Document:

Exhibit
10.1

    
      
        	 
      

      

    Credit
Agreement

     

    Dated as
of November 19, 2010

    

    By and
Among

    

    Cornerstone
Healthcare Plus Operating Partnership, L.P.,

    as the
Borrower

    

    the
Lenders from time to time parties hereto,

    as
Lenders

     

    and

     

    KeyBank
National Association,

    as Lead
Arranger, a Lender and Agent

    
      
        	 
      

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    
      TABLE
OF CONTENTS

      

      
        
          
            
              
                	 
      	 
      	
                        Page

                      
	 
      	 
      	 
      
	
                        ARTICLE 1.     

                      	
                        DEFINITIONS.

                      	
                        1

                      

              

            

          

        

      

      

      
        
          	             	
                  Section 1.1              

                	
                  Defined
      Terms

                	
                  1

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 1.2

                	
                  GAAP

                	
                  18

                

        

      

      

      
        
          
            
              	
                      ARTICLE 2.     

                    	
                      REVOLVING
      CREDIT COMMITMENTS; REVOLVING CREDIT LOANS

                    	
                      18

                    

            

          

        

      

      

      
        
          	             	
                  Section 2.1              

                	
                  Revolving
      Credit Loans

                	
                  18

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.2

                	
                  Notices
      Relating to Revolving Credit Loans

                	
                  18

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.3

                	
                  Disbursement
      of Loan Proceeds

                	
                  19

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.4

                	
                  Notes

                	
                  19

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.5

                	
                  Payment
      of Revolving Credit Loans; Termination of and Voluntary Changes in
      Commitments; Mandatory Repayments

                	
                  20

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.6

                	
                  Interest

                	
                  21

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.7

                	
                  Fees

                	
                  22

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.8

                	
                  Use
      of Proceeds of Loans

                	
                  22

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.9

                	
                  Computations

                	
                  22

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.10

                	
                  Minimum
      Amounts of Borrowings, Conversions and Repayments

                	
                  23

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.11

                	
                  Time
      and Method of Payments

                	
                  23

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.12

                	
                  Lending
      Offices

                	
                  23

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.13

                	
                  Several
      Obligations

                	
                  23

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.14

                	
                  Pro
      Rata Treatment Among Lenders

                	
                  23

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.15

                	
                  Non-Receipt
      of Funds by the Agent

                	
                  24

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.16

                	
                  Sharing
      of Payments and Set-Off Among Lenders

                	
                  24

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.17

                	
                  Conversion
      of Loans

                	
                  25

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.18

                	
                  Additional
      Costs; Capital Requirements

                	
                  25

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.19

                	
                  Limitation
      on Types of Loans

                	
                  26

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.20

                	
                  Illegality

                	
                  27

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.21

                	
                  Certain
      Conversions pursuant to Sections 2.18 and 2.20

                	
                  27

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.22

                	
                  Indemnification

                	
                  28

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.23

                	
                  Special
      Provisions Regarding Defaulting Lenders

                	
                  28

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 2.24

                	
                  Extension
      of Revolving Credit Commitment Termination Date

                	
                  30

                

        

      

       

      
        
           

        

        
          -i-

          
            

          

        

        
           

        

      

      TABLE
OF CONTENTS

      (continued)

      

      
        
          
            
              
                
                  
                    	 
      	
                            Page

                          
	 
      	 
      
	
                            ARTICLE 3.     

                          	
                            REPRESENTATIONS
      AND WARRANTIES

                          	
                            30

                          

                  

                

              

            

          

        

      

      

      
        
          	             	
                  Section 3.1              

                	
                  Organization

                	
                  30

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.2

                	
                  Power,
      Authority, Consents

                	
                  31

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.3

                	
                  No
      Violation of Law or Agreements

                	
                  31

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.4

                	
                  Due
      Execution, Validity, Enforceability

                	
                  31

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.5

                	
                  Title
      to Properties

                	
                  31

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.6

                	
                  Judgments,
      Actions, Proceedings

                	
                  32

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.7

                	
                  No
      Defaults, Compliance With Laws

                	
                  32

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.8

                	
                  Burdensome
      Documents

                	
                  32

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.9

                	
                  Financial
      Statements; Projections

                	
                  32

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.10

                	
                  Tax
      Returns

                	
                  33

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.11

                	
                  Intangible
      Assets

                	
                  33

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.12

                	
                  Regulation
      U

                	
                  33

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.13

                	
                  Name
      Changes, Mergers, Acquisitions

                	
                  33

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.14

                	
                  Full
      Disclosure

                	
                  33

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.15

                	
                  Licenses
      and Approvals

                	
                  34

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.16

                	
                  ERISA

                	
                  34

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.17

                	
                  USA
      Patriot Act

                	
                  34

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 3.18

                	
                  REIT
      Status

                	
                  35

                

        

      

      

      
        
          
            
              	
                      ARTICLE 4.     

                    	
                      CONDITIONS
      TO THE LOANS

                    	
                      35

                    

            

          

        

      

      

      
        
          	             	
                  Section 4.1              

                	
                  Conditions
      to Initial Loan(s)

                	
                  35

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 4.2

                	
                  Conditions
      to All Loans

                	
                  38

                

        

      

      

      
        
          
            
              	
                      ARTICLE 5.     

                    	
                      DELIVERY
      OF FINANCIAL REPORTS, DOCUMENTS AND OTHER INFORMATION

                    	
                      39

                    

            

          

        

      

      

      
        
          	             	
                  Section 5.1              

                	
                  Section
      5.1 Annual Financial Statements

                	
                  39

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.2

                	
                  Quarterly
      Financial Statements

                	
                  39

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.3

                	
                  Compliance
      Information

                	
                  40

                
	 
      	 
      	 	 
      
	 
      	
                  Section 5.4

                	
                  Compliance
      Certificate;  Borrowing Base Certificate

                	
                  40

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.5

                	
                  Monthly
      Information

                	
                  40

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.6

                	
                  Intentionally
      Omitted

                	
                  41

                

        

      

       

      
        
           

        

        
          -ii-

          
            

          

        

        
           

        

      

      TABLE
OF CONTENTS

      (continued)

      

      
        
          	 
      	 
      	 
      	
                  Page

                
	 
      	 
      	 
      	 
      
	             	
                  Section 5.7              

                	
                  Business
      Plan and Projections

                	
                  41

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.8

                	
                  USA
      Patriot Act  Reports

                	
                  41

                
	 
      	 
      	 	 
      
	 
      	
                  Section 5.9

                	
                  Accountants’
      Reports

                	
                  41

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.10

                	
                  Copies
      of Documents

                	
                  41

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.11

                	
                  Notices
      of Defaults

                	
                  42

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.12

                	
                  ERISA
      Notices and Requests

                	
                  42

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 5.13

                	
                  Additional
      Information

                	
                  42

                

        

      

      

      
        
          
            
              	
                      ARTICLE 6.     

                    	
                      AFFIRMATIVE
      COVENANTS

                    	
                      42

                    

            

          

        

      

      

      
        
          	             	
                  Section 6.1              

                	
                  Books
      and Records

                	
                  43

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.2

                	
                  Inspections
      and Audits

                	
                  43

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.3

                	
                  Maintenance
      and Repairs

                	
                  43

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.4

                	
                  Continuance
      of Business

                	
                  43

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.5

                	
                  Copies
      of Corporate Documents

                	
                  43

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.6

                	
                  Perform
      Obligations

                	
                  44

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.7

                	
                  Notice
      of Litigation

                	
                  
                    44

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.8

                	
                  Insurance

                	
                  
                    44

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.9

                	
                  Minimum
      Equity Increase

                	
                  
                    44

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.10

                	
                  Notice
      of Certain Events

                	
                  
                    44

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.11

                	
                  Comply
      with ERISA

                	
                  45

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.12

                	
                  Environmental
      Compliance

                	
                  
                    45

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.13

                	
                  Maintenance
      of REIT Status

                	
                  
                    45

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.14

                	
                  Post
      Closing Lien Searches

                	
                  
                    45

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.15

                	
                  The
      Account;  Cash Management

                	
                  
                    45

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.16

                	
                  Right
      of First Refusal;  Right of First Offer

                	
                  46

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.17

                	
                  Casualty
      and Condemnation

                	
                  47

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 6.18

                	
                  REIT
      Sub-Advisor

                	
                  47

                

        

      

      

      
        
          
            
              	
                      ARTICLE 7.     

                    	
                      NEGATIVE
      COVENANTS

                    	
                      48

                    

            

          

        

      

      

      
        
          	             	
                  Section 7.1              

                	
                  Indebtedness

                	
                  48

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.2

                	
                  Liens

                	
                  48

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.3

                	
                  Guaranties

                	
                  49

                

        

      

       

      
        
           

        

        
          -iii-

          
            

          

        

        
           

        

      

      TABLE
OF CONTENTS

      (continued)

      

      
        
          	 
      	 
      	 
      	
                  Page

                
	 
      	 
      	 
      	 
      
	             	
                  Section 7.4              

                	
                  Mergers,
      Acquisitions

                	
                  49

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.5

                	
                  Distributions

                	
                  49

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.6

                	
                  Changes
      in Structure

                	
                  50

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.7

                	
                  Disposition
      of Assets

                	
                  
                    50

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.8

                	
                  Investments

                	
                  
                    50

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.9

                	
                  Fiscal
      Year

                	
                  52

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.10

                	
                  ERISA
      Obligations

                	
                  
                    52

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.11

                	
                  Negative
      Financial Covenants

                	
                  
                    52

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.12

                	
                  Use
      of Cash

                	
                  53

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.13

                	
                  Transactions
      with Affiliates

                	
                  53

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 7.14

                	
                  Hazardous
      Material

                	
                  54

                

        

      

      

      
        
          
            
              	
                      ARTICLE 8.     

                    	
                      EVENTS
      OF DEFAULT

                    	
                      54

                    

            

          

        

      

      

      
        
          	             	
                  Section 8.1              

                	
                  Payments

                	
                  
                    54

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.2

                	
                  Certain
      Covenants

                	
                  
                    54

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.3

                	
                  Other
      Covenants

                	
                  
                    54

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.4

                	
                  Other
      Defaults

                	
                  55

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.5

                	
                  Representations
      and Warranties

                	
                  
                    55

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.6

                	
                  Bankruptcy

                	
                  
                    55

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.7

                	
                  Judgments

                	
                  56

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.8

                	
                  ERISA

                	
                  
                    56

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.9

                	
                  Material
      Adverse Effect

                	
                  
                    56

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.10

                	
                  Ownership

                	
                  
                    56

                  

                
	 
      	 
      	 	 
      
	 
      	
                  Section 8.11

                	
                  REIT
      Status;  Material Licenses and Permits

                	
                  57

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.12

                	
                  Environmental

                	
                  
                    57

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 8.13

                	
                  Default
      by Operator

                	
                  
                    57

                  

                

        

      

      

      
        
          
            
              	
                      ARTICLE 9.     

                    	
                      THE
      AGENT.

                    	
                      
                        57

                      

                    

            

          

        

      

      

      
        
          	             	
                  Section 9.1              

                	
                  Appointment,
      Powers and Immunities

                	
                  
                    57

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 9.2

                	
                  Reliance
      by Agent

                	
                  58

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 9.3

                	
                  Events
      of Default

                	
                  
                    58

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 9.4

                	
                  Rights
      as a Lender

                	
                  
                    58

                  

                

        

      

       

      
        
           

        

        
          -iv-

          
            

          

        

        
           

        

      

      TABLE
OF CONTENTS

      (continued)

      

      
        
          	 
      	 
      	 
      	
                  Page

                
	 
      	 
      	 
      	 
      
	             	
                  Section 9.5              

                	
                  Indemnification

                	
                  59

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 9.6

                	
                  Non-Reliance
      on Agent and other Lenders

                	
                  
                    59

                  

                
	 
      	 
      	 	 
      
	 
      	
                  Section 9.7

                	
                  Failure
      to Act

                	
                  
                    59

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 9.8

                	
                  Resignation
      or Removal of Agent

                	
                  60

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 9.9

                	
                  Sharing
      of Payments

                	
                  60

                

        

      

      

      
        
          
            
              	
                      ARTICLE 10.     

                    	
                      MISCELLANEOUS
      PROVISIONS

                    	
                      61

                    

            

          

        

      

      

      
        
          	             	
                  Section 10.1            

                	
                  Fees
      and Expenses; Indemnity

                	
                  61

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.2

                	
                  Taxes

                	
                  62

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.3

                	
                  Payments

                	
                  63

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.4

                	
                  Survival
      of Agreements and Representations; Construction

                	
                  63

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.5

                	
                  Lien
      on and Set-off of Deposits

                	
                  63

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.6

                	
                  Modifications,
      Consents and Waivers; Entire Agreement

                	
                  64

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.7

                	
                  Remedies
      Cumulative; Counterclaims

                	
                  64

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.8

                	
                  Further
      Assurances

                	
                  65

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.9

                	
                  Notices

                	
                  65

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.10

                	
                  Counterparts

                	
                  66

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.11

                	
                  Severability

                	
                  67

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.12

                	
                  Binding
      Effect; No Assignment or Delegation by Borrower

                	
                  
                    67

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.13

                	
                  Assignments
      and Participations by Lenders

                	
                  
                    67

                  

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.14

                	
                  Delivery
      of Tax Forms

                	
                  69

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.15

                	
                  Governing
      Law; Consent to Jurisdiction; Waiver of Trial by Jury

                	
                  70

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.16

                	
                  Confidentiality

                	
                  71

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.17

                	
                  USA
      Patriot Act Notice; Anti-Money Laundering

                	
                  71

                
	 
      	 
      	 
      	 
      
	 
      	
                  Section 10.18

                	
                  Removal
      and Replacement of Defaulting Lenders

                	
                  72

                

        

      

       

    

    
      
         

      

      
        -v-

        
          

        

      

      
         

      

    

    TABLE
OF CONTENTS

    (continued)

     

    
      
        
          
            
              
                	 
      	 
      	 
      	
                        Page

                      
	 
      	 
      	 
      	 
      
	
                        Exhibit
      A

                      	
                        
                          -

                        

                      	
                        Form
      of Revolving Credit Note

                      	 
      
	
                        Exhibit
      B

                      	
                        -

                      	
                        Form
      of Guaranty Agreement

                      	 
      
	
                        Exhibit
      C

                      	
                        -

                      	
                        Form
      of Mortgage Agreement

                      	 
      
	
                        Exhibit
      D

                      	
                        -

                      	
                        Form
      of Compliance Certificate

                      	 
      
	
                        Exhibit
      E

                      	
                        -

                      	
                        Form
      of Borrowing Base Certificate

                      	 
      
	
                        Exhibit
      F

                      	
                        -

                      	
                        Form
      of Assignment and Acceptance

                      	 
      
	
                        Exhibit
      G

                      	
                        -

                      	
                        Form
      of Borrowing Notice (Borrowing)

                      	 
      
	
                        Exhibit
      H

                      	
                        -

                      	
                        Form
      of Borrowing Notice (Conversion)

                      	 
      
	 
      	 
      	 
      	 
      
	
                        Schedule
      3.1

                      	 
      	
                        Organization;
      Capitalization; Subsidiaries

                      	 
      
	
                        Schedule
      3.6

                      	 
      	
                        Judgments,
      Actions, Proceedings

                      	 
      
	
                        Schedule
      3.7

                      	 
      	
                        Defaults

                      	 
      
	
                        Schedule
      3.8

                      	 
      	
                        Burdensome
      Documents

                      	 
      
	
                        Schedule
      3.13

                      	 
      	
                        Name
      Changes; Mergers Acquisitions

                      	 
      
	
                        Schedule
      3.16

                      	 
      	
                        ERISA

                      	 
      
	
                        Schedule
      6.16

                      	 
      	
                        Existing
      Rights of First Refusal

                      	 
      
	
                        Schedule
      7.1

                      	 
      	
                        Permitted
      Indebtedness

                      	 
      
	
                        Schedule
      7.2

                      	 
      	
                        Permitted
      Liens

                      	 
      
	
                        Schedule
      7.3

                      	 
      	
                        Permitted
      Guaranties

                      	 
      

              

            

          

        

      

    

     

    
      
         

      

      
        -vi-

        
          

        

      

      
         

      

    

    Credit
Agreement

    

    This
Credit
Agreement dated as of November 19, 2010 (as amended or supplemented from
time to time hereafter, this “Agreement”), is by and
among, Cornerstone
Healthcare Plus Operating Partnership, L.P., a Delaware limited
partnership (“Borrower”); KeyBank
National Association, a national banking association, as Administrative
Agent for the Lenders (in such capacity, together with its successors in such
capacity, the “Agent”);
and the several financial institutions from time to time party to this
Agreement, as Lenders (hereinafter referred to as “Lenders” or “Banks”);

     

    Recitals:

     

    The
Lenders have agreed to make available to the Borrower various Revolving Credit
Loans (as defined below) upon the terms and conditions set forth
herein.

     

    In
consideration of the mutual covenants and agreements herein contained, the
parties hereto agree as follows:

     

    
      	
            	
              Article
      1. 

            	
              Definitions.
      

            

    

     

    
      	
               
      

            	
              Section
      1.1

            	
              Defined Terms.
      

            

    

     

    As used
in this Agreement, the following terms shall have the following
meanings:

     

    “Account” – that certain
deposit account (Account Number 359683023576) established by Borrower at KeyBank
National Association.

     

    “Acquisition” – the
acquisition of title to an Eligible Facility by any Subsidiary
Guarantor.

     

    “Acquisition Date” – the date
(a) of any Acquisition of any Eligible Facility by any Subsidiary Guarantor and
(b) all other conditions set forth in Section 4 with respect to advance of Loan
proceeds with respect to such Acquisition have been satisfied.

     

    “Advance Rate” - fifty-five
percent (55%).

     

    “Advance Value” - fifty-five
percent (55%) of any individual Eligible Asset’s Appraised
Value,  provided,
however, that, upon Borrower achieving and maintaining Total Asset Value
of $150,000,000 or more, the Advance Value will be one hundred percent (100%) of
such Eligible Asset’s Appraised Value.

     

    “Advisor” – Cornerstone
Leveraged Fund Advisors, LLC, a Delaware limited liability company.

     

    “Additional Costs” - as
defined in subsection 2.18(b) hereof.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    “Affected Loans” - as defined
in Section 2.21 hereof.

     

    “Affected Type” - as defined
in Section 2.21 hereof

     

    “Affiliate” - as to any
Person, any other Person that directly or indirectly controls, or is under
common control with, or is controlled by, such Person.  As used in
this definition, “control” (including, with its correlative meanings,
“controlled by” and “under common control with”) shall mean possession, directly
or indirectly, of power to direct or cause the direction of management or
policies (whether through ownership of securities or partnership or other
ownership interests, by contract or otherwise), provided that, in any event:
(a) any Person that owns directly or indirectly ten (10%) percent or more of the
securities having ordinary voting power for the election of directors or other
governing body of a corporation or ten (10%) percent or more of the partnership
or other ownership interests of any other Person (other than as a limited
partner of such other Person) will be deemed to control such corporation or
other Person; and (b) each ten (10%) percent or more shareholder, each director
and executive officer of any Loan Party shall be deemed to be an Affiliate of
such Loan Party.

     

    “Agent” – as defined in the
introductory paragraph hereof.

     

    “Alternate Base Rate” - for
any day, a fluctuating interest rate per annum as shall be in effect from time
to time which rate per annum shall at all times be equal to the greatest of (i)
the rate of interest established by KeyBank National Association, from time to
time, as its "prime rate,”
whether or not publicly announced, which interest rate may or may not be
the lowest rate charged by it for commercial loans or other extensions of
credit; (ii) the Federal Funds Rate in effect from time to time, determined one
Business Day in arrears, plus 1/2 of 1% per annum; and
(iii) the then-applicable interest rate for LIBOR Loans, plus 1.00% per
annum.

     

    “Applicable Margin” - as at
any date of determination, with respect to LIBOR Loans or Base Rate Loans, Four
and No/100 (4.00%) percent per annum.

     

    “Application Fee” - as
defined in subsection 2.7(c) hereof.

     

    “Appraisal” - an appraisal
providing an assessment of the fair market value of a Property (whether
appraised on a stand-alone basis or “in bulk” together with similar Properties)
which is independently and impartially prepared by an MAI appraiser having
substantial experience in the appraisal of health care facilities and conforming
to Uniform Standards of Professional Appraisal Practice adopted by the Appraisal
Standards Board of the Appraisal Foundation.

     

    “Appraised Value” - with
respect to any Facility or Property comprised of real estate, the value (based
upon the lesser of cost or value) of such Facility or Property reflected in the
most recent Appraisal prepared with respect to such Facility or
Property.

     

    “Assessment Rate” - at any
time, the rate (rounded upwards, if necessary, to the nearest 1/100 of one (1%)
percent) then charged by the Federal Deposit Insurance Corporation (or any
successor) to the Agent for deposit insurance for Dollar time deposits with the
Agent at its Principal Office.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    “Assigned Credit Advance
Value” – with respect to each Eligible Facility, the amount of that
portion of the Revolving Credit Loan advanced hereunder for the Acquisition of
such Eligible Facility together with all accrued and unpaid interest and fees
thereon.

     

    “Assignment and Acceptance” -
an agreement in the form of Exhibit F
hereto.

     

    “Bank(s)” - the meaning
specified in the introductory paragraph hereto.

     

    “Bankruptcy Code” - Title 11
of the United States Code entitled “Bankruptcy,” as now and
hereafter in effect, or any successor statute.

     

    “Base Rate Loans” - Loans
that bear interest at a rate based upon the Alternate Base Rate.

     

    “Borrower” – as defined in
the introductory paragraph hereof.

     

    “Borrowing Base” - shall mean
as of any time the same is to be determined an amount equal to the lesser of (a)
the product of the Advance Rate multiplied by the Appraised
Value of each Eligible Facility at the time of the respective Acquisition Date
therefor, which shall be based on an Appraisal acceptable to the Agent in its
reasonable discretion, or (b) an amount which results in a 1.60 to 1.00 debt
service coverage based upon the following assumed factors:  (i) the
stabilized pro forma
Net Operating Income developed by the Agent for the Eligible Facilities,
(ii) interest payable hereunder at the pro forma Implied Interest
Rate and (iii) amortization payable under a thirty (30) year amortization
schedule.

     

    Notwithstanding
the foregoing, any Facility meeting the following criteria will not be included
in the Borrowing Base:  (a) the Operator or any Substantial Tenant of
such Facility is bankrupt, insolvent or is otherwise the subject of any
proceedings similar in nature to those set forth in Section 8.6 hereof, (b) the
Operator or any Substantial Tenant of such Facility is more than ninety (90)
days past due on its obligations of any lease pertaining to such Facility
(without giving effect to any waivers granted by the applicable lessor or
amendments to such lease) unless otherwise consented to by Agent (in its sole
discretion) with respect to Operators or Substantial Tenants that are Affiliates
of the Borrower, (c) such Facility ceases to be an Eligible Facility, and (d)
any Eligible Facility removed from the Borrowing Base pursuant to the terms of
Section 7.7 hereof.

     

    The
Borrowing Base shall be adjusted promptly upon each Acquisition or Disposition
upon receipt of each Borrowing Base Certificate to reflect such additions or
deletions of Eligible Facilities and other adjustments as set forth in this
Agreement.

     

    “Borrowing Base Certificate” –
the certificate in the form of Exhibit E hereto which is
required to be delivered from time to time to Agent and Lenders in accordance
with Section 4.2(a) and Article 5 hereof.

     

    “Borrowing Notice” - as
applicable, a written notice with respect to each termination or reduction of
the Revolving Credit Commitments, each borrowing (substantially in the form of
Exhibit G), conversion
(substantially in the form of Exhibit H), repayment and
prepayment of each Revolving Credit Loan and of the duration of each Interest
Period applicable to each LIBOR Loan.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    “Business Day” - any day
other than Saturday, Sunday or any other day on which commercial Lenders in the
States of Ohio or New York are authorized or required to close under the laws of
such States.

     

    “Capital Expenditures” - for
any period, the aggregate amount of all payments made or to be made during such
period by any Person directly or indirectly for the purpose of acquiring,
constructing or maintaining fixed assets, real property or equipment that, in
accordance with GAAP, would be added as a debit to the fixed asset account of
such Person, including, without limitation, all amounts paid or payable during
such period with respect to Capitalized Lease Obligations and interest that are
required to be capitalized in accordance with GAAP.

     

    “Capitalized Lease” - any
lease, the obligations to pay rent or other amounts under which constitute
Capitalized Lease Obligations.

     

    “Capitalized Lease
Obligations” - as to any Person, the obligations of such Person to pay
rent or other amounts under a lease of (or other agreement conveying the right
to use) real and/or personal property which obligations are required to be
classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.

     

    “Cash” or “Cash Equivalents” - assets
properly classified as “marketable securities”, “cash”, “cash equivalents” or
“short term investments” under GAAP.

     

    “CERCLA” - the Comprehensive
Environmental Response Compensation and Liability Act of 1980, 42 U.S.C. §9601,
et seq.

     

    “Closing Date” - the date on
which all such conditions precedent set forth in Section 4.1 and otherwise to
initial funding of the Revolving Credit Loans have been satisfied or waived in
writing by the Agent and the Lenders

     

    “Code” - the Internal Revenue
Code of 1986, as it may be amended from time to time, and the regulations
promulgated thereunder.

     

    “Collateral Document” – each
Mortgage, security agreement, pledge, UCC financing statement and other document
or instrument creating, perfecting or otherwise pertaining to Liens and security
interests from Borrower and/or each Subsidiary Guarantor in favor of Agent
securing the Obligations hereunder and under each other Loan
Document.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    “Compliance Certificate” - a
certificate in the form of Exhibit D annexed hereto,
executed by a Responsible Officer of each of Parent Guarantor and Borrower to
the effect that, to such Responsible Officers’ knowledge (after due inquiry into
the matters being certified): (a) as of the effective date of the certificate,
no Default or Event of Default under this Agreement exists or would exist after
giving effect to the action intended to be taken by the Borrower as described in
such certificate, including, without limitation, that the covenants set forth in
Section 6.9 and Section 7.11 hereof would not be breached after giving effect to
such action, together with a calculation in reasonable detail, and in form and
substance satisfactory to the Agent, of such compliance, and (b) the
representations and warranties contained in Article 3 hereof are true and with
the same effect as though such representations and warranties were made on the
date of such certificate, except for changes in the ordinary course of business
none of which, either singly or in the aggregate, have had a Material Adverse
Effect.

     

    “Computation Period” means,
(a) for the fiscal quarter ending on March 31, 2011, the three (3) consecutive
months ending on March 31, 2011, (b) for the fiscal quarter ending on June 30,
2011, the two (2) fiscal quarters ending on June 30, 2011, (c) for the fiscal
quarter ending on September 30, 2011, the three (3) consecutive fiscal quarters
ending on September 30, 2011, (d) for the fiscal quarter ending on December 31,
2011, the four (4) consecutive fiscal quarters ending on December 31, 2011 and
(e) for each fiscal quarter thereafter, each period of preceding four (4)
consecutive fiscal quarters.

     

    “Consolidated Indebtedness” –
as of any date of determination, the total amount of all Indebtedness of the
Parent Guarantor and its Subsidiaries as of such time, all as determined in
accordance with GAAP consistently applied.

     

    “Consolidated Net Worth” – at
any time, the consolidated stockholders equity of the Parent Guarantor and its
Subsidiaries, all as determined in accordance with GAAP consistently
applied.

     

    “Consolidated Total Assets” -
on any date, the consolidated total assets of the Parent Guarantor and its
Subsidiaries, as such amount would appear on a consolidated balance sheet of the
Parent Guarantor prepared as of such date in accordance with GAAP.

     

    “Controlled Group” - all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with
Cornerstone REIT, are treated as a single employer under Section 414(b), 414(c)
or 414(m) of the Code and Section 4001 (a)(2) of ERISA.

     

    “Cornerstone REIT” –
Cornerstone Healthcare Plus REIT, Inc., a Maryland corporation.

     

    “Credit Period” - the period
commencing on the date of this Agreement and ending on the Revolving Credit
Commitment Termination Date.

     

    “Debt Instrument” - as
defined in subsection 8A(a) hereof.

     

    “Debt Service Coverage Ratio”
- for any period, the ratio of (i) Modified Funds From Operations of
Borrower (as defined by the National Association of Real Estate Investment
Trusts as in effect on the Closing Date), to (ii) principal payments due on
the Borrowers’ long-term Indebtedness during the period measured, plus the Borrowers’ Interest
Expense (including any payments in connection with any Interest Rate Contract),
as determined in accordance with GAAP.

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    “Default” - an event which
with notice or lapse of time, or both, would constitute an Event of
Default.

     

    “Defaulting Lender” - any
Lender which is a Funds Defaulting Lender and/or an Insolvency Defaulting
Lender.

     

    “Disposition” - the sale,
lease, conveyance, transfer or other disposition of any Eligible Facility
(whether in one or a series of transactions), including accounts and notes
receivable (with or without recourse), refinancing transactions and
sale-leaseback transactions other than to an Affiliate.

     

    “Dollars” and “$” - lawful money of the
United States of America.

     

    “EBITDA” - for any period,
with respect to the Parent Guarantor on a consolidated basis, determined in
accordance with GAAP, the sum of net income (or net loss) for such period plus, the sum of all amounts
treated as expenses for: (a) interest, (b) depreciation, (c) amortization,
including, but not limited to, amortization of loan expenses and stock-based
compensation, (d) all accrued taxes on or measured by income to the extent
included in the determination of such net income (or net loss), (e) provision
for loan losses, and (f) losses on extinguishment of debt, minus gains on extinguishment
of debt, provided, however, that net income (or net loss) shall be computed
without giving effect to extraordinary losses or gains.

     

    “Eligible Assignee” - a
commercial bank or other financial institution (other than a Defaulting Lender)
having a combined capital and surplus of at least One Hundred Million
($100,000,000) Dollars.

     

    “Eligible Facility” – any
Facility located in any of the fifty (50) states of the United States of America
or the District of Columbia that, as determined by the Agent in its reasonable
discretion:  (a) is owned by a Subsidiary Guarantor (or, if such
Facility is owned by a Joint Venture, at least eighty percent (80%) of the
Equity Interests in such Joint Venture are owned by a Subsidiary Guarantor so
long as such Subsidiary Guarantor is the managing member or general partner of
such Joint Venture), (b) has had an average occupancy rate of at least eighty
percent (80%) for the three (3) month period immediately preceding the
Acquisition Date for such Facility, (c) is (or, immediately after giving effect
to the Acquisition thereof, will be) free and clear of any adverse Environmental
Liabilities, (d) is not (or, immediately after giving effect to the Acquisition
thereof, will not be) encumbered by any Liens other than Permitted Liens, (e) if
all or a substantial portion of such Facility is leased to a third party tenant
(or a group of tenants that are Affiliates) such lease(s) have a remaining term
ending not earlier than five (5) years after the Revolving Credit Commitment
Termination Date, (f) if such facility is leased to an Operator or a Substantial
Tenant, such lessee has and maintains all licenses and approvals necessary to
operate such Facility, and (g) is otherwise reasonably acceptable to
Agent.

     

    “Employee Benefit Plan” - any
employee benefit plan within the meaning of Section 3(3) of ERISA which is
subject to ERISA and (a) is maintained for employees of the Parent Guarantor or
Borrower, or (b) with respect to which any Loan Party has any
liability.

     

    “Environmental Audit” means a
Phase One environmental site assessment (the scope and performance of which
meets or exceeds the then most current ASTM Standard Practice E1527-93 Standard
Practice for Environmental Site Assessments: Phase One Environmental Site
Assessment Process) of each Eligible Facility.

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    “Environmental Laws and
Regulations” - all federal, state and local environmental laws,
regulations, ordinances, orders, judgments and decrees applicable to the
Borrower or any other Loan Party, or any of their respective assets or
properties.

     

    “Environmental Liability” -
any liability under any applicable Environmental Laws and Regulations for any
disposal, release or threatened release of a hazardous substance pollutant or
contaminant as those terms are defined under CERCLA, and any liability which
would require a removal, remedial or response action, as those terms are defined
under CERCLA, by any person or by any environmental regulatory body having
jurisdiction over the Parent Guarantor and its Subsidiaries and/or any liability
arising under any Environmental Laws and Regulations for the Parent Guarantor’s
or any Subsidiary’s failure to comply with such laws and regulations, including
without limitation, the failure to comply with or obtain any applicable
environmental permit.

     

    “Environmental Proceeding” -
any judgment, action, proceeding or investigation pending before any court or
governmental authority, with respect to the Parent Guarantor or any Subsidiary
and arising under or relating to any Environmental Laws and
Regulations.

     

    “Equity Interests” - the
membership interests, partnership interests, capital stock of any class or any
other equity interest of any Person and options, warrants and other rights to
acquire membership interests, partnership interests, capital stock of any class
or any other equity interest of such Person.

     

    “ERISA” - the Employee
Retirement Income Security Act of 1974, as it may be amended from time to time,
and the regulations promulgated thereunder.

     

    “ERISA Affiliate” - as
applied to any Loan Party, any corporation, person or trade or business which is
a member of a group which is under common control with any Loan Party, who
together with any Loan Party, is treated as a single employer within the meaning
of Section 4l4(b) - (o) of the Code and, if applicable, Section 4001(a)(l4) and
(b) of ERISA.

     

    “Event of Default” - as
defined in Article 8 hereof.

     

    “Extension Fee” - as defined
in subsection 2.24 hereof.

     

    “Facility” – (a) a health
care facility offering health care-related products and services, including but
not limited to any medical office building, skilled nursing facility, or
independent or assisted living facility, and (b) any other real property
acceptable to Agent in its sole discretion.

     

    “Facility Fee” - as defined
in subsection 2.7(b) hereof.

