Document:

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Exhibit 10.4

                          DEFERRED PURCHASE PRICE NOTE

                                                                  Columbus, Ohio
$3,449,401.47                                                     March 31, 2002

      On or before September 30, 2003 (the "Initial Due Date"), which Initial
Due Date may be extended by Ocwen Financial Corporation, a Florida corporation
("Ocwen"), in accordance with Section 1.3(a) of the Term Loan Agreement (defined
hereinafter), for value received, the undersigned, Balanced Care Realty (OFC),
Inc., a Delaware corporation ("Borrower"), promises to pay to the order of
Seller (hereinafter defined) or its successors or assigns, the principal amount
of Three Million Four Hundred Forty-Ninety Thousand Four Hundred One Dollars and
47/100 ($3,449,401.47) together with interest on the unpaid principal balance of
the loan made hereunder ("Deferred Purchase Price Loan") until paid in full. The
amount of principal owed to each respective Seller is as follows: (i) Medina
ALF, Inc. = $1,172,796.50, (ii) Centerville ALF, Inc. = $1,524,635.45, and (iii)
Shippensburg ALF, Inc. = $751,969.52. Both principal and interest are payable in
federal funds or other immediately-available money of the United States of
America at Ocwen Financial Corporation, 1675 Palm Beach Lakes Blvd., West Palm
Beach, FL 33401.

      Section 1. Purchase Agreement, Term Loan Agreement, Compromise and
Settlement, BCC Note, and Subordinate Mortgage. This Deferred Purchase Price
Note is the Deferred Purchase Price Note referred to in the Agreement of
Purchase and Sale, dated of even date herewith, by and among Medina ALF, Inc., a
Florida corporation ("Medina"), Centerville ALF, Inc., a Florida corporation
("Centerville"), Shippensburg ALF, Inc., a Florida corporation ("Shippensburg")
(Medina, Centerville, and Shippensburg are collectively referred to hereinafter
as "Seller"), Borrower, and certain other parties (as used hereinafter,
"Purchase Agreement"). In addition to the Deferred Purchase Price Loan evidenced
by this Deferred Purchase Price Note, the Borrower has also borrowed funds from
Ocwen as evidenced by the Term Note, of even date herewith, given by Borrower in
favor of Ocwen ("Term Note") in connection with the Term Loan Agreement, of even
date herewith, by and among Ocwen, Borrower, Balanced Care Corporation, a
Delaware corporation ("Balanced Care"), Balanced Care at Medina, Inc., a
Delaware corporation, Balanced Care at Centerville, Inc., a Delaware
corporation, Balanced Care at Shippensburg, Inc., a
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Delaware corporation, and Senior Care Operators of Shippensburg, LLC, a Delaware
LLC ("Term Loan Agreement").

      The transactions contemplated by the Purchase Agreement and Term Loan
Agreement are being entered into by the parties thereto in connection with and
as part of the Settlement Agreement and Release, executed by Seller, Balanced
Care, Ocwen, Senior Care Operators of Ohio, LLC, Senior Care Operators of
Centerville, LLC, and Senior Care Operators of Shippensburg, LLC, as of the date
hereof, to resolve the suit filed in the United States District Court, Southern
District of Ohio, Western Division, by Seller against Balanced Care for past due
rent owed Seller ("Compromise and Settlement"). In connection with the
Compromise and Settlement, Balanced Care has executed, of even date herewith, in
favor of Seller, the Balanced Care Note ("BCC Note"), pursuant to which Balanced
Care has promised to pay to Sellers $936,445.00, with interest thereon as
specified in the BCC Note.

      This Deferred Purchase Price Note and the BCC Note are secured by the
Subordinate Mortgage (as defined in the Term Loan Agreement). In the event of
nonpayment or other nonperformance by Borrower of any of the terms and
conditions set forth in this Deferred Purchase Price Note or by Balanced Care
with respect to the BCC Note, it shall be considered an event of default under
this Deferred Purchase Price Note, the BCC Note, and under the Subordinate
Mortgage. In addition, such failure to pay and/or otherwise perform shall also
be considered an Event of Default under the Term Loan Agreement.

      Section 2. Maturity Date; Extension. This Deferred Purchase Price Note
shall mature, by acceleration or otherwise, on the same date of maturity as the
Term Note. In the absence of an Event of Default occurring under the Term Loan
Agreement, it is anticipated that maturity of the Term Note will occur on the
Initial Due Date. Section 1.3(a) of the Term Loan Agreement contains the terms
and provisions pursuant to which an extension of the Initial Due Date may be
granted by Ocwen for the Term Note. In the event that the Term Note is extended
pursuant to Section 1.3(a) of the Term Loan Agreement, then this Deferred
Purchase Price Note shall be similarly extended, without further action required
of either Borrower or Seller, and at no cost to Borrower. In such case, subject
to the provisions of Section 6 below, the Deferred Purchase Price Loan evidenced
by this Deferred Purchase Price Note shall be due and payable in full on the
Extended Due Date (as defined in the Term Loan Agreement).

