporation and VXM Investments Limited, a
Cayman Islands corporation (collectively, "Junior Lenders") have made a loan to
Guarantor in the amount of Six Million Five Hundred Thousand and No/100 Dollars
($6,500,000.00) (the "Initial Guarantor Loan"). Junior Lenders intend to make
additional loans to Guarantor in an aggregate amount not to exceed One Million
Five Hundred Thousand and No/100

                                      -3-
<PAGE>   4

Dollars ($1,500,000.00) (collectively, the "Subsequent Guarantor Loan").
Guarantor has used a portion of the proceeds of the Initial Guarantor Loan to
cause Outlook Pointe Borrowers to repay the outstanding principal balance of
Note C. In conjunction with the Initial Guarantor Loan, the Subsequent Guarantor
Loans and the repayment of Note C, Lender, Borrowers and Guarantor desire to
enter into this Amendment amending the Loan Documents. Also in conjunction with
such transactions, Lender, Borrowers, Guarantor, certain affiliates of Borrowers
and Guarantor, FRR Investments Limited, a Cayman Island Corporation, IPC
Advisors, S.a.r.l., a Luxembourg corporation and Assignees have entered into
that certain Amended and Restated Subordination Agreement dated as of the date
hereof (the "Amended and Restated Subordination Agreement").

                  NOW, THEREFORE, in consideration of the foregoing recitals and
the mutual conditions and agreements contained herein, and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), Lender, the Borrowers and Guarantor hereby agree as follows:

                  1. Defined Terms. Capitalized terms used herein without
definition shall have the meanings provided in the Loan Agreement.

                  2. Payment of Expenses. Outlook Pointe Borrowers shall pay all
Expenses (as hereinafter defined) incurred by Lender previously, now or
hereafter in connection with the Second Amended Loan, the Revolving Credit
Facility, the Loan Documents or this Amendment, including without limitation,
Lender's expenses incurred in the negotiation and documentation related to the
approval of the Initial Guarantor Loan and the Subsequent Guarantor Loans, the
repayment of Note C, the Amended and Restated Subordination Agreement and this
Amendment. BCC Borrowers acknowledge and agree that Lender shall be entitled, at
any time, to advance any amounts available under the Revolving Credit Facility
to Lender in payment of any amounts due Lender from BCC Borrowers, Outlook
Pointe Borrowers, Guarantor or any affiliates of the foregoing in respect of any
Expenses. For the purposes hereof "Expenses" means all reasonable expenditures
and expenses which may be paid or incurred by or on behalf of Lender including
repair costs, payments to remove or protect against liens, attorneys' fees
(including fees of Lender's outside and inside counsel), receivers' fees,
engineers' fees, accountants' fees, independent consultants' fees (including
environmental

                                      -4-
<PAGE>   5

consultants), all costs and expenses incurred in connection with any of the
foregoing, Lender's out-of-pocket costs and expenses related to any audits or
inspections, outlays for documentary and expert evidence, stenographers'
charges, stamp taxes, publication costs, and costs (which may be estimates as to
items to be expended after entry of an order or judgment) for procuring all such
abstracts of title, title and UCC searches, and examination, title insurance
policies, Torrens' Certificates (if applicable) and similar data and assurances
with respect to title as Lender may deem reasonably necessary either to
prosecute any action or to evidence to bidders at any foreclosure sale of any
collateral held by Lender the true condition of the title to, or the value of,
such collateral or any part thereof.

                  3. Lender has reviewed the documents evidencing the Initial
Guarantor Loan and hereby consents to Guarantor's indebtedness to Junior Lenders
under the Initial Guarantor Loan and agrees that the same shall not constitute
an Event of Default under any of the Loan Documents. Provided that the documents
evidencing the Subsequent Guarantor Loans are in substantially the same form and
contain substantially the same terms as the documents evidencing the Initial
Guarantor Loan, Lender hereby consents to Guarantor's indebtedness to Junior
Lenders under the Subsequent Guarantor Loans and agrees that the same shall not
constitute an Event of Default under any of the Loan Documents.