     

    “Facility Fee Percentage” –
Twenty-Five/100 of One Percent (0.25%) per annum.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    “Federal Funds Rate” - for
any day, the weighted average of the rates on overnight federal funds
transactions with member Lenders of the Federal Reserve System arranged by
federal funds brokers as published by the Federal Reserve Bank of New York for
such day, or if such day is not a Business Day, for the next preceding Business
Day (or, if such rate is not so published for any such day, the average rate
charged to the Agent on such day on such overnight transactions as reasonably
determined by the Agent).

     

    “Fee(s)” - as defined in
subsection 2.7(d) hereof.

     

    “Financial Statements” - with
respect to Parent Guarantor, its audited Consolidated Balance Sheet as at
December 31, 2009, together with the related audited Consolidated Income
Statement and Statement of Changes in Cash Flow for the fiscal year then
ended.

     

    “Funds
Defaulting Lender” -
any Lender that (a) other than at the direction or request of any regulatory
agency or authority, defaults in its obligation to fund any Revolving Credit
Loan, (b) has notified Borrower or Agent in writing, or has made a public
statement, that it does not intend to comply with its obligation to fund any
Revolving Credit Loan or its pro rata share of any payment
under Section 9.5, (c) has failed to confirm that it will comply with its
obligation to fund any Revolving Credit Loan or its pro rata share of any payment
under Section 9.5 within five (5) Business Days after written request for such
confirmation from Agent (which request may only be made after all conditions to
funding have been satisfied);  provided that such Lender shall cease
to be a Funds Defaulting Lender upon receipt of such confirmation by
Administrative Agent, or (d) has failed to pay to Administrative Agent or any
other Lender any amount (other than its portion of any Revolving Loan or amounts
required to be paid under Section 9.7 or any other amount that is de minimis) due under any
Loan Document within five (5) Business Days of the date due, unless, in case of
each of (a), (b), (c) and (d) above, such amount is the subject of a good faith
dispute.

     

    “Future Commitment” - as
defined in subsection 2.23(d) hereof.

     

    “GAAP” - generally accepted
accounting principles in the United States in effect from time to
time.

     

    “Governmental Authority” -
any nation or government, any state or other political subdivision thereof, any
central bank (or similar monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, and any corporation or other entity
owned or controlled, through stock or capital ownership or otherwise, by any of
the foregoing.

     

    “Gross Issuance Proceeds” -
in respect of any issuance of Indebtedness or equity, the gross proceeds in Cash
received by Parent Guarantor or any of its Subsidiaries upon or simultaneously
with such issuance.

     

    “Guarantor” – Cornerstone
REIT as Parent Guarantor and each Subsidiary Guarantor.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    “Guaranty” – the Guaranty
Agreement from Parent Guarantor and each Person that is, from time to time, a
Subsidiary Guarantor, in the form of Exhibit B attached
hereto.

     

    “Hazardous Materials” - any
toxic chemical, hazardous substances, contaminants or pollutants, medical
wastes, infectious wastes, or hazardous wastes which have not been remediated in
accordance with applicable Environmental Laws and Regulations.

     

    “Implied Interest Rate” - the
interest rate that is the greater of (i) Seven and No/100 percent (7.00)% per
annum or (ii) the rate (as reasonably estimated by Agent on the Acquisition
Date, the methodology and calculation of which will be provided to Borrower upon
request from time to time) to be the current interest rate required by the
secondary market to finance an asset similar to an Eligible Facility, or as the
context may require, the Eligible Facilities.

     

    “Indebtedness” - with respect
to any Person, all: (a) liabilities or obligations, direct and contingent, which
in accordance with GAAP would be included in determining total liabilities as
shown on the liability side of a balance sheet of such Person at the date as of
which Indebtedness is to be determined, including, without limitation,
contingent liabilities that in accordance with such principles, would be set
forth in a specific Dollar amount on the liability side of such balance sheet,
and Capitalized Lease Obligations of such Person; (b) liabilities or obligations
of others for which such Person is directly or indirectly liable, by way of
guaranty (whether by direct guaranty, suretyship, discount, endorsement,
take-or-pay agreement, agreement to purchase or advance or keep in funds or
other agreement having the effect of a guaranty) or otherwise; (c) liabilities
or obligations secured by Liens on any assets of such Person, whether or not
such liabilities or obligations shall have been assumed by it; (d) liabilities
or obligations of such Person, direct or contingent, with respect to letters of
credit issued for the account of such Person and bankers acceptances created for
such Person; and (e) monetary obligations of such Person under a so-called
synthetic lease, off-balance sheet or tax retention lease or under an agreement
for the use or possession of property creating obligations that do not appear on
the balance sheet of such Person but which, upon the insolvency or bankruptcy of
such Person, would be characterized as the indebtedness of such Person (without
regard to accounting treatment).

     

    “Insolvency Defaulting
Lender” -
any Lender that (a) has been adjudicated as, or determined by any Governmental
Authority having regulatory authority over such Person or its assets to be,
insolvent, (b) becomes the subject of an insolvency, bankruptcy, dissolution,
liquidation or reorganization proceeding, or (c) becomes the subject of an
appointment of a receiver, intervenor or conservator under the Bankruptcy Code
or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect; provided,
however, that a Lender shall not be an Insolvency Defaulting Lender
solely by virtue of the ownership or acquisition by a Governmental Authority or
an instrumentality thereof of any Equity Interests in such Lender or a parent
company thereof, unless, in the case of each of the foregoing, the Borrower and
the Agent shall determine in their sole and absolute discretion the such Lender
intends and is able (and has all necessary approvals and authority) to continue
to perform its obligations under and in accordance with the Loan
Documents.

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    “Intercompany Notes” –
promissory notes from time to time from each Subsidiary Guarantor payable to
Borrower (and endorsed in blank (as to payee) and delivered to Agent) in the
amount of such Subsidiary Guarantor’s Assigned Credit Advance
Value.

     

    “Interest Expense” - for any
period, on a combined basis, the sum of all interest paid or payable (excluding
unamortized debt issuance costs) on all items of Indebtedness of the Borrower
outstanding at any time during such period.

     

    “Interest Period” - with
respect to any LIBOR Loan, each period commencing on the date such Loan is made
or converted from a Loan or Loans of another Type into a LIBOR Loan, or the last
day of the next preceding Interest Period with respect to such Loan, and ending
on the same day one (1) month thereafter, as the Borrower may select as provided
in Section 2.2 hereof, except that each such Interest Period which commences on
the last LIBOR Business Day of a calendar month (or on any day for which there
is no numerically corresponding day in the appropriate subsequent calendar
month) shall end on the last LIBOR Business Day of the appropriate subsequent
calendar month.

     

    Notwithstanding
the foregoing: (a) each Interest Period that would otherwise end on a day which
is not a LIBOR Business Day shall end on the next succeeding LIBOR Business Day
(or, if such next succeeding LIBOR Business Day falls in the next succeeding
calendar month, on the next preceding LIBOR Business Day); (b) no more than
seven (7) Interest Periods for LIBOR Loans shall be in effect at the same time;
(c) any Interest Period that commences before the Revolving Credit Commitment
Termination Date shall end no later than the Revolving Credit Commitment
Termination Date; and (d) notwithstanding clause (c) above, no Interest Period
shall have a duration of less than one month.  In the event that the
Borrower fail to select the duration of any Interest Period for any LIBOR Loan
within the time period and otherwise as provided in Section 2.2 hereof, such
LIBOR Loans will be automatically converted into a Base Rate Loan on the last
day of the preceding Interest Period for such LIBOR Loan.

     

    “Interest Rate Contracts” -
interest rate swap agreements, interest rate cap agreements, interest rate
collar agreements, interest rate insurance and other agreements or arrangements
designed to provide protection against fluctuation in interest rates, in each
case, in form and substance satisfactory to the Agent and, in each case, with
counter-parties satisfactory to the Agent.

     

    “Investments” – all
investments, in cash or by delivery of property made, directly or indirectly,
(i) in any Person, whether by acquisition of Equity Interests, Indebtedness or
other obligations or securities or by loan, advance, guaranty, capital
contribution or otherwise, or (ii) in any assets or Property.

     

    “Joint Venture” – a
partnership, limited liability company, corporation, joint venture or trust
(other than a Subsidiary) in which the Parent Guarantor, Borrower and/or its
Subsidiaries (or any combination thereof) own less than 100% of the Equity
Interests.

     

    “Late Charge” - as defined in
subsection 2.6(d) hereof.

     

    “Latest Balance Sheet” - as defined in
subsection 3.9(a) hereof.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    “Lease Rental Expense” - for
any period and with respect to any Facility, the total amount payable during
such period by any third party lessee of such Facility to any Loan Party,
including, without limitation, (a) base rent (as adjusted from time to time),
plus (b) all
incremental charges to which the Facility is subject under the lease relating
thereto.

     

    “Lender(s)” - the meaning
specified in the introductory paragraph hereto.

     

    “Lending Office” - with
respect to each Lender, with respect to each Type of Loan, the Lending Office as
designated for such Type of Loan below its name on the signature pages hereof or
such other office of such Lender or of an affiliate of such Lender as it may
from time to time specify to the Agent and the Borrower as the office at which
its Loans of such Type are to be made and maintained.

     

    “LIBOR Base Rate” - with
respect to any LIBOR Loan, for any Interest Period therefor, the greater of (a)
the rate per annum, calculated to five (5) decimal points, appearing on the
Screen at approximately 11:00 a.m. London time (or as soon thereafter as
practicable) two (2) LIBOR Business Days prior to the first day of such Interest
Period, as “LIBOR” for
deposits denominated in Dollars with a maturity comparable to such Interest
Period or (b) two and no/100 percent (2.0%).  In the case of any
borrowing of a LIBOR Loan where such rate is not available at such time in
accordance with the preceding sentence, then the LIBOR Base Rate with respect to
any such borrowing for such Interest Period shall be the rate at which Dollar
deposits for a maturity comparable to such Interest Period are offered by the
principal office of a leading bank in the London interbank market as selected by
the Agent at approximately 11 :00 a.m. London time (or as soon thereafter as
practicable) two (2) LIBOR Business Days prior to the first day of such Interest
Period.

     

    “LIBOR Business Day” - a
Business Day on which dealings in Dollar deposits are earned out in the London
interbank market.

     

    “LIBOR Loan(s)” - any Loan
the interest on which is determined on the basis of rates referred to in the
definition of “LIBOR Rate”
in this Article 1.

     

    “LIBOR Rate” - for any LIBOR
Loan for any Interest Period therefor, the greater of (a) the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of one (l%) percent)
determined by the Agent to be equal to: (a) the LIBOR Base Rate for such Loan
for such Interest Period; divided by (b) one (1) minus the Reserve Requirement
for such Loan for such Interest Period, or (b) two percent (2.0%) per
annum.  The Agent shall use its best efforts to advise the Borrower of
the LIBOR Rate as soon as practicable after each change in the LIBOR Rate; provided, however, that the
failure of the Agent to so advise the Borrower on anyone or more occasions shall
not affect the rights of the Lenders or the Agent or the obligations of the
Borrower hereunder.

     

    “Lien” - any mortgage, deed
of trust, pledge, security interest, encumbrance, lien, claim or charge of any
kind (including any agreement to give any of the foregoing), any conditional
sale or other title retention agreement, any lease in the nature of any of the
foregoing, and the filing of or agreement to give any financing statement under
the Uniform Commercial Code of any jurisdiction.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    “Loan(s)” - Revolving Credit
Loans.  Loans of different Types made or converted from Loans of other
Types on the same day (or of the same Type but having different Interest
Periods) shall be deemed to be separate Loans for all purposes of this
Agreement.

     

    “Loan Documents” - this
Agreement, the Notes, Interest Rate Contracts, Mortgages, other Collateral
Document, any SNDA, and all other documents executed and delivered in connection
herewith or therewith, including all amendments, modifications and supplements
of or to all such documents.

     

    “Loan Party” – each Guarantor
and Borrower and any other Person (other than the Lenders and the Agent) which
now or hereafter executes and delivers to any Lender or the Agent any Loan
Document.

     

    “Material Adverse Effect” -
any fact or circumstance which (a) materially and adversely affects the
business, operation, property or financial condition of the Borrower and any
Guarantor taken as a whole, or (b) has a material adverse effect on the ability
of the Borrower or any Guarantor to perform their respective obligations under
this Agreement, the Notes or the other Loan Documents.

     

    “Monthly Dates” - the first
day of each month, the first of which shall be the first such day after the date
of this Agreement, provided that, if any such date is not a LIBOR Business Day,
the relevant Monthly Date shall be the next succeeding LIBOR Business Day (or,
if the next succeeding LIBOR Business Day falls in the next succeeding calendar
month, then on the next preceding LIBOR Business Day).

     

    “Mortgage(s)” – any mortgage,
deed of trust, deed to secure debt or similar document encumbering real property
constituting a Eligible Facility for which any Loan Party is the mortgagor,
grantor or trustor, as the case may be, substantially in the form of Exhibit C attached hereto (as
revised to comply with local law and practice).

     

    “Multiemployer Plan” - a
“multiemployer plan” as defined in Section 4001(a)(3) of ERISA to which any Loan
Party or any ERISA Affiliate is making, or is accruing an obligation to make,
contributions or has made, or been obligated to make, contributions within the
preceding six (6) years.

     

    “Net Asset Sale Proceeds” -
with respect to any Disposition or refinancing of any Eligible Facility an
amount equal to:  (a) the sum of cash payments received by Borrower or
any Subsidiary Guarantor from such sale or refinancing, minus (b) any bona fide
direct costs incurred in connection with such sale or refinancing, including (i)
income or gains taxes paid or payable by the seller as a result of any gain
recognized in connection with such sale or refinancing during the tax period
applicable to the sale (after taking into account any available tax credits or
deductions and any tax-sharing arrangements), (ii) payment of the outstanding
principal amount of, premium or penalty, if any, and interest on any
Indebtedness (other than the Revolving Credit Loans) that is secured by a Lien
on the assets in question and that is required to be repaid under the terms
thereof as a result of such sale or refinancing, and (iii) a reasonable reserve
for any indemnification payments (fixed or contingent) attributable to seller’s
indemnities and representations and warranties to purchaser in respect of such
sale undertaken by Borrower or any Subsidiary Guarantor in connection with such
sale; provided that
upon release of any such reserve, the amount released shall be considered Net
Asset Sale Proceeds.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    “Net Insurance/Condemnation
Proceeds” means an amount equal to:  (a) any cash payments or
proceeds received by Borrower or any Subsidiary Guarantor (i) under any
casualty, business interruption or “key man” insurance policies
in respect of any covered loss thereunder, or (ii) as a result of the taking of
any assets of Borrower or any Subsidiary Guarantor by any Person pursuant to the
power of eminent domain, condemnation or otherwise, or pursuant to a sale of any
such assets to a purchaser with such power under threat of such a taking, minus (b) (i) any actual and
reasonable costs incurred by Borrower or any Subsidiary Guarantor in connection
with the adjustment or settlement of any claims of Borrower or such Subsidiary
Guarantor in respect thereof, and (ii) any bona fide direct costs incurred in
connection with any sale of such assets as referred to in clause (a)(ii) of this
definition, including income taxes paid or payable as a result of any gain
recognized in connection therewith (after taking into account any available tax
credits or deductions and any tax-sharing arrangements).

     

    “Net Issuance Proceeds” - in
respect of any issuance of Indebtedness or equity, the proceeds in Cash received
by Parent Guarantor or any of its Subsidiaries upon or simultaneously with such
issuance, net of direct costs of such issuance and any taxes paid or payable by
the recipient of such proceeds.

     

    “New Type Loans” - as defined
in Section 2.21 hereof.

     

    “Non-Defaulting Lender” -
each Lender other than an Insolvency Defaulting Lender or Funds Defaulting
Lender.

     

    “Note(s)” - a Revolving
Credit Note.

     

    “Obligations” - collectively,
all of the indebtedness, liabilities and obligations of the Loan Parties to the
Lenders and the Agent, whether now existing or hereafter arising, whether or not
currently contemplated, including, without limitation, those arising under the
Loan Documents.

     

    “Operator” - the lessee of
any Eligible Facility owned or leased by a Loan Party, to the extent that such
entity controls the operation of such Eligible Facility.

     

    “Origination Fee” - as
defined in subsection 2.7(a) hereof.

     

    “Payor” - as defined in
Section 2.15 hereof.

     

    “Parent Guarantor” –
Cornerstone Healthcare Plus REIT, Inc.

     

    “PBGC” - Pension Benefit
Guaranty Corporation.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    “Permitted Liens” - as to any
Person: (a) pledges or deposits by such Person under workers’ compensation laws,
unemployment insurance laws, social security laws, or similar legislation, or
good faith deposits in connection with bids, tenders, contracts (other than for
the payment of Indebtedness of such Person), or leases to which such Person is a
party, or deposits to secure public or statutory obligations of such Person or
deposits of Cash or United States Government Bonds to secure surety, appeal,
performance or other similar bonds to which such Person is a party, or deposits
as security for contested taxes or import duties or for the payment of rent; (b)
Liens imposed by law, such as carriers’, warehousemen’s, materialmen’s and
mechanics’ liens, or Liens arising out of judgments or awards against such
Person with respect to which such Person at the time shall currently be
prosecuting an appeal or proceedings for review; (c) Liens for taxes not yet
subject to penalties for non-payment and Liens for taxes the payment of which is
being contested as permitted by Section 6.6 hereof; (d) minor survey exceptions,
minor encumbrances, easements or reservations of, or rights of, others for
rights of way, highways and railroad crossings, sewers, electric lines,
telegraph and telephone lines and other similar purposes, or zoning or other
restrictions as to the use of real properties; (e) Liens securing the
Obligations; (f) Liens of any lease to an Operator or Substantial Tenant
approved by Agent;  (g) Liens incidental to the conduct of the
business of such Person or to the ownership of such Person’s property that were
not incurred in connection with Indebtedness of such Person, all of which Liens
referred to in this clause (g) do not in the aggregate materially impair the
value of the properties to which they relate or materially impair their use in
the operation of the business taken as a whole of such Person; and (h) any Lien
disclosed on any Title Policy and approved by Agent (such approval being
evidenced by Agent’s agreement to permit such exception in the Agent’s title
escrow instructions delivered in connection with the Acquisition of such
Eligible Facility), and as to all the foregoing only to the extent arising and
continuing in the ordinary course of business.

     

    “Person” - an individual, a
corporation, a limited liability company, a partnership, a joint venture, a
trust or unincorporated organization, a joint stock company or other similar
organization, a government or any political subdivision thereof, a court, or any
other legal entity, whether acting in an individual, fiduciary or other
capacity.

     

    “Plan” - at any time an
employee pension benefit plan that is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Code and is either: (a)
maintained by Cornerstone REIT or any member of the Controlled Group for
employees of Cornerstone REIT, or by Cornerstone REIT for any other member of
such Controlled Group, or (b) maintained pursuant to a collective bargaining
agreement or any other arrangement under which more than one employer makes
contributions and to which Cornerstone REIT or any member of the Controlled
Group is then making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions.

     

    “Post-Default Rate” - (a) in
respect of any Loans, a rate per annum equal to: (i) if such Loans are Base Rate
Loans, three (3%) percent above the Alternate Base Rate as in effect from time
to time for Base Rate Loans, or (ii) if such Loans are LIBOR Loans, three (3%)
percent above the rate of interest in effect thereon at the time of the Event of
Default that resulted in the Post-Default Rate being instituted until the end of
the then current Interest Period therefor and, thereafter, three (3%) above the
Alternate Base Rate as in effect from time to time; and (b) in respect of other
amounts payable by the Borrower hereunder (other than interest), equal to three
(3%) above the Alternate Base Rate as in effect from time to time.

     

    “Principal Office” - the
principal office of the Agent presently located at 127 Public Square, Cleveland,
Ohio 44114-1306.

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    “Projections” - the
projections relating to Parent Guarantor and its Subsidiaries for the three (3)
year period 2010-2012, including balance sheets, statements of operations and
cash flows (together with related assumptions) as furnished by Parent Guarantor
to the Agent.

     

    “Property” - any estate or
interest in any kind of property or asset, whether real, personal or mixed, and
whether tangible or intangible.

     

    “Regulation D” - Regulation D
of the Board of Governors of the Federal Reserve System, as the same may be
amended or supplemented from time to time.

     

    “Regulatory Change” - as to
any Lender, any change after the date of this Agreement in United States
federal, or state, or foreign, laws or regulations (including Regulation D and
the laws or regulations that designate any assessment rate relating to
certificates of deposit or otherwise (including the Assessment Rate if
applicable to any Loan)) or the adoption or making after such date of any
interpretations, directives or requests applying to a class of Lenders,
including such Lender, of or under any United States federal, or state, or
foreign laws or regulations (whether or not having the force of law) by any
court or governmental or monetary authority charged with the interpretation or
administration thereof.

     

    “REIT Sub-Advisor” – Servant
Healthcare Investments, LLC or such replacement as Agent shall, in its sole
discretion, approve in writing.

     

    “REIT Status” - with respect
to any Person, (a) the qualification of such Person as a real estate investment
trust under Sections 856 through 860 of the Code, and (b) the applicability to
such Person and its shareholders of the method of taxation provided for in
Sections 857 et seq. of
the Code.

     

    “Required Lenders” - at any
time, subject to the terms of Section 2.23, Non-Defaulting Lenders holding or
being responsible for 51% or more (or, if there are less than three (3)
Non-Defaulting Lenders that are not Affiliates, 100%) of the sum of all
Revolving Exposure and all unutilized Revolving Credit Commitments.

     

    “Required Payment” - as
defined in Section 2.15 hereof.

     

    “Reserve Requirement” - for
any LIBOR Loans for any quarterly period (or, as the case may be, shorter
period) as to which interest is payable hereunder, the average maximum rate at
which reserves (including any marginal, supplemental or emergency reserves) are
required to be maintained during such period under Regulation D by member
Lenders of the Federal Reserve System in New York City with deposits exceeding
One Billion ($1,000,000,000) Dollars against “Eurocurrency liabilities” (as such
term is used in Regulation D).  Without limiting the effect of the
foregoing, the Reserve Requirement shall reflect any other reserves required to
be maintained by such member Lenders by reason of any Regulatory Change against:
(a) any category of liabilities which includes deposits by references to which
the LIBOR Rate for LIBOR Loans is to be determined as provided in the definition
of “LIBOR Base Rate” in
this Article 1, or (b) any category of extensions of credit or other assets
which include LIBOR Loans.

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    “Responsible Officer” of any
Person means the chief executive officer, chief operating officer, chief
financial officer, treasurer or chief accounting officer of such Person or any
other officer of such Person involved principally in its financial
administration or its controllership function.

     

    “Revolving Credit Commitment”
- as to each Lender, the obligation of such Lender to make Revolving Credit
Loans in the aggregate amount set forth opposite such Lender’s name on the
signature pages hereof under the caption “Revolving Credit Commitment”
as such amount is subject to reduction in accordance with the terms
hereof.

     

    “Revolving Credit Commitment
Termination Date” – November 18, 2012, or any later date established in
accordance with Section 2.24 hereof.

     

    “Revolving Credit Loan(s)” -
as defined in Section 2.1 hereof.

     

    “Revolving Credit Note(s)” -
as defined in Section 2.4(a) hereof.

     

    “Revolving Exposure” - with
respect to any Lender as of any date, the sum as of such date of the outstanding
principal balance of such Lender’s Revolving Credit Loans.

     

    “Revolving Percentage” - as
of any date and with respect to each Lender, the percentage equal to a fraction
(i) the numerator of which is the Revolving Credit Commitment of such Lender on
such date (or, if there are no Revolving Credit Commitments on such date, on the
last date upon which one or more Revolving Credit Commitments were in effect),
and (ii) the denominator of which is Total Revolving Credit Commitment on such
date (or, if there are no Revolving Credit Commitments on such date, on the last
date upon which one or more Revolving Credit Commitments were in
effect).

     

    “S&P” - Standard and
Poor’s Ratings Service, a division of The McGraw-Hill Companies,
Inc.

     

    “Screen” - the relevant
display page for LIBOR on the Reuter Monitor Money Rates Service, provided that if the Agent determines
that there is no such relevant display page for LIBOR, “Screen” shall mean the
relevant display page for LIBOR on the Dow Jones Market Service.

     

    “SNDA” – with respect to any
proposed Eligible Facility, a Subordination, Non-Disturbance and Attornment
Agreement (or similar document) executed, at Agent’s request pursuant to Section
4.2, by such tenants (including, without limitation, any Operator or Substantial
Tenant) of the proposed Eligible Facility as Agent shall request.

     

    “Subsidiary” - with respect
to any Person, any corporation, partnership, joint venture or other entity,
whether now existing or hereafter organized or acquired: (a) in the case of a
corporation, of which a majority of the securities having ordinary voting power
for the election of directors (other than securities having such power only by
reason of the happening of a contingency) are at the time owned by such Person
and/or one or more Subsidiaries of such Person, (b) in the case of a partnership
or other entity, in which such Person is a general partner or of which a
majority of the partnership or other equity interests are at the time owned by
such Person and/or one or more of its Subsidiaries, or (c) in the case of a
joint venture, in which such Person is a joint venturer and of which a majority
of the ownership interests are at the time owned by such Person and/or one or
more of its Subsidiaries.  Unless the context otherwise requires,
references in this Agreement to “Subsidiary” or “Subsidiaries” shall be
deemed to be references to a Subsidiary or Subsidiaries of Parent
Guarantor.

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    “Subsidiary Guarantor” – each
direct or indirect Subsidiary (including any TRS) of Cornerstone REIT or
Borrower that is the legal or beneficial owner of an Eligible Facility or is an
Operator or Substantial Tenant of such Eligible Property and in each case that
becomes a Guarantor hereunder pursuant to the terms of Section 4
hereof.

     

    “Substantial Tenant” - any
tenant that occupies thirty percent (30%) or more of any Facility’s total
rentable area as determined by Agent in its reasonable discretion.

     

    “Survey” – as set forth in
Section 4.1(h).

     

    “Terrorism Laws” - any of the
following (a) Executive Order 13224 issued by the President of the United
States, (b) the Terrorism Sanctions Regulations (Title 31 Part 595 of the U.S.
Code of Federal Regulations), (c) the Terrorism List Governments Sanctions
Regulations (Title 31 Part 596 of the U.S. Code of Federal Regulations), (d) the
Foreign Terrorist Organizations Sanctions Regulations (Title 31 Part 597 of the
U.S. Code of Federal Regulations), (e) the Patriot Act (as it may be
subsequently codified), (f) all other present and future legal requirements of
any Governmental Authority addressing, relating to, or attempting to eliminate,
terrorist acts and acts of war and (g) any regulations promulgated pursuant
thereto or pursuant to any legal requirements of any Governmental Authority
governing terrorist acts or acts of war.

     

    “Title Policy” – as set forth
in Section 4.1(g).

     

    “Total Asset Value” – the
aggregate Appraised Value of all Facilities determined by an Appraisal not less
than twenty four (24) months old and otherwise reasonably satisfactory to
Agent.

     

    “Total Revolving Credit
Commitment” - the aggregate obligation of the Lenders to make Revolving
Credit Loans hereunder up to the aggregate amount of Twenty Five Million
($25,000,000) Dollars, subject to reductions as set forth in Article
2.

     

    “Total Revolving Exposure” -
at any time, the sum at such time of the outstanding principal balance of the
Revolving Credit Loans of all Lenders.

     

    “TRS” – any Subsidiary that
is a “taxable REIT subsidiary” as defined in the Code.

     

    “Type” - refers to the
characteristics of a Loan as a Base Rate Loan or a LIBOR Loan for a particular
Interest Period.  All Base Rate Loans are of the same
Type.  All LIBOR Loans with identical interest rates and Interest
Periods are of the same Type.  All other Loans are of different
Types.  Interest Periods are identical if they begin and end on the
same days.

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    “UCC” means the Uniform
Commercial Code as in effect in any applicable jurisdiction.

     

    “USA Patriot Act” means
United States Public Law 107-56, the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA
Patriot Act of 2001), as amended from time to time and the rules and regulations
promulgated thereunder from time to time in effect.

     

    
      	
               
      

            	
              Section
      1.2

            	
              GAAP.
      

            

    

     

    Any
accounting terms used in this Agreement that are not specifically defined herein
shall have the meanings customarily given to them in accordance with GAAP as in
effect on the date of this Agreement, except that references in Article 5 to
such principles shall be deemed to refer to such principles as in effect on the
date of the financial statements delivered pursuant thereto.

     

    
      	
            	
              Article2. 

            	
              Revolving Credit
      Commitments; Revolving Credit Loans.

            

    

     

    
      	
               
      

            	
              Section
      2.1

            	
              Revolving Credit
      Loans. 

            

    

     

    Each
Lender hereby severally agrees, on the terms and subject to the conditions of
this Agreement, to make loans (individually a “Revolving Credit Loan” and,
collectively, the “Revolving
Credit Loans”) to the Borrower during the Credit Period to and including
the Revolving Credit Commitment Termination Date.

     

    Each
Lender’s obligations to make Revolving Credit Loans are subject to the following
limitations:  (a) subject at all times to the limitations set forth in
“(c)” below, the amount
of each Revolving Credit Loan made in connection with any Acquisition may not to
exceed the Advance Value of such Eligible Facility;  (b) the aggregate
principal amount of each Revolving Credit Loan at anyone time outstanding may
not result in any Lender’s Revolving Exposure exceeding the Revolving Credit
Commitment of such Lender as then in effect;  and (c) at all
times the Total
Revolving Exposure shall not exceed the lesser of (i) the Total Revolving Credit
Commitment as then in effect or (ii) the Borrowing Base as from time to time
determined and computed.

     

    Subject
to the terms of this Agreement, during the Credit Period the Borrower may
borrow, repay and reborrow Revolving Credit Loans.

     

    
      	
               
      

            	
              Section
      2.2

            	
              Notices Relating to
      Revolving Credit Loans. 

            

    

     

    The
Borrower shall give the Agent written notice of each termination or reduction of
the Revolving Credit Commitments, each borrowing, conversion, repayment and
prepayment of each Revolving Credit Loan and of the duration of each Interest
Period applicable to each LIBOR Loan (and the Agent shall promptly notify the
Lenders thereof).  Each such Borrowing Notice shall be irrevocable and
shall be effective only if received by the Agent not later than 1:00 p.m.
(Cleveland, Ohio time) on the date that is:

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    (a)           In
the case of each notice of termination or reduction of the Revolving Credit
Commitments, five (5) Business Days prior to the date of the related termination
or reduction;

     

    (b)           In
the case of each notice of borrowing and repayment of, or conversion into, Base
Rate Loans, one (l) Business Day prior to the date of the related borrowing or
repayment or conversion; and

     

    (c)           In
the case of each notice of borrowing or repayment of, or conversion into, LIBOR
Loans, or the duration of an Interest Period for LIBOR Loans, two (2) LIBOR
Business Days prior to the date of the related borrowing, repayment or
conversion or the first day of such Interest Period.

     

    Each such
notice of termination or reduction shall specify the amount
thereof.  Each such notice of borrowing, conversion, repayment or
prepayment shall specify the amount (subject to Section 2.1 hereof) and Type of
Loans to be borrowed, converted, repaid or prepaid (and, in the case of a
conversion, the Type of Loans to result from such conversion), the date of
borrowing, conversion, repayment or prepayment (which shall be: (i) a Business
Day in the case of each borrowing or repayment of Base Rate Loans, and (ii) a
LIBOR Business Day in the case of each borrowing, prepayment, or repayment of
LIBOR Loans and each conversion of or into a LIBOR Loan).  Each such
notice of the duration of an Interest Period shall specify the Loans to which
such Interest Period is to relate.  The Agent shall notify the Lenders
of the content of each such Borrowing Notice promptly after its receipt
thereof.

     

    
      	
               
      

            	
              Section
      2.3

            	
              Disbursement of Loan
      Proceeds. 

            

    

     

    The
Borrower shall give the Agent notice of each borrowing hereunder as provided in
Section 2.2 hereof and the Agent shall promptly notify the Lenders
thereof.  Not later than 1:00 p.m. (Cleveland, Ohio time) on the date
specified for each borrowing hereunder, each Lender shall transfer to the Agent,
by wire transfer or otherwise, but in any event in immediately available funds,
the amount of the Loan to be made by it on such date, and the Agent, upon its
receipt thereof, upon compliance with the requirements of Section 4.1 and 4.2,
as applicable, shall disburse such sum to the Borrower by depositing the amount
thereof either (a) in an account (including the Account) of the Borrower
designated by the Borrower maintained with the Agent or (b) into an escrow
account satisfactory to Agent for disbursement in connection with any
Acquisition.

     

    
      	
               
      

            	
              Section
      2.4

            	
              Notes.
      

            

    

     

    (a)           The
Revolving Credit Loans made by each Lender shall be evidenced by a single
promissory note of the Borrower in substantially the form of Exhibit A hereto (each, a
“Revolving Credit Note”
and collectively, the “Revolving Credit
Notes”).  Each Revolving Credit Note shall be dated the date
hereof, shall be payable to the order of such Lender in a principal amount equal
to such Lender’s Revolving Credit Commitment as originally in effect, and shall
otherwise be duly completed.  The Revolving Credit Notes shall be
payable as provided in Sections 2.1 and 2.5 hereof.

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    (b)           Each
Lender shall enter on a schedule with respect to its Note a notation with
respect to each Loan made hereunder of: (i) the date and principal amount
thereof and (ii) each payment and repayment of principal thereof.  The
failure of any Lender to make a notation on any such schedule as aforesaid shall
not limit or otherwise affect the obligation of the Borrower to repay the Loans
in accordance with their respective terms as set forth herein.

     

    
      	
               
      

            	
              Section
      2.5

            	
              Payment of Revolving
      Credit Loans; Termination of and Voluntary Changes in Commitments;
      Mandatory Repayments. 