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      Section 3. Interest Rate. This Deferred Purchase Price Note shall bear
interest during the period from the date hereof on the unpaid principal balance
of the Deferred Purchase Price Loan made hereunder, until paid in full, at a
fixed rate of sixteen percent (16%) per annum. Such interest shall be computed
on the basis of a 360-day year consisting of twelve (12) consecutive thirty (30)
day months.

      Section 4. Interest Payment; Event of Default. No interest payments will
be due under this Deferred Purchase Price Note unless and until an Event of
Default (as defined in the Term Loan Agreement) occurs and continues beyond any
applicable cure period. In the event such an Event of Default shall occur and
continue beyond any applicable cure period, and therefore interest shall become
due hereunder, Borrower shall pay interest to each respective Seller on the
amount of the total principal balance owed to each Seller, as set forth in the
introductory paragraph hereof, from the date hereof (March 31, 2002) until the
date that this Deferred Purchase Price Note is paid in full, whether by
acceleration or otherwise.

      Monthly interest payments shall be required after an Event of Default (as
defined in the Term Loan Agreement) has occurred and is continuing beyond any
applicable cure period. Such interest payments for the prior month (provided,
however, that interest for the first month shall be calculated from the date
hereof (March 31, 2002) to the end of the month in which the Event of Default
occurs) shall be payable on the eleventh (11th) day of each month commencing the
month after the month in which the Event of Default (which continues beyond any
applicable cure period) occurs, and thereafter payable on the eleventh (11th)
day of each month during the term of the Deferred Purchase Price Loan. If a
monthly interest payment is not made by Borrower and received by each respective
Seller by the sixteenth (16th) day of any month during the term of the Deferred
Purchase Price Loan, including during any Extension (as defined in the Term Loan
Agreement), Borrower shall pay to each Seller a late fee equal to five percent
(5%) of the monthly interest payment that was due on the 11th day of the month.
All interest payments received by a Seller shall be applied in the inverse order
of their maturity. That is, the most recent payment received shall be credited
to the first of the payments due and owing by Borrower to any Seller.

      If an Event of Default has occurred, and Borrower has made all of the
monthly interest payments required hereunder as a result of the occurrence of
such Event of Default, but such Event of Default has been cured and is not
continuing, except for any

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Event of Default that continues until a payoff of the Term Note is received by
Ocwen, then, Borrower's obligation to make monthly payments of interest
hereunder shall cease upon the effective date of the accepted cure of the Event
of Default. Borrower shall make a partial interest payment to each Seller if the
date of cure is other than the last day of the month. In no event shall Borrower
be entitled to any refund of interest payments made to any Seller pursuant to
this Section 4.

      As indicated above, in the event that Borrower fails to pay or otherwise
perform any obligation of Borrower set forth herein, such default shall be
considered a default and breach of this Deferred Purchase Price Note, the BCC
Note, and the Subordinate Mortgage, as well as an Event of Default under the
Term Loan Agreement.

      Section 5. Principal Payments. Subject to the provisions of Section 6
below, the entire principal balance and any accrued interest under this Deferred
Purchase Price Note shall be due and payable on the Initial Due Date, unless
Borrower elects and properly exercises an Extension (as defined in the Term Loan
Agreement) of the Term Note, in accordance with the provisions of Section 1.3(a)
of the Term Loan Agreement, in which case the term of this Deferred Purchase
Price Note shall be similarly extended until the Extended Due Date (as defined
in the Term Loan Agreement), when the entire principal balance and any accrued
interest thereon is due and payable in full. Principal payments should be made
to each respective Seller in accordance with its allocated portion of the total
outstanding principal, as set forth in the introductory paragraph hereof.

      Section 6. Deferred Purchase Price Loan Forgiveness. In the event that (i)
the Term Note is paid in full, whether on the Initial Due Date, the Extended Due
Date (as defined in the Term Loan Agreement), or by prepayment, and (ii) an
Event of Default (as defined in the Term Loan Agreement), which constitutes a
monetary default or breach of any payment obligation, has not occurred and is
not continuing until the payoff is received by Ocwen (e.g., the payoff is not
made pursuant to an acceleration of the Term Note as a result of an Event of
Default constituting a monetary default or breach of any payment obligation
under the Term Loan Agreement having occurred), then the entire outstanding
principal amount due under this Deferred Purchase Price Note as well as any and
all interest accrued hereunder, shall be forgiven. Provided, however, that in no
event shall any Seller be required, and Borrower shall not be entitled, to a
return of any interest payment made by Borrower hereunder.

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      Section 7. Setoff. Any and all moneys now or at any time hereafter owing
to the Borrower from the holder hereof, are hereby pledged for the security of
this and all other Indebtedness (as defined in the Term Loan Agreement) from the
Borrower to the holder hereof, and may, upon the occurrence of any Event of
Default (as defined in the Term Loan Agreement) that continues beyond any
applicable cure period, be paid and applied thereon whether such Indebtedness be
then due or is to become due.