                  4. No Expenses or other expenses incurred by the Outlook
Pointe Borrowers in connection with this Amendment shall constitute an
"operating expense" for purposes of calculating Net Cash Flow.

                  5. Section 1.10 (Additional Exit Fee) of the Loan Agreement is
hereby deleted in its entirety.

                  6. The following new Section 7.1(l) shall be added immediately
following Section 7.1(k) of the Loan Agreement:

                  (l) The occurrence of a default by Guarantor under the Initial
         Guarantor Loan or any of the Subsequent Guarantor Loans, which default
         continues uncured beyond any applicable cure period.

                  7. All references in the Outlook Pointe Loan Documents to the
Subordination Agreement shall mean the Amended and Restated Subordination
Agreement.

                                      -5-
<PAGE>   6

                  8. All references in the Loan Documents to any of the Outlook
Pointe Loan Documents shall mean the applicable Outlook Pointe Loan Document, as
amended hereby.

                  9. All references in the Loan Documents to any of the
Revolving Credit Facility Loan Documents shall mean the applicable Revolving
Credit Facility Loan Document as amended hereby.

                  10. Except as expressly provided herein, the Loan Documents
(including without limitation the Guaranty, Environmental Indemnity and the
undated Consent Form with attached letter dated February 16, 2000, to Lender and
Heller Financial, Inc. from Guarantor) shall remain unmodified and in full force
and effect and are hereby ratified and confirmed as amended by this Amendment
and the Amended and Restated Subordination Agreement.

                  11. The provisions of this Amendment that pertain to the
Outlook Pointe Loan, the Outlook Pointe Loan Documents, and the Outlook Pointe
Borrowers shall be governed by and construed in accordance with the internal
laws of the State of Illinois. The provisions of this Amendment that pertain to
the Revolving Credit Facility, the Revolving Credit Facility Loan Documents, and
the BCC Borrowers shall be governed by and construed in accordance with the
internal laws of the State of Maryland.

                         [signatures on following pages]

                                      -6-
<PAGE>   7

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

                              OUTLOOK POINTE BORROWERS:

                              BALANCED CARE REALTY AT STATE
                              COLLEGE, INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT ALTOONA,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT LEWISTOWN,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT READING,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT BERWICK,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                                      -7-
<PAGE>   8

                              BALANCED CARE REALTY AT PECKVILLE,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT SCRANTON,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT MARTINSBURG,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT MAUMELLE,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT SHERWOOD,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE REALTY AT MOUNTAIN
                              HOME, INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                                      -8-
<PAGE>   9

                              BALANCED CARE REALTY AT MANSFIELD,
                              INC., a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BCC BORROWERS:

                              BCC AT DARLINGTON, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE AT EYERS GROVE, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE AT BUTLER, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE AT SARVER, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE AT NORTH RIDGE, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                                      -9-
<PAGE>   10

                              GUARANTOR:

                              BALANCED CARE CORPORATION,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Senior Vice President and Legal
                              Counsel & Assistant Secretary

                                      -10-
<PAGE>   11

                              LENDER:

                              HELLER HEALTHCARE FINANCE, INC.,
                              a Delaware corporation formerly known as
                              HCFP FUNDING, INC.

                              By/s/David G. Moore
                              Name
                              Its

                  Accepted and agreed to on the date first set forth above.

                              MANAGERS OF PROJECTS:

                              BCC AT STATE COLLEGE, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              TC REALTY OF ALTOONA, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              TC REALTY OF LEWISTOWN, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                                      -11-
<PAGE>   12

                              TC REALTY OF READING, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              TC REALTY OF BERWICK, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BLACK BOX OF PECKVILLE, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              TC REALTY CORPORATION III,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE AT MARTINSBURG, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                                      -12-
<PAGE>   13

                              BALANCED CARE AT MAUMELLE, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE AT SHERWOOD, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              BALANCED CARE AT MOUNTAIN HOME, INC.,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                              TC REALTY CORPORATION II,
                              a Delaware corporation

                              By/s/Robin L. Barber
                              Name Robin L. Barber
                              Its Vice President and Secretary

                                      -13-

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