            

    

     

    (a)           All
outstanding Revolving Credit Loans shall be paid in full not later than the
Revolving Credit Commitment Termination Date.

     

    (b)          Unless
previously terminated, the Revolving Credit Commitments shall terminate on the
Revolving Credit Commitment Termination Date.  The Borrower shall be
entitled to terminate or reduce the Total Revolving Credit Commitment or repay
the principal amount of the Revolving Credit Loans provided that, the Borrower
shall give notice of such termination, reduction or repayment to the Agent as
provided in Section 2.2 hereof and that any repayment or partial reduction of
the Total Revolving Credit Commitment shall be in the minimum aggregate amount
of One Million ($1,000,000) Dollars.  Any such termination or
reduction in the Total Revolving Credit Commitment shall be permanent and
irrevocable.  Repayment of a LIBOR Loan on a day other than the last
day of the relevant Interest Period relating thereto shall be subject to the
provisions of Section 2.22 hereof; and all repayments of principal (whether
mandatory or voluntary) shall be applied first to Base Rate Loans,
then to the fewest
number of Types of LIBOR Loans as possible.

     

    (c)           If
the outstanding principal amount of the Revolving Exposure shall at any time
exceed the Borrowing Base as then determined and computed, the Borrower shall
immediately prepay the Loans by the amount of such excess.

     

    (d)          To
the extent required by Section 6.17 hereof, no later than the first Business Day
following the date of receipt by Borrower or any of its Subsidiaries, or Agent
as loss payee, of any Net Insurance/Condemnation Proceeds, Borrower shall prepay
Revolving Credit Loans in an aggregate amount equal to the greater of (i) such
Net Insurance/Condemnation Proceeds or (ii) the Assigned Credit Advance Value of
the related Eligible Facility.

     

    (e)          No
later than the first Business Day following the date of receipt by Borrower or
any of its Subsidiaries of any Net Asset Sale Proceeds, Borrower shall prepay
Revolving Credit Loans in an aggregate amount equal to greater of (i) such Net
Asset Sale Proceeds or (ii) the Assigned Credit Advance Value of the related
Eligible Facility.

     

    (f)           Upon
the receipt by Agent of final payment in full of the Assigned Credit Advance
Value of the related Eligible Facility pursuant to this Section 2.5, and so long
as no Default or Event of Default hereunder shall then exist (or shall occur as
a result of the below described release) and the Revolving Exposure shall not
then exceed the Borrowing Base as then determined and computed, the Agent shall,
upon written request by Borrower, release the Lien of the applicable Mortgage on
such Eligible Facility.

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              Section
      2.6

            	
              Interest.
      

            

    

     

    (a)           The
Borrower shall pay to the Agent for the account of each Lender interest on the
unpaid principal amount of each Loan made by such Lender for the period
commencing on the date of such Loan until such Loan shall be paid in full, at
the following rates per annum:

     

    (i)           Revolving
Credit Loans shall, in each case, bear interest at:

     

    (A)          During
such periods that such Revolving Credit Loan is a Base Rate Loan, the Alternate
Base Rate plus the
Applicable Margin; and

     

    (B)           During
such periods that such Revolving Credit Loan is a LIBOR Loan, for each Interest
Period relating thereto, the LIBOR Rate for such Revolving Credit Loan for such
Interest Period plus
the Applicable Margin; and

     

    (b)           Notwithstanding
the foregoing, the Borrower shall pay interest on any Loan or any installment
thereof, and on any other amount payable by the Borrower hereunder (to the
extent permitted by law) which are not paid in full when due (whether at stated
maturity, by acceleration or otherwise) for the period commencing on the due
date thereof until the same is paid in full at the applicable Post-Default
Rate.

     

    (c)           Accrued
interest on each Loan shall be payable on the Monthly Dates.  Interest
that is payable at the Post-Default Rate shall be payable from time to time on
demand of the Agent.  Promptly after the establishment of any interest
rate provided for herein or any change therein, the Agent will notify the
Lenders and the Borrower thereof, provided that the failure of the Agent to so
notify the Lenders and the Borrower shall not affect the obligations of the
Borrower hereunder or under any of the Notes in any respect.

     

    (d)           Any
and all amounts due hereunder or under the other Loan Documents which remain
unpaid more than ten (10) days after the date said amount was due and payable
shall incur a fee (the “Late
Charge”) in the amount equal to the greater of (i) five percent (5%) of
said unpaid amount, or (ii) $50.00, which payment shall be in addition to all of
the Agent’s and the Lenders’ other rights and remedies under the Loan
Documents.

     

    (e)           Anything
in this Agreement or any of the Notes to the contrary notwithstanding, the
obligation of the Borrower to make payments of interest shall be subject to the
limitation that payments of interest shall not be required to be made to any
Lender to the extent that such Lender’s receipt thereof would not be permissible
under the law or laws applicable to such Lender limiting rates of interest that
may be charged or collected by such Lender.  Any such payments of
interest that are not made as a result of the limitation referred to in the
preceding sentence shall be made by the Borrower to such Lender on the earliest
interest payment date or dates on which the receipt thereof would be permissible
under the laws applicable to such Lender limiting rates of interest that may be
charged or collected by such Lender.  Such deferred interest shall not
bear interest.

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              Section
      2.7

            	
              Fees.
      

            

    

     

    (a)           Simultaneously
with the execution and delivery of this Agreement, the Borrower shall pay to the
Agent, for the benefit of the Lenders according to their respective Revolving
Credit Commitments, a non-refundable upfront fee (the “Origination Fee”), as set
forth in a separate written agreement.

     

    (b)           The
Borrower shall pay to the Agent for the account of the Lenders, pro rata according to their
respective Revolving Percentage, a monthly facility fee (the “Facility Fee”) on an amount
equal to the product of
(i) the difference of (A) the daily average amount of such Lender’s Revolving
Credit Commitment for such monthly period (such monthly period beginning on the
first day of each such month to and ending on (and including) the earlier of (1)
the date such Lender’s Revolving Credit Commitment is terminated, (2) the
Revolving Credit Commitment Termination Date and (3) the last day of such month,
minus (B) the daily
average amount of such Lender’s Revolving Exposure, multiplied by (ii) such
month’s portion of the annual Facility Fee Percentage (i.e., 0.25% divided by
360 days and multiplied by the actual number of days in the current
month).  The accrued Facility Fee shall be payable on the Monthly
Dates, and also on the earlier of (i) the date the Total Revolving Credit
Commitment is terminated, or (ii) the Revolving Credit Commitment Termination
Date, and in the event the Borrower reduces the Total Revolving Credit
Commitment as provided in subsection 2.5(b) hereof, on the effective date of
such reduction.

     

    (c)           The
Borrower shall pay to the Agent, for its own account, an application fee (the
“Application Fee”), all
as set forth in a separate written agreement.

     

    (d)          
The Origination Fee, the Facility Fee and the Application Fee, and any Extension
Fee payable pursuant to Section 2.24 are hereinafter sometimes referred to
individually as a “Fee”
and collectively as the “Fees”.

     

    
      	
               
      

            	
              Section
      2.8

            	
              Use of Proceeds of
      Loans. 

            

    

     

    The
proceeds of the Loans hereunder may be used by the Borrower solely to (a)
acquire, finance or re-finance Eligible Facilities, and (b) for such other
incidental purposes as approved by Agent and Required Lenders in their sole
discretion.

     

    
      	
               
      

            	
              Section
      2.9

            	
              Computations.
      

            

    

     

    Interest
on all Loans and each Fee shall be computed on the basis of a year of 360 days
and actual days elapsed (including the first day but excluding the last)
occurring in the period for which payable.

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              Section
      2.10

            	
              Minimum Amounts of
      Borrowings, Conversions and Repayments.

            

    

     

    Except
for borrowings, conversions and repayments that exhaust the full remaining
amount of the Revolving Credit Commitments (in the case of borrowings) or result
in the conversion or repayment of all Loans of a particular Type (in the case of
conversions or repayments) or conversions made pursuant to Section 2.17,
subsection 2.18(b) or Section 2.20 hereof, each borrowing of a Revolving Credit
Loan from each Lender, each conversion of Loans of one Type into Loans of
another Type and each repayment of principal of Loans hereunder shall be in a
minimum amount of One Million ($1,000,000) Dollars, in the case of Base Rate
Loans, and Three Million ($3,000,000) Dollars, in the case of LIBOR Loans, and
in either case if in excess thereof, in integral multiples of One Hundred
Thousand ($100,000) Dollars (borrowings, conversions and repayments of different
Types of Loans at the same time hereunder to be deemed separate borrowings,
conversions and repayments for purposes of the foregoing, one for each
Type).  The Agent and the Borrower may make immaterial mutually
convenient adjustments to the thresholds and multiples set forth above in
respect of LIBOR Loans.

     

    
      	
               
      

            	
              Section
      2.11

            	
              Time and Method of
      Payments. 

            

    

     

    All
payments of principal, interest, Fees and other amounts (including indemnities)
payable by the Borrower hereunder shall be made in Dollars, in immediately
available funds, to the Agent at the Principal Office not later than 11:00 a.m.,
Cleveland, Ohio time, on the date on which such payment shall become due (and
the Agent or any Lender for whose account any such payment is to be made may,
but shall not be obligated to, debit the amount of any such payment that is not
made by such time to any ordinary deposit account of the Borrower, or any of
them, with the Agent or such Lender, as the case may be).  Additional
provisions relating to payments are set forth in Section 10.3
hereof.  Each payment received by the Agent hereunder for the account
of a Lender shall be paid promptly to such Lender, in like funds, for the
account of such Lender’s Lending Office for the Loan in respect of which such
payment is made.

     

    
      	
               
      

            	
              Section
      2.12

            	
              Lending Offices.
      

            

    

     

    The Loans
of each Type made by each Lender shall be made and maintained at such Lender’s
applicable Lending Office for Loans of such Type.

     

    
      	
               
      

            	
              Section
      2.13

            	
              Several Obligations.
      

            

    

     

    The
failure of any Lender to make any Loan to be made by it on the date specified
therefor shall not relieve the other Lenders of their respective obligations to
make their Loans on such date, but no Lender shall be responsible for the
failure of the other Lenders to make Loans to be made by such other
Lenders.

     

    
      	
               
      

            	
              Section
      2.14

            	
              Pro Rata Treatment
      Among Lenders. 

            

    

     

    Except as
otherwise provided herein: (a) each borrowing from the Lenders under Section 2.1
hereof will be made from the Lenders and each payment of each Fee (other than
the Application Fee and the Origination Fee) shall be made for the account of
the Lenders pro rata
according to the amount of their respective Revolving Percentage; (b) each
partial reduction of the Total Revolving Credit Commitment shall be applied to
the Revolving Credit Commitments of the Lenders pro rata according to each
Lender’s respective Revolving Percentage; (c) each payment and repayment of
principal of or interest on Revolving Credit Loans will be made to the Agent for
the account of the Lenders pro
rata in accordance with the respective unpaid principal amounts of the
Revolving Credit Loans held by such Lenders; and (d) each conversion of
Revolving Credit Loans of a particular Type under Section 2.17 hereof (other
than conversions provided for by Section 2.20 or 2.21 hereof) shall be made
pro rata among the
Lenders holding Revolving Credit Loans of such Type according to the respective
principal amounts of such Revolving Credit Loans held by such
Lenders.

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              Section
      2.15

            	
              Non-Receipt of Funds
      by the Agent.

            

    

     

    Unless
the Agent shall have been notified by a Lender or the Borrower (the “Payor”) prior to the date on
which such Lender is to make payment to the Agent of the proceeds of a Loan to
be made by it hereunder or the Borrower is to make a payment to the Agent for
the account of one or more of the Lenders, as the case may be (such payment
being herein called the “Required Payment”), which
notice shall be effective upon receipt, that the Payor does not intend to make
the Required Payment to the Agent, the Agent shall assume that the Required
Payment has been made and may, in reliance upon such assumption (but shall not
be required to), make the amount thereof available to the intended recipient on
such date and, if the Payor has not in fact made the Required Payment to the
Agent, the recipient of such payment shall, on demand, repay to the Agent the
amount made available to it together with interest thereon in respect of each
day during the period commencing on the date such amount was so made available
by the Agent until the date the Agent recovers such amount at a rate per annum
equal (i) when the recipient is a Lender, the Federal Funds Rate for such day,
or (ii) the rate of interest applicable to such Loan (when the recipient is the
Borrower).

     

    
      	
               
      

            	
              Section
      2.16

            	
              Sharing of Payments
      and Set-Off Among Lenders.

            

    

     

    The
Borrower hereby agrees that, in addition to (and without limitation of) any
right of setoff, banker’s lien or counterclaim a Lender may otherwise have, each
Lender shall be entitled, at its option, to offset balances held by it at any of
its offices against any principal of or interest on any of its Loans hereunder
or any Fee payable to it, that is not paid when due (regardless of whether such
balances are then due to the Borrower), in which case it shall promptly notify
the Borrower and the Agent thereof, provided that its failure to give such
notice shall not affect the validity thereof.  If a Lender shall
effect payment of any principal of or interest or Fee on Loans held by it under
this Agreement through the exercise of any right of set-off, banker’s lien,
counterclaim or similar right, it shall promptly purchase from the other Lenders
participations in the Loans held by the other Lenders in such amounts, and make
such other adjustments from time to time as shall be equitable, to the end that
all the Lenders shall share the benefit of such payment pro rata in accordance with
the unpaid amount of principal and interest or Fee on the Loans held by each of
them.  To such end all the Lenders shall make appropriate adjustments
among themselves (by the resale of participations sold or otherwise) if such
payment is rescinded or must otherwise be restored.  The Borrower
agrees that any Lender so purchasing a participation in the Loans held by the
other Lenders may exercise all rights of set-off, banker’s lien, counterclaim or
similar rights with respect to such participation as fully as if such Lender
were a direct holder of Loans in the amount of such
participation.  Nothing contained herein shall require any Lender to
exercise any such right or shall affect the right of any Lender to exercise and
retain the benefits of exercising, any such right with respect to any other
indebtedness or obligation of the Borrower.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      2.17

            	
              Conversion of
      Loans.

            

    

     

    The
Borrower shall have the right to convert Loans of one Type into Loans of another
Type from time to time, provided that: (i) the Borrower shall give the Agent
notice of each such conversion as provided in Section 2.2 hereof; (ii) LIBOR
Loans may be converted only on the last day of an Interest Period for such
Loans; and (iii) no Base Rate Loan may be converted into a LIBOR Loan or LIBOR
Loan continued as or converted into another LIBOR Loan if on the proposed date
of conversion a Default or an Event of Default exists.  The Agent
shall use its best efforts to notify the Borrower of the effectiveness of such
conversion, and the new interest rate to which the converted Loans are subject,
as soon as practicable after the conversion; provided, however, that any
failure to give such notice shall not affect the Borrower’s obligations, or the
Agent’s or the Lenders’ rights and remedies, hereunder in any way
whatsoever.

     

    
      	
               
      

            	
              Section
      2.18

            	
              Additional Costs;
      Capital Requirements.

            

    

     

    (a)           In
the event that any existing or future law or regulation, guideline or
interpretation thereof, by any court or administrative or Governmental Authority
(foreign or domestic) charged with the administration thereof, or compliance by
any Lender with any request or directive (whether or not having the force of
law) of any such authority shall impose, modify or deem applicable or result in
the application of, any capital maintenance, capital ratio or similar
requirement against loan commitments made by any Lender hereunder, and the
result of any event referred to above is to impose upon any Lender or increase
any capital requirement applicable as a result of the making or maintenance of
such Lender’s Revolving Credit Commitment or the obligation of the Borrower
hereunder with respect to such Revolving Credit Commitment (which imposition of
capital requirements may be determined by each Lender’s reasonable allocation of
the aggregate of such capital increases or impositions), then, within ten (10)
Business Days’ of demand made by such Lender as promptly as practicable after it
obtains knowledge that such law, regulation, guideline, interpretation, request
or directive exists and determines to make such demand, the Borrower shall pay
to such Lender from time to time as specified by such Lender additional amounts
which shall be sufficient to compensate such Lender for such imposition of or
increase in capital requirements together with interest on each such amount from
the date demanded until payment in full thereof at the Post-Default
Rate.  All references to any “Lender” shall be deemed to
include any participant in such Lender’s Revolving Credit
Commitment.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    (b)           In
the event that any Regulatory Change shall: (i) change the basis of taxation of
any amounts payable to any Lender under this Agreement or the Notes in respect
of any Loans including, without limitation, LIBOR Loans (other than taxes
imposed on the overall net income of such Lender for any such Loans by the
United States of America or the jurisdiction in which such Lender has its
principal office); or (ii) impose or modify any reserve, Federal Deposit
Insurance Corporation premium or assessment, special deposit or similar
requirements relating to any extensions of credit or other assets of, or any
deposits with or other liabilities of, such Lender (including any of such Loans
or any deposits referred to in the definition of “LIBOR Base Rate” in Article
I hereof); or (iii) impose any other conditions affecting this Agreement in
respect of Loans, including, without limitation, LIBOR Loans (or any of such
extensions of credit, assets, deposits or liabilities); and the result of any
event referred to in clause (i), (ii) or (iii) above shall be to increase such
Lender’s costs of making or maintaining any Loans including, without limitation,
LIBOR Loans, or its Revolving Credit Commitment, or to reduce any amount
receivable by such Lender hereunder in respect of its Commitment (such increases
in costs and reductions in amounts receivable are hereinafter referred to as
“Additional Costs”) in
each case, only to the extent, with respect to LIBOR Loans, that such Additional
Costs are not included in the LIBOR Base Rate applicable to LIBOR Loans, then,
within ten (10) Business Days’ of demand made by such Lender as promptly as
practicable after it obtains knowledge that such a Regulatory Change exists and
determines to make such demand (a copy of which demand shall be delivered to the
Agent), the Borrower shall pay to such Lender from time to time as specified by
such Lender, additional amounts which shall be sufficient to compensate such
Lender for such increased cost or reduction in amounts receivable by such Lender
from the date of such change, together with interest on each such amount from
the date demanded until payment in full thereof at the Post-Default
Rate.  All references to any “Lender” shall be deemed to
include any participant in such Lender’s Revolving Credit
Commitment.

     

    (c)           Without
limiting the effect of the foregoing provisions of this Section 2.18, in the
event that, by reason of any Regulatory Change, any Lender either: (i) incurs
Additional Costs based on or measured by the excess above a specified level of
the amount of a category of deposits or other liabilities of such Lender which
includes deposits by reference to which the interest rate on LIBOR Loans is
determined as provided in this Agreement or a category of extensions of credit
or other assets of such Lender which includes LIBOR Loans, or (ii) becomes
subject to restrictions on the amount of such a category of liabilities or
assets that it may hold, then, if such Lender so elects by notice to the
Borrower (with a copy to the Agent), the obligation of such Lender to make, and
to convert Loans of any other Type into, Loans of such Type hereunder shall be
suspended until the date such Regulatory Change ceases to be in effect (and all
Loans of such Type then outstanding shall be converted into Base Rate Loans or
into LIBOR Loans of another duration as the case may be, in accordance with
Sections 2.17 and 2.21).

     

    (d)           Determinations
by any Lender for purposes of this Section 2.18 of the effect of any Regulatory
Change on its costs of making or maintaining Loans or on amounts receivable by
it in respect of Loans, and of the additional amounts required to compensate
such Lender in respect of any Additional Costs, shall be set forth in writing in
reasonable detail describing the Additional Costs together with a calculation
demonstrating the allocation to the Borrower of such Additional
Costs.

     

    
      	
               
      

            	
              Section
      2.19

            	
              Limitation on Types of
      Loans.

            

    

     

    Anything
herein to the contrary notwithstanding, if, on or prior to the determination of
an interest rate for any LIBOR Loans for any Interest Period therefor, the
Required Lenders reasonably determine:

     

    (a)           by
reason of any event affecting the money markets in the United States of America
or the London interbank market, quotations of interest rates for the relevant
deposits are not being provided in the relevant amounts or for the relevant
maturities for purposes of determining the rate of interest for such Loans under
this Agreement; or

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    (b)           the
rates of interest referred to in the definition of “LIBOR Base Rate” in Article 1
hereof upon the basis of which the rate of interest on any LIBOR Loans for such
period is determined, do not accurately reflect the cost to the Lenders of
making or maintaining such Loans for such period;

     

    then the
Agent shall give the Borrower and each Lender prompt notice thereof (and shall
thereafter give the Borrower and each Lender prompt notice of the cessation, if
any, of such condition), and so long as such condition remains in effect, the
Lenders shall be under no obligation to make Loans of such Type or to convert
Loans of any other Type into Loans of such Type and the Borrower shall, on the
last day(s) of the then current Interest Period(s) for
the  outstanding Loans of the affected Type either repay such Loans in
accordance with Section 2.5 hereof or convert such Loan into Loans of another
Type in accordance with Section 2.17 hereof.

     

    
      	
               
      

            	
              Section
      2.20

            	
              Illegality.

            

    

     

    Notwithstanding
any other provision in this Agreement, in the event that it becomes unlawful for
any Lender or its applicable Lending Office to: (a) honor its obligation to make
LIBOR Loans hereunder, or (b) maintain LIBOR Loans hereunder, then such Lender
shall promptly notify the Borrower thereof (with a copy to the Agent),
describing such illegality in reasonable detail (and shall thereafter promptly
notify the Borrower and the Agent of the cessation, if any, of such illegality),
and such Lender’s obligation to make LIBOR Loans and to convert Base Rate Loans
into LIBOR Loans hereunder shall, upon written notice given by such Lender to
the Borrower, be suspended until such time as such Lender may again make and
maintain LIBOR Loans and such Lender’s outstanding LIBOR Loans shall be
converted into Base Rate Loans, in accordance with Sections 2.17 and 2.21
hereof.

     

    
      	
               
      

            	
              Section
      2.21

            	
              Certain Conversions
      pursuant to Sections 2.18 and
2.20.

            

    

     

    If the
Loans of any Lender of a particular Type (Loans of such Type are hereinafter
referred to as “Affected
Loans” and such Type is hereinafter referred to as the “Affected Type”) are to be
converted pursuant to Section 2.18 or 2.20 hereof, such Lender’s Affected Loans
shall be converted into Base Rate Loans, or LIBOR Loans of another Type, as the
case may be (the “New Type
Loans”), on the last day(s) of the then current Interest Period(s) for
the Affected Loans (or, in the case of a conversion required by subsection
2.18(b) or Section 2.20 hereof, on such earlier date as such Lender may specify
to the Borrower with a copy to the Agent) and, until such Lender gives notice as
provided below that the circumstances specified in Section 2.18 or 2.20 hereof
which gave rise to such conversion no longer exist:

     

    (a)           to
the extent that such Lender’s Affected Loans have been so converted, all
repayments of principal which would otherwise be applied to such Affected Loans
shall be applied instead to its New Type Loans;

     

    (b)           all
Loans which would otherwise be made by such Lender as Loans of the Affected Type
shall be made instead as New Type Loans and all Loans of such Lender which would
otherwise be converted into Loans of the Affected Type shall be converted
instead into (or shall remain as) New Type Loans.

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      2.22

            	
              Indemnification.

            

    

     

    The
Borrower shall pay to the Agent for the account of each Lender, upon the request
of such Lender through the Agent, such amount or amounts as shall compensate
such Lender for any loss (including loss of profit), cost or expense incurred by
such Lender (as reasonably determined by such Lender) as a result
of:

     

    (a)           any
payment or repayment or conversion of a LIBOR Loan held by such Lender on a date
other than the last day of an Interest Period for such LIBOR Loan except
pursuant to Sections 2.18 or 2.20 hereof; or

     

    (b)           any
failure by the Borrower to borrow a LIBOR Loan held by such Lender (other than
that caused by a failure of such Lender to fund such LIBOR Loan) on the date for
such borrowing specified in the relevant Borrowing Notice under Section 2.2
hereof,

     

    such
compensation to include, without limitation, an amount equal to: (i) any loss or
expense suffered by such Lender during the period from the date of receipt of
such early payment or repayment or the date of such conversion to the last day
of such Interest Period if the rate of interest obtainable by such Lender upon
the redeployment of an amount of funds equal to such Lender’s pro rata share of such
payment, repayment or conversion or failure to borrow or convert is less than
the rate of interest applicable to such LIBOR Loan for such Interest Period, or
(ii) any loss or expense suffered by such Lender in liquidating LIBOR deposits
prior to maturity which correspond to such Lender’s pro rata share of such
payment, repayment, conversion, failure to borrow or failure to
convert.  The determination by each such Lender of the amount of any
such loss or expense, when set forth in a written notice to the Borrower,
containing such Lender’s calculation thereof in reasonable detail, shall be
presumed correct, in the absence of manifest error.

     

    
      	
               
      

            	
              Section
      2.23

            	
              Special Provisions
      Regarding Defaulting
Lenders.

            

    

     

    Notwithstanding
any provision of this Agreement to the contrary, if any Lender becomes a
Defaulting Lender, then the following provisions shall apply for so long as such
Lender is a Defaulting Lender:

     

    (a)           fees
shall cease to accrue on the unfunded portion of the Revolving Credit Commitment
of such Defaulting Lender pursuant to Section 2.7(a);

     

    (b)           with
respect to Defaulting Lenders only, the Revolving Credit Commitments of such
Defaulting Lender shall not be included in determining whether all Lenders or
the Required Lenders have taken or may take any action hereunder (including any
consent to any amendment or waiver pursuant to Section 10.6), provided that any
waiver, amendment or modification requiring the consent of all Lenders or each
affected Lender which affects such Defaulting Lender differently than other
affected Lenders shall require the consent of such Defaulting Lender;
and

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    (c)           any
amount payable to such Defaulting Lender hereunder (whether on account of
principal, interest, fees or otherwise payable to such Defaulting Lender
pursuant to the Loan Documents) shall, in lieu of being distributed to such
Defaulting Lender, be retained by the Agent in a segregated account and, subject
to any applicable requirements of law, be applied at such time or times as may
be determined by the Agent (i) first, to the payment of any
amounts owing by such Defaulting Lender to the Agent hereunder, (ii) second, to the funding of any
Revolving Credit Loan in respect of which such Defaulting Lender has failed to
fund its portion thereof as required by this Agreement, as determined by the
Agent, (iii) third, if
so determined by the Agent and the Borrower, held in such account as cash
collateral for future funding obligations of the Defaulting Lender of any
Revolving Credit Loans under this Agreement, (iv) fourth , to the payment of
any amounts owing to the Lenders as a result of any judgment of a court of
competent jurisdiction obtained by any Lender against such Defaulting Lender as
a result of such Defaulting Lender’s breach of its obligations under this
Agreement, (v) fifth ,
to the payment of any amounts owing to the Borrower as a result of any judgment
of a court of competent jurisdiction obtained by the Borrower against such
Defaulting Lender as a result of such Defaulting Lender’s breach of its
obligations under this Agreement, and (vii) sixth, to such Defaulting
Lender or as otherwise directed by a court of competent jurisdiction; provided that if such payment
is (x) a prepayment of the principal amount of any Loans for which a Defaulting
Lender has funded its participation obligations and (y) made at a time when the
conditions set forth in Section 4.2 are satisfied, such payment shall be applied
solely to prepay the Revolving Loans of, and reimbursement obligations owed to,
all Non-Defaulting Revolving Lenders pro rata prior to being
applied to the prepayment of any Revolving Loans, or reimbursement obligations
owed to, any Defaulting Lender.

     

    (d)           The
Non-Defaulting Lenders shall also have the right, but not the obligation, in
their respective, sole and absolute discretion, to acquire for no cash
consideration, (pro
rata, based on the respective Revolving Credit Commitments of those
Lenders electing to exercise such right) the Defaulting Lender’s Revolving
Credit Commitment to fund future  advances of Revolving Credit Loans
(the “Future
Commitment”).  Upon any such purchase of the pro rata share of any
Defaulting Lender’s Future Commitment, the Defaulting Lender’s share in future
Loans and its rights under the Credit Documents with respect thereto shall
terminate on the date of purchase, and the Defaulting Lender shall promptly
execute all documents reasonably requested to surrender and transfer such
interest, including, if so requested, an Assignment and
Acceptance.  Each Defaulting Lender shall indemnify Agent and each
Non-Defaulting Lender from and against any and all loss, damage or expenses,
including but not limited to reasonable attorney’s fees and costs and funds
advanced by Agent or by any Non-Defaulting Lender, on account of any Defaulting
Lender’s failure to timely fund its Revolving Percentage of a Loan or to
otherwise perform its obligations under the Loan Documents.

     

    (e)           In
the event that the Agent and the Borrower each agrees that a Defaulting Lender
has adequately remedied all matters that caused such Revolving Lender to be a
Defaulting Lender, then the pro rata share of the
Revolving Exposure of the Lenders shall be readjusted to reflect the inclusion
of such Lender’s Revolving Credit Commitment and on such date such Lender shall
purchase at par such of the Revolving Credit Loans of the other Lenders as the
Agent shall determine may be necessary in order for such Lender to hold such
Revolving Credit Loans in accordance with its Revolving Percentage.

     

    (f)           Upon
any Lender becoming a Defaulting Lender, Borrower may remove and replace such
Defaulting Lender in accordance with Section 10.18 hereof.

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      2.24

            	
              Extension of Revolving
      Credit Commitment Termination
Date.

            

    

     

    Subject
to the following provisions, the Borrower shall have the option to extend the
initial Revolving Credit Commitment Termination Date to May 18,
2013.  By written notice to the Agent delivered no later than six (6)
months prior to the initial Revolving Credit Commitment Termination Date, so
long as no Event of Default has occurred (and remains uncured), the Borrower may
request such extension to the initial Revolving Credit Commitment Termination
Date (which request shall be accompanied by a Compliance
Certificate).  Promptly upon receipt of such written notice, the Agent
shall deliver a copy to each Lender and the initial Revolving Credit Commitment
Termination Date shall be deemed so extended.  In the event that the
Borrower shall have delivered an extension notice under this Section 2.24, the
Borrower shall pay to the Agent for the ratable benefit of the Lenders on the
initial Revolving Credit Commitment Termination Date, a non-refundable extension
fee (the “Extension
Fee”) in an amount equal to twenty-five (25) basis points multiplied by
the Total Revolving Credit Commitment, as then in effect.

     

    
      	
            	
              Article
      3.

            	
              Representations and
      Warranties.

            

    

     

    The
Borrower hereby represents and warrants to the Lenders and the Agent
that:

     

    
      	
               
      

            	
              Section
      3.1

            	
              Organization.

            

    

     

    (a)           Each
Loan Party is duly organized and validly existing under the laws of its state of
organization and has the power to own its assets and to transact the business in
which it is presently engaged and in which it proposes to be
engaged.  Schedule
3.1 hereto accurately and completely lists, as to each Loan Party: (i)
the state of incorporation or organization of each such entity, (ii) as to each
of them that is a corporation, the classes and number of authorized and
outstanding shares of capital stock of each such corporation, and (iii) the
business in which each of such entities is engaged.  All of the
foregoing shares or other Equity Interests that are issued and outstanding have
been duly and validly issued and are fully paid and
non-assessable.  Except as set forth on Schedule 3.1, the Borrower
has no Subsidiaries.

     

    (b)           Each
Loan Party is in good standing in its state of organization and in each state in
which it is qualified to do business.  There are no jurisdictions
other than as set forth on Schedule 3.1 hereto in which
the character of the properties owned or proposed to be owned by each Loan Party
or in which the transaction of the business of each Loan Party as now conducted
or as proposed to be conducted requires or will require such Loan Party to
qualify to do business and as to which failure so to qualify could have a
Material Adverse Effect on such Loan Party.

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      3.2

            	
              Power, Authority,
      Consents.

            

    

     

    Each Loan
Party has the power to execute, deliver and perform the Loan Documents to be
executed by it.  Each Loan Party has the power to borrow hereunder
(and to guarantee the Obligations under its respective Guaranty) and has taken
all necessary action, corporate or otherwise, to authorize the borrowing
hereunder (and to guarantee the Obligations under its respective Guaranty) on
the terms and conditions of the Loan Documents.  Each Loan Party has
taken all necessary action, corporate or otherwise, to authorize the execution,
delivery and performance of the Loan Documents to be executed by
it.  No consent or approval of any Person (including, without
limitation, any stockholder of any Loan Party), no consent or approval of any
landlord or mortgagee, no waiver of any Lien or right of distraint or other
similar right and no consent, license, certificate of need, approval,
authorization or declaration of any governmental authority, bureau or agency, is
or will be required in connection with the execution, delivery or performance by
each Loan Party, or the validity or enforcement of the Loan
Documents.

     

    
      	
               
      

            	
              Section
      3.3

            	
              No Violation of Law or
      Agreements.

            

    

     

    The
execution and delivery by each Loan Party of each Loan Document to which it is a
party and performance by it hereunder and thereunder, will not violate any
provision of law and will not conflict with or result in a breach of any order,
writ, injunction, ordinance, resolution, decree, or other similar document or
instrument of any court or governmental authority, bureau or agency, domestic or
foreign, or any certificate of incorporation or by-laws or other organizational
document of each Loan Party, or create (with or without the giving of notice or
lapse of time, or both) a default under or breach of any agreement, bond, note
or indenture to which any Loan Party is a party, or by which any Loan Party is
bound or any of their respective properties or assets is affected, except for
such defaults and breaches which in the aggregate could not have a Material
Adverse Effect on the Loan Parties, or result in the imposition of any Lien of
any nature whatsoever upon any of the properties or assets owned by or used in
connection with the business of each Loan Party.

     

    
      	
               
      

            	
              Section
      3.4

            	
              Due Execution,
      Validity, Enforceability.

            

    

     

    This
Agreement and each other Loan Document to which each Loan Party is a party has
been duly executed and delivered by each Loan Party that is a party thereto and
each constitutes the valid and legally binding obligation of each Loan Party,
enforceable in accordance with its terms, except as such enforcement may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium, or
other similar laws, now or hereafter in effect, relating to or affecting the
enforcement of creditors’ rights generally and except that the remedy of
specific performance and other equitable remedies are subject to judicial
discretion.