      Section 8. Effect on Other Agreements. Nothing set forth in this Deferred
Purchase Price Note is intended or shall be construed to (i) release, mitigate,
or limit any obligation or duty of any party to the Purchase Agreement, Term
Loan Agreement, Term Note, Compromise and Settlement, BBC Note, Management
Agreements, Security Documents, Subordinate Mortgage, Ancillary Documents, the
Agreed Entry, or the documents executed in connection with the transactions
contemplated by the Purchase Agreement, which is set forth in any of said
documents, or (ii) waive, discharge or abrogate any right or interest of any
party to such documents of any right or interest set forth therein. In the event
of any conflict between the express terms of this Deferred Purchase Price Note
and the express terms of the Purchase Agreement, or any of the other documents
listed above, the terms of this Deferred Purchase Price Note shall control.

      Section 9. Jury Waiver. BORROWER AND SELLER (BY ITS ACCEPTANCE HEREOF)
HEREBY VOLUNTARILY, KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT
TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE (WHETHER BASED ON CONTRACT,
TORT, OR OTHERWISE) BETWEEN THEM ARISING OUT OF OR IN ANY WAY RELATED TO, IN
CONNECTION WITH, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN
CONNECTION WITH THIS DEFERRED PURCHASE PRICE NOTE OR THE TRANSACTIONS
CONTEMPLATED BY THIS DEFERRED PURCHASE PRICE NOTE. THIS PROVISION IS A MATERIAL
INDUCEMENT TO SELLER TO PROVIDE THE FINANCING EVIDENCED BY THIS DEFERRED
PURCHASE PRICE NOTE. THIS PROVISION SHALL NOT IN ANY WAY AFFECT, WAIVE, LIMIT,
AMEND OR MODIFY SELLER'S ABILITY TO PURSUE ITS REMEDIES INCLUDING, BUT NOT
LIMITED TO, ANY CONFESSION OF JUDGMENT OR COGNOVIT PROVISION CONTAINED IN THIS
DEFERRED PURCHASE PRICE NOTE.

      Section 10. Warrant of Attorney. Borrower hereby authorizes any attorney
at law to appear for Borrower in any action on any or all of the monetary
obligations of Borrower set forth herein at any time after such obligations
become due, whether by acceleration or otherwise, in any federal court or court
of record in or of the State of Ohio or elsewhere, to waive the issuing and

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service of process against, and to confess judgment against the Borrower in
favor of Seller for the amount that may be due, including interest, late
charges, collection costs, attorneys' fees and the like, and costs of suit, and
to waive and release all errors in said proceedings and judgments, and all
petitions in error and rights of appeal from the judgments rendered. The
foregoing warrants of attorney shall survive any judgment, and, if any judgment
be vacated for any reason, the holder hereof nevertheless may thereafter use the
foregoing warrant of attorney to obtain an additional judgment or judgments
against the Borrower. The Borrower hereby waives any conflict of interest in
Seller's attorney confessing judgment against the Borrower pursuant to the
foregoing warrant of attorney and further agrees that the attorney confessing
judgment pursuant to the foregoing warrant of attorney may receive a legal fee
or other thing of value from Seller.

      Section 11. Pennsylvania Cognovit Provisions. The following provisions in
this Section 11 shall apply only in the event that Seller elects to seek a
judgment on this Deferred Purchase Price Note in any court in Pennsylvania, as
opposed to Ohio, and are included herein for no other purpose. In the event that
Seller so elects, Seller agrees to provide any notice required by Pennsylvania
law with respect to the exercise by Seller of its rights under the following
provisions.

(i) POWER TO CONFESS JUDGMENT: BORROWER HEREBY AUTHORIZES AND EMPOWERS THE
PROTHONOTARY OR ANY ATTORNEY OF ANY COURT OF RECORD WITHIN THE COMMONWEALTH OF
PENNSYLVANIA OR ELSEWHERE TO APPEAR FOR BORROWER, AND, WITH OR WITHOUT
DECLARATION FILED, CONFESS JUDGMENT AGAINST BORROWER AND IN FAVOR OF SELLER, AS
OF ANY TERM, FOR THE UNPAID OBLIGATIONS HEREUNDER, INCLUDING WITHOUT LIMITATION
ALL ACCRUED AND UNPAID CHARGES PAYABLE HEREUNDER, WHETHER BY ACCELERATION OR
OTHERWISE, WITH COSTS OF SUIT AND A REASONABLE ATTORNEY'S COMMISSION OF 15%,
WITH RELEASE OF ALL ERRORS, WAIVING ALL LAWS EXEMPTING REAL OR PERSONAL PROPERTY
FROM EXECUTION, TO THE EXTENT THAT SUCH LAWS MAY LAWFULLY BE WAIVED. NO SINGLE
EXERCISE OF THE FOREGOING POWER TO CONFESS JUDGMENT SHALL BE DEEMED TO EXHAUST
THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE HELD BY ANY COURT TO BE
VALID, VOIDABLE, OR VOID, BUT THE POWER SHALL CONTINUE UNDIMINISHED AND IT MAY
BE EXERCISED FROM TIME TO TIME AND AS OFTEN AS SELLER SHALL ELECT, UNTIL SUCH
TIME AS ALL AMOUNTS AND ALL OTHER MATERIAL OBLIGATIONS OF BORROWER HEREUNDER
SHALL HAVE BEEN SATISFIED.