     

    
      	
               
      

            	
              Section
      3.5

            	
              Title to
      Properties.

            

    

     

    Each of
the Loan Parties has good and marketable title in fee simple to, or valid
leasehold interests in, all real property necessary or used in the ordinary
course of its business, except for such defects in title as could not,
individually or in the aggregate, have a Material Adverse Effect.

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      3.6

            	
              Judgments, Actions,
      Proceedings.

            

    

     

    Except as
set forth on Schedule
3.6 hereto, there are no outstanding judgments, investigations, actions
or proceedings, including, without limitation, any Environmental Proceeding,
pending before any court or governmental authority, bureau or agency, with
respect to or, to the best of each Loan Party’s knowledge, threatened against or
affecting such Loan Party or any of its assets involving, in the case of any
court proceeding, a claim in excess of Two Hundred Fifty Thousand ($250,000)
Dollars, nor, to the best of each Loan Party’s knowledge, is there any
reasonable basis for the institution of any such action or proceeding that is
probable of assertion, nor are there any pending actions or proceedings in which
any Loan Party is a plaintiff or complainant.

     

    
      	
               
      

            	
              Section
      3.7

            	
              No Defaults,
      Compliance With Laws.

            

    

     

    Except as
set forth on Schedule
3.7 hereto, none of the Loan Parties is in default under any agreement,
ordinance, resolution, decree, bond, note, indenture, order or judgment to which
it is a party or by which it is bound, or any other agreement or other
instrument by which any of the properties or assets owned by it or used in the
conduct of its business is affected, which default could have a Material Adverse
Effect on such Loan Party.  Each Loan Party has complied and is in
compliance in all material respects with all applicable laws, ordinances and
regulations, resolutions, ordinances, decrees, executive orders and other
similar documents and instruments of all courts and governmental authorities,
bureaus and agencies, domestic and foreign, including, without limitation, all
applicable provisions of the Americans with Disabilities Act (42 U.S.C.
§12101-12213) and the regulations issued thereunder and all applicable
Environmental Laws and Regulations, non-compliance with which could have a
Material Adverse Effect on such Loan Party.

     

    
      	
               
      

            	
              Section
      3.8

            	
              Burdensome
      Documents.

            

    

     

    Except as
set forth on Schedule
3.8 hereto, none of the Loan Parties is a party to or bound by, nor are
any of the properties or assets owned by any of the Loan Parties used in the
conduct of their respective businesses affected by, any agreement, ordinance,
resolution, decree, bond, note, indenture, order or judgment, including, without
limitation, any of the foregoing relating to any Environmental Liability, that
materially and adversely affects their respective businesses, assets or
conditions, financial or otherwise.

     

    
      	
               
      

            	
              Section
      3.9

            	
              Financial Statements;
      Projections.

            

    

     

    (a)           Each
of the Financial Statements is complete and presents fairly the consolidated
financial position of Parent Guarantor and its Subsidiaries as at its date, and
has been prepared in accordance with GAAP.  None of the Loan Parties
to which any of the Financial Statements relates, has any material obligation,
liability or commitment, direct or contingent (including, without limitation,
any Environmental Liability), that is not reflected in the Financial
Statements.  There has been no material adverse change in the
financial position or operations of any of the Loan Parties since the date of
the latest balance sheet included in the Financial Statements (the “Latest Balance
Sheet”).  Each Loan Parties’ fiscal year is the twelve-month
period ending on December 31 in each year.

     

    (b)           The
Projections have been prepared on the basis of the assumptions accompanying them
and reflect as of the date thereof Parent Guarantor’s good faith projections,
after reasonable analysis, of the matters set forth therein, based on such
assumptions.

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

    

     

    
      	
               
      

            	
              Section
      3.10

            	
              Tax
      Returns.

            

    

     

    Each Loan
Party has filed all federal, state and local tax returns required to be filed by
it (subject to permitted extensions) and has not failed to pay any taxes, or
interest and penalties relating thereto, on or before the due dates
thereof.  Except to the extent that reserves therefor are reflected in
the Financial Statements: (i) there are no material federal, state or local tax
liabilities of any of the Loan Parties, due or to become due for any tax year
ended on or prior to the date of the Latest Balance Sheet relating to such
entity, whether incurred in respect of or measured by the income of such entity,
that are not properly reflected in the Latest Balance Sheet relating to such
entity, and (ii) there are no material claims pending or, to the knowledge of
each of the Loan Parties, proposed or threatened against such Loan Party for
past federal, state or local taxes, except those, if any, as to which proper
reserves are reflected in the Financial Statements.

     

    
      	
               
      

            	
              Section
      3.11

            	
              Intangible
      Assets.

            

    

     

    Each Loan
Party possesses all patents, trademarks, service marks, trade names, and
copyrights, and rights with respect to the foregoing, necessary to conduct its
business as now conducted and as proposed to be conducted, without, to the
knowledge of each of the Loan Parties (after due inquiry into the matters being
certified), any conflict with the patents, trademarks, service marks, trade
names, and copyrights and rights with respect to the foregoing, of any other
Person.

     

    
      	
               
      

            	
              Section
      3.12

            	
              Regulation
      U.

            

    

     

    No part
of the proceeds received by any of the Loan Parties from the Loans will be used
directly or indirectly for: (a) any purpose other than as set forth in Section
2.8 hereof, or (b) the purpose of purchasing or carrying, or for payment in full
or in part of Indebtedness that was incurred for the purposes of purchasing or
carrying, any “margin
stock”, as such term is defined in §221.3 of Regulation U of the Board of
Governors of the Federal Reserve System, 12 C.F.R., Chapter II, Part
221.

     

    
      	
               
      

            	
              Section
      3.13

            	
              Name Changes, Mergers,
      Acquisitions.

            

    

     

    Except as
set forth on Schedule
3.13 hereto, none of the Loan Parties has within the six-year period
immediately preceding the date of this Agreement changed its name, been the
surviving entity of a merger or consolidation, or, except in the ordinary course
of business, acquired all or substantially all of the assets of any
Person.

     

    
      	
               
      

            	
              Section
      3.14

            	
              Full
      Disclosure.

            

    

     

    Neither
the Financial Statements nor any certificate, opinion, or any other statement
made or furnished in writing to the Agent or any Lender by or on behalf of the
Loan Parties in connection with this Agreement or the transactions contemplated
herein, contains any untrue statement of a material fact, or omits to state a
material fact necessary in order to make the statements contained therein or
herein not misleading, as of the date such statement was made.  There
is no fact known to any Loan Party that has, or would in the now foreseeable
future have, a Material Adverse Effect on such Loan Party, which fact has not
been set forth herein, in the Financial Statements or any certificate, opinion
or other written statement so made or furnished to the Agent or the
Lenders.

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      3.15

            	
              Licenses and
      Approvals.

            

    

     

    (a)           Each
Loan Party has all necessary licenses, permits and governmental authorizations,
including, without limitation, licenses, permits and authorizations arising
under or relating to Environmental Laws and Regulations, to own and operate its
properties and to carry on its business as now conducted, the absence of which
would have a Material Adverse Effect on any Loan Party.

     

    (b)           No
violation exists of any applicable law pertaining to the ownership or operation
of any Eligible Facility or any Operator that would have a reasonable likelihood
of leading to revocation of any license necessary for the operation of such
Eligible Facility.

     

    
      	
               
      

            	
              Section
      3.16

            	
              ERISA.

            

    

     

    (a)           Except
as set forth on Schedule
3.16 hereto, no Employee Benefit Plan is maintained or has ever been
maintained by any Loan Party or any ERISA Affiliate, nor has any Loan Party or
any ERISA Affiliate ever contributed to a Multiemployer Plan.

     

    (b)           There
are no agreements which will provide payments to any officer, employee,
shareholder or highly compensated individual which will be “parachute payments” under
280G of the Code that are nondeductible to any Loan Party and which will be
subject to tax under Section 4999 of the Code for which any Loan Party will have
a material withholding liability.

     

    
      	
               
      

            	
              Section
      3.17

            	
              USA Patriot
      Act

            

    

     

    (a)           Neither
the Loans contemplated hereunder nor the use of the proceeds thereof will
violate the Anti-Terrorism Order, the USA Patriot Act, the Trading with the
Enemy Act, as amended, or any of the foreign assets control regulations of the
United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or
any enabling legislation or executive order relating thereto.

     

    (b)           Neither
the Parent Guarantor, Borrower nor any Subsidiary (1) is a Person described or
designated in the Specially Designated Nationals and Blocked Persons List of the
Office of Foreign Assets Control or in Section 1 of the Anti-Terrorism Order, or
(2) to the best knowledge of Borrower, engages in any dealings or transactions
with any such Person.  The Parent Guarantor, the Borrower and their
respective Subsidiaries are in compliance, in all material respects, with the
USA Patriot Act.

     

    (c)           No
part of the proceeds from the Loans hereunder will be used, directly or
indirectly, for any payments to any governmental official or employee, political
party, official of a political party, candidate for political office, or anyone
else acting in an official capacity, in order to obtain, retain or direct
business or obtain any improper advantage, in violation of the United States
Foreign Corrupt Practices Act of 1977, as amended.

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      3.18

            	
              REIT
      Status.

            

    

     

    Parent
Guarantor currently has REIT Status and has maintained REIT Status on a
continuous basis since the filing of its United States Federal Income Tax return
for the year ending December 31, 2008.

     

    
      	
            	
              Article
      4.

            	
              Conditions to the
      Loans.

            

    

     

    
      	
               
      

            	
              Section
      4.1

            	
              Conditions to Initial
      Loan(s).

            

    

     

    The
obligation of each Lender to execute and deliver this Agreement shall be subject
to the fulfillment (to the satisfaction of the Agent) of the following
conditions precedent:

     

    (a)           Revolving Credit
Notes.  The Borrower shall have executed and delivered to each
Lender its Revolving Credit Note.

     

    (b)           Fees.  The Borrower
shall have paid (i) to the Agent, for the benefit of the Lenders, the
Origination Fee, (ii) to the Agent, the Application Fee, and (iii) fees and
expense of counsel to the Agent due pursuant to Section 10.1.

     

    (c)           Opinions of
Counsel.  Counsel to the Borrower and each Subsidiary Guarantor
in existence on such date shall have delivered its opinion (or, as the case may
be, their opinions) to, and in form and substance satisfactory to, the
Agent.  Such opinion(s) will, inter alia, cover such local
law matters in the jurisdiction where any such proposed Eligible Facility is
located as Agent shall reasonably request.

     

    (d)           Financial Statements;
Projections;  Pro Forma Compliance Certificate.  The
Agent shall have received complete copies of (i) the Financial Statements, (ii)
the Projections, and (iii) a pro forma compliance
certificate addressing compliance with each of the financial covenants contained
herein, each certified as such in a certificate executed by an executive officer
of Borrower (and based upon such executive officer’s knowledge, after due
inquiry into the matters being certified).

     

    (e)           Guaranty.  The
Guarantor and each Subsidiary Guarantor shall have executed and delivered its
respective Guaranty.

     

    (f)           Mortgage and Other Collateral
Documents.  Each then Subsidiary Guarantor shall have delivered
its respective Mortgage and other Collateral Documents related to its Eligible
Facility and the same shall have been delivered and deposited (i) into escrow
for filing and recording or (ii) pursuant to such other arrangements as are
satisfactory to Agent.

     

    (g)           Title
Insurance.  Agent shall have received a commitment to deliver
an ALTA Lenders title insurance policy covering the Eligible Facilities in favor
of the Agent, such policy to be in the amount not less than the Assigned Credit
Advance Value and to be reasonably satisfactory to the Agent with such customary
endorsements and affirmative assurances issued by the title company as a routine
matter (each, a “Title
Policy”).

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

     

    (h)           Survey.  Survey At
least five (5) Business Days prior to the Closing Date, Borrowers shall have
delivered to the Agent an ALTA/ACSM survey (each a “Survey”) of each Eligible
Facility owned by (or to be owned by) a Subsidiary Guarantor on the Closing
Date, each reasonably acceptable to the Agent and caused any exceptions to the
related title insurance delivered on the Closing Date pursuant to Section
4.1.(g) above with respect to the non-delivery of such survey on the Closing
Date to be removed.

     

    (i)        
   Intercompany
Notes.  The Agent shall have received the executed Intercompany
Notes in existence on such date, together with an executed endorsement (in
blank) thereto.

     

    (j)         
  The
Account.  Borrower shall have opened the Account and made such
other arrangements with KeyBank with respect thereto as are required by KeyBank
and Agent (including creation of Liens thereon to secure the
Obligations).

     

    (k)           Corporate
Proceedings.  The Agent shall have received copies of the
following:

     

    (i)           The
certificates of incorporation (or other organizational documents) of each Loan
Party in existence on such date, certified by the Secretary of State of their
respective states of organization;

     

    (ii)           The
by-laws (or other organizational documents) of each Loan Party in existence on
such date, certified by their respective secretaries;

     

    (iii)           All
action taken by each Loan Party in existence on such date, corporate or
otherwise (including without limitation, any resolutions or other consents), to
authorize the execution, delivery and performance of each of the Loan Documents
to which it is a party and the transactions contemplated thereby, certified by
their respective secretaries;

     

    (iv)           Good
standing certificates as of a recent date, with respect to each Loan Party in
existence on such date from the Secretary of State of their respective states of
organization 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 Loan
Party in existence on such date.

     

    (l)           Officer’s
Certificate.  A certificate from an authorized officer of each
Loan Party to the effect that, to the best of such officer’s knowledge, after
due inquiry into the matters being certified (i) each Loan Party in existence on
such date shall have complied and shall then be in compliance with all of the
terms, covenants and conditions of this Agreement;

     

    (ii)          After
giving effect to the initial Loan, there shall exist no Default or Event of
Default hereunder; and

     

    (iii)          The
representations and warranties contained in Article 3 hereof shall be true and
correct on the date hereof;

     

    
      
        
        

      

      
        36

        
          

        

      

      
        
        

      

    

     

    and the
borrowing by the Borrower of the initial Loan hereunder shall constitute a
representation and warranty by the Borrower as of the date hereof that the
conditions set forth in this subsection 4.1(k) have been satisfied.

     

    (m)           Search Results; Lien
Terminations.  Certified copies of judgment, tax, bankruptcy
and Uniform Commercial Code search reports dated a date reasonably near to the
Closing Date, listing all effective financing statements which name any Loan
Party (under their present names and any previous names) as debtors, together
with (i) copies of such financing statements, (ii) Lien releases in respect
of Liens to be released in connection with each Acquisition, and (iii) such
other Uniform Commercial Code termination statements as the Agent may reasonably
request.

     

    (n)           Appraisal.  On or
prior to the Closing Date, the Agent shall have received an Appraisal of each
proposed Eligible Facility, which shall be reasonably acceptable to the Agent;
provided, however, that
such Appraisal may be delivered, with Agent’s prior consent (which will not be
unreasonably withheld), within ten (10) Business Days after such Closing
Date.

     

    (o)           Letter of
Direction.  A letter of direction containing funds flow
information with respect to the proceeds of the Loan on the Closing
Date.

     

    (p)           Property Condition
Report.  The Agent shall have received a property condition
report (the “Property
Condition Report”) from a third party consultant with respect to each
proposed Eligible Facility, which report shall be in form and substance
reasonably acceptable to the Agent.

     

    (q)           Environmental
Audit.  At least ten (10) Business Days prior to the Closing
Date, the Agent shall have received an Environmental Audit for each proposed
Eligible Facility addressed to the Agent and each Lender or accompanied by a
letter allowing such Persons to rely thereon.

     

    (r)           Additional Information Regarding
Proposed Eligible Facilities.  Agent shall have received all
such information as the Agent shall request with respect to each proposed
Eligible Facility and Subsidiary Guarantor together with information concerning
(i) its unit mix and scheduled rents and ancillary fees, building age, fire
protection attributes, emergency call systems and other health and safety
matters, (ii) all leases (and amendments thereto) associated with such proposed
Eligible Facility, (iii) copies of all contracts and leases for equipment
utilized at such proposed Eligible Facility, (iv) operating statements (annual)
for the prior two (2) years at such proposed Eligible Facility, if available, or
such operating statements for any available shorter period, (v) operating
statements (year to date) for such proposed Eligible Facility, if available,
(vi) monthly occupancy reports (for prior twelve (12) months) for such proposed
Eligible Facility, if available, (vii) rent rolls in detail satisfactory to
Agent (which shall set forth, inter alia, any residents
that are the beneficiary of any State or Federal subsidy or assistance programs
(such as Medicaid, Medicare or Medicaid Waiver), (viii) information concerning
the proposed manager of such proposed Eligible Facility as Agent shall request
(including information regarding such proposed manager’s other real estate and
its recent annual and interim financial statements), (ix) a copy of the proposed
management agreement relating to such proposed Eligible Facility, (x) evidence
that such proposed Eligible Facility is not located in an area designated by the
Secretary of Housing and Urban Development as a special flood zone area, or
flood hazard insurance acceptable to Agent in its sole discretion, and (xi)
copies of all licenses and permits required by law for operation of such
proposed Eligible Facility.

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

    

     

    (s)           Insurance.  Evidence
of the existence of insurance required to be maintained pursuant to Section 6.8,
together with evidence that the Agent has been named as a lender’s loss payee
and the Agent has been named as an additional insured on all related insurance
policies, as appropriate.

     

    (t)           Consents, Permits,
etc.  To the extent not otherwise required hereunder, certified
copies of all documents evidencing any necessary limited liability company
action, consents and governmental approvals (if any) required for the execution,
delivery and performance by the Loan Parties of the documents referred to in
this Section 4 and copies of all permits, licenses and approvals necessary
for the acquisition, ownership and operation of the Eligible Facilities by the
Loan Parties.

     

    (u)           Other Matters.  All
legal matters incident to the initial Loans shall be satisfactory to counsel to
the Agent.

    

    
      	
               
      

            	
              Section
      4.2

            	
              Conditions to All
      Loans.

            

    

     

    The
obligation of the Lenders to make the initial Loan and each Loan subsequent to
the date hereof shall be subject to the fulfillment (to the satisfaction of the
Agent) of the following conditions precedent:

     

    (a)           The
Agent shall have received (i) a Borrowing Notice in accordance with Section 2.2
hereof and (ii) a pro
forma Borrowing Base Certificate.

     

    (b)           Each
of the Loan Parties shall have complied and shall then be in compliance with all
of the terms, covenants and conditions of this Agreement (including, without
limitation, all provisions relating to the Borrowing Base, inclusions of
Eligible Facilities therein and the calculation thereof).

     

    (c)           After
giving effect to the requested Loan, there shall exist no Default or Event of
Default hereunder.

     

    (d)           The
representations and warranties contained in Article 3 hereof (i) shall be true,
correct and complete on and as of such date as if made on and as of such date
(and the borrowing by the Borrower of the requested Loan hereunder shall
constitute a representation and warranty by the Borrower as of the date of such
Loan that the conditions set forth in this subsection 4.2(b) have been
satisfied) and (ii) to the extent necessary to comply with 4.2(d)(i) above, each
such representation or warranty (and any related schedules) updated information
required to make each such representation true, correct and complete on such
date shall have been delivered to Agent and all information set forth therein
shall be otherwise reasonably satisfactory to Agent.

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

     

    (e)           To
the extent not previously delivered with respect to a new proposed Eligible
Facility and Subsidiary Guarantor, all items listed above in Section 4.1(c)-(u)
inclusive with respect to such proposed Eligible Facility and Subsidiary
Guarantor.

     

    (f)           To
the extent requested by Agent, an SNDA with respect to any tenant (including,
without limitation, any Operator or Substantial Tenant) occupying such proposed
Eligible Facility in scope, form and substance satisfactory to Agent and its
counsel.

     

    (g)   
       To the extent requested by Agent,
Interest Rate Contracts, if any, relating to the Loans (or a portion
thereof).

     

    (h)           To
the extent requested by Agent, any Guarantor will ratify and reaffirm its
respective Guaranty.

     

    (i)      
     All legal matters incident to such Loan shall be
satisfactory to counsel for the Agent.

     

    
      	
            	
              Article
      5.

            	
              Delivery of Financial
      Reports, Documents and Other
Information.

            

    

     

    While the
Revolving Credit Commitments are outstanding, and, in the event any Loan remains
outstanding, so long as the Borrower is indebted to the Lenders or the Agent and
until payment in full of the Notes and full and complete performance of all
other Obligations arising hereunder, Borrower and Parent Guarantor shall deliver
to each Lender:

     

    
      	
               
      

            	
              Section
      5.1

            	
              Section 5.1 Annual
      Financial Statements.

            

    

     

    Annually,
as soon as available, but in any event within one hundred twenty (120) days
after the last day of each of its fiscal years, a consolidated balance sheet of
Parent Guarantor and its Subsidiaries as at such last day of the fiscal year,
and consolidated statements of income and retained earnings and statements of
cash flow, for such fiscal year, each prepared in accordance with generally
accepted accounting principles consistently applied, in reasonable detail, and
certified without qualification by a nationally recognized independent public
accounting firm or by any other certified public accounting firm satisfactory to
the Agent as fairly presenting the financial position and results of operations
of Parent Guarantor and its Subsidiaries as at and for the year ending on its
date and as having been prepared in accordance with GAAP.

     

    
      	
               
      

            	
              Section
      5.2

            	
              Quarterly Financial
      Statements.

            

    

     

    (a)           As
soon as available, but in any event within sixty (60) days after the end of each
of Parent Guarantor’s fiscal quarters, a consolidated balance sheet of Parent
Guarantor and its Subsidiaries as of the last day of such quarter and
consolidated statements of income and retained earnings and statements of cash
flow, for such quarter, and on a comparative basis figures for the corresponding
period of the immediately preceding fiscal year, all in reasonable detail, each
such statement to be certified in a certificate of the Responsible Officer of
Parent Guarantor as (to the best of such Responsible Officer’s knowledge, after
due inquiry into the matters being certified) accurately presenting the
financial position and the results of operations of Parent Guarantor and its
Subsidiaries as at its date and for such quarter and as having been prepared in
accordance with GAAP (subject to year-end audit adjustments).

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

     

    (b)           As
soon as available, but in any event within fifty (50) days after the end of each
of Parent Guarantor’s fiscal quarters, a financial statement for each Eligible
Facility, together with occupancy reports and rent rolls, for the corresponding
period of the immediately preceding fiscal month, all in reasonable detail, each
such statement to be certified in a certificate of a Responsible Officer of
Parent Guarantor as accurately presenting (to the best of such Responsible
Officer’s knowledge, after due inquiry into the matters being certified) the
financial position and the results of operations of such Eligible Facility as at
its date and for such month and as having been prepared in accordance with GAAP
(subject to year-end audit adjustments).

     

    
      	
               
      

            	
              Section
      5.3

            	
              Compliance
      Information.

            

    

     

    Promptly
after a written request therefor, such other financial data or information
(including, without limitation, Borrowing Base Certificates) evidencing
compliance with the requirements of this Agreement, the Notes and the other Loan
Documents, as Agent or any Lender may reasonably request from time to
time.

     

    
      	
               
      

            	
              Section
      5.4

            	
              Compliance
      Certificate;  Borrowing Base
  Certificate.

            

    

     

    At the
same time as it delivers the financial statements required under the provisions
of Sections 5.1 and 5.2 hereof, a certificate of a Responsible Officer of Parent
Guarantor to the effect that (to the best of such Responsible Officer’s
knowledge, after due inquiry into the matters being certified) no Event of
Default hereunder and that no default under any other material agreement to
which any Loan Party is a party or by which it is bound, or by which, to the
best knowledge of Parent Guarantor or any other Loan Party, any of its
properties or assets, taken as a whole, may be materially affected, and no event
which, with the giving of notice or the lapse of time, or both, would constitute
such an Event of Default or default, exists, or, if such cannot be so certified,
specifying in reasonable detail the exceptions, if any, to such
statement.  Such certificate shall be accompanied by a detailed
calculation indicating compliance with the covenants contained in Sections 6.9
and 7.11 hereof in the form annexed hereto as Exhibit D.

     

    In
addition to the foregoing, Borrower shall also deliver (without limiting its
obligation to deliver the same at any other time required by this Agreement) at
the same time as it delivers the financial statements required under the
provisions of Sections 5.1 and 5.2 hereof, a Borrowing Base Certificate executed
by a Responsible Officer of Parent Guarantor and Borrower, specifying (to the
best of such Responsible Officer’s knowledge, after due inquiry into the matters
being certified) in reasonable detail the Borrower’s calculations of the
Borrowing Base.

     

    
      	
               
      

            	
              Section
      5.5

            	
              Monthly
      Information.

            

    

     

    Upon
request by Agent, as soon as available, but in any event within thirty (30) days
after the end of each of each Loan Party’s fiscal month, a financial statement
for each Eligible Facility, together with occupancy reports and rent rolls, for
the corresponding period of the immediately preceding fiscal month, all in
reasonable detail, each such statement to be certified in a certificate of a
Responsible Officer of Parent Guarantor as (to the best of such Responsible
Officer’s knowledge, after due inquiry into the matters being certified)
accurately presenting the financial position and the results of operations of
such Eligible Facility as at its date and for such month and as having been
prepared in accordance with GAAP (subject to year-end audit
adjustments).

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      5.6

            	
              Intentionally
      Omitted.

            

    

     

    
      	
               
      

            	
              Section
      5.7

            	
              Business Plan and
      Projections.

            

    

     

    Not later
than January 31st in each year, copies of Parent Guarantor’s and Borrower’s
respective business plans and financial projections for the upcoming fiscal year
(together with a copy in writing of the assumptions on which such business plan
and projections were based), each certified by a Responsible Officer of Parent
Guarantor and Borrower and illustrating the projected income statements, balance
sheets and statements of changes in cash flow on a consolidated
basis.

     

    
      	
               
      

            	
              Section
      5.8

            	
              USA Patriot
      Act  Reports.

            

    

     

    Promptly
(a) if any Loan Party obtains knowledge that any Loan Party or any Person which
owns, directly or indirectly, any Equity Interests of any Loan Party, or any
other holder at any time of any direct or indirect equitable, legal or
beneficial interest therein is the subject of any of the Terrorism Laws, such
Loan Party will notify the Agent and (b) upon the request of any Lender, such
Loan Party will provide any information such Lender believes is reasonably
necessary to be delivered to comply with the USA Patriot Act

     

    
      	
               
      

            	
              Section
      5.9

            	
              Accountants’
      Reports.

            

    

     

    Promptly
upon receipt thereof, copies of all material reports submitted to any Loan Party
by its independent accountants in connection with any annual or interim audit of
the books of Parent Guarantor and Borrower or their Subsidiaries made by such
accountants which material reports are a necessary part of such annual or
interim audit

     

    
      	
               
      

            	
              Section
      5.10

            	
              Copies of
      Documents.

            

    

     

    Promptly
upon their becoming available, copies of any:  (i) financial
statements, non-routine reports and notices (other than routine correspondence),
any of which are of a material nature, requests for waivers and proxy
statements, in each case, delivered by Parent Guarantor, Borrower or any
Subsidiary Guarantor to any of their respective existing lending institutions or
creditors; (ii) correspondence or notices received by Parent Guarantor, Borrower
or any Subsidiary Guarantor from any federal, state or local governmental
authority that regulates the operations of Parent Guarantor, Borrower or any
Subsidiary Guarantor, relating to an actual or threatened change or development
that would be materially adverse (whether individually or on a consolidated
basis) to Parent Guarantor, Borrower or any Subsidiary Guarantor or otherwise
have a Material Adverse Effect; (iii) registration statements and any amendments
and supplements thereto, and any regular and periodic reports, if any, filed by
Parent Guarantor, Borrower or any Subsidiary Guarantor with any securities
exchange or with the Securities and Exchange Commission or any governmental
authority succeeding to any or all of the functions of the said Commission; and
(iv) at the request of the Agent, any appraisals received by Parent Guarantor,
Borrower or any Subsidiary Guarantor with respect to the properties or assets of
Parent Guarantor, Borrower or any Subsidiary Guarantor during the term of this
Agreement

     

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      5.11

            	
              Notices of
      Defaults.

            

    

     

    Promptly,
notice of the occurrence of any Default or Event of Default, or any event that
would constitute or cause a Material Adverse Effect in the condition, financial
or otherwise, or the operations of Parent Guarantor or any of its
Subsidiaries.

     

    
      	
               
      

            	
              Section
      5.12

            	
              ERISA Notices and
      Requests.

            

    

     

    (a)           Concurrently
with such filing, a copy of each Form 5500 that is filed with respect to each
Plan, if any, with the IRS; and

     

    (b)           Promptly,
upon their becoming available, copies of:  (i) all correspondence with
the PBGC, the Secretary of Labor or any representative of the IRS with respect
to any Plan, if any, relating to an actual or threatened change or development
that would be materially adverse to any Loan Party; (ii) all actuarial
valuations received by the Parent Guarantor or Borrower with respect to any
Plan; and (iii) any notices of Plan termination filed by any Plan Administrator
(as those terms are used in ERISA) with the PBGC and of any notices from the
PBGC to the Parent Guarantor or Borrower with respect to the intent of the PBGC
to institute involuntary termination proceedings.

     

    
      	
               
      

            	
              Section
      5.13

            	
              Additional
      Information.

            

    

     

    Such
other material additional information regarding the business, affairs and
condition of any Loan Party as the Agent may from time to time request,
including, without limitation, as soon as available but in any event not less
than forty-five (45) days after the end of each fiscal quarter of Parent
Guarantor, schedules, in form and substance satisfactory to the Agent, with
respect to Parent Guarantor and its Subsidiaries on a consolidated basis, of
recorded liabilities, unfunded commitments, contingent liabilities, any off
balance sheet financings including synthetic lease transactions and
sale-leaseback arrangements and other similar material items, in each case,
covering such quarter to the extent not otherwise contained in the information
otherwise provided under this Article 5.

     

    
      	
            	
              Article
      6.

            	
              Affirmative
      Covenants.

            

    

     

    While the
Revolving Credit Commitments are outstanding, and, in the event any Loan remains
outstanding, so long as any Loan Party is indebted to the Lenders or the Agent,
and until payment in full of the Notes and full and complete performance of all
of its other Obligations arising hereunder, each Loan Party shall:

     

    
      
        
        

      

      
        42

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      6.1

            	
              Books and
      Records.

            

    

     

    Keep
proper books of record and account in a manner reasonably satisfactory to the
Agent in which full and true entries shall be made of all dealings or
transactions in relation to its business and activities.

     

    
      	
               
      

            	
              Section
      6.2

            	
              Inspections and
      Audits.

            

    

     

    Permit
the Agent to make or cause to be made (prior to an Event of Default, at the
Lenders’ expense and after the occurrence of and during the continuance of an
Event of Default, at the Borrower’s expense), inspections and audits of any
books, records and papers of Parent Guarantor, Borrower or any Subsidiary
Guarantor and to make extracts therefrom and copies thereof, or to make
appraisals, inspections and examinations of any properties and facilities of
Parent Guarantor, Borrower or any Subsidiary Guarantor, on reasonable notice, at
all such reasonable times and as often as any Lender may reasonably require, in
order to assure that the Borrower is and will be in compliance with their
obligations under the Loan Documents or to evaluate the investment in the then
outstanding Notes.  Notwithstanding the foregoing, the Borrower agrees
that the Agent shall be permitted to conduct or cause to be conducted an annual
field audit at the Borrower’s expense.

     

    
      	
               
      

            	
              Section
      6.3

            	
              Maintenance and
      Repairs.

            

    

     

    Cause to
be maintained in good repair, working order and condition, subject to normal
wear and tear, all material properties and assets from time to time owned by
Parent Guarantor, Borrower or any Subsidiary Guarantor and used in or necessary
for the operation of its businesses, and make or cause to be made all reasonable
repairs, replacements, additions and improvements thereto.

     

    
      	
               
      

            	
              Section
      6.4

            	
              Continuance of
      Business.

            

    

     

    Do, or
cause to be done, all things reasonably necessary to preserve and keep in full
force and effect the corporate existence of Parent Guarantor, Borrower or any
Subsidiary Guarantor and all permits, rights and privileges necessary for the
proper conduct of its business, and continue to engage in the same line of
business and comply in all material respects with all applicable laws,
regulations and orders.

     

    
      	
               
      

            	
              Section
      6.5

            	
              Copies of Corporate
      Documents.

            

    

     

    Subject
to the prohibitions set forth in Section 7.6 hereof, promptly deliver to the
Agent copies of any amendments or modifications to the certificate of
incorporation (or other applicable organizational documents) and by-laws of
Parent Guarantor, Borrower or any Subsidiary Guarantor, certified with respect
to the certificate of incorporation (or other organizational documents) by the
Secretary of State of its state of incorporation and, with respect to the
by-laws, by the secretary or assistant secretary of such
corporation.

     

    
      
        
        

      

      
        43

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      6.6

            	
              Perform
      Obligations.

            

    

     

    Pay and
discharge all of the obligations and liabilities of Parent Guarantor, Borrower
or any Subsidiary Guarantor, including, without limitation, all taxes,
assessments and governmental charges upon its income and properties when due,
unless and to the extent only that such obligations, liabilities, taxes,
assessments and governmental charges shall be contested in good faith and by
appropriate proceedings and that, to the extent required by GAAP, proper and
adequate book reserves relating thereto are established by Parent Guarantor,
Borrower or any Subsidiary Guarantor, and then only to the extent that a bond is
filed in cases where the filing of a bond is necessary to avoid the creation of
a Lien against any of its properties.

     

    
      	
               
      

            	
              Section
      6.7

            	
              Notice of
      Litigation.

            

    

     

    Promptly
notify the Agent in writing of any adverse litigation, legal proceeding or
dispute, other than disputes in the ordinary course of business or, whether or
not in the ordinary course of business, involving amounts in excess of Five
Hundred Thousand ($500,000) Dollars, affecting Parent Guarantor, Borrower or any
Subsidiary Guarantor or any Eligible Facility whether or not fully covered by
insurance, and regardless of the subject matter thereof (excluding, however, any
actions relating to workers’ compensation claims or negligence claims relating
to use of motor vehicles, if fully covered by insurance, subject to
deductibles).

     

    
      	
               
      

            	
              Section
      6.8

            	
              Insurance.

            

    

     

    (a)
Maintain or cause to maintain with responsible insurance companies reasonably
acceptable to the Agent such insurance on the properties of Parent Guarantor,
Borrower or any Subsidiary Guarantor, in such amounts and against such risks as
is customarily maintained by similar businesses and cause each Operator and
Substantial Tenant to do so; and (b) file with the Agent upon its request a
detailed list of the insurance then in effect, stating the names of the
insurance companies, the amounts and rates of the insurance, the dates of the
expiration thereof and the properties and risks covered thereby; and (c) within
ten (10) days after notice in writing from the Agent, obtain such additional
insurance as the Agent may reasonably request.

     

    
      	
               
      

            	
              Section
      6.9

            	
              Minimum Equity
      Increase.

            

    

     

    Have or
maintain, with respect to Parent Guarantor, on a consolidated basis, as at the
last day of each fiscal quarter of Parent Guarantor, an additional $20,000,000
in Net Issuance Proceeds from issuances of Equity Interests in Parent Guarantor
during each six (6) month calendar period (i.e., the periods of January 1 to
June 30 and July 1 to December 31 in each calendar year) starting with the six
(6) month period beginning on January 1, 2011.

     

    
      	
               
      

            	
              Section
      6.10

            	
              Notice of Certain
      Events.

            

    

     

    (a)           Promptly
notify the Agent in writing of the occurrence of any Reportable Event, as
defined in Section 4043 of ERISA, if a notice of such Reportable Event is
required under ERISA to be delivered to the PBGC within thirty (30) days after
the occurrence thereof, together with a description of such Reportable Event and
a statement of the action the Borrower or the ERISA Affiliate intends to take
with respect thereto, together with a copy of the notice thereof given to the
PBGC.

     

    
      
        
        

      

      
        44

        
          

        

      

      
        
        

      

    

     

    (b)           Promptly
notify the Agent in writing if the Borrower(s) or ERISA Affiliate receives an
assessment of withdrawal liability in connection with a complete or partial
withdrawal with respect to any Multiemployer Plan, together with a statement of
the action that such Loan Party(s) or ERISA Affiliate intends to take with
respect thereto.

     

    (c)           Promptly
notify the Agent in writing if any Loan Party receives: (i) any notice of any
violation or administrative or judicial complaint or order having been filed or
about to be filed against such Loan Party alleging violations of any
Environmental Law and Regulation, or (ii) any notice from any governmental body
or any other Person alleging that such Loan Party is or may be subject to any
Environmental Liability; and promptly upon receipt thereof, provide the Agent
with a copy of such notice together with a statement of the action such Loan
Party intends to take with respect thereto.

     

    
      	
               
      

            	
              Section
      6.11

            	
              Comply with
      ERISA.

            

    

     

    Materially
comply with all applicable provisions of ERISA and the Code now or hereafter in
effect.

     

    
      	
               
      

            	
              Section
      6.12

            	
              Environmental
      Compliance.

            

    

     

    Operate
or cause to operate all property owned, operated or leased by it in compliance
with all Environmental Laws and Regulations, such that no Environmental
Liability arises under any Environmental Laws and Regulations, which would
result in a Lien on any property of any Loan Party.

     

    
      	
               
      

            	
              Section
      6.13

            	
              Maintenance of REIT
      Status.

            

    

     

    Parent
Guarantor will maintain its REIT Status.

     

    
      	
               
      

            	
              Section
      6.14

            	
              Post Closing Lien
      Searches.

            

    

     

    Without
limiting Borrower’s obligations under Section 10.1 hereof, Borrower agrees
within ten (10) days of Agent’s written demand, to reimburse Agent for all
expenses incurred by Agent in periodically (up to two (2) times per year)
verifying Borrower’s performance of its obligations under the Loan Documents and
the security and priority of each Mortgage, including without limitation
expenses incurred by Agent for title searches, title updates and endorsements,
tax and judgment lien searches, litigation searches, and UCC
searches.

     

    
      	
               
      

            	
              Section
      6.15

            	
              The
      Account;  Cash
Management.

            

    

     

    (a)           Borrower
agrees that it will establish the Account and at all times maintain a balance
therein in an amount equal to the greater of (i) $2,500,000.00, or (ii) five
percent (5%) of the Total Revolving Credit Commitment.

     

    
      
        
        

      

      
        45

        
          

        

      

      
        
        

      

    

     

    (b)           Borrower
agrees to provide to Agent such reasonable information regarding its, Parent
Guarantor’s and each Subsidiary’s accounts so as to permit Agent to prepare an
analysis of, and proposal regarding, a comprehensive cash management and
treasury services proposal to the Loan Parties and their
Subsidiaries.

     

    
      	
               
      

            	
              Section
      6.16

            	
              Right of First
      Refusal;  Right of First
Offer.

            

    

     

    (a)           Borrower
agrees that the Agent and Agent’s Affiliates shall have the exclusive right
(other than with respect to any agreements with other parties existing as of the
date of this Agreement and set forth on Schedule 6.16 hereof) of
first refusal on each Loan Party’s (and their respective Subsidiary’s) behalf to
arrange for or otherwise provide any permanent loan provided to such Person by
Fannie Mae, Freddie Mac or HUD. Agent (or Agent’s
Affiliate) will have a period of fifteen (15) Business Days after its receipt of
all necessary analytical information to advise the appropriate Loan Party of
Agent’s (or Agent’s Affiliate’s) decision with respect to such
financing.  Notwithstanding the foregoing, the requirements regarding
the above described right of first refusal shall not apply to any Facility that
was originally presented to Agent for inclusion as an Eligible Facility
hereunder but was subsequently not approved by Agent as an Eligible Facility
hereunder.

     

    (b)           Borrower
agrees that the Agent and Agent’s Affiliates shall have the exclusive right
(other than with respect to any agreements with other parties existing as of the
date of this Agreement and set forth on Schedule 6.16 hereof) of
first offer to arrange for or otherwise provide to (or on behalf of) any Loan
Party with respect to agency or other secondary market refinancings of any
Eligible Facility.

     

    (c)           In
the event that Agent (or Agent’s Affiliate) is retained to arrange for or
otherwise provide any of the above described services, the Borrower shall pay to
Agent (or, as the case may be, Agent’s Affiliate) an origination fee (each an
“Origination Fee”) upon
closing and funding of such transaction equal to the greater of (i) the minimum
origination fee prescribed by the relevant governmental agency, or (ii) the
amount set forth below:

     

    (A)          For
transactions with Fannie Mae, Freddie Mac:

     

    (1)           financing
transactions involving single assets and loan amounts under $10,000,000, the
Origination Fee will be an amount equal to 1.00% of such loan
amount;

     

    (2)           financing
transactions involving single assets and loan amounts between $10,000,000 and
$20,000,000 the Origination Fee will be an amount equal to 0.75% of such loan
amount; and

     

    (3)           financing
transactions involving single assets and loan amounts in excess of $20,000,000,
the Origination Fee will be an amount equal to 0.55% of such loan
amount.

     

    (B)           For
transactions with HUD:

     

    (1)           financing
transactions involving single assets and loan amounts between $5,000,000 and
$10,000,000, the Origination Fee will be an amount equal to 1.50% of such loan
amount;

     

    
      
        
        

      

      
        46

        
          

        

      

      
        
        

      

    

     

    (2)           financing
transactions involving single assets and loan amounts in excess of $10,000,000,
the Origination Fee will be an amount equal to 1.00% of such loan amount;
and

     

    (3)           the
Origination Fee for all such transactions in this subsection 6.16(c)(ii)(B)
involving loan amounts less than $5,000,000 will be subject to such the mutual
agreement of Borrower and Agent (or, as the case may be, Agent’s
Affiliate).

     

    
      	
               
      

            	
              Section
      6.17

            	
              Casualty and
      Condemnation.

            

    

     

    (a)           Notice.  The
Borrower will furnish to the Agent and the Lenders prompt written notice of (i)
any casualty or other insured damage to any Eligible Facility in excess of
$500,000 or (ii) the commencement of any action or proceeding for the taking of
any Eligible Facility, or any interest therein, under power of eminent domain or
by condemnation or similar proceeding.

     

    (b)           Application of
Proceeds.  (i) So long as no Default or Event of Default shall
have occurred and be continuing, and (ii) to the extent that aggregate Net
Insurance/Condemnation Proceeds from the Closing Date through the applicable
date of determination do not exceed twenty-five percent (25%) of the Appraised
Value for such Eligible Facility, Borrower shall have the option, directly or
through one or more of its Subsidiary Guarantors to utilize such Net
Insurance/Condemnation Proceeds within one hundred eighty (180) days of receipt
thereof for the repair, restoration or replacement of the applicable Eligible
Facility giving rise to such Net Insurance/Condemnation
Proceeds;  provided,
however, pending any such investment all such Net Insurance/Condemnation
Proceeds, as the case may be, shall be applied to prepay Revolving Credit Loans
to the extent outstanding (without a reduction in Revolving Credit Commitments)
pursuant to Section 2.5(d) but such amounts prepaid shall thereafter be made
available to Borrower or the applicable Subsidiary Guarantor for reborrowing for
repair, restoration or replacement of such Eligible Facility upon such
reasonable and customary terms and conditions as Agent shall require (and
otherwise consistent with Agent’s procedures and practices for administration
and disbursement of construction loans, including, without limitation, customary
retainages, plan and budget review, assurances as to compliance with all
applicable laws, assurances as to lack of non-permitted Liens, and such other
matters as Agent shall reasonably require).  In the event that the
criteria set forth above in subsection 6.17(b)(i) and (ii) are not satisfied,
such funds shall be applied to prepay Revolving Credit Loans in an amount up to
the Assigned Credit Advance Value of such Eligible Facility to the extent
outstanding (without a reduction in Revolving Credit Commitments) pursuant to
Section 2.5(d) and shall not be available for reborrowing for repair,
restoration or replacement of such Eligible Facility unless otherwise approved
by Agent and the Required Lenders.

     

    
      	
               
      

            	
              Section
      6.18

            	
              REIT
      Sub-Advisor.

            

    

     

    At all
times the REIT Sub-Advisor shall be a sub-advisor to the Advisor to Parent
Guarantor and Advisor shall be advisor to Parent Guarantor.

     

    
      
        
        

      

      
        47

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              Article
      7.

            	
              Negative
      Covenants.

            

    

     

    While the
Revolving Credit Commitments are outstanding, and, in the event any Loan remains
outstanding, so long as any Loan Party is indebted to the Lenders or the Agent
and until payment in full of the Notes and full and complete performance of all
of its other Obligations arising hereunder, Parent Guarantor and Borrower shall
not and shall not permit any of the Subsidiary Guarantors to do, agree to do, or
permit to be done, any of the following:

     

    
      	
               
      

            	
              Section
      7.1

            	
              Indebtedness.

            

    

     

    Create,
incur, permit to exist or have outstanding any Indebtedness,
except:

     

    (a)           Indebtedness
of the Loan Parties to the Lenders and the Agent under this Agreement, the
Notes, and each Guaranty;

     

    (b)           Taxes,
assessments and governmental charges, non-interest bearing accounts payable and
accrued liabilities, in any case not more than ninety (90) days past due from
the original due date thereof (unless the failure to satisfy such obligations is
pursuant to the good faith contest by appropriate dispute or other proceedings
as set forth in Section 6.6 hereof), and non-interest bearing deferred
liabilities other than for borrowed money (e.g., deferred compensation and
deferred taxes), in each case incurred and continuing in the ordinary course of
business and then only to the extent that such Loan Party has set aside on its
books adequate reserves therefor, if appropriate under GAAP;

     

    (c)           Indebtedness
secured by the security interests referred to in subsection 7.2(b) and (c)
hereof;

     

    (d)           Indebtedness
consisting of contingent obligations permitted by Section 7.3
hereof;

     

    (e)           Recourse
Indebtedness (other than Indebtedness hereunder) at any time outstanding not
exceeding in the aggregate (when aggregated with Indebtedness permitted by
subsections 7.1(c), (d) and (f) hereof) twenty-five percent (25%) of Total Asset
Value; and

     

    (f)           Indebtedness
set forth on Schedule
7.1 hereto.

     

    
      	
               
      

            	
              Section
      7.2

            	
              Liens.

            

    

     

    Create,
or assume or permit to exist, any Lien on any of the properties or assets of the
Borrower or any of any Subsidiary Guarantor, whether now owned or hereafter
acquired, except:

     

    (a)           Permitted
Liens;

     

    (b)           Liens
securing Indebtedness created after the date hereof and permitted under
subsection 7.1(e) hereof; and

     

    (c)           Liens
set forth on Schedule
7.2 hereto.

     

    
      
        
        

      

      
        48

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Section
      7.3

            	
              Guaranties.
      

            

    

     

    Assume,
endorse, be or become liable for, or guarantee, the obligations of any Person,
except (i) by the endorsement of negotiable instruments for deposit or
collection in the ordinary course of business, (ii) guarantees of payment or
completion in support of Facilities if, after giving effect to the proposed
guarantee, the aggregate amount of all such obligations guaranteed by Parent
Guarantor, Borrower or any Subsidiary Guarantor, or any of them (inclusive of
the guarantees referred to in subsection 7.3(iii) and, to the extent the
condition precedent provided therein has occurred, subsection 7.3(iv) hereof but
exclusive of the guarantees of the Guarantors with respect to the Obligations),
does not exceed fifteen percent (15%) of Total Asset Value, (iii) guarantees
which are non-recourse in nature (i.e., recourse is limited to a Facility (that
is not an Eligible Facility) and otherwise does not require the payment of
funds), (iv) guarantees which are effective upon the occurrence of one or more
conditions precedent (e.g., such as guarantees that require payments upon the
occurrence of fraud, willful misrepresentation, gross negligence, misapplication
of funds or willful misconduct) to the extent the condition(s) precedent with
respect to such obligation have not occurred, and (v) as set forth on Schedule 7.3
hereof.  For the purposes hereof, the term “guarantee” shall include any
agreement, whether such agreement is on a contingency or otherwise, to purchase,
repurchase or otherwise acquire Indebtedness of any other Person, or to
purchase, sell or lease, as lessee or lessor, property or services, in any such
case primarily for the purpose of enabling another person to make payment of
Indebtedness, or to make any payment (whether as an advance, capital
contribution, purchase of an equity interest or otherwise) to assure a minimum
equity, asset base, working capital or other balance sheet or financial
condition, in connection with the Indebtedness of another Person, or to supply
funds to or in any manner invest in another Person in connection with such
Person’s Indebtedness.

     

    
      	
               
      

            	
              Section
      7.4

            	
              Mergers, Acquisitions.
      

            

    

     

    Merge or
consolidate with any Person, or, acquire all or substantially all of the assets
or any of the capital stock or other Equity Interests of any Person unless (a)
Parent Guarantor, Borrower or a Subsidiary Guarantor is the surviving entity,
and (b) no Default or Event of Default exists or will occur after giving effect
thereto.

     

    
      	
               
      

            	
              Section
      7.5

            	
              Distributions.
      

            

    

     

    Declare
or pay any dividends or make any distribution of any kind on Parent Guarantor’s
outstanding stock, or set aside any sum for any such purpose, except
that:

     

    (a)           Parent
Guarantor may declare and make dividend payments or other distributions payable
solely in its common stock;

     

    (b)           Parent
Guarantor may declare and pay cash dividends if (i) such dividend is a regularly
declared distribution to the holders of its Equity Interests (and not a
“special” dividend, “extraordinary” dividend or otherwise any unusual,
non-typical or “one-time” dividend), and (ii) only if at the time of such
payment and after giving effect thereto, no Event of Default shall exist
hereunder; and

    
      
         

      

      
        49

        
          

        

      

      
         

      

    

    (c)           if
a Default or an Event of Default exists or will occur as a result of the
dividend payment, Parent Guarantor may declare and pay dividends to the minimum
extent necessary (taking into account any dividends or distributions otherwise
made including under subsection 7.5(b)) to generate the minimum deduction for
dividends paid during each year that would be required to satisfy Code Section
857(a)(1).

     

    
      	
               
      

            	
              Section
      7.6

            	
              Changes in Structure.
      

            

    

     

    Amend,
supplement or modify the certificate of incorporation or by-laws (or other
applicable organizational documents) of any Loan Party in a manner which would
be reasonably likely to cause a Material Adverse Effect.

     

    
      	
               
      

            	
              Section
      7.7

            	
              Disposition of Assets.
      

            

    

     

    Make any
Disposition of any Eligible Facility, or enter into any agreement to do so,
unless (a) the Disposition is made for a price equal to the greater of (i) its
fair market value (based on a bona fide arm’s length transaction with a third
party) or (ii) such amount as is sufficient to create Net Asset Sale Proceeds of
not less than the Assigned Credit Advance Value of such Eligible Facility, (b)
at the time of such Disposition and after giving effect thereto, no Default or
Event of Default exists (unless otherwise consented to by Agent and Required
Lenders, which consent will not be unreasonably withheld), and (c) the Net Asset
Sale Proceeds of such Disposition are applied pursuant to the terms of Section
2.5 hereof.

     

    
      	
               
      

            	
              Section
      7.8

            	
              Investments.
      

            

    

     

    Make or
suffer to exist, any Investment in any Person, including, without limitation,
any shareholder, director, officer or employee of Parent Guarantor or any of its
Subsidiaries, except:

     

    (a)         Investments
in:

     

    (i)        
   obligations issued or guaranteed by the United States of
America;

     

    (ii)           certificates
of deposit, bankers acceptances and other “money market instruments”
issued by any Lender or trust company organized under the laws of the United
States of America or any State thereof and having capital and surplus in an
aggregate amount of not less than $100,000,000;

     

    (iii)           open
market commercial paper bearing the highest credit rating issued by S&P or
by another nationally recognized credit rating agency;

     

    (iv)           repurchase
agreements entered into with any Lender or trust company organized under the
laws of the United States of America or any State thereof and having capital and
surplus in an aggregate amount of not less than $100,000,000 relating to United
States of America government obligations; and

    
      
         

      

      
        50

        
          

        

      

      
         

      

    

    (v)           shares
of “money market
funds”, each having net assets of not less than
$100,000,000;

     

    in each
case maturing or being due or payable in full not more than 180 days after the
Borrower’s acquisition thereof.

     

    (b)          Whether
or not in connection with an Acquisition, Investments by Parent Guarantor or
Borrower in any Subsidiary Guarantor, and by any Subsidiary
Guarantor  in Parent Guarantor, Borrower or another Subsidiary
Guarantor, provided, to
the extent required in connection with an Acquisition of an Eligible Facility,
Parent Guarantor shall cause each Subsidiary Guarantor, formed or acquired
during such immediately preceding fiscal quarter, to become a party to a
Guaranty, with the effect that each such new Subsidiary Guarantor shall be
deemed to become a “Guarantor” for the purposes
of this Agreement and in connection therewith, there shall be delivered to the
Agent with respect to such Subsidiary those certificates and documents described
in subsection 4.2 hereof and all legal matters incident to the addition of such
Subsidiary as a “Guarantor” hereunder shall
be satisfactory to counsel to the Agent.

     

    (c)           The
acquisition by Parent Guarantor and its Subsidiaries, of any real estate,
whether developed or undeveloped;  provided, however, that
Parent Guarantor and any Subsidiaries will only make Investments in such amounts
and allocations so as not to exceed the below listed percentages for each type
of asset:

     

    
      
        
          
            
              	
                      Type of Asset

                    	 	
                      Maximum Percentage of Total Asset Value

                    	 
	
                      1.  undeveloped
      land

                    	 	 	5.0	%
	
                      2.  properties
      for development

                    	 	 	20.0	%
	
                      3.  mortgage
      notes

                    	 	 	5.0	%
	
                      4.  aggregate
      of asset types listed at 1, 2 and 3 above

                    	 	 	20.0	%

            

          

        

      

    

     

    (d)           Investments
by Parent Guarantor or Borrower in any Subsidiary;

     

    (e)           Investments
in any Joint Venture provided that the aggregate Cash portion of all such
Investments does not exceed an amount equal to fifty percent (50%) of Total
Asset Value as at any date of determination thereof, prior to giving effect to
any such Investment.

     

    For
purposes of subsection 7.8(a)-(d) and Section 7.14 hereof, “Investments” shall mean, by
any Person:

     

    (i)           the
amount paid or committed to be paid, or the value of property or services
contributed or committed to be contributed, by such Person for or in connection
with the acquisition by such Person of any stock, bonds, notes, debentures,
partnership or other ownership interests or other securities of any other
Person; and

    
      
         

      

      
        51

        
          

        

      

      
         

      

    

    (ii)           the
amount of any advance, loan or extension of credit by such Person, to any other
Person, or guaranty or other similar obligation of such Person with respect to
any Indebtedness of such other Person, and (without duplication) any amount
committed to be advanced, loaned, or extended by such Person to any other
Person, or any amount the payment of which is committed to be assured by a
guaranty or similar obligation by such Person tor the benefit of, such other
Person.

     

    
      	
               
      

            	
              Section
      7.9

            	
              Fiscal Year.
      

            

    

     

    Change
its fiscal year.

     

    
      	
               
      

            	
              Section
      7.10

            	
              ERISA Obligations.
      

            

    

     

    Permit
the establishment of any Employee Benefit Plan or amend any Employee Benefit
Plan which establishment or amendment could result in liability to any Loan
Party or increase the obligation for post-retirement welfare benefits of any
Loan Party which liability or increase, individually or together with all
similar liabilities and increases, has a Material Adverse Effect on any Loan
Party.

     

    
      	
               
      

            	
              Section
      7.11

            	
              Negative Financial
      Covenants 

            

    

     

    (a)           Minimum Debt Service Coverage
Ratio.  Commencing with the calendar quarter ending March 31,
2011, permit (or suffer to exist) its Debt Service Coverage Ratio for any
Computation Period set forth below to be not less than the applicable ratio set
forth below for such Computation Period:

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      Computation Periods Ending 

                                      (all dates are inclusive):

                                    	 	
                                       

                                      Debt Service Coverage Ratio

                                    
	 	 	 
	
                                      March
      31, 2011

                                    	 	
                                      1.25:1.00

                                    
	 	 	 
	
                                      June
      30, 2011

                                    	 	
                                      1.25:1.00

                                    
	 	 	 
	
                                      September
      30, 2011

                                    	 	
                                      1.25:1.00

                                    
	 	 	 
	
                                      December
      31, 2011

                                    	 	
                                      1.25:1.00

                                    
	 	 	 
	
                                      March
      31, 2012

                                    	 	
                                      1.35:1.00

                                    
	 	 	 
	
                                      June
      30, 2012

                                    	 	
                                      1.35:1.00

                                    
	 	 	 
	
                                      September
      30, 2012

                                    	 	
                                      1.35:1.00

                                    
	 	 	 
	
                                      December
      31, 2012 (assuming Extension Option is exercised)

                                    	 	
                                      1.35:1.00

                                    
	 	 	 
	
                                      March
      31, 2013 and each June 30, September 30, and December 31
      thereafter

                                    	 	
                                      1.40:1.00

                                    

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        52

        
          

        

      

      
         

      

    

     

    (b)           Maximum Ratio of Consolidated
Indebtedness to Total Asset Value.  Permit (or suffer to
exist), at all times, a ratio of Consolidated Indebtedness to Total Asset Value
greater than 0.60:1.00;

     

    (c)           Consolidated Net
Worth.  Permit (or suffer to exist), at all times, Consolidated
Net Worth less than the sum of $40,000,000, plus 80% of all Gross
Issuance Proceeds received by Parent Guarantor (or any of its Subsidiaries) in
connection with the issuance after the Closing Date of any Equity Interest in
Parent Guarantor (or any of its Subsidiaries) other than any such equity
interests issued in connection with any dividend reinvestment
program(s);

     

    (d)           Liquidity.  Permit
(or suffer to exist), at all times, its average monthly balance of Cash and Cash
Equivalents to be less than $5,000,000.

     

    
      	
               
      

            	
              Section
      7.12

            	
              Use of Cash.
      

            

    

     

    Use, or
permit to be used, in any manner or to any extent, each Loan Party’s Cash from
operations for the benefit of any Person, except: (a) in connection with the
payment or prepayment of expenses (other than Capital Expenditures) directly
incurred for the benefit of each Loan Party in the maintenance and operation of
its business, in each case only in the ordinary course of its business, (b) for
the payment of required payments of principal and interest on Indebtedness of
each Loan Party permitted to exist hereunder, and (c) for uses that are
otherwise specifically permitted by this Agreement.

     

    
      	
               
      

            	
              Section
      7.13

            	
              Transactions with
      Affiliates. 

            

    

     

    Except as
expressly permitted by this Agreement, directly or indirectly:  (a)
make any Investment in an Affiliate; (b) transfer, sell, lease, assign or
otherwise dispose of any material assets to an Affiliate; (c) merge into or
consolidate with or purchase or acquire material assets from an Affiliate; or
(d) enter into any other transaction directly or indirectly with or for the
benefit of any Affiliate (including, without limitation, guarantees and
assumptions of obligations of an Affiliate); provided, however,
that:  (i) payments on Investments expressly permitted by Section 7.8
hereof may be made, (ii) any Affiliate who is a natural person may serve as an
employee or director of Parent Guarantor, Borrower or any Subsidiary and receive
reasonable compensation for his services in such capacity, and (iii) Parent
Guarantor, Borrower or any Subsidiary may enter into any transaction with an
Affiliate providing for the leasing of property, the rendering or receipt of
services or the purchase or sale of product, inventory and other assets in the
ordinary course of business if the monetary or business consideration arising
therefrom would be substantially as advantageous to Parent Guarantor, Borrower
or a Subsidiary as the monetary or business consideration that would obtain in a
comparable arm’s length transaction with a Person not an Affiliate.

     

    
      
         

      

      
        53

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              Section
      7.14

            	
              Hazardous Material.
      

            

    

     

    Cause or
permit: (i) any Hazardous Material to be placed, held, located or disposed of,
on, under or at any Eligible Facility or any part thereof, except for such
Hazardous Materials that are necessary for any Subsidiary Guarantor’s or any
Operator’s operation of its business thereon and which shall be used, stored,
treated and disposed of in material compliance with all applicable Environmental
Laws and Regulations or (ii) such Eligible Facility or any part thereof to be
used as a collection, storage, treatment or disposal site for any Hazardous
Material.  Parent Guarantor, Borrower and each Subsidiary Guarantor
acknowledges and agrees that the Agent and the Lenders shall have no liability
or responsibility for either:

     

    (i)           damage,
loss or injury to human health, the environment or natural resources caused by
the presence, disposal, release or threatened release of Hazardous Materials on
any part of such Eligible Facility; or

     

    (ii)           abatement
and/or clean-up required under any applicable Environmental Laws and Regulations
for a release, threatened release or disposal of any Hazardous Materials located
at any Eligible Facility or used by or in connection with Parent Guarantor’s,
Borrower’s or any Subsidiary Guarantor’s or any Operator’s
business.

     

    
      	 	
              Article 8.

            	
              Events of Default.
      

            

    

     

    If any
one or more of the following events (“Events of Default”) shall
occur and be continuing at any time any amounts are outstanding hereunder, the
Revolving Credit Commitments shall terminate and the entire unpaid balance of
the principal of and interest on the Notes outstanding and all other obligations
and Indebtedness of each of the Borrower to the Lenders and the Agent arising
hereunder and under the other Loan Documents shall immediately become due and
payable upon written notice to that effect given to the Borrower by the Agent
(except that in the case of the occurrence of any Event of Default described in
Section 8.6 no such notice shall be required), without presentment or demand for
payment, notice of non-payment, protest or further notice or demand of any kind,
all of which are expressly waived by each Loan Party:

     

    
      	
               
      

            	
              Section
      8.1

            	
              Payments.

            

    

     

    Failure
by any Loan Party to:  (a) make any payment or mandatory repayment of
principal upon any Note when due, or (b) make any payment of interest upon any
Note or to make any payment of any Fee within three (3) Business Days after the
date when due; or

     

    
      	
               
      

            	
              Section
      8.2

            	
              Certain Covenants.
      

            

    

     

    Failure
by any Loan Party to perform or observe any of the agreements of a Borrower
contained in Section 5.11, Section 6.9 or Article 7 hereof; or

     

    
      	
               
      

            	
              Section
      8.3

            	
              Other Covenants.
      

            

    

     

    Failure
by any Loan Party to perform or observe any other term, condition or covenant of
this Agreement or of any of the other Loan Documents to which it is a party,
which shall remain unremedied for a period of thirty (30) days after notice
thereof shall have been given to such Loan Party by the Agent;
or

    
      
         

      

      
        54

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              Section
      8.4

            	
              Other Defaults.
      

            

    

     

    (a)           Failure
by any Loan Party to perform or observe any term, condition or covenant (unless
such performance or observance is being disputed through a good faith contest
and such Loan Party is otherwise in compliance with the terms of Section 6.6
with respect thereto) of any bond, note, debenture, loan agreement, indenture,
guaranty, trust agreement, mortgage or similar instrument to which it is a party
or by which it is bound, or by which any of its properties or assets may be
affected (a “Debt
Instrument”), so that, as a result of any such failure to perform, the
Indebtedness included therein or secured or covered thereby may be declared due
and payable prior to the date on which such Indebtedness would otherwise become
due and payable; or

     

    (b)           Any
event or condition referred to in any Debt Instrument shall occur or fail to
occur, so that, as a result thereof, the Indebtedness included therein or
secured or covered thereby may be declared due and payable prior to the date on
which such Indebtedness would otherwise become due and payable; or

     

    (c)           Failure
to pay any Indebtedness for borrowed money due at final maturity or pursuant to
demand under any Debt Instrument;

     

    provided, however, that the
provisions of this Section 8.4 shall not be applicable to any Debt Instrument
that on the date this Section 8.4 would otherwise be applicable thereto, relates
to or evidences Indebtedness (y) in a principal amount of less than $500,000 or
(z) the terms of the which shall have been subordinated to the terms, payment
and priority of the final payment in full of all of the Obligations;
or

     

    
      	
               
      

            	
              Section
      8.5

            	
              Representations and
      Warranties. 

            

    

     

    Any
representation or warranty made in writing to the Lenders or the Agent in any of
the Loan Documents or in connection with the making of the Loans, or any
certificate, statement or report made or delivered in compliance with this
Agreement, shall have been false or misleading in any material adverse respect
when made or delivered; or

     

    
      	
               
      

            	
              Section
      8.6

            	
              Bankruptcy.
      

            

    

     

    (a)           Any
Loan Party shall make an assignment for the benefit of creditors, file a
petition in bankruptcy, be adjudicated insolvent, petition or apply to any
tribunal for the appointment of a receiver, custodian, or any trustee for it or
a substantial part of its assets, or shall commence any proceeding under any
Bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or
liquidation law or statute of any jurisdiction, whether now or hereafter in
effect, or any Loan Party shall take any corporate action to authorize any of
the foregoing actions; or there shall have been filed any such petition or
application, or any such proceeding shall have been commenced against it, that
remains undismissed for a period of sixty (60) days or more; or any order for
relief shall be entered in any such proceeding; or any Loan Party by any act or
omission shall indicate its consent to, approval of or acquiescence in any such
petition, application or proceeding or the appointment of a custodian, receiver
or any trustee for it or any substantial part of its properties, or shall suffer
any custodianship, receivership or trusteeship to continue undischarged for a
period of thirty (30) days or more; or

    
      
         

      

      
        55

        
          

        

      

      
         

      

    

    (b)           Any
Loan Party shall generally not pay its debts as such debts become due;
or

     

    (c)           Any
Loan Party shall have concealed, removed, or permitted to be concealed or
removed, any part of its property, with intent to hinder, delay or defraud its
creditors or any of them or made or suffered a transfer of any of its property
that may be fraudulent under any Bankruptcy, fraudulent conveyance or similar
law; or shall have made any transfer of its property to or for the benefit of a
creditor at a time when other creditors similarly situated have not been paid;
or shall have suffered or permitted, while insolvent, any creditor to obtain a
Lien upon any of its property through legal proceedings or distraint that is not
vacated within thirty (30) days from the date thereof; or

     

    
      	
               
      

            	
              Section
      8.7

            	
              Judgments.
      

            

    

     

    Any
judgment against any Loan Party or any attachment, levy or execution against any
of its properties for any amount in excess of Five Hundred Thousand ($500,000)
Dollars shall remain unpaid, unstayed on appeal, undischarged, unbonded or
undismissed for a period of thirty (30) days or more; or

     

    
      	
               
      

            	
              Section
      8.8

            	
              ERISA.
      

            

    

     

    (a)           The
termination of any Plan or the institution by the PBGC of proceedings for the
involuntary termination of any Plan, in either case, by reason of, or that
results or could result in, a “material accumulated funding deficiency” under
Section 412 of the Code; or

     

    (b)           Failure
by any Loan Party to make required contributions, in accordance with the
applicable provisions of ERISA, to each of the Plans hereafter established or
assumed by it; or

     

    
      	
               
      

            	
              Section
      8.9

            	
              Material Adverse
      Effect. 

            

    

     

    There
shall occur a Material Adverse Effect; or

     

    
      	
               
      

            	
              Section
      8.10

            	
              Ownership.
      