      BY SIGNING THIS INSTRUMENT, BORROWER HEREBY ACKNOWLEDGES THAT BORROWER HAS
READ THIS AGREEMENT (INCLUDING WITHOUT LIMITATION THE CONFESSION OF JUDGMENT SET
FORTH HEREIN), HAS HAD THE OPPORTUNITY

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TO HAVE THE SAME REVIEWED BY LEGAL COUNSEL, UNDERSTANDS THE SAME, AND AGREES TO
THE PROVISIONS CONTAINED HEREIN, INCLUDING, WITHOUT LIMITATION, THE CONFESSION
OF JUDGMENT PROVISIONS AND UNDERSTANDS THAT A CONFESSION OF JUDGMENT CONSTITUTES
A WAIVER OF RIGHTS BORROWER OTHERWISE WOULD HAVE TO PRIOR NOTICE AND A HEARING
BEFORE A JUDGMENT IS ENTERED AGAINST BORROWER AND WHICH MAY RESULT IN A COURT
JUDGMENT AGAINST BORROWER WITHOUT PRIOR NOTICE OR HEARING AND THAT THE
OBLIGATIONS MAY BE COLLECTED FROM BORROWER REGARDLESS OF ANY CLAIM BORROWER MAY
HAVE AGAINST SELLER OR OTHERWISE.

                                          /s/Robin L. Barber
                                          SIGNATURE

      (ii) POWER TO EXECUTE ON A JUDGMENT WITHOUT HEARING: BORROWER HEREBY
AUTHORIZES AND EMPOWERS THE PROTHONOTARY OR ANY ATTORNEY OF ANY COURT OF RECORD
OR THE SHERIFF (OR THE LAWFUL DESIGNEE OF THE SHERIFF) WITHIN ANY COUNTY OF THE
COMMONWEALTH OF PENNSYLVANIA OR ELSEWHERE, TO TAKE ALL ACTION ALLOWED BY OR
PROVIDED FOR IN THE PENNSYLVANIA RULES OF CIVIL PROCEDURE OR OTHER APPLICABLE
RULES OF CIVIL PROCEDURE TO EXECUTE ON ANY JUDGMENT ENTERED AGAINST BORROWER
PURSUANT TO THE CONFESSION OF JUDGMENT SET FORTH ABOVE WITHOUT PRIOR NOTICE OR
HEARING OF ANY NATURE WHATSOEVER, WAIVING ALL LAWS EXEMPTING REAL OR PERSONAL
PROPERTY FROM EXECUTION TO THE EXTENT THAT SUCH LAWS MAY LAWFULLY BE WAIVED. NO
SINGLE EXERCISE OF THE FOREGOING POWER TO EXECUTE ON JUDGMENTS WITHOUT A HEARING
SHALL BE DEEMED TO EXHAUST THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE
HELD BY ANY COURT TO BE VALID, VOIDABLE OR VOID, BUT THE POWER SHALL CONTINUE
UNDIMINISHED AND IT MAY BE EXERCISED FROM TIME TO TIME AS OFTEN AS SELLER SHALL
ELECT.

      BY SIGNING THIS AGREEMENT, BORROWER HEREBY ACKNOWLEDGES THAT BORROWER HAS
READ THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION, THE CONFESSION OF JUDGMENT
AND THE POWER TO EXECUTE ON A JUDGMENT WITHOUT A HEARING), HAS HAD THE
OPPORTUNITY TO HAVE THIS AGREEMENT REVIEWED BY LEGAL COUNSEL, UNDERSTANDS AND
AGREES TO THE PROVISIONS CONTAINED HEREIN, INCLUDING, WITHOUT LIMITATION, THE
POWERS TO EXECUTE ON JUDGMENT WITHOUT A HEARING, AND UNDERSTANDS THAT THE POWER
TO EXECUTE ON A JUDGMENT WITHOUT A HEARING CONSTITUTES A WAIVER OF RIGHTS
BORROWER OTHERWISE WOULD HAVE TO PRIOR NOTICE AND A HEARING BEFORE EXECUTION ON
A JUDGMENT, AND THAT THE OBLIGATIONS MAY BE COLLECTED FROM BORROWER REGARDLESS
OF ANY CLAIM THAT BORROWER MAY HAVE AGAINST SELLER OR OTHERWISE.

                                          /s/Robin L. Barber
                                          SIGNATURE

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      IN WITNESS WHEREOF, the Borrower has caused this DEFERRED PURCHASE PRICE
NOTE to be duly executed and delivered by its duly authorized representative as
of the date first above written.

BORROWER:

================================================================================
WARNING-BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT TRIAL.
IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU WITHOUT YOUR
PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT FROM YOU
REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR RETURNED
GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE AGREEMENT, OR ANY
OTHER CAUSE.
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BALANCED CARE REALTY (OFC), INC.