            

    

     

    (i)           Any
Person, or a group of related Persons, shall after the Closing Date acquire (a)
beneficial ownership in excess of 25% of the outstanding stock of Parent
Guarantor, Borrower or other voting interest having ordinary voting powers to
elect a majority of the directors, managers or trustees of Parent Guarantor or
Borrower (irrespective of whether at such time stock of any other class or
classes shall have or might have voting power by reason of the happening of any
contingency), or (b) all or substantially all of the Investments of Parent
Guarantor or Borrower, or (ii) a majority of the Board of Directors of Parent
Guarantor or Borrower, at any time, shall be composed of Persons other than (a)
Persons who were members of the Board of Directors on the date of this
Agreement, or (b) Persons who subsequently become members of the Board of
Directors and who either (x) are appointed or recommended for election with the
affirmative vote of a majority of the directors in office as of the date of this
Agreement, or (y) are appointed or recommended for election with the affirmative
vote of a majority of the Board of Directors of Parent Guarantor or Borrower
then in office; or

    
      
         

      

      
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              Section
      8.11

            	
              REIT
      Status;  Material Licenses and Permits.
  

            

    

     

    Parent
Guarantor shall at any time fail to maintain its REIT Status, or Parent
Guarantor, Borrower or any Subsidiary Guarantor shall lose, through suspension,
termination, impoundment, revocation, failure to renew or otherwise, its REIT
Status (if any) or any material license or permit (unless such material license
or permit is promptly replaced, renewed or  otherwise reinstated);
or

     

    
      	
               
      

            	
              Section
      8.12

            	
              Environmental.
      

            

    

     

    Any of
the Loan Parties or any of their respective Facilities shall become subject to
one or more Liens for costs or damages in excess of Five Hundred Thousand
($500,000) Dollars individually or in the aggregate under any Environmental Laws
and Regulations, such Liens shall remain in place for thirty (30) days after the
creation thereof and such Liens are reasonably likely to cause a Material
Adverse Effect; or

     

    
      	
               
      

            	
              Section
      8.13

            	
              Default by Operator.
      

            

    

     

    Unless
the Assigned Credit Advance Value for such Eligible Facility is first paid in
full, thirty (30) days after the acceleration by any Loan Party of the
obligations of an Operator or a Substantial Tenant as a result of any default in
the payment of amounts which are due and owing under any third party lease or
related security documents in connection with any Eligible Facility of such
Operator or Substantial Tenant (such Eligible Facility, herein referred to as
the “Defaulted
Facility”), in the event the Lease Rental Expense arising from the
Defaulted Facility accounts for 20% or more of the aggregate amount of all Lease
Rental Expense owing to the Borrower from all Operators and Substantial Tenants
during the immediately preceding four (4) calendar quarters.

     

    
      	 	
              Article 9. 

            	
              The Agent.
      

            

    

     

    
      	
               
      

            	
              Section
      9.1

            	
              Appointment, Powers
      and Immunities. 

            

    

     

    Each
Lender hereby irrevocably appoints and authorizes the Agent to act as its agent
hereunder and the other Loan Documents with such powers as are specifically
delegated to the Agent by the terms of this Agreement and the other Loan
Documents together with such other powers as are reasonably incidental
thereto.  The Agent shall have no duties or responsibilities except
those expressly set forth in this Agreement and the other Loan Documents and
shall not be a trustee for any Lender.  The Agent shall not be
responsible to the Lenders for any recitals, statements, representations or
warranties contained in this Agreement or the other Loan Documents in any
certificate or other document referred to or provided for in, or received by any
of them under, this Agreement or the other Loan Documents, or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or the other Loan Documents or any other document referred to or
provided for herein or therein or for the collectability of the Loans or for any
failure by any Loan Party to perform any of its obligations hereunder or under
the other Loan Documents.  The Agent may employ agents and
attorneys-in-­fact and shall not be answerable, except as to money or
securities received by it or its authorized agents, for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care.  Neither the Agent nor any of its directors,
officers, employees or agents shall be liable or responsible for any action
taken or omitted to be taken by it or them hereunder or the other Loan Documents
or in connection herewith or therewith, except for its or their own gross
negligence or willful misconduct.

    
      
         

      

      
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              Section
      9.2

            	
              Reliance by Agent.
      

            

    

     

    The Agent
shall be entitled to rely upon any certification, notice or other communication
(including any thereof by telephone, telex, telegram or cable) believed by it to
be genuine and correct and to have been signed or sent by or on behalf of the
proper person or persons, and upon advice and statements of legal counsel,
independent accountants and other experts selected by the Agent.  As
to any matters not expressly provided for by this Agreement or the other Loan
Documents, the Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder or the other Loan Documents in accordance with
instructions signed by the Required Lenders (other than any Defaulting Lender),
and such instructions of the Required Lenders (other than any Defaulting Lender)
and any action taken or failure to act pursuant thereto shall be binding on all
of the Lenders.

     

    
      	
               
      

            	
              Section
      9.3

            	
              Events of Default.
      

            

    

     

    The Agent
shall not be deemed to have knowledge of the occurrence of a Default (other than
the non-payment of principal of or interest on Loans) unless the Agent has
received notice from a Lender or the Borrower specifying such Default and
stating that such notice is a “Notice of Default”.  In the event that
the Agent receives such a notice of the occurrence of a Default, the Agent shall
give notice thereof to the Lenders (and shall give each Lender notice of each
such non-payment).  The Agent shall (subject to Section 9.7 hereof)
take such action with respect to such Default as shall be directed in writing by
the Required Lenders (or all of the Lenders, if required by the terms of this
Agreement).

     

    
      	
               
      

            	
              Section
      9.4

            	
              Rights as a Lender.
      

            

    

     

    With
respect to its Revolving Credit Commitment and the Loans made by it, the Agent
in its capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
acting as the Agent, and the term “Bank” or “Lenders” shall, unless the context
otherwise indicates, include the Agent in its individual
capacity.  The Agent and its Affiliates may (without having to account
therefor to any Lender) accept deposits from, lend money to and generally engage
in any kind of banking, trust or other business with each Loan Party or its
Affiliates, as if it were not acting as the Agent, and the Agent may accept fees
and other consideration from each Loan Party or its Affiliates, for services in
connection with this Agreement or any of the other Loan Documents or otherwise
without having to account for the same to the Lenders.

    
      
         

      

      
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              Section
      9.5

            	
              Indemnification.
      

            

    

     

    The
Lenders shall indemnify the Agent (to the extent not reimbursed by each Loan
Party under Sections 10.1 and 10.2 hereof), ratably in accordance with the
aggregate principal amount of the Loans made by the Lenders (or, if no Loans are
at the time outstanding, ratably in accordance with their respective Revolving
Credit Commitments), for any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind and nature whatsoever that may be imposed on, incurred by or asserted
against the Agent in any way relating to or arising out of this Agreement or any
of the other Loan Documents or any other documents contemplated by or referred
to herein or therein or the transactions contemplated by or referred to herein
or therein or the transactions contemplated hereby and thereby (including,
without limitation, the costs and expenses that each Loan Party is obligated to
pay under Sections 10.1 and 10.2 hereof, but excluding normal administrative
costs and expenses incident to the performance of its agency duties hereunder)
or the enforcement of any of the terms hereof or of any such other documents,
provided that no Bank
shall be liable for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of the party to be indemnified.

     

    
      	
               
      

            	
              Section
      9.6

            	
              Non-Reliance on Agent
      and other Lenders. 

            

    

     

    Each
Lender agrees that it has, independently and without reliance on the Agent or
any other Lender, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of each Loan Party and decision to
enter into this Agreement and that it will, independently and without reliance
upon the Agent or any other Lender, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement or the other Loan
Documents.  The Agent shall not be required to keep itself informed as
to the performance or observance by each Loan Party of this Agreement or the
other Loan Documents or any other document referred to or provided for herein or
therein or to inspect the properties or books of each Loan
Party.  Except for notices, reports and other documents and
information expressly required to be furnished to the Lenders by the Agent
hereunder or the other Loan Documents, the Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the affairs, financial condition or business of each Loan Party, that
may come into the possession of the Agent or any of its Affiliates.

     

    
      	
               
      

            	
              Section
      9.7

            	
              Failure to Act.
      

            

    

     

    Except
for action expressly required of the Agent hereunder, the Agent shall in all
cases be fully justified in failing or refusing to act hereunder or thereunder
unless it shall be indemnified to its satisfaction by the Lenders against any
and all liability and expense that may be incurred by it by reason of taking or
continuing to take any such action.

    
      
         

      

      
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              Section
      9.8

            	
              Resignation or Removal
      of Agent. 

            

    

     

    Subject
to the appointment and acceptance of a successor Agent as provided below, the
Agent may resign at any time by giving not less than ten (10) days’ prior
written notice thereof to the Lenders and each Loan Party and the Agent may be
removed by the Required Lenders for gross negligence or willful misconduct (as
determined by a court of competent jurisdiction).  Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Agent.  If no successor Agent shall have been so appointed
by the Required Lenders and shall have accepted such appointment within thirty
(30) days after the retiring Agent’s giving of notice of resignation or the
Required Lenders’ removal of the retiring Agent, then the retiring Agent may, on
behalf of the Lenders, after consultation with the Borrower, appoint a successor
Agent which shall be a Lender with a combined capital and surplus of at least
$100,000,000.  Upon the acceptance of any appointment as Agent
hereunder by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations hereunder.  After any retiring Agent’s resignation or
removal hereunder as Agent, the provisions of this Article 9 shall continue in
effect for its benefit in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent.

     

    
      	
               
      

            	
              Section
      9.9

            	
              Sharing of Payments.
      

            

    

     

    (a)           Prior
to any acceleration by the Agent and the Lenders of the
Obligations:

     

    (i)           in
the event that any Lender shall obtain payment in respect of a Note, or interest
thereon, whether voluntarily or involuntarily, and whether through the exercise
of a right of banker’s lien, set-off or counterclaim against each Loan Party or
otherwise, in a greater proportion than any such payment obtained by any other
Lender in respect of the corresponding Note held by it, then the Lender so
receiving such greater proportionate payment shall purchase for cash from the
other Lender or Lenders such portion of each such other Lender’s or Lenders’
Loan as shall be necessary to cause such Lender receiving the proportionate
overpayment to share the excess payment with each Lender; and

     

    (ii)           in
the event that any Lender shall obtain payment in respect of any Interest Rate
Contract to which such Lender is a party, whether voluntarily or involuntarily,
and whether through the exercise of a right of banker’s lien, set-off or
counterclaim against each Loan Party or otherwise, such Lender shall be
permitted to retain the full amount of such payment and shall not be required to
share such payment with any other Lender.

     

    (b)           Upon
or following any acceleration by the Agent and the Lenders of the Obligations,
in the event that any Lender shall obtain payment in respect of a Note, or
interest or Fees thereon, or in respect of an Interest Rate Contract to which
such Lender is a party, whether voluntarily or involuntarily, and whether
through the exercise of a right of banker’s lien, set-off or counterclaim
against each Loan Party or otherwise, in a greater proportion than any such
payment obtained by any other Lender in respect of the aggregate amount of the
corresponding Note held by such Lender and any Interest Rate Contract to which
such Lender is a party, then the Lender so receiving such greater proportionate
payment shall purchase for cash from the other Lender or Lenders such portion of
each such other Lender’s or Lenders’ Loan as shall be necessary to cause such
Lender receiving the proportionate overpayment to share the excess payment with
each Lender.  For the purposes of this subsection 9.9(b), payments on
Notes received by each Lender shall be in the same proportion as the proportion
of: (A) the sum of: (x) the Obligations owing to such Lender in respect of the
Note held by such Lender, plus (y) the Obligations
owing to such Lender in respect of Interest Rate Contracts to which such Lender
is party, if any, to (B) the sum of: (x) the Obligations owing to all of the
Lenders in respect of all of the Notes, plus (y) the Obligations
owing to all of the Lenders in respect of all Interest Rate Contracts to which
any Lender is a party; provided, however, that, with respect to subsections
9.9(a)(i) and (b) above, if all or any portion of such excess payment or
benefits is thereafter recovered from the Lender that received the proportionate
overpayment, such purchase of Loans or payment of benefits, as the case may be,
shall be rescinded, and the purchase price and benefits returned, to the extent
of such recovery, but without interest.

    
      
         

      

      
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                Article 10.

              	
                Miscellaneous
      Provisions. 

              

      

    

     

    
      	
               
      

            	
              Section
      10.1

            	
              Fees and Expenses;
      Indemnity. 

            

    

     

    (a)           The
Borrower will promptly pay all costs of the Agent in preparing the Loan
Documents and all actual, reasonable, out-of-pocket costs and expenses of the
issuance of the Notes and of each Loan Party’s performance of and compliance
with all agreements and conditions contained herein on its part to be performed
or complied with and the reasonable fees and expenses and disbursements of
counsel to the Agent in connection with the preparation, execution and delivery,
administration, interpretation and enforcement of this Agreement, the other Loan
Documents and all other agreements, instruments and documents relating to this
transaction, the consummation of the transactions contemplated by all such
documents, the preservation of all rights of the Lenders and the Agent, the
negotiation, preparation, execution and delivery of any amendment, modification
or supplement of or to, or any consent or waiver under, any such document (or
any such instrument that is proposed but not executed and delivered) and with
any claim or action threatened, made or brought against any of the Lenders or
the Agent arising out of or relating to any extent to this Agreement, the other
Loan Documents or the transactions contemplated hereby or thereby (other than a
claim or action resulting from the gross negligence, willful misconduct, or
intentional violation of law by the Agent and or the
Lenders).  Notwithstanding the above, Borrower shall not be obligated
under this Section 10.1(a) (but shall be obligated under Section 10.1(b) below,
to the extent applicable) to indemnify Lenders for fees and expenses and
disbursements of separate counsel to Lenders (other than Agent’s
counsel).

    
      
         

      

      
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    (b)           In
addition, the Borrower will promptly pay all actual, reasonable out-of-pocket
costs and expenses (including, without limitation, reasonable fees and
disbursements of counsel) suffered or incurred by each Lender in connection with
its enforcement of the payment of the Notes or any other sum due to it under
this Agreement or any of the other Loan Documents or any of its other rights
hereunder or thereunder.  In addition to the foregoing, the Borrower
shall indemnify each Lender and the Agent and each of their respective
directors, officers, employees, attorneys, agents and Affiliates against, and
hold each of them harmless from, any loss, liabilities, damages, penalties,
claims, costs and expenses (including reasonable attorneys’ fees and
disbursements) suffered or incurred by any of them arising out of, resulting
from or in any manner connected with, the execution, delivery and performance of
each of the Loan Documents, the Loans and any and all transactions related to or
consummated in connection with the Loans (other than as a result of the gross
negligence, willful misconduct or intentional violation of law by the party
seeking indemnification), including, without limitation, losses, liabilities,
damages, penalties, claims, costs and expenses suffered or incurred by any
Lender or the Agent or any of their respective directors, officers, employees,
attorneys, agents or Affiliates arising out of or related to any Environmental
Liability or Environmental Proceeding, or in investigating, preparing for,
defending against, or providing evidence, producing documents or taking any
other action in respect of any commenced or threatened litigation,
administrative proceeding or investigation under any federal securities law or
any other statute of any jurisdiction, or any regulation, or at common law or
otherwise against the Agent, the Lenders or any of their officers, directors,
affiliates, agents or Affiliates, that is alleged to arise out of or is based
upon: (i) any untrue statement or alleged untrue statement of any material
adverse fact of any Loan Party and its affiliates in any document or schedule
filed with the Securities and Exchange Commission or any other governmental
body; (ii) any omission or alleged omission to state any material fact required
to be stated in such document or schedule, or necessary to make the statements
made therein, in light of the circumstances under which made, not misleading;
(iii) any acts, practices or omission or alleged acts, practices or omissions of
any Loan Party or its .agents related to the making of any acquisition, purchase
of shares or assets pursuant thereto, financing of such purchases or the
consummation of any other transactions contemplated by any such acquisitions
that are alleged to be in violation of any federal securities law or of any
other statute, regulation or other law of any jurisdiction applicable to the
making of any such acquisition, the purchase of shares or assets pursuant
thereto, the financing of such purchases or the consummation of the other
transactions contemplated by any such acquisition; or (iv) any withdrawals,
termination or cancellation of any such proposed acquisition for any reason
whatsoever.  The indemnity set forth herein shall be in addition to
any other obligations or liabilities of any Loan Party to the Agent and the
Lenders hereunder, at common law or otherwise.  The provisions of this
Section 10.1 shall survive the payment of the Notes and the termination of this
Agreement.

     

    
      	
               
      

            	
              Section
      10.2

            	
              Taxes.
      

            

    

     

    If, under
any law in effect on the date of the closing of any Loan hereunder, or under any
retroactive provision of any law subsequently enacted, it shall be determined
that any Federal, state or local tax (other than any tax (except those referred
to in clause (ii) of Section 10.3 below) on or measured by the net income of the
Lender to which any such payment is due pursuant to applicable federal, state
and local income tax laws) is payable in respect of the issuance of any Note, or
in connection with the filing or recording of any assignments, mortgages,
financing statements, or other documents (whether measured by the amount of
Indebtedness secured or otherwise) as contemplated by this Agreement, then each
Loan Party will pay any such tax and all interest and penalties, if any, and
will indemnify the Lenders and the Agent against and save each of them harmless
from any loss or damage resulting from or arising out of the nonpayment or delay
in payment of any such tax.  If any such tax or taxes shall be
assessed or levied against any Lender or any other holder of a Note, such
Lender, or such other holder, as the ease may be, may notify each Loan Party and
make immediate payment thereof, together with interest or penalties in
connection therewith, and shall thereupon be entitled to and shall receive
immediate reimbursement therefor from each Loan
Party.  Notwithstanding any other provision contained in this
Agreement, the covenants and agreements of the Borrower in this Section 10.2
shall survive payment of the Notes and the termination of this
Agreement.

    
      
         

      

      
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              Section
      10.3

            	
              Payments.
      

            

    

     

    As set
forth in Article 2 hereof, all payments by each Loan Party on account of
principal, interest, fees and other charges (including any indemnities) shall be
made to the Agent at the Principal Office of the Agent, in lawful money of the
United States of America in immediately available funds, by wire transfer or
otherwise, not later than 11:00 A.M. Cleveland, Ohio time on the date such
payment is due.  Any such payment made on such date but after such
time shall, if the amount paid bears interest, be deemed to have been made on,
and interest shall continue to accrue and be payable thereon until, the next
succeeding Business Day.  If any payment of principal or interest
becomes due on a day other than a Business Day, such payment may be made on the
next succeeding Business Day and such extension shall be included in computing
interest in connection with such payment.  All payments hereunder and
under the Notes shall be made without set-off or counterclaim and in such
amounts as may be necessary in order that all such payments shall not be less
than the amounts otherwise specified to be paid under this Agreement and the
Notes (without regard to withholding for or on account of: (i) any present or
future taxes, levies, imposts, duties or other similar charges of whatever
nature imposed by any government or any political subdivision or taxing
authority thereof, other than any tax (except those referred to in clause (ii)
below) on or measured by the net income of the Lender to which any such payment
is due pursuant to applicable federal, state and local income tax laws, and (ii)
deduction of amounts equal to the taxes on or measured by the net income of such
Lender payable by such Lender with respect to the amount by which the payments
required to be made under this sentence exceed the amounts otherwise specified
to be paid in this Agreement and the Notes).  Upon payment in full of
any Note, the Lender holding such Note shall mark the Note “Paid” and return it to the
Borrower.

     

    
      	
               
      

            	
              Section
      10.4

            	
              Survival of Agreements
      and Representations; Construction.

            

    

     

    All
agreements, representations and warranties made herein shall survive the
delivery of this Agreement and the Notes.  The headings used in this
Agreement and the table of contents are for convenience only and shall not be
deemed to constitute a part hereof.  All uses herein of the masculine
gender or of singular or plural terms shall be deemed to include uses of the
feminine or neuter gender, or plural or singular terms, as the context may
require.

     

    
      	
               
      

            	
              Section
      10.5

            	
              Lien on and Set-off of
      Deposits. 

            

    

     

    As
security for the due payment and performance of all the Obligations, each Loan
Party hereby grants to Agent for the ratable benefit of the Lenders a Lien on
any and all deposits or other sums at any time credited by or due from the Agent
or any Lender to the Borrower, whether in regular or special depository accounts
or otherwise, and any and all monies, securities and other property of the
Borrower, and the proceeds thereof, now or hereafter held or received by or in
transit to any Lender or the Agent from or for such Loan Party, whether for
safekeeping, custody, pledge, transmission, collection or otherwise, and any
such deposits, sums, monies, securities and other property, may at any time
after the occurrence and during the continuance of any Event of Default be
set-off, appropriated and applied by any Lender or the Agent against any of the
Obligations, whether or not any of such Obligations is then due or is secured by
any collateral.

     

    
      
         

      

      
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              Section
      10.6

            	
              Modifications,
      Consents and Waivers; Entire Agreement.

            

    

     

    No
modification, amendment or waiver of or with respect to any provision of this
Agreement, any Notes, or any of the other Loan Documents and all other
agreements, instruments and documents delivered pursuant hereto or thereto, nor
consent to any departure by any Loan Party from any of the terms or conditions
thereof, shall in any event be effective unless it shall be in writing and
signed by the Agent and each Lender (other than any Defaulting Lender except as
set forth in the proviso of Section 2.23(b)) except that:  (i) any
modification or amendment of, or waiver or consent with respect to, Article 4
shall be required to be signed only by the Borrower, Agent and the Required
Lenders, and (ii) any modification or amendment of, or waiver or consent with
respect to, Articles 1 (other than the definition of “Required Lenders” or any
other defined term which is used in the application of any of the provisions of
Article 2), 5, 6, 7, 8 (other than Section 8.1 and Section 8.4 hereof) and 10
(other than this Section 10.6) may be signed only by the Borrower, Agent and the
Required Lenders.  Any such waiver or consent shall be effective only
in the specific instance and for the purpose for which given.  No
consent to or demand on any Loan Party in any case shall, of itself, entitle it
to any other or further notice or demand in similar or other
circumstances.  Notwithstanding anything to the contrary contained
herein, no modification, amendment or waiver of or with respect to any provision
of this Agreement, any Notes, or any of the other Loan Documents and all other
agreements, instruments and documents delivered pursuant hereto or thereto, nor
consent to any departure by any Loan Party from any of the terms or conditions
thereof, shall in any event amend, modify or otherwise affect the rights or
duties of the Agent or the Lenders hereunder without the prior written consent
of the Agent or the Lenders (other than any Defaulting Lender except as set
forth in the proviso of Section 2.23(b)), as the case may be.  This
Agreement and the other Loan Documents embody the entire agreement and
understanding among the Lenders, the Agent and the Borrower and supersede all
prior agreements and understandings relating to the subject matter
hereof.

     

    
      	
               
      

            	
              Section
      10.7

            	
              Remedies Cumulative;
      Counterclaims. 

            

    

     

    Each and
every right granted to the Agent and the Lenders hereunder or under any other
document delivered hereunder or in connection herewith, or allowed it by law or
equity, shall be cumulative and may be exercised from time to
time.  No failure on the part of the Agent or any Lender or the holder
of any Note to exercise, and no delay in exercising, any right shall operate as
a waiver thereof, nor shall any single or partial exercise of any right preclude
any other or future exercise thereof or the exercise of any other
right.  The due payment and performance of the Obligations shall be
without regard to any counterclaim, right of offset or any other claim
whatsoever that any Loan Party may have against any Lender or the Agent and
without regard to any other obligation of any nature whatsoever that any Lender
or the Agent may have to any Loan Party, and no such counterclaim or offset
shall be asserted by any Loan Party (unless such counter-claim or offset would,
under applicable law, be permanently and irrevocably lost if not brought in such
action) in any action, suit or proceeding instituted by any Lender or the Agent
for payment or performance of the Obligations.

    
      
         

      

      
        64

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              Section
      10.8

            	
              Further Assurances.
      

            

    

     

    At any
time and from time to time, upon the request of the Agent, each Loan Party shall
execute, deliver and acknowledge or cause to be executed, delivered and
acknowledged, such further documents and instruments and do such other acts and
things as the Agent may reasonably request in order to fully effect the purposes
of this Agreement, the other Loan Documents and any other agreements,
instruments and documents delivered pursuant hereto or in connection with the
Loans.

     

    
      	
               
      

            	
              Section
      10.9

            	
              Notices.
      

            

    

     

    All
notices, requests, reports and other communications pursuant to this Agreement
shall be in writing, either by letter (delivered by hand or commercial messenger
service or sent by certified mail, return receipt requested, except for routine
reports delivered in compliance with Article 5 hereof which may be sent by
ordinary first-class mail) or telecopy, addressed as follows:

     

    (a)           If
to the Borrower:

     

    Cornerstone
Healthcare Plus Operating Partnership, L.P.

    1920 Main
Street

    Suite
400

    Irvine,
California 92614

    Attention: 
Sharon Kaiser, Chief Financial Officer

    Telecopier
No: (949) 250-0592

    Telephone
No: (949) 852-1007

    

    with a
copy to:

    

    Servant
Healthcare Investments, LLC

    1000
Legion Place, Suite 1750

    Orlando,
Florida 32801

    Attention: 
Kevin R. Maddron, COO and CFO

    Telecopier
No.:  (407) 999-5210

    Telephone
No: (407) 999-2437

    

    with a
copy (other than in the case

    of
Borrowing Notices and reports

    and other
documents delivered in

    compliance
with Article 5 hereof) to:

     

    Foley
& Lardner LLP

    111 North
Orange Avenue

    Suite
1800

    Orlando,
Florida  32801

    Attention: 
Michael A. Okaty, Esq.

    Telecopier
No.: (407) 648-1743

    Telephone
No:  (407) 244-3229

    
      
         

      

      
        65

        
          

        

      

      
         

      

    

    (b)           If
to any Lender:

     

    To its
address set forth below its

    name on
the signature pages hereof,

    with a
copy to the Agent; and

     

    (c)           If
to the Agent:

     

    KeyBank
National Association, as Administrative Agent

    Mailcode
OH-01-49-0424

    4900
Tiedeman Road, 4th Floor

    Brooklyn,
Ohio 44144

    Attention: 
Charles W. Cashin III

    Telecopier
No.: (216) 828-7521

     

    with a
copy (other than in the case

    of
Borrowing Notices and reports

    and other
documents delivered in

    compliance
with Article 5 hereof) to:

     

    Schiff
Hardin, LLP

    233 South
Wacker Drive

    Suite
6600

    Chicago,
Illinois 60606

    Attention: 
Sean T. Maloney, Esq.

    Telecopier
No.: (312) 258-5700

    Telephone
No.:  (312) 258-5505

    
 

    Any
notice, request, demand or other communication hereunder shall be deemed to have
been given on: (x) the day on which it is telecopied to such party at its
telecopier number specified above (provided such notice shall be effective only
if followed by one of the other methods of delivery set forth herein) or
delivered by receipted hand or such commercial messenger service to such party
at its address specified above, or (y) on the third Business Day after the day
deposited in the mail, postage prepaid, if sent by mail.  Any party
hereto may change the Person, address or telecopier number to whom or which
notices are to be given hereunder, by notice duly given hereunder; provided, however, that any
such notice shall be deemed to have been given hereunder only when actually
received by the party to which it is addressed.

     

    
      	
               
      

            	
              Section
      10.10

            	
              Counterparts.
      

            

    

     

    This
Agreement may be signed in any number of counterparts with the same effect as if
the signatures thereto and hereto were upon the same
instrument.

    
      
         

      

      
        66

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              Section
      10.11

            	
              Severability.
      

            

    

     

    The
provisions of this Agreement are severable, and if any clause or provision
hereof shall be held invalid or unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall affect only such
clause or provision, or part thereof, in such jurisdiction and shall not in any
manner affect such clause or provision in any other jurisdiction, or any other
clause or provision in this Agreement in any jurisdiction.  Each of
the covenants, agreements and conditions contained in this Agreement is
independent and compliance by the Borrower with any of them shall not excuse
non-compliance by the Borrower with any other.  All covenants
hereunder shall be given independent effect so that if a particular action or
condition is not permitted by any of such covenants, the fact that it would be
permitted by an exception to, or be otherwise within the limitations of, another
covenant shall not avoid the occurrence of a Default or an Event of Default if
such action is taken or condition exists.

     

    
      	
               
      

            	
              Section
      10.12

            	
              Binding Effect; No
      Assignment or Delegation by Borrower.

            

    

     

    This
Agreement shall be binding upon and inure to the benefit of each of the Borrower
and their respective successors and to the benefit of the Lenders and the Agent
and their respective successors and assigns.  The rights and
obligations of each Loan Party under this Agreement shall not be assigned or
delegated without the prior written consent of the Agent and the Required
Lenders, and any purported assignment or delegation without such consent shall
be void.

     

    
      	
               
      

            	
              Section
      10.13

            	
              Assignments and
      Participations by Lenders. 

            

    

     

    (a)           Each
Lender may assign to one or more Lenders or other entities all or a portion of
its rights and obligations under this Agreement (including, without limitation,
all or a portion of its Revolving Credit Commitment, the Loans owing to it, and
the Note held by it); provided, however, that: (i)
the Borrower and the Agent must give prior written consent to such assignment
(unless such assignment is to an Affiliate of such Lender or to another Lender),
which consent shall not be unreasonably withheld (provided, however, that
Borrower’s consent may be withheld for any reason with respect to, and only with
respect to, any Lender that would (A) provide a Revolving Credit Commitment on
the initial Closing Date and (B) provide any additional Revolving Credit
Commitment(s) over and above the Revolving Credit Commitments provided for on
the Closing Date, it being acknowledged for sake of clarity, that the standard
set forth in this proviso does not apply to assignments or participations of any
Revolving Credit Commitment and further that there is no commitment or
obligation to increase the amount of the Revolving Credit Commitment), (ii) the
parties to each such assignment shall execute and deliver to the Agent an
Assignment and Acceptance, and a processing fee of $3,500.00, (iii) each such
assignment shall be of a constant, and not a varying, percentage of all of the
assigning Bank’s rights and obligations under this Agreement, (iv) the amount of
the Revolving Credit Commitment of the assigning Bank being assigned pursuant to
each such assignment (determined as of the date of the Assignment and Acceptance
with respect to such assignment) shall in no event be less than $5,000,000 and
shall be an integral multiple of $1,000,000, and (v) each such assignment shall
be to an Eligible Assignee.  Upon such execution, delivery and
acceptance, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least five (5) Business Days after
the execution thereof: (x) the assignee thereunder shall be a party hereto and,
to the extent that rights and obligations hereunder have been assigned to it
pursuant to such Assignment and Acceptance, have the rights and obligations of a
Lender hereunder, and (y) the Lender assignor thereunder shall, to the extent
that rights and obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Bank’s rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto).  Notwithstanding anything to the contrary in clause (a)(i)
above, no consent of the Borrower shall be required for an assignment if an
Event of Default has occurred and is continuing.

    
      
         

      

      
        67

        
          

        

      

      
         

      

    

    (b)           By
executing and delivering an Assignment and Acceptance, the Lender assignor
thereunder and the assignee thereunder confirm to and agree with each other and
the other parties hereto as follows: (i) other than as provided in such
Assignment and Acceptance, such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Bank makes no representation or warranty and assumes
no responsibility with respect to the financial condition of each Loan Party or
the performance or observance by each Loan Party of any of its obligations under
this Agreement or any other instrument or document furnished pursuant hereto;
(iii) such assignee confirms that it has received a copy of this Agreement,
together with copies of such financial statements and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Agent, such assigning Bank or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (v) such assignee confirms that it is an
Eligible Assignee; (vi) such assignee appoints and authorizes the Agent to take
such action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Agent by the terms hereof, together with such
powers as are reasonably incidental thereto; and (vii) such assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of this Agreement are required to be performed by it as a
Lender.

     

    (c)           Upon
its receipt of an Assignment and Acceptance executed by an assigning Bank and an
assignee representing that it is an Eligible Assignee, together with any Note
subject to such assignment (and also, to the extent required, any consent of the
Borrower required pursuant to Section 10.13(a) above), the Agent
shall:  (i) accept such Assignment and Acceptance, and (ii) give
prompt notice thereof to the Borrower.  Within five (5) Business Days
after its receipt of such notice, the Borrower, at their own expense, shall
execute and deliver to the Agent in exchange for the surrendered Note a new Note
to the order of such Eligible Assignee in an amount equal to the Revolving
Credit Commitment assumed by it pursuant to such Assignment and Acceptance and,
if the assigning Bank has retained a Revolving Credit Commitment hereunder, a
new Note to the order of the assigning Bank in an amount equal to the Revolving
Credit Commitment retained by it hereunder.  Such new Note shall be in
an aggregate principal amount equal to the aggregate principal amount of such
surrendered Note, shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of Exhibit F
hereto.

    
      
         

      

      
        68

        
          

        

      

      
         

      

    

    (d)           Each
Lender may, without the prior consent of the Agent, the other Lenders or the
Borrower, sell participations to one or more Lenders or other entities in all or
a portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Revolving Credit Commitment, the Loans owing
to it, and the Note held by it); provided, however,
that:  (i) such Lender’s obligations under this Agreement (including,
without limitation, its Revolving Credit Commitment hereunder) shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) such Lender shall remain
the holder of any such Note for all purposes of this Agreement, and the
Borrower, the Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.

     

    (e)           Any
Lender may, in connection with any assignment or participation or proposed
assignment or participation pursuant to this Section 10.13, disclose to the
assignee or participant or proposed assignee or participant, any information
relating to any Loan Party furnished to such Lender by or on behalf of such Loan
Party; provided that,
prior to any such disclosure, the assignee or participant or proposed assignee
or participant shall agree to preserve the confidentiality of any confidential
information relating to such Loan Party received by it from such
Lender.

     

    (f)           Anything
in this Section 10.13 to the contrary notwithstanding, any Lender may assign and
pledge all or any portion of its Loans and its Note to any Federal Reserve Bank
(and its transferees) as collateral security pursuant to Regulation A of the
Board of Governors of the Federal Reserve System and any Operating Circular
issued by such Federal Reserve Bank.  No such assignment shall release
the assigning Bank from its obligations hereunder.