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

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Exhibit 10.5

                            BALANCED CARE CORPORATION
                                 PROMISSORY NOTE

                                                                  Columbus, Ohio
$936,445.00                                                       March 31, 2002

         On or before September 30, 2003 (the "Initial Due Date"), which Initial
Due Date may be extended by Ocwen Financial Corporation, a Florida corporation
("Ocwen"), in accordance with Section 1.3(a) of the Term Loan Agreement (defined
hereinafter), for value received, the undersigned, Balanced Care Corporation, a
Delaware corporation ("Balanced Care") promises to pay to the order of Seller
(hereinafter defined), or its successors or assigns, the principal amount of
Nine Hundred Thirty-Six Thousand Four Hundred Forty-Five Dollars ($936,445.00),
together with interest on the unpaid principal balance of the loan made
hereunder ("BCC Loan") until paid in full. The amount of principal owed to each
respective Seller is as follows: (i) Medina ALF, Inc. = $318,391.30, (ii)
Centerville ALF, Inc. = $413,908.69, and (iii) Shippensburg ALF, Inc. =
$204,145.01. Both principal and interest are payable in federal funds or other
immediately-available money of the United States of America at Ocwen Financial
Corporation, 1675 Palm Beach Lakes Blvd., West Palm Beach, FL 33401.

         Section 1. Compromise and Settlement, Term Loan Agreement, Purchase
Agreement, Deferred Purchase Price Note, and Subordinate Mortgage. This BCC Note
is the BCC Note referred to in the Settlement Agreement and Release, executed by
Seller, Balanced Care, Ocwen, Senior Care Operators of Ohio, LLC, Senior Care
Operators of Centerville, LLC, and Senior Care Operators of Shippensburg, LLC,
as of the date hereof, to resolve the suit filed in the United States District
Court, Southern District of Ohio, Western Division, by Seller against Balanced
Care for past due rent owed Seller ("Compromise and Settlement") and is provided
also in connection with the Agreed Entry (as defined in the Term Loan
Agreement). In connection with and as part of the Compromise and Settlement, a
subsidiary of Balanced Care, Balanced Care Realty (OFC), Inc., a Delaware
corporation ("Borrower"), has entered into the Agreement of Purchase and Sale,
dated of even date herewith (as used hereinafter, "Purchase Agreement"), with
Medina ALF, Inc., a Florida corporation ("Medina"), Centerville ALF, Inc., a
Florida corporation ("Centerville"), Shippensburg ALF, Inc., a Florida
corporation ("Shippensburg") (Medina, Centerville, and Shippensburg are
collectively referred to hereinafter as
<PAGE>
"Seller"), and certain other parties, pursuant to which Borrower will purchase
three (3) assisted living facilities from Seller. Borrower has provided the
Deferred Purchase Price Note, of even date herewith, to Seller in payment of a
portion of the purchase price (as used hereinafter "Purchase Price") under the
Purchase Agreement ("Deferred Purchase Price Note").

         Borrower will also borrow funds from Ocwen in order to finance a
portion of the Purchase Price, as evidenced by the Term Note, of even date
herewith, given by Borrower in favor of Ocwen ("Term Note") in connection with
the Term Loan Agreement, of even date herewith, by and among Ocwen, Borrower,
Balanced Care, Balanced Care at Medina, Inc., a Delaware corporation, Balanced
Care at Centerville, Inc., a Delaware corporation, Balanced Care at
Shippensburg, Inc., a Delaware corporation, and Senior Care Operators of
Shippensburg, LLC, a Delaware LLC ("Term Loan Agreement").

         This BCC Note and the Deferred Purchase Price Note are secured by the
Subordinate Mortgage (as defined in the Term Loan Agreement). In the event of
nonpayment or other nonperformance by Balanced Care of any of the terms and
conditions set forth in this BCC Note or by Borrower with respect to the
Deferred Purchase Price Note, it shall be considered an event of default under
this BCC Note, the Deferred Purchase Price Note, and under the Subordinate
Mortgage. In addition, such failure to pay and/or otherwise perform shall also
be considered an Event of Default under the Term Loan Agreement.

         Section 2. Maturity Date; Extension. This BCC Note shall mature, by
acceleration or otherwise, on the same date of maturity as the Term Note. In the
absence of an Event of Default occurring under the Term Loan Agreement, it is
anticipated that maturity of the Term Note will occur on the Initial Due Date.
Section 1.3(a) of the Term Loan Agreement contains the terms and provisions
pursuant to which an extension of the Initial Due Date may be granted by Ocwen
for the Term Note. In the event that the Term Note is extended pursuant to
Section 1.3(a) of the Term Loan Agreement, then this BCC Note shall be similarly
extended, without further action required of either Balanced Care or Seller, and
at no cost to Balanced Care. In such case, subject to the provisions of Section
6 below, the BCC Loan evidenced by this BCC Note shall be due and payable in
full on the Extended Due Date (as defined in the Term Loan Agreement).

         Section 3. Interest Rate. This BCC Note shall bear interest during the
period from the date hereof on the unpaid principal

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balance of the BCC Loan made hereunder, until paid in full, at a fixed rate of
two and 66/100 percent (2.66%) per annum. Such interest shall be computed on the
basis of a 360-day year consisting of twelve (12) consecutive thirty (30) day
months.

         Section 4. Interest Payment; Event of Default. No interest payments
will be due under this BCC Note unless and until an Event of Default (as defined
in the Term Loan Agreement) occurs and continues beyond any applicable cure
period. In the event such an Event of Default shall occur and continue beyond
any applicable cure period, and therefore interest shall become due hereunder,
Balanced Care shall pay interest to each respective Seller on the amount of the
total principal balance owed to each Seller, as set forth in the introductory
paragraph hereof, from the date hereof (March 31, 2002) until the date that this
BCC Note is paid in full, whether by acceleration or otherwise.

         Monthly interest payments shall be required after an Event of Default
(as defined in the Term Loan Agreement) has occurred and is continuing beyond
any applicable cure period. Such interest payments for the prior month
(provided, however, that interest for the first month shall be calculated from
the date hereof (March 31, 2002) to the end of the month in which the Event of
Default occurs) shall be payable on the eleventh (11th) day of each month
commencing the month after the month in which the Event of Default (which
continues beyond any applicable cure period) occurs, and thereafter payable on
the eleventh (11th) day of each month during the term of the BCC Loan. If a
monthly interest payment is not made by Balanced Care and received by each
respective Seller by the sixteenth (16th) day of any month during the term of
the BCC Loan, including during any Extension (as defined in the Term Loan
Agreement), Balanced Care shall pay to each Seller a late fee equal to five
percent (5%) of the monthly interest payment that was due on the 11th day of the
month. All interest payments received by a Seller shall be applied in the
inverse order of their maturity. That is, the most recent payment received shall
be credited to the first of the payments due and owing by Balanced Care to any
Seller.

         If an Event of Default has occurred, and Balanced Care has made all of
the monthly interest payments required hereunder as a result of the occurrence
of such Event of Default, but such Event of Default has been cured and is not
continuing, except for any Event of Default that continues until a payoff of the
Term Note is received by Ocwen, then, Balanced Care's obligation to make monthly
payments of interest hereunder shall cease upon the effective date of the
accepted cure of the Event of Default.

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Balanced Care shall make a partial interest payment to each Seller if the date
of cure is other than the last day of the month. In no event shall Balanced Care
be entitled to any refund of interest payments made to any Seller pursuant to
this Section 4.

         As indicated above, in the event that Balanced Care fails to pay or
otherwise perform any obligation of Balanced Care set forth herein, such default
shall be considered a default and breach of this BCC Note, the Deferred Purchase
Price Note, and the Subordinate Mortgage, as well as an Event of Default under
the Term Loan Agreement.

         Section 5. Principal Payments. Subject to the provisions of Section 6
below, the entire principal balance and any accrued interest under this BCC Note
shall be due and payable on the Initial Due Date, unless Borrower elects and
properly exercises an Extension (as defined in the Term Loan Agreement) of the
Term Note, in accordance with the provisions of Section 1.3(a) of the Term Loan
Agreement, in which case the term of this BCC Note shall be similarly extended
until the Extended Due Date (as defined in the Term Loan Agreement), when the
entire principal balance and any accrued interest thereon is due and payable in
full. Principal payments should be made to each respective Seller in accordance
with its allocated portion of the total outstanding principal, as set forth in
the introductory paragraph hereof.

         Section 6. BCC Loan Forgiveness. In the event that (i) the Term Note is
paid in full, whether on the Initial Due Date, the Extended Due Date (as defined
in the Term Loan Agreement), or by prepayment, and (ii) an Event of Default (as
defined in the Term Loan Agreement), which constitutes a monetary default or
breach of any payment obligation, has not occurred and is not continuing until
the payoff is received by Ocwen (e.g., the payoff is not made pursuant to an
acceleration of the Term Note as a result of an Event of Default constituting a
monetary default or breach of any payment obligation under the Term Loan
Agreement having occurred), then the entire outstanding principal amount due
under this BCC Note as well as any and all interest accrued hereunder, shall be
forgiven. Provided, however, that in no event shall any Seller be required, and
Balanced Care shall not be entitled, to a return of any interest payment made by
Balanced Care hereunder.

         Section 7. Setoff. Any and all moneys now or at any time hereafter
owing to Balanced Care from the holder hereof, are hereby pledged for the
security of this and all other Indebtedness (as defined in the Term Loan
Agreement) from Balanced Care to the holder hereof, and may, upon the occurrence
of any Event of

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Default (as defined in the Term Loan Agreement) that continues beyond any
applicable cure period, be paid and applied thereon whether such Indebtedness be
then due or is to become due.