     

    
      	
               
      

            	
              Section
      10.14

            	
              Delivery of Tax Forms.
      

            

    

     

    Each
Lender that is not organized under the laws of the United States or a state
thereof shall:

     

    (a)           deliver
to the Borrower and the Agent, on or prior to the date of the execution and
delivery of this Agreement or the date on which it becomes a Lender hereunder,
two accurate and duly completed executed copies of United States IRS Form W-8BEN
or W-­8ECI, as appropriate, or successor applicable form, as the case may
be;

     

    (b)           deliver
to the Borrower and the Agent two further accurate and complete executed copies
of any such form or certification on or before the date that any such form or
certification expires or becomes obsolete and after the occurrence of any event
requiring a change in the most recent form previously delivered by it to the
Borrower; and

    
      
         

      

      
        69

        
          

        

      

      
         

      

    

    (c)           obtain
such extensions of time for filing and completing such forms or certifications
as may reasonably be requested by the Borrower or the Agent; unless in any such
case under clause (b) above an event (including, without limitation, any change
in treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and delivering any such
form with respect to it and such Lender so advises the Borrower and the
Agent.  Such Lender shall certify with respect to Form W-8BEN or
W8ECI, as appropriate that (i) it is entitled to receive payments under this
Agreement without deduction or withholding of any United States Federal income
taxes; (ii) to the extent legally entitled to do so, that it is entitled to
receive payments under this Agreement without, or at a reduced rate of,
deduction or withholding of any United States Federal income taxes; or (iii)
that it is entitled to an exemption from United States backup withholding
tax.  Each Person not organized under the laws of the United States or
a state thereof that is an assignee hereunder shall, prior to the effectiveness
of the related transfer, be required to provide all of the forms and statements
required pursuant to this Section 10.14.

     

    
      	
               
      

            	
              Section
      10.15

            	
              Governing Law; Consent
      to Jurisdiction; Waiver of Trial by
Jury.

            

    

     

    (a)           THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS AND ALL OTHER DOCUMENTS AND INSTRUMENTS
EXECUTED AND DELIVERED IN CONNECTION HEREWITH AND THEREWITH, SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORKWITHOUT REGARD TO ITS RULES PERTAINING TO CONFLICTS OF
LAWS.

     

    (b)           EACH
LOAN PARTY IRREVOCABLY CONSENTS THAT ANY LEGAL ACTION OR PROCEEDING AGAINST IT
UNDER, ARISING OUT OF OR IN ANY MANNER RELATING TO THIS AGREEMENT, AND EACH
OTHER LOAN DOCUMENT MAY BE BROUGHT IN ANY COURT OF THE STATE OF NEW YORK, COUNTY
OF NEW YORK, OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK.  EACH LOAN PARTY, BY THE EXECUTION AND DELIVERY OF THIS
AGREEMENT, EXPRESSLY AND IRREVOCABLY ASSENTS AND SUBMITS TO THE NONEXCLUSIVE
PERSONAL JURISDICTION OF ANY OF SUCH COURTS IN ANY SUCH ACTION OR
PROCEEDING.  EACH LOAN PARTY FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF ANY COMPLAINT, SUMMONS, NOTICE OR OTHER PROCESS RELATING TO ANY SUCH
ACTION OR PROCEEDING BY DELIVERY THEREOF TO IT BY HAND OR BY MAIL IN THE MANNER
PROVIDED FOR IN SECTION 10.9 HEREOF.  EACH LOAN PARTY HEREBY EXPRESSLY
AND IRREVOCABLY WAIVES ANY CLAIM OR DEFENSE IN ANY SUCH ACTION OR PROCEEDING
BASED ON ANY ALLEGED LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS OR ANY
SIMILAR BASIS.  EACH LOAN PARTY SHALL NOT BE ENTITLED IN ANY SUCH
ACTION OR PROCEEDING TO ASSERT ANY DEFENSE GIVEN OR ALLOWED UNDER THE LAWS OF
ANY STATE OTHER THAN THE STATE OF NEW YORK UNLESS SUCH DEFENSE IS ALSO GIVEN OR
ALLOWED BY THE LAWS OF THE STATE OF NEW YORK.  NOTHING IN THIS SECTION
10.15 SHALL AFFECT OR IMPAIR IN ANY MANNER OR TO ANY EXTENT THE RIGHT OF THE
AGENT OR ANY LENDER TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST
ANY LOAN PARTY IN THE COURTS OF ANY OTHER JURISDICTION OR THE RIGHT, IN
CONNECTION WITH ANY LEGAL ACTION OR PROCEEDING WHATSOEVER, TO SERVE LEGAL
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

    
      
         

      

      
        70

        
          

        

      

      
         

      

    

    (c)           EACH
LOAN PARTY, THE LENDERS AND THE AGENT WAIVE TRIAL BY JURY IN ANY LITIGATION IN
ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF, THIS
AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS, OR ANY INSTRUMENT OR DOCUMENT
DELIVERED PURSUANT TO THIS AGREEMENT, OR THE VALIDITY, INTERPRETATION,
COLLECTION OR ENFORCEMENT THEREOF.

     

    
      	
               
      

            	
              Section
      10.16

            	
              Confidentiality.
      

            

    

     

    Each of
the Agent and the Lenders agree to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates’ directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory or self-regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (f) with the consent of the Borrower, (g) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this Section, or (ii) becomes available to the Agent or any Lender on a
nonconfidential basis from a source other than the Borrower, or (h) to any
prospective assignee or participant in connection with any contemplated transfer
pursuant to Section 10.13 or to any direct, indirect, actual or prospective
counterparty (and its advisor) to any swap, derivative or securitization
transaction related to the obligations under this Agreement, provided that such
prospective assignee, participant or counterparty shall have been made aware of
this Section 10.16 and shall have agreed to be bound by its provisions as if it
were a party to this Agreement.  For the purposes of this Section,
“Information” means all
information received from Borrower relating to Borrower or its business, other
than any such information that is available to the Agent or any Lender on a
nonconfidential basis prior to disclosure by Borrower; provided, that, in the
case of information received from Borrower after the date hereof, such
information is clearly identified at the time of delivery as
confidential.  Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.

     

    
      	
               
      

            	
              Section
      10.17

            	
              USA Patriot Act
      Notice; Anti-Money Laundering.

            

    

     

    (a)           The
Agent and each Lender hereby notifies each Loan Party that, pursuant to the
requirements of the USA Patriot Act it is required to obtain, verify and record
information that identifies Borrower (and to the extent requested, each Loan
Party), which information includes the name and address of Borrower (and to the
extent requested, each Loan Party) and other information that will allow the
Agent and such Lenders to identify the Borrower (and to the extent requested,
each Loan Party) in accordance with the Patriot Act.
 

    
      
         

      

      
        71

        
          

        

      

      
         

      

    

    (b)           The
Borrower shall, following a request by the Agent or any Lender, provide (or
cause the same to be provided) all documentation and other information that the
Agent or such Lender reasonably requests in order to comply with its ongoing
obligations .under applicable “know your customer” and anti-money laundering
rules and regulations, including the USA Patriot Act.

     

    
      	
               
      

            	
              Section
      10.18

            	
              Removal and
      Replacement of Defaulting Lenders.

            

    

     

    Under any
circumstances set forth in Section 2.23 of this Agreement providing that
Borrower shall have the right to remove and replace a Defaulting Lender as a
party to this Agreement, Borrower may, upon notice to such Defaulting Lender and
Agent, remove such Defaulting Lender by causing such Defaulting Lender to assign
its Revolving Credit Commitment to one or more other Lenders or Eligible
Assignees acceptable to Borrower and Agent; provided, however, that
during the existence of any Event of Default, Borrower may not remove or replace
a Defaulting Lender pursuant to this Section 10.18.  Any removed or
replaced Defaulting Lender shall be entitled, subject to the terms and
provisions of Section 2.23, to (y) payment in full of all principal, interest,
fees and other amounts owing to such Defaulting Lender or such Defaulting
Lender’s affiliated indemnitees under any Loan Document through the date of
termination or assignment (including any amounts payable pursuant to Section
2.22), and (z) a release of such Lender from its obligations under the Loan
Documents (other than with respect to such default).  Any Defaulting
Lender being replaced shall execute and deliver an Assignment and Acceptance
covering such Defaulting Lender’s Revolving Credit Commitment, and shall
otherwise comply with Section 10.13 (and Borrower shall be responsible for
payment of any processing and recordation fee payable under Section
10.13).  Administrative Agent shall distribute an amended listing of
Revolving Credit Commitments, which shall thereafter be incorporated into this
Agreement, to reflect adjustments to Lenders and their Revolving Credit
Commitments.

    
      
         

      

      
        72

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed on the date first
above written.

     

    
      
        
          
            
              
                
                  
                    
                      
                        	 
      	 	
                                Cornerstone
      Healthcare Plus Operating

                                Partnership,
      L.P.

                              
	 
      	 	
                                By
      Cornerstone Healthcare Plus REIT, Inc.,

                              
	 
      	 	
                                Its
      General Partner

                              
	 
      	 	 
      
	 
      	 	
                                By

                              	

                                /s/ Sharon C. Kaiser 
      

                              
	 
      	 	 
      	
                                Printed
      Name: Sharon C. Kaiser

                              
	 
      	 	 
      	
                                Its
      Authorized Representative

                              
	 
      	 	 
      
	
                                Revolving Credit Commitment:

                              	 	
                                KeyBank
      National Association

                              
	 
      	 	
                                as
      Administrative Agent, and as a Lender

                              
	 
      	 	 
      
	
                                Pro
      rata Share of Aggregate

                              	 	
                                By:

                              	

                                /s/
      Charles W. Cashin III  

                              
	
                                Revolving Credit Commitments:

                              	 	 
      	
                                Name:  Charles
      W. Cashin III

                              
	 
      	 	 
      	
                                Title:    Assistant
      Vice President

                              
	
                                100.0%

                              	 	 
      
	 
      	 	
                                Lending
      Office for Base Rate Loans

                              
	 
      	 	
                                and
      LIBOR Loans:

                              
	 
      	 	 
      
	 
      	 	
                                KeyBank
      National Association

                              
	 
      	 	
                                127
      Public Square, MC:OH-01-27-0605

                              
	 
      	 	
                                Cleveland,
      Ohio 44114

                              
	 
      	 	
                                Attention:  Healthcare
      Administrative Assistant

                              
	 
      	 	 
      
	 
      	 	
                                Address
      for Notices:

                              
	 
      	 	 
      
	 
      	 	
                                KeyBank
      National Association

                              
	 
      	 	
                                Mailcode
      OH-01-49-0424

                              
	 
      	 	
                                4900
      Tiedeman Road, 4th Floor

                              
	 
      	 	
                                Brooklyn,
      Ohio 44144

                              
	 
      	 	
                                Attention:  Charles
      W. Cashin III

                              
	 
      	 	
                                Telecopier:
      (216)
216-828-7521

                              

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

      EXHIBIT
A

       

      Form
of

      Revolving
Note

       

      
        	
                $25,000,000.00

              	
                November
      19, 2010

              

      

       

      For
Value Received, the undersigned (the “Borrower”), hereby promises
to pay to the order of KeyBank
National Association (the “Lender”), on the Maturity
Date (as defined in the Credit Agreement referred to below) the principal amount
of Twenty-Five
Million and No/100 Dollars ($25,000,000.00), or such lesser principal
amount of Loans (as defined in the Credit Agreement referred to below) payable
by Borrower to Lender on such Revolving Credit Termination Date under that
certain Credit Agreement, dated as of November 19, 2010, among Borrower, Lenders
from time to time party thereto, KeyBank
National Association, as Agent and a Lender (as amended, restated,
extended, supplemented or otherwise modified in writing from time to time, the
“Agreement;” the terms
defined therein being used herein as therein defined).

       

      Borrower
promises to pay interest on the unpaid principal amount of each Revolving Credit
Loan from the date of such Revolving Credit Loan until such principal amount is
paid in full, at such interest rates, and payable at such times as are specified
in the Agreement.

       

      All
payments of principal and interest shall be made to Agent for the account of
Lender in United States dollars in immediately available funds at Agent's
Principal Office.

       

      If any
amount is not paid in full when due hereunder, such unpaid amount shall bear
interest, to be paid upon demand, from the due date thereof until the date of
actual payment (and before as well as after judgment) computed at the per annum
rate set forth in the Agreement.

       

      This
Revolving Note is one of the “Revolving Credit Notes” referred to in the
Agreement.  Reference is hereby made to the Agreement for rights and
obligations of payment and prepayment, events of default and the right of Lender
to accelerate the maturity hereof upon the occurrence of such
events.  Revolving Credit Loans made by Lender shall be evidenced by
one or more loan accounts or records maintained by Lender in the ordinary course
of business.  Lender may also attach schedules to this Revolving
Credit Note and endorse thereon the date, amount and maturity of its Revolving
Credit Loans and payments with respect thereto.

       

      Borrower,
for itself, its successors and assigns, hereby waives diligence, presentment,
protest and demand and notice of protest, demand, dishonor and non-payment of
this Revolving Credit Note.

       

      Borrower
agrees to pay all collection expenses, court costs and attorney costs (whether
or not litigation is commenced) which may be incurred by Lender in connection
with the collection or enforcement of this Revolving Credit Note, all as further
set forth in the Agreement.

      
        
           

        

        
          A-1

          
            

          

        

        
           

        

      

       

      THIS
REVOLVING NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK.

       

      
        
          
            
              
                	 
      	
                        Cornerstone Healthcare Plus

                        Operating Partnership, L.P., a

                        Delaware limited partnership, as Borrower

                           

                        By Cornerstone Healthcare Plus REIT, Inc.,

                        its General Partner

                      
	 	 
	 
      	
                        By:

                      	
                        /s/ Sharon C. Kaiser

                      
	 
      	 
      	 
      
	 
      	
                        Name: 

                      	
                        Sharon C. Kaiser

                      
	 
      	 
      	 
      
	 
      	
                        Title:

                      	
                        Chief Financial Officer

                      

              

            

          

        

      

      
        
           

        

        
          A-2

          
            

          

        

        
           

        

      

      LOANS
AND PAYMENTS WITH RESPECT THERETO

       

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            	
                                                    Date

                                                  	 
      	
                                                    Type of

                                                    Loan

                                                    Made

                                                  	 
      	
                                                    Amount of

                                                    Loan

                                                    Made

                                                  	 
      	
                                                    End of

                                                    Interest

                                                    Period

                                                  	 
      	
                                                    Amount of

                                                    Principal

                                                    or Interest

                                                    Paid this

                                                    Date

                                                  	 
      	
                                                    Outstanding

                                                    Principal

                                                    Balance

                                                    This Date

                                                  	 
      	
                                                    Notation

                                                    Made by

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  	 
      	
                                                      

                                                  
	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  	
                                                      

                                                  

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      
        
           

        

        
          A-3

          
            

          

        

        
           

        

      

      EXHIBIT
B

       

      Form
of Guaranty Agreement

       

      Subsidiary
Guaranty Agreement

       

      Dated
as of [November __], 2010

       

      Re:           Cornerstone
Healthcare Plus Operating Partnership, L.P.

      
        
           

        

        
          A-i

          
            

          

        

        
           

        

      

       

      Table
of Contents

       

      
        
          
            
              	 	(Not
      a part of the Agreement) 	 
	 	 	 
	
                      Section
      1.

                    	
                      Definitions

                    	
                      2

                    
	 
      	 
      	 
      
	
                      Section
      2.

                    	
                      Guaranty
      of Notes and Credit Agreement

                    	
                      2

                    
	 
      	 
      	 
      
	
                      Section
      3.

                    	
                      Guaranty
      of Payment and Performance

                    	
                      4

                    
	 
      	 
      	 
      
	
                      Section
      4.

                    	
                      General
      Provisions Relating to the Guaranty

                    	
                      4

                    
	 
      	 
      	 
      
	
                      Section
      5.

                    	
                      Representations
      and Warranties of the Guarantors

                    	
                      10

                    
	 
      	 
      	 
      
	
                      Section
      6.

                    	
                      Amendments,
      Waivers and Consents

                    	
                      12

                    
	 
      	 
      	 
      
	
                      Section
      7.

                    	
                      Notices

                    	
                      13

                    
	 
      	 
      	 
      
	
                      Section
      8.

                    	
                      Miscellaneous

                    	
                      13

                    

            

          

        

      

      
        
           

        

        
          A-ii

          
            

          

        

        
           

        

      

       

      
        Attachments
to Subsidiary Guaranty Agreement:

      

       

      Exhibit
A      —      Form
of Guaranty Supplement

    

    

      
        
           

        

        
          A-iii

          
            

          

        

        
           

        

      

      Subsidiary
Guaranty Agreement

      

      Re:Cornerstone Healthcare
Plus Operating Partnership, L.P.

      
        

      

      This
Subsidiary
Guaranty Agreement dated as of [November __], 2010 (this “Subsidiary Guaranty”) is
entered into on a joint and several basis by each of the undersigned, together
with any entity which may become a party hereto by execution and delivery of a
Subsidiary Guaranty Supplement in substantially the form set forth as Exhibit A hereto (a
“Guaranty Supplement”)
(which parties are hereinafter referred to individually as a “Subsidiary Guarantor” and collectively as the
“Subsidiary
Guarantors”).

       

      Recitals

       

      A.          Each
Subsidiary Guarantor, directly or indirectly, is a subsidiary of Cornerstone
Healthcare Plus Operating Partnership, L.P., a limited partnership organized
under the laws of the State of Delaware (the “Borrower”).

       

      B.          The
Borrower has entered into that certain Credit Agreement dated as of November 19,
2010 (as the same may be amended, supplemented, restated or otherwise modified
from time to time, the “Credit
Agreement”) among the Borrower, KeyBank National Association, as Agent
(the “Agent”) and each
of the Lenders from time to time parties thereto (the “Lenders”), providing for,
among other things, Revolving Credit Loans to the Borrower of up to $25,000,000
(herein, and as defined in the Credit Agreement, the “Revolving Credit
Loans”).

       

      C.          The
proceeds of the Revolving Credit Loans will be used by Borrower to provide funds
(each, an “Intercompany
Loan”) from time to time to each Subsidiary Guarantor to purchase or
refinance an Eligible Facility (as defined in the Credit Agreement) that is
owned or operated by such Subsidiary Guarantor.  

       

      D.          Each
Intercompany Loan will be evidenced by an Intercompany Note (as defined in the
Credit Agreement) which Intercompany Note will be assigned to Agent as
collateral for all of the Revolving Credit Loans.

       

      E.          The
Agent and the Lenders have required as a condition of their making Revolving
Credit Loans from time to time that the Borrower cause each of the undersigned
to enter into this Subsidiary Guaranty and to cause each Subsidiary that
thereafter becomes an owner or Operator of an Eligible Facility (each as defined
in the Credit Agreement) to enter into a Guaranty Supplement, and the Borrower
has agreed to cause each of the undersigned to execute this Subsidiary Guaranty
and to cause each such that becomes owner or Operator of an Eligible Facility to
execute a Guaranty Supplement, in each case in order to induce the Agent and the
Lenders to make the Revolving Credit Loans and thereby benefit the Borrower and
its Subsidiaries by providing funds to the Borrower for the purposes described
in Schedule 2.8 of the Credit Agreement.

      
        
           

        

        
          A-1

          
            

          

        

        
           

        

      

       

      Now,
therefore,
as required by Section 4.1 of the Credit Agreement and in consideration of
the premises and other good and valuable consideration, the receipt and
sufficiency whereof are hereby acknowledged, each Subsidiary Guarantor does
hereby covenant and agree, jointly and severally, as follows:

       

      
        
          	
                  Section 1.

                	
                  Definitions.

                

        

      

       

      Capitalized
terms used herein shall have the meanings set forth in the Credit Agreement
unless otherwise defined herein.

       

      
        
          	
                  Section 2.

                	
                  Guaranty
      of Notes and Credit
Agreement.

                

        

      

       

      (a)          Each
Subsidiary Guarantor jointly and severally does hereby irrevocably, absolutely
and unconditionally guarantee, as primary obligor and not as surety, unto the
Agent and the Lenders:  (1) the full and prompt payment of (i)
the principal of, and interest on the Revolving Credit Notes from time to time
outstanding, as and when such payments shall become due and payable whether by
lapse of time, upon redemption or prepayment, by extension or by acceleration or
declaration or otherwise (including, to the extent permitted by applicable law,
interest due on overdue payments of principal, or interest at the rate set forth
in the Credit Agreement) and (ii) all fees (including, without limitation, any
Fees) that shall become due and payable under the terms of the Credit Agreement,
in each case, in federal or other immediately available funds of the United
States of America which at the time of payment or demand therefor shall be legal
tender for the payment of public and private debts, (2) the full and prompt
performance and observance by the Borrower of each and all of the obligations,
covenants and agreements required to be performed or owed by the Borrower and
the Loan Parties under the terms of the Revolving Credit Loans, the Credit
Agreement and all other Loan Documents to which the Borrower or any other Loan
Party is a party, and (3) the full and prompt payment, (i) upon demand by
Agent or any Lender of all costs and expenses, legal or otherwise (including
reasonable attorneys’ fees), if any, as shall have been expended or incurred in
the protection or enforcement of any rights, privileges or liabilities in favor
of the Lenders under or in respect of the Revolving Credit Loans, the Credit
Agreement, the other Loan Documents or under this Subsidiary Guaranty or in any
consultation or action in connection therewith or herewith and (ii) all other
Obligations (as defined in the Credit Agreement).  All amounts due,
debts, liabilities and other obligations described in this Section 2 shall be
hereinafter collectively referred to as the “Guaranteed Obligations.”
 

       

      Each
Subsidiary Guarantor agrees that its guarantee hereunder is continuing in nature
and applies to all Guaranteed Obligations whether currently existing or
hereafter incurred or created.

      
        
           

        

        
          A-2

          
            

          

        

        
           

        

      

      (b)          To
the extent that any Subsidiary Guarantor shall make a payment hereunder (a
“Payment”) which,
taking into account all other Payments previously or concurrently made by any of
the other Guarantors (including, without limitation, the Parent Guarantor under
its Guaranty), exceeds the amount which such Subsidiary Guarantor would
otherwise have paid if each Guarantor had paid the aggregate obligations
satisfied by such Payment in the same proportion as such Subsidiary Guarantor’s
“Allocable Amount” (as
hereinafter defined) in effect immediately prior to such Payment bore to the
“Aggregate Allocable
Amount” (as hereinafter defined) of all of the Guarantors (including,
without limitation, the Parent Guarantor under its Guaranty) in effect
immediately prior to the making of such Payment, then such Subsidiary Guarantor
shall be entitled to contribution and indemnification from, and be reimbursed
by, each of the other Guarantors for the amount of such excess, pro rata based upon their
respective Allocable Amounts in effect immediately prior to such
Payment;  provided that each Subsidiary
Guarantor covenants and agrees that such right of contribution and
indemnification and any and all claims of such Subsidiary Guarantor against any
other Guarantor, any endorser or against any of their property shall be junior
and subordinate in right of payment to the prior indefeasible final payment in
cash in full of all Guaranteed Obligations and satisfaction by the Borrower of
its Guaranteed Obligations and by the Subsidiary Guarantors of their obligations
under this Subsidiary Guaranty and the other Loan Documents to which any
Subsidiary Guarantor is a party, and the Subsidiary Guarantors shall not take
any action to enforce such right of contribution and indemnification, and no
Subsidiary Guarantors shall accept any payment in respect of such right of
contribution and indemnification, until all of the Guaranteed Obligations and
all amounts payable by the Subsidiary Guarantors hereunder (and by the Parent
Guarantor under its Guaranty) have indefeasibly been finally paid in cash in
full and all of the Guaranteed Obligations have otherwise been satisfied in
full.

       

      As of any
date of determination, (1) the “Allocable Amount” of any
Subsidiary Guarantor shall be equal to the maximum amount which could then be
claimed by the Agent and Lenders under this Subsidiary Guaranty without
rendering such claim voidable or avoidable under Section 548 of Chapter 11 of
the United States Bankruptcy Code (11 U.S.C. Sec. 101 et. seq.) or under any
applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance
Act or similar statute or common law; and (2) the “Aggregate Allocable
Amount” shall be equal to the
sum of each Guarantor’s Allocable Amount.

       

      This
clause (b) is intended only to define the relative rights of the Guarantors, and
nothing set forth in this clause (b) is intended to or shall impair the
obligations of the Guarantors, jointly and severally, to pay any amounts to the
Agent and Lenders as and when the same shall become due and payable in
accordance herewith.

       

      Each
Subsidiary Guarantor acknowledges that the rights of contribution and
indemnification hereunder shall constitute an asset in favor of any Guarantor
(including the Parent Guarantor and any other Subsidiary Guarantor) to which
such contribution and indemnification is owing.

       

      
        
          
          

        

        
          A-3

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  Section 3.

                	
                  Guaranty
      of Payment and
Performance.

                

        

      

      This is
an irrevocable, absolute and unconditional guarantee of payment and performance
(but not of collection) and each Subsidiary Guarantor hereby waives, to the
fullest extent permitted by law, any right to require that any action on or in
respect of any Revolving Credit Loan, the Credit Agreement, any other Loan
Document or any other Guaranteed Obligation be brought against the Borrower or
any other Person or that resort be had to any direct or indirect security for
the Guaranteed Obligations or for this Subsidiary Guaranty or any other
remedy.  Agent and any Lender may, at its option, proceed hereunder
against any Guarantor in the first instance to collect monies when due, the
payment of which is guaranteed hereby, without first proceeding against the
Borrower or any other Person and without first resorting to any direct or
indirect security for the Guaranteed Obligations or for this Guaranty or any
other remedy.  The liability of each Subsidiary Guarantor hereunder
shall in no way be affected or impaired by any acceptance by Agent or any Lender
of any direct or indirect security for, or other guaranties of, any
Indebtedness, liability or obligation of the Borrower or any other Person to
Agent or any Lender or by any failure, delay, neglect or omission by Agent or
any Lender to realize upon or protect any such guarantees, Indebtedness,
liability or obligation or any notes or other instruments evidencing the same or
any direct or indirect security therefor or by any approval, consent, waiver, or
other action taken, or omitted to be taken by Agent or any such
Lender.

       

      The
covenants and agreements on the part of the Subsidiary Guarantors herein
contained shall take effect as joint and several covenants and agreements, and
references to the Subsidiary Guarantors shall take effect as references to each
of them and none of them shall be released from liability hereunder by reason of
the guarantee ceasing to be binding as a continuing security on any other of
them.

       

      
        
          	
                  Section 4.

                	
                  General Provisions Relating to
      the Guaranty.

                

        

      

       

      (a)          Each
Subsidiary Guarantor hereby consents and agrees that Agent or any Lender or
Lenders from time to time, with or without any further notice to or assent from
any other Guarantor may, without in any manner affecting the liability of any
Subsidiary Guarantor under this Subsidiary Guaranty, and upon such terms and
conditions as Agent any such Lender or Lenders may deem advisable:

       

                     (1)          extend
in whole or in part (by renewal or otherwise), modify, change, compromise,
release or extend the duration of the time for the performance or payment of any
Indebtedness, liability or obligation of the Borrower or of any other Person
(including, without limitation, any other Guarantor) secondarily or otherwise
liable for any Indebtedness, liability or obligation of the Borrower on the
Guaranteed Obligations, or waive any Default or Event of Default with respect
thereto, or waive, modify, amend or change any provision of the Credit
Agreement, any other Loan Document, any other agreement or waive this Subsidiary
Guaranty; or

       

                     (2)          sell,
release, surrender, modify, impair, exchange or substitute any and all property,
of any nature and from whomsoever received, held by, or for the benefit of,
Agent or any such Lender as direct or indirect security for the payment or
performance of any Indebtedness, liability or obligation of the Borrower or of
any other Person (including, without limitation, any other Guarantor)
secondarily or otherwise liable for any Indebtedness, liability or obligation of
the Borrower on the Guaranteed Obligations; or

      
        
           

        

        
          A-4

          
            

          

        

        
           

        

      

      

                     (3)          settle,
adjust or compromise any claim of the Borrower against any other Person
(including, without limitation, any other Guarantor) secondarily or otherwise
liable for any Indebtedness, liability or obligation of the Borrower on the
Guaranteed Obligations.

       

      Each
Subsidiary Guarantor hereby ratifies and confirms any such extension, renewal,
change, sale, release, waiver, surrender, exchange, modification, amendment,
impairment, substitution, settlement, adjustment or compromise and that the same
shall be binding upon it, and hereby waives, to the fullest extent permitted by
law, any and all defenses, counterclaims or offsets which it might or could have
by reason thereof, it being understood that such Subsidiary Guarantor shall at
all times be bound by this Subsidiary Guaranty and remain liable
hereunder.

       

      (b)          Each
Subsidiary Guarantor hereby waives, to the fullest extent permitted by
law:

       

                     (1)          notice
of acceptance of this Subsidiary Guaranty by the Agent or the Lenders or of the
creation, renewal or accrual of any liability of the Borrower, present or
future, or of the reliance of Agent or such Lenders upon this Subsidiary
Guaranty (it being understood that every Indebtedness, liability and obligation
described in Section 2 hereof shall conclusively be presumed to have been
created, contracted or incurred in reliance upon the execution of this
Subsidiary Guaranty);

       

                     (2)          notice
of the making of any additional Revolving Credit Loans pursuant to the Credit
Agreement;

       

                     (3)          demand
of payment by Agent or any Lender from the Borrower or any other Person
(including, without limitation, any other Guarantor) indebted in any manner on
or for any of the Indebtedness, liabilities or obligations hereby guaranteed;
and

       

                     (4)          presentment
for the payment by Agent or any Lender or any other Person of the Revolving
Credit Notes or any other instrument, protest thereof and notice of its dishonor
to any party thereto and to such Subsidiary Guarantor.

       

      The
obligations of each Subsidiary Guarantor under this Subsidiary Guaranty and the
rights of Agent and any Lender to enforce such obligations by any proceedings,
whether by action at law, suit in equity or otherwise, shall not be subject to
any reduction, limitation, impairment or termination, whether by reason of any
claim of any character whatsoever or otherwise and shall not be subject to any
defense, set-off, counterclaim (other than any compulsory counterclaim),
recoupment or termination whatsoever.