         Section 8. Effect on Other Agreements. Nothing set forth in this BCC
Note is intended or shall be construed to (i) release, mitigate, or limit any
obligation or duty of any party to the Purchase Agreement, Term Loan Agreement,
Term Note, Compromise and Settlement, Deferred Purchase Price Note, Management
Agreements, Security Documents, Subordinate Mortgage, Ancillary Documents, the
Agreed Entry, or the documents executed in connection with the transactions
contemplated by the Purchase Agreement, which is set forth in any of said
documents, or (ii) waive, discharge or abrogate any right or interest of any
party to such documents of any right or interest set forth therein. In the event
of any conflict between the express terms of this BCC Note and the express terms
of the Compromise and Settlement, or any of the other documents listed above,
the terms of this BCC Note shall control.

         Section 9. Jury Waiver. BALANCED CARE AND SELLER (BY ITS ACCEPTANCE
HEREOF) HEREBY VOLUNTARILY, KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY
RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE (WHETHER BASED ON
CONTRACT, TORT, OR OTHERWISE) BETWEEN THEM ARISING OUT OF OR IN ANY WAY RELATED
TO, IN CONNECTION WITH, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN
THEM IN CONNECTION WITH THIS BCC NOTE OR THE TRANSACTIONS CONTEMPLATED BY THIS
BCC NOTE. THIS PROVISION IS A MATERIAL INDUCEMENT TO SELLER TO PROVIDE THE
FINANCING EVIDENCED BY THIS BCC NOTE AND ENTER INTO THE COMPROMISE AND
SETTLEMENT WITH BALANCED CARE. THIS PROVISION SHALL NOT IN ANY WAY AFFECT,
WAIVE, LIMIT, AMEND OR MODIFY SELLER'S ABILITY TO PURSUE ITS REMEDIES INCLUDING,
BUT NOT LIMITED TO, ANY CONFESSION OF JUDGMENT OR COGNOVIT PROVISION CONTAINED
IN THIS BCC NOTE.

         Section 10. Warrant of Attorney. Balanced Care hereby authorizes any
attorney at law to appear for Balanced Care in any action on any or all of the
monetary obligations of Balanced Care set forth herein at any time after such
obligations become due, whether by acceleration or otherwise, in any federal
court or court of record in or of the State of Ohio or elsewhere, to waive the
issuing and service of process against, and to confess judgment against Balanced
Care in favor of Seller for the amount that may be due, including interest, late
charges, collection costs, attorneys' fees and the like, and costs of suit, and
to waive and release all errors in said proceedings and judgments, and all
petitions in error and rights of appeal from the judgments

                                     - 5 -
<PAGE>
rendered. The foregoing warrants of attorney shall survive any judgment, and, if
any judgment be vacated for any reason, the holder hereof nevertheless may
thereafter use the foregoing warrant of attorney to obtain an additional
judgment or judgments against Balanced Care. Balanced Care hereby waives any
conflict of interest in Seller's attorney confessing judgment against Balanced
Care pursuant to the foregoing warrant of attorney and further agrees that the
attorney confessing judgment pursuant to the foregoing warrant of attorney may
receive a legal fee or other thing of value from Seller.

         Section 11. Pennsylvania Cognovit Provisions. The following provisions
in this Section 11 shall apply only in the event that Seller elects to seek a
judgment on this BCC Note in any court in Pennsylvania, as opposed to Ohio, and
are included herein for no other purpose. In the event that Seller so elects,
Seller agrees to provide any notice required by Pennsylvania law with respect to
the exercise by Seller of its rights under the following provisions.

(i) POWER TO CONFESS JUDGMENT: BORROWER HEREBY AUTHORIZES AND EMPOWERS THE
PROTHONOTARY OR ANY ATTORNEY OF ANY COURT OF RECORD WITHIN THE COMMONWEALTH OF
PENNSYLVANIA OR ELSEWHERE TO APPEAR FOR BORROWER, AND, WITH OR WITHOUT
DECLARATION FILED, CONFESS JUDGMENT AGAINST BORROWER AND IN FAVOR OF SELLER, AS
OF ANY TERM, FOR THE UNPAID OBLIGATIONS HEREUNDER, INCLUDING WITHOUT LIMITATION
ALL ACCRUED AND UNPAID CHARGES PAYABLE HEREUNDER, WHETHER BY ACCELERATION OR
OTHERWISE, WITH COSTS OF SUIT AND A REASONABLE ATTORNEY'S COMMISSION OF 15%,
WITH RELEASE OF ALL ERRORS, WAIVING ALL LAWS EXEMPTING REAL OR PERSONAL PROPERTY
FROM EXECUTION, TO THE EXTENT THAT SUCH LAWS MAY LAWFULLY BE WAIVED. NO SINGLE
EXERCISE OF THE FOREGOING POWER TO CONFESS JUDGMENT SHALL BE DEEMED TO EXHAUST
THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE HELD BY ANY COURT TO BE
VALID, VOIDABLE, OR VOID, BUT THE POWER SHALL CONTINUE UNDIMINISHED AND IT MAY
BE EXERCISED FROM TIME TO TIME AND AS OFTEN AS SELLER SHALL ELECT, UNTIL SUCH
TIME AS ALL AMOUNTS AND ALL OTHER MATERIAL OBLIGATIONS OF BORROWER HEREUNDER
SHALL HAVE BEEN SATISFIED.