       

      (c)          The
obligations of the Subsidiary Guarantors hereunder shall be binding upon the
Subsidiary Guarantors and their successors and assigns, and shall remain in full
force and effect irrespective of:

      
        
           

        

        
          A-5

          
            

          

        

        
           

        

      

                     (1)          the
genuineness, validity, regularity or enforceability of the Revolving Credit
Loans, the Credit Agreement, any other Loan Document or any other agreement or
any of the terms of any thereof, the continuance of any obligation on the part
of the Borrower or any other Person on or in respect of the Revolving Credit
Loan or under the Credit Agreement, any other Loan Document or any other
agreement or the power or authority or the lack of power or authority of the
Borrower to execute and deliver the Credit Agreement, any other Loan Document to
which it is a party or any other agreement or of any Subsidiary Guarantor to
execute and deliver this Subsidiary Guaranty (or the Parent Guarantor to execute
and deliver its Guaranty) or to perform any of its obligations hereunder or the
existence or continuance of the Borrower or any other Person as a legal entity;
or

       

                     (2)          any
default, failure or delay, willful or otherwise, in the performance by the
Borrower, any Guarantor or any other Person of any obligations of any kind or
character whatsoever under Guaranteed Obligations, the Revolving Credit Loans,
the Credit Agreement, this Subsidiary Guaranty, any other Loan Document, or any
other agreement; or

       

                     (3)          any
creditors’ rights, bankruptcy, receivership or other insolvency proceeding of
the Borrower, any Guarantor or any other Person or in respect of the property of
the Borrower, any Guarantor or any other Person or any merger, consolidation,
reorganization, dissolution, liquidation, the sale of all or substantially all
of the assets of or winding up of the Borrower, any Guarantor or any other
Person; or

       

                     (4)          impossibility
or illegality of performance on the part of the Borrower, any Guarantor or any
other Person of its obligations (including, without limitation, the Guaranteed
Obligations) under the Revolving Credit Loans, the Credit Agreement, this
Subsidiary Guaranty, any other Loan Document, or any other agreements;
or

       

                     (5)          in
respect of the Borrower or any other Person, any change of circumstances,
whether or not foreseen or foreseeable, whether or not imputable to the Borrower
or any other Person, or other impossibility of performance through fire,
explosion, accident, labor disturbance, floods, droughts, embargoes, wars
(whether or not declared), civil commotion, acts of God or the public enemy,
delays or failure of suppliers or carriers, inability to obtain materials,
action of any Federal or state regulatory body or agency, change of law or any
other causes affecting performance, or any other force majeure, whether or not
beyond the control of the Borrower or any other Person and whether or not of the
kind hereinbefore specified; or

       

                     (6)          any
attachment, claim, demand, charge, Lien, order, process, encumbrance or any
other happening or event or reason, similar or dissimilar to the foregoing, or
any withholding or diminution at the source, by reason of any taxes,
assessments, expenses, Indebtedness, obligations or liabilities of any
character, foreseen or unforeseen, and whether or not valid, incurred by or
against the Borrower, any Guarantor or any other Person or any claims, demands,
charges or Liens of any nature, foreseen or unforeseen, incurred by the
Borrower, any Guarantor or any other Person, or against any sums payable in
respect of the Guaranteed Obligations, the Revolving Credit Loans, under the
Credit Agreement, this Subsidiary Guaranty or any other Loan Document, so that
such sums would be rendered inadequate or would be unavailable to make the
payments herein provided; or

      
        
           

        

        
          A-6

          
            

          

        

        
           

        

      

      

                     (7)          any
order, judgment, decree, ruling or regulation (whether or not valid) of any
court of any nation or of any political subdivision thereof or any body, agency,
department, official or administrative or regulatory agency of any thereof or
any other action, happening, event or reason whatsoever which shall delay,
interfere with, hinder or prevent, or in any way adversely affect, the
performance by the Borrower, any Guarantor or any other Person of its respective
obligations under or in respect of the Guaranteed Obligations, the Revolving
Credit Loans, the Credit Agreement, this Subsidiary Guaranty, any other Loan
Document, or any other agreement; or

       

                     (8)          the
failure of (i) any Subsidiary Guarantor to receive any benefit from or as a
result of its execution, delivery and performance of this Subsidiary Guaranty or
(ii) the Parent Guarantor to receive any benefit from or as a result of its
execution, delivery and performance of its Guaranty; or

       

                     (9)          any
failure or lack of diligence in collection or protection, failure in presentment
or demand for payment, protest, notice of protest, notice of default and of
nonpayment, any failure to give notice to any Guarantor of failure of the
Borrower, any Guarantor or any other Person to keep and perform any Guaranteed
Obligation, any other obligation, covenant or agreement under the terms of the
Revolving Credit Loans, the Credit Agreement, this Subsidiary Guaranty, any
other Loan Document, or any other agreement or failure to resort for payment to
the Borrower, any Guarantor or to any other Person or to any other guaranty or
to any property, security, Liens or other rights or remedies; or

       

                     (10)        the
acceptance of any additional security or other guaranty, the advance of
additional money to the Borrower or any other Person, the renewal or extension
of the Revolving Credit Loans or amendments, modifications, consents or waivers
with respect to the Revolving Credit Loans, the Credit Agreement, any other Loan
Document or any other agreement, or the sale, release, substitution or exchange
of any security for the Guaranteed Obligations; or

       

                     (11)        any
merger or consolidation of the Borrower, any Guarantor or any other Person into
or with any other Person or any sale, lease, transfer or other disposition of
any of the assets of the Borrower, any Guarantor or any other Person to any
other Person, or any change in the ownership of any shares or other equity
interests of the Borrower, any Guarantor or any other Person; or

       

                     (12)        any
defense whatsoever that:  (i) the Borrower or any other Person might
have to the payment of the Revolving Credit Loans (including, principal, Fees or
interest) or any other Guaranteed Obligations, other than payment thereof in
Federal or other immediately available funds or (ii) the Borrower or any other
Person might have to the performance or observance of any of the provisions of
the Revolving Credit Loans, the Credit Agreement, any other Loan Document or any
other Guaranteed Obligations, whether through the satisfaction or purported
satisfaction by the Borrower or any other Person of its debts due to any cause
such as bankruptcy, insolvency, receivership, merger, consolidation,
reorganization, dissolution, liquidation, winding-up or otherwise;
or

      
        
           

        

        
          A-7

          
            

          

        

        
           

        

      

      

                     (13)        any
act or failure to act with regard to the Revolving Credit Loans, the Credit
Agreement, this Subsidiary Guaranty, any other Loan Document or any other
agreement or Guaranteed Obligation or anything which might vary the risk of any
Subsidiary Guarantor, the Parent Guarantor or any other Person; or 

       

                     (14)        any
other circumstance which might otherwise constitute a defense available to, or a
discharge of, any Subsidiary Guarantor, the Parent Guarantor or any other Person
in respect of the obligations (including, without limitations, the Guaranteed
Obligations) of any Subsidiary Guarantor under this Subsidiary Guaranty or any
other agreement or of the Parent Guarantor or other Person under or any other
agreement;

       

      provided that the specific
enumeration of the above-mentioned acts, failures or omissions shall not be
deemed to exclude any other acts, failures or omissions, though not specifically
mentioned above, it being the purpose and intent of this Subsidiary Guaranty and
the parties hereto that the obligations of each Subsidiary Guarantor shall be
absolute and unconditional and shall not be discharged, impaired or varied
except by the payment and performance of the Guaranteed Obligations in
accordance with their respective terms whenever the same shall become due and
payable as in the Credit Agreement provided, at the place specified in and all
in the manner and with the effect provided in the Credit Agreement, as each may
be amended or modified from time to time.  Without limiting the
foregoing, it is understood that repeated and successive demands may be made and
recoveries may be had hereunder as and when, from time to time, the Borrower
shall default under or in respect of the terms of the Revolving Credit Loans or
the Credit Agreement or any other Loan Document to which the Borrower is a party
and that notwithstanding recovery hereunder for or in respect of any given
default or defaults by the Borrower under the Revolving Credit Loans or the
Credit Agreement or any other Loan Document to which the Borrower is a party,
this Subsidiary Guaranty shall remain in full force and effect and shall apply
to each and every subsequent default.

       

      (d)          All
rights of Agent and any Lender under this Subsidiary Guaranty shall be
considered to be transferred or assigned at any time or from time to time upon
the transfer of any Revolving Credit Loan (or portion thereof) held by such
Lender whether with or without the consent of or notice to the Subsidiary
Guarantors under this Subsidiary Guaranty or to the Borrower.

       

      (e)          To
the extent of any payments made under this Subsidiary Guaranty, the Subsidiary
Guarantors shall be subrogated to the rights of the Agent or any Lenders upon
whose Guaranteed Obligations such payment was made, but each Subsidiary
Guarantor covenants and agrees that such right of subrogation and any and all
claims of such Subsidiary Guarantor against the Borrower, any endorser or other
Guarantor or against any of their respective properties shall be junior and
subordinate in right of payment to the prior indefeasible final payment in cash
in full of all of the Guaranteed Obligations and satisfaction by the Borrower of
its Obligations under the Credit Agreement and the other Loan Documents to which
the Borrower is a party and by the Subsidiary Guarantors of their obligations
under this Subsidiary Guaranty and the other Loan Documents to which any
Subsidiary Guarantor is a party, and the Subsidiary Guarantors shall not take
any action to enforce such right of subrogation, and the Subsidiary Guarantors
shall not accept any payment in respect of such right of subrogation, until all
of the Guaranteed Obligations payable by the Subsidiary Guarantors hereunder
have indefeasibly been finally paid in cash in full and all of the Guaranteed
Obligations of the Borrower and all of the Subsidiary Guarantors under this
Subsidiary Guaranty and the other Loan Documents to which any Subsidiary
Guarantor is a party have been satisfied.  Notwithstanding any right
of any Subsidiary Guarantor to ask, demand, sue for, take or receive any payment
from the Borrower, all rights, Liens and security interests of each Subsidiary
Guarantor, whether now or hereafter arising and howsoever existing, in any
assets of the Borrower shall be and hereby are subordinated to the rights, if
any, of the Agent and the Lenders in those assets.  No Subsidiary
Guarantor shall have any right to possession of any such asset or to foreclose
upon any such asset, whether by judicial action or otherwise, unless and until
all of the Guaranteed Obligations shall have been paid in cash in full and
satisfied.

      
        
           

        

        
          A-8

          
            

          

        

        
           

        

      

       

      (f)          Each
Subsidiary Guarantor agrees that to the extent the Borrower or any other Person
makes any payment on any Guaranteed Obligation, which payment or any part
thereof is subsequently invalidated, voided, declared to be fraudulent or
preferential, set aside, recovered, rescinded or is required to be retained by
or repaid to a trustee, receiver, or any other Person under any bankruptcy code,
common law, or equitable cause, then and to the extent of such payment, the
obligation or the part thereof intended to be satisfied shall be revived and
continued in full force and effect with respect to the Subsidiary Guarantors’
obligations hereunder, as if said payment had not been made.  The
liability of the Subsidiary Guarantors hereunder shall not be reduced or
discharged, in whole or in part, by any payment to Agent or any Lender from any
source that is thereafter paid, returned or refunded in whole or in part by
reason of the assertion of a claim of any kind relating thereto, including, but
not limited to, any claim for breach of contract, breach of warranty,
preference, illegality, invalidity or fraud asserted by any account debtor or by
any other Person.

       

      (g)          Neither
Agent nor any Lender shall be under any obligation:  (1) to marshall
any assets in favor of the Subsidiary Guarantors (or Parent Guarantor) or in
payment of any or all of the liabilities of the Borrower under or in respect of
Guaranteed Obligations or under any Loan Documents or (2) to pursue any other
remedy that the Subsidiary Guarantors (or Parent Guarantor) may or may not be
able to pursue themselves and that may lighten the Subsidiary Guarantors’ (or
Parent Guarantor’s) burden, any right to which each Subsidiary Guarantor hereby
expressly waives.

       

      (h)         Each
Subsidiary Guarantor expressly authorizes the Agent to take and hold security
for the payment and performance of the Guaranteed Obligations, to exchange,
waive or release any or all such security (with or without consideration), to
enforce or apply such security and direct the order and manner of any sale
thereof in their sole discretion or to release or substitute any one or more
other guarantors or obligors upon or in respect of the Guaranteed Obligations,
all without affecting the obligations of any Subsidiary Guarantor
hereunder.  To the fullest extent permitted by applicable law, each
Subsidiary Guarantor waives any defense based on or arising out of any defense
of the Borrower or any other Loan Party of the unenforceability of Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of the Borrower or any other Loan Party, other than the
indefeasible payment in full in cash of all the Guaranteed
Obligations.  The Agent may, at its election, foreclose on any
security held by it by one or more judicial or non-judicial sales, accept an
assignment of any such security in lieu of foreclosure, compromise or adjust any
part of the Guaranteed Obligations, make any other accommodation with the
Borrower or any other Loan Party or exercise ay other right or remedy available
to them against the Borrower or any other Loan Party, without affecting or
impairing in any way the liability of any Subsidiary Guarantor hereunder except
to the extent the Guaranteed Obligations have been fully and indefeasibly paid
in full in cash.  To the fullest extent permitted by applicable law,
each Subsidiary Guarantor waives any defense arising out of any such election
even though such election operates, pursuant to applicable law, to impair or to
extinguish any right of reimbursement or subrogation or other right or remedy of
such Subsidiary Guarantor against the Borrower or any other Loan Party, as the
case may be, or any security.

      
        
           

        

        
          A-9

          
            

          

        

        
           

        

      

       

      
        
          	
                  Section 5.

                	
                  Representations
      and Warranties of the Subsidiary
Guarantors.

                

        

      

       

      Each
Subsidiary Guarantor represents and warrants to Agent and each Lender
that:

       

      (a)          Such
Subsidiary Guarantor is a corporation or other legal entity duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization, and is duly qualified as a foreign corporation or other legal
entity and is in good standing in each jurisdiction in which such qualification
is required by law, other than those jurisdictions as to which the failure to be
so qualified or in good standing would not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on (1) the
business, operations, affairs, financial condition, assets or properties of such
Subsidiary Guarantor and the Borrower and its subsidiaries, taken as a whole, or
(2) the ability of such Subsidiary Guarantor to perform its obligations
under this Subsidiary Guaranty or (3) the validity or enforceability of
this Subsidiary Guaranty (herein in this Section 5, a “Material Adverse
Effect”).  Such Subsidiary Guarantor has the power and
authority to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts and proposes to transact, to
execute and deliver this Subsidiary Guaranty and the other Loan Documents to
which such Subsidiary Guarantor is a party and to perform the provisions hereof
and thereof.

       

      (b)          Each
subsidiary of such Subsidiary Guarantor is a corporation or other legal entity
duly organized, validly existing and in good standing under the laws of its
jurisdiction of organization, and is duly qualified as a foreign corporation or
other legal entity and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.  Each subsidiary of such Subsidiary Guarantor has the power
and authority to own or hold under lease the properties it purports to own or
hold under lease and to transact the business it transacts and proposes to
transact.

      (c)          This
Subsidiary Guaranty and each Loan Document to which such Subsidiary Guarantor is
a party has been duly authorized by all necessary action on the part of such
Subsidiary Guarantor, and this Subsidiary Guaranty and each Loan Document to
which such Subsidiary Guarantor is a party constitutes a legal, valid and
binding obligation of such Subsidiary Guarantor enforceable against such
Subsidiary Guarantor in accordance with its terms, except as such enforceability
may be limited by (1) applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors’ rights
generally and (2) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

       

      
        
          
          

        

        
          A-10

          
            

          

        

        
          
          

        

      

       

      (d)          The
execution, delivery and performance by such Subsidiary Guarantor of this
Subsidiary Guaranty and each Loan Document to which such Subsidiary Guarantor is
a party will not (1) contravene, result in any breach of, or constitute a
default under, or result in the creation of any Lien (other than the Liens
contemplated by the Loan Documents) in respect of any property of such
Subsidiary Guarantor or any of its subsidiaries under any indenture, mortgage,
deed of trust, loan, purchase or credit agreement, lease, organizational
document or any other agreement or instrument to which such Subsidiary Guarantor
or any of its subsidiaries is bound or by which such Subsidiary Guarantor or any
of its subsidiaries or any of their respective properties may be bound or
affected, (2) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to such Subsidiary Guarantor or
any of its subsidiaries or (3) violate any provision of any statute or
other rule or regulation of any Governmental Authority applicable to such
Subsidiary Guarantor or any of its subsidiaries.

       

      (e)          No
consent, approval or authorization of, or registration, filing or declaration
with, any Governmental Authority is required in connection with the execution,
delivery or performance by such Subsidiary Guarantor of this Subsidiary Guaranty
and each Loan Document to which such Subsidiary Guarantor is a
party.

       

      (f)           (1) There
are no actions, suits or proceedings pending or, to the knowledge of such
Subsidiary Guarantor, threatened against or affecting such Subsidiary Guarantor
or any of its subsidiaries or any property of such Subsidiary Guarantor or any
of its subsidiaries in any court or before any arbitrator of any kind or before
or by any Governmental Authority that, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect.

       

                     (2)          Neither
such Subsidiary Guarantor nor any of its subsidiaries is in default under any
term of any agreement or instrument to which it is a party or by which it is
bound, or any order, judgment, decree or ruling of any court, arbitrator or
Governmental Authority or is in violation of any applicable law, ordinance, rule
or regulation (including, without limitation, Environmental Laws and
Regulations) of any Governmental Authority, which default or violation,
individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect.

       

      (g)          Each
Subsidiary Guarantor expects to derive a direct benefit (and its board of
directors or other governing body had determined that it may reasonably be
expected to derive such benefit) from:  (1) the Revolving Credit Loans
and the Intercompany Loans to finance its business; (2) the successful
operations of Borrower and each other Subsidiary Guarantor individually and as a
group; (3) its rights of contribution and subrogation against the Borrower and
each other Subsidiary Guarantor as provided herein or under applicable law; and
(4) the Credit Agreement and the other Loan Documents.

      
        
           

        

        
          A-11

          
            

          

        

        
           

        

      

    

     

    (h)         
Such Subsidiary Guarantor is solvent, has capital not unreasonably small in
relation to its business or any contemplated or undertaken transaction and has
assets having a value both at fair valuation and at present fair salable value
greater than the amount required to pay its debts as they become due and greater
than the amount that will be required to pay its probable liability on its
existing debts as they become absolute and matured.  Such Subsidiary
Guarantor does not intend to incur, or believe or should have believed that it
will incur, debts beyond its ability to pay such debts as they become
due.  Such Subsidiary Guarantor will not be rendered insolvent by the
execution and delivery of, and performance of its obligations under, this
Subsidiary Guaranty.  Such Subsidiary Guarantor does not intend to
hinder, delay or defraud its creditors by or through the execution and delivery
of, or performance of its obligations under, this Subsidiary
Guaranty.

     

    
      
        	
                Section 6.

              	
                Amendments, Waivers and
      Consents.

              

      

    

     

    (a)          This
Subsidiary Guaranty may be amended, and the observance of any term hereof may be
waived (either retroactively or prospectively), with (and only with) the written
consent of each Subsidiary Guarantor and the Required Lenders, except that (but
subject to the terms of Sections 2.23(b) and 10.6 of the Credit Agreement)
(1) no amendment or waiver of any of the provisions of Sections 3, 4
or 5, or any defined term (as it is used therein), will be effective as to Agent
or any Lender unless consented to by Agent or such Lender in writing, and
(2) no such amendment or waiver may, without the written consent of each
Lender, (i) change the percentage of the principal amount of the Revolving
Credit Commitments which are required to consent to any such amendment or waiver
or (ii) amend Section 2 or this Section 6.  No consent
of the Agent or the Lenders or the Subsidiary Guarantors shall be required in
connection with the execution and delivery of a Guaranty Supplement or other
addition of any additional Subsidiary Guarantor, and each such Subsidiary
Guarantor, by its execution and delivery of this Subsidiary Guaranty (or
Guaranty Supplement) consents to the addition of each additional Subsidiary
Guarantor.  No consent of the Subsidiary Guarantors shall be required
in connection with and subsequent Revolving Credit Loans, and each Subsidiary
Guarantor, by its execution and delivery of this Subsidiary Guaranty (or
Guaranty Supplement) consents to the making of additional Revolving Credit Loans
pursuant to the Credit Agreement.

     

    (b)         
The Subsidiary Guarantors will provide Agent and each Lender (irrespective of
the amount of Revolving Credit Commitments then held by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable Agent and such Lender to make an informed and considered decision with
respect to any proposed amendment, waiver or consent in respect of any of the
provisions hereof.  The Subsidiary Guarantors will deliver executed or
true and correct copies of each amendment, waiver or consent effected pursuant
to the provisions of this Section 6 to Agent and each Lender promptly
following the date on which it is executed and delivered by, or receives the
consent or approval of, the Required Lenders.

     

    
      
         

      

      
        A-12

        
          

        

      

      
         

      

    

     

    (c)         
Any amendment or waiver consented to as provided in this Section 6 applies
equally to Agent and all Lenders affected thereby and is binding upon them and
upon each future Lender and upon the Subsidiary Guarantors.  No such
amendment or waiver will extend to or affect any obligation, covenant or
agreement not expressly amended or waived or impair any right consequent
thereon.  No course of dealing between the Subsidiary Guarantors,
Agent and any Lender nor any delay in exercising any rights hereunder shall
operate as a waiver of any rights of Agent or any Lender.  As used
herein, the term “this
Subsidiary Guaranty” and references
thereto shall mean this Subsidiary Guaranty as it may from time to time be
amended or supplemented.

     

    
      
        	
                Section 7.

              	
                Notices.

              

      

    

     

    All
notices and communications provided for hereunder shall be in writing and sent
(a) by telefacsimile if the sender on the same day sends a confirming copy
of such notice by a recognized overnight delivery service (charges prepaid),
(b) by registered or certified mail with return receipt requested (postage
prepaid) or (c) by a recognized overnight delivery service (charges
prepaid).  Any such notice must be sent:

     

    (1)         
if to Agent or a Lender, to Agent or such Lender or its nominee at the address
specified for such communications in Section 10.9 of the Credit Agreement or at
such other address as Agent or such Lender shall have specified to any
Subsidiary Guarantor or the Borrower in writing, or

     

    (2)         
if to any Subsidiary Guarantor, to such Subsidiary Guarantor c/o the Borrower at
its address set forth in Section 10.9 of the Credit Agreement to the attention
of each of the Chief Financial Officer of the Borrower, or at such other address
as such Subsidiary Guarantor shall have specified to the Agent and Lenders in
writing.

     

    Notices
under this Section 7 will be deemed given in accordance with the provisions
of Section 10.9 of the Credit Agreement.

     

    
      
        	
                Section 8.

              	
                Miscellaneous
      .

              

      

    

     

    (a)         
No Remedy
Exclusive.  No remedy herein conferred upon or reserved to
Agent or any Lender is intended to be exclusive of any other available remedy or
remedies, but each and every such remedy shall be cumulative and shall be in
addition to every other remedy given under this Subsidiary Guaranty now or
hereafter existing at law or in equity.  No delay or omission to
exercise any right or power accruing upon any default, omission or failure of
performance hereunder shall impair any such right or power or shall be construed
to be a waiver thereof but any such right or power may be exercised from time to
time and as often as may be deemed expedient.  In order to entitle
Agent or any Lender to exercise any remedy reserved to it under this Subsidiary
Guaranty, it shall not be necessary for Agent or such Lender to physically
produce its Revolving Credit Note in any proceedings instituted by it or to give
any notice, other than such notice as may be herein expressly
required.

     

    (b)         
Payments.  The
Subsidiary Guarantors will pay all sums becoming due under this Subsidiary
Guaranty by the method and at the address specified for such purpose for Agent
or such Lender in Article 2 and Section 10.3 of the Credit Agreement, or by such
other method or at such other address as Agent or any Lender shall have from
time to time specified to the Subsidiary Guarantors or the Borrower on behalf of
the Subsidiary Guarantors in writing for such purpose, without the presentation
or surrender of this Subsidiary Guaranty or any Revolving Credit
Note.  

     

    
      
         

      

      
        A-13

        
          

        

      

      
         

      

    

     

    (c)         
Indemnity and
Subrogation.  In addition to all such rights of indemnity and
subrogation as the Subsidiary Guarantors may have under applicable law (but
subject to the terms, restrictions and limitations set forth in this Subsidiary
Guaranty), the Borrower agrees that (1) in the event a payment in respect
of any Guaranteed Obligation shall be made by any Subsidiary Guarantor under
this Subsidiary Guaranty, the Borrower shall indemnify such Subsidiary Guarantor
for the full amount of such payment and such Subsidiary Guarantor shall be
subrogated to the rights of the Person to whom such payment shall have been made
to the extent of such payment and (2) in the event any assets of any
Subsidiary Guarantor shall be sold pursuant to this Subsidiary Guaranty or any
other Collateral Document to satisfy in whole or in part a Guaranteed Obligation
owed to Agent or any Lender, the Borrower shall indemnify such Subsidiary
Guarantor in an amount equal to the great of the book value or the fair market
value of the assets so sold.

     

    (d)       Contribution and
Subrogation.  Each Subsidiary Guarantor (a “Contributing Party”) agrees
(but subject to the terms, restrictions and limitations set forth in this
Subsidiary Guaranty) that, in the event a payment shall be made by any other
Subsidiary Guarantor hereunder in respect of any obligation or assets of any
other Subsidiary Guarantor (other than Parent Guarantor or the Borrower) shall
be sold pursuant to any Collateral Document to satisfy any Guaranteed Obligation
owed to Agent or any Lender and such other Subsidiary Guarantor (the “Claiming Party”) shall not
have been fully indemnified by the Borrower as provided in Section 8(c), the
Contributing Party shall indemnify the Claiming Party in an amount equal to the
amount of such payment or the greater of the book value or the fair market value
of such assets, as the case may be, in each case multiplied by a fraction of
which the numerator shall be the net worth of the Contributing Party on the date
hereof and the denominator shall be the aggregate net worth of all the
Subsidiary Guarantors on the date hereof (or, in the case of any Subsidiary
Guarantor becoming a party hereto pursuant to the terms hereof, the date of the
supplement hereto executed and delivered by such Subsidiary
Guarantor).  Any Contributing Party making any payment to a Claiming
Party pursuant to this Section shall (subject to Section 8(c) above) be
subrogated to the rights of such Claiming Party to the extent of such
payment.

     

    (e)         
Partial
Unenforceability.  Any provision of this Subsidiary Guaranty
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall (to the full
extent permitted by law) not invalidate or render unenforceable such provision
in any other jurisdiction.

     

    (f)         
Continued
Enforceability.  If the whole or any part of this Subsidiary
Guaranty shall be now or hereafter become unenforceable against any one or more
of the Subsidiary Guarantors for any reason whatsoever or if it is not executed
by any one or more of the Subsidiary Guarantors, this Subsidiary Guaranty shall
nevertheless be and remain fully binding upon and enforceable against each other
Guarantor as if it had been made and delivered only by such other Subsidiary
Guarantors.

     

    (g)         
Successors and
Assigns.  This Subsidiary Guaranty shall be binding upon each
Subsidiary Guarantor and its successors and assigns and shall inure to the
benefit of Agent and each Lender and its successors and assigns so long as its
Revolving Credit Loans and the other Guaranteed Obligations remain outstanding
and unpaid.  

     

    
      
         

      

      
        A-14

        
          

        

      

      
         

      

    

     

    (h)         
Counterparts.  This
Subsidiary Guaranty may be executed in any number of counterparts, each of which
shall be an original but all of which together shall constitute one
instrument.  Each counterpart may consist of a number of copies
hereof, each signed by less than all, but together signed by all, of the parties
hereto.

     

    (i)          
Choice of
Law.  This Subsidiary Guaranty shall be construed and enforced
in accordance with, and the rights of the parties shall be governed by, the law
of the State of New York excluding choice-of-law principles of the law of such
State that would require the application of the laws of a jurisdiction other
than such State.

     

    (j)          
Submission
to Jurisdiction.  Each
Subsidiary Guarantor hereby irrevocably submits to the non-exclusive
jurisdiction of any State of New York court or any federal court located in New
York County, New York, New York for the adjudication of any matter arising out
of or relating to this Guaranty, and consents to the service of all writs,
process and summonses by registered or certified mail out of any such court or
by service of process on such Subsidiary Guarantor at its address to which
notices are to be given pursuant to Section 7 hereof and hereby waives any
requirement to have an agent for service of process in the State of New
York.  Nothing contained herein shall affect the right of Agent or any
Lender to serve legal process in any other manner or to bring any proceeding
hereunder in any jurisdiction where such Subsidiary Guarantor may be amenable to
suit.  Each Subsidiary Guarantor hereby irrevocably waives any
objection to any suit, action or proceeding in any New York court or federal
court located in New York County, New York, New York on the grounds of venue and
hereby further irrevocably waives any claim that any such suit, action or
proceeding brought in any such court has been brought in an inconvenient
forum.  

     

    
      
         

      

      
        A-15

        
          

        

      

      
         

      

    

     

    In
witness whereof, the undersigned has caused this Subsidiary Guaranty to
be duly executed by an authorized representative as of the date first written
above.

     

    
      
        
          	 
      	
                  [Subsidiary
      Guarantors]

                
	 
      	 
      	 
      
	 
      	
                  By:

                	   
        

        

      

    

    
      
        
          
            	 
      	 
      	
                    Printed Name:

                  	
                       
      

                  

          

        

      

    

    
      
        
          	 
      	 
      	
                  Its:

                	
                   
        

                

        

      

    

     

    The
Borrower is executing below for purposes of acknowledging its obligations,
agreements and covenants set forth in the provisions of Section 8(c) and 8(d)
hereof.

     

    
      
        
          
            	
                    Cornerstone
      Healthcare Plus Operating Partnership, L.P.,

                  
	 
      	
                    By
      Cornerstone Healthcare Plus REIT, Inc., its General
  Partner

                  
	 
      	 
      
	 
      	
                    By:

                  	 
        

          

        

      

    

    
      
        
          	 
      	
                  Printed Name: 

                	   
        
	 
      	
                  Its
      Authorized
Representative

                

        

      

    

    
      
         

      

      
        A-16

        
          

        

      

      
         

      

    

    Form
of Guaranty Supplement

     

    To
KeyBank National Association, as Agent and

     

      each
of the Lenders from time to party to the Credit Agreement

     

    Ladies
and Gentlemen:

     

    Cornerstone
Healthcare Plus Operating Partnership, L.P., a limited partnership organized
under the laws of the State of Delaware (the “Borrower”) Credit Agreement
dated as of November 18, 2010 (as the same may be amended, supplemented,
restated or otherwise modified from time to time, the “Credit Agreement”) among the
Borrower, KeyBank National Association, as Agent (the “Agent”) and each of the
Lenders from time to time parties thereto (the “Lenders”), providing for,
among other things, Revolving Credit Loans to the Borrower of up to
$25,000,000.  Capitalized terms used herein shall have the meanings
set forth in the hereinafter defined Subsidiary Guaranty Agreement unless herein
defined or the context shall otherwise require.

     

    As a
condition precedent to their making of Revolving Credit Loans, the Agent and the
Lenders required that certain Subsidiaries of the Borrower enter into that
certain Subsidiary Guaranty Agreement dated as of [November __], 2010 as
security for the Guaranteed Obligations (as amended, supplemented, restated or
otherwise modified from time to time, the “Subsidiary Guaranty
Agreement”).

     

    In
addition, as further condition precedent to their making of additional Revolving
Credit Loans, the Borrower has agreed (pursuant to Section 4.2 of the
Credit Agreement) to cause the undersigned, ____________, a [corporation]
organized under the laws of ______________ (the “Additional Guarantor”), to
join in the Subsidiary Guaranty Agreement.  In accordance with the
requirements of the Subsidiary Guaranty Agreement, the Additional Guarantor
desires to amend the definition of “Subsidiary Guarantor” (as
the same may have been heretofore amended) set forth in the Subsidiary Guaranty
Agreement attached hereto so that at all times from and after the date hereof,
the Additional Guarantor shall be jointly and severally liable as set forth in
the Subsidiary Guaranty Agreement for the obligations of the Borrower under the
Guaranteed Obligations to the extent and in the manner set forth in the
Subsidiary Guaranty Agreement.  

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    The
undersigned is the duly elected ____________ of the Additional Guarantor, a
subsidiary of the Borrower, and is duly authorized to execute and deliver this
Guaranty Supplement to each of you.  The execution by the undersigned
of this Guaranty Supplement shall evidence such Additional Guarantor’s consent
to and acknowledgment and approval of the terms set forth herein and in the
Subsidiary Guaranty Agreement and its agreement to be bound by the covenants,
terms and provisions of the Subsidiary Guaranty Agreement as a Subsidiary
Guarantor thereunder and by such execution the Additional Guarantor shall be
deemed to have made in favor of the Agent and the Lenders the representations
and warranties set forth in Section 5 of the Subsidiary Guaranty
Agreement.

     

    Upon
execution of this Guaranty Supplement, the Subsidiary Guaranty Agreement shall
be deemed to be amended as set forth above.  Except as amended herein,
the terms and provisions of the Subsidiary Guaranty Agreement are hereby
ratified, confirmed and approved in all respects.

     

    Any and
all notices, requests, certificates and other instruments may refer to the
Subsidiary Guaranty Agreement without making specific reference to this Guaranty
Supplement, but nevertheless all such references shall be deemed to include this
Guaranty Supplement unless the context shall otherwise require.

     

    Dated:  _________________,
201   
.

     

    
      
        
          
            	 
      	
                    [Name
      of Additional Guarantor]

                  
	 
      	 
      	 
      
	 
      	
                    By

                  	
                     

                  

          

        

      

    

    
      	  	 
      	
              Printed Name:

            	
                   
      

            

      
        
          
            	   
      	 
      	
                    Its:

                  	
                     
         

                  

          

        

      

    

     

    
      
         

      

      
        A-2

        
          

        

      

      
         

      

    

    EXHIBIT
C

     

    Form
of Mortgage Agreement

     

    Form
of

     

    Mortgage,
Assignment of Rents,

    
      Security
Agreement and Fixture Filing

    

     

    Project
[_____________]: [City, State]

     

    Made
by

     

    [Mortgagor],

     

    as
Mortgagor

     

    to

     

    KeyBank
national Association,

    as
Agent,

     

    as
Mortgagee

     

    ___________________________

     

    Dated as
of: [_____________] ___, 201__

     

    Re:           Cornerstone
Healthcare Plus Operating Partnership, L.P.

    
      
        
          	 
      
	 
      

        

      

    

    PREPARED
BY AND UPON RECORDATION RETURN TO:

     

    Sean T.
Maloney, Esq.

    Schiff
Hardin LLP

    233 South
Wacker Drive

    Suite
6600

    Chicago,
Illinois 60606

    
      
        	 
      
	 
      

      

    

     

    
      
         

      

      
        A-3

        
          

        

      

      
         

      

    

    Mortgage
Assignment of Rents, Security

    
      Agreement
and Fixture Filing

    

     

    Project
[___________]: [City, State]

     

    This
Mortgage, Assignment of Rents, Security Agreement and Fixture Filing
(this “Mortgage”) is
made as of [__________] ___, 201__, by [Borrower],
a Delaware ________ (“Mortgagor”), whose address
is __________________________, in favor of KeyBank
National Association, as Agent, its successors and assigns (“Mortgagee”), whose address
is Mailcode OH-01-49-0424, 4900 Tiedeman Road, 4th Floor, Brooklyn, Ohio
44144.

     

    Recitals:

     

    A.          
Mortgagor, directly or indirectly, is a subsidiary of Cornerstone Healthcare
Plus Operating Partnership, L.P., a limited partnership organized under the laws
of the State of Delaware (the “Borrower”).

     

    B.          
The Borrower has entered into that certain Credit Agreement dated as of November
19, 2010 (as the same may be amended, supplemented, restated or otherwise
modified from time to time, the “Credit Agreement”) among the
Borrower, KeyBank National Association, as Agent (the “Agent”) and each of the
Lenders from time to time parties thereto (the “Lenders”), providing for,
among other things, Revolving Credit Loans to the Borrower of up to $25,000,000
(herein, and as defined in the Credit Agreement, the “Revolving Credit
Loans”).

     

    C.          
The proceeds of the Revolving Credit Loans will be used by Borrower to provide
funds (each, an “Intercompany
Loan”) from time to time to each Subsidiary Guarantor (as defined in the
Credit Agreement) to purchase or refinance an Eligible Facility (as defined in
the Credit Agreement) that is owned or operated by such Subsidiary
Guarantor.  

     

    D.          
Each Intercompany Loan will be evidenced by an Intercompany Note (as defined in
the Credit Agreement) from each such Subsidiary Guarantor, which Intercompany
Note will be assigned (including an assignment of Mortgagor’s Intercompany Note
contemporaneously herewith) to Agent as collateral for all of the Revolving
Credit Loans.

     

    E.          
Mortgagor is a Subsidiary Guarantor under that certain Subsidiary Guaranty
Agreement dated as of [November ___], 2010 [as supplemented by that certain
Guaranty Supplement dated of even date herewith] (as supplemented, modified or
amended from time to time, the “Subsidiary Guaranty”)
providing a guarantee of all of Borrower’s Obligations (as defined in the Credit