         BY SIGNING THIS INSTRUMENT, BORROWER HEREBY ACKNOWLEDGES THAT BORROWER
HAS READ THIS AGREEMENT (INCLUDING WITHOUT LIMITATION THE CONFESSION OF JUDGMENT
SET FORTH HEREIN), HAS HAD THE OPPORTUNITY TO HAVE THE SAME REVIEWED BY LEGAL
COUNSEL, UNDERSTANDS THE SAME, AND AGREES TO THE PROVISIONS CONTAINED HEREIN,
INCLUDING, WITHOUT LIMITATION, THE CONFESSION OF JUDGMENT PROVISIONS AND
UNDERSTANDS THAT A CONFESSION OF JUDGMENT CONSTITUTES A WAIVER OF RIGHTS
BORROWER OTHERWISE WOULD HAVE TO PRIOR NOTICE AND A HEARING BEFORE

                                     - 6 -
<PAGE>
A JUDGMENT IS ENTERED AGAINST BORROWER AND WHICH MAY RESULT IN A COURT JUDGMENT
AGAINST BORROWER WITHOUT PRIOR NOTICE OR HEARING AND THAT THE OBLIGATIONS MAY BE
COLLECTED FROM BORROWER REGARDLESS OF ANY CLAIM BORROWER MAY HAVE AGAINST SELLER
OR OTHERWISE.

                                                 /s/Robin L. Barber
                                                 -------------------------------
                                                 SIGNATURE

         (ii) POWER TO EXECUTE ON A JUDGMENT WITHOUT HEARING: BORROWER HEREBY
AUTHORIZES AND EMPOWERS THE PROTHONOTARY OR ANY ATTORNEY OF ANY COURT OF RECORD
OR THE SHERIFF (OR THE LAWFUL DESIGNEE OF THE SHERIFF) WITHIN ANY COUNTY OF THE
COMMONWEALTH OF PENNSYLVANIA OR ELSEWHERE, TO TAKE ALL ACTION ALLOWED BY OR
PROVIDED FOR IN THE PENNSYLVANIA RULES OF CIVIL PROCEDURE OR OTHER APPLICABLE
RULES OF CIVIL PROCEDURE TO EXECUTE ON ANY JUDGMENT ENTERED AGAINST BORROWER
PURSUANT TO THE CONFESSION OF JUDGMENT SET FORTH ABOVE WITHOUT PRIOR NOTICE OR
HEARING OF ANY NATURE WHATSOEVER, WAIVING ALL LAWS EXEMPTING REAL OR PERSONAL
PROPERTY FROM EXECUTION TO THE EXTENT THAT SUCH LAWS MAY LAWFULLY BE WAIVED. NO
SINGLE EXERCISE OF THE FOREGOING POWER TO EXECUTE ON JUDGMENTS WITHOUT A HEARING
SHALL BE DEEMED TO EXHAUST THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE
HELD BY ANY COURT TO BE VALID, VOIDABLE OR VOID, BUT THE POWER SHALL CONTINUE
UNDIMINISHED AND IT MAY BE EXERCISED FROM TIME TO TIME AS OFTEN AS SELLER SHALL
ELECT.

         BY SIGNING THIS AGREEMENT, BORROWER HEREBY ACKNOWLEDGES THAT BORROWER
HAS READ THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION, THE CONFESSION OF
JUDGMENT AND THE POWER TO EXECUTE ON A JUDGMENT WITHOUT A HEARING), HAS HAD THE
OPPORTUNITY TO HAVE THIS AGREEMENT REVIEWED BY LEGAL COUNSEL, UNDERSTANDS AND
AGREES TO THE PROVISIONS CONTAINED HEREIN, INCLUDING, WITHOUT LIMITATION, THE
POWERS TO EXECUTE ON JUDGMENT WITHOUT A HEARING, AND UNDERSTANDS THAT THE POWER
TO EXECUTE ON A JUDGMENT WITHOUT A HEARING CONSTITUTES A WAIVER OF RIGHTS
BORROWER OTHERWISE WOULD HAVE TO PRIOR NOTICE AND A HEARING BEFORE EXECUTION ON
A JUDGMENT, AND THAT THE OBLIGATIONS MAY BE COLLECTED FROM BORROWER REGARDLESS
OF ANY CLAIM THAT BORROWER MAY HAVE AGAINST SELLER OR OTHERWISE.

                                                 /s/Robin L. Barber
                                                 -------------------------------
                                                 SIGNATURE

                                     - 7 -
<PAGE>
         IN WITNESS WHEREOF, Balanced Care has caused this BALANCED CARE
CORPORATION PROMISSORY NOTE to be duly executed and delivered by its duly
authorized representative as of the date first above written.

WARNING-BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT TRIAL.
IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU WITHOUT YOUR
PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT FROM YOU
REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR RETURNED
GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE AGREEMENT, OR ANY
OTHER CAUSE.

BALANCED CARE CORPORATION

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

                                     - 8 -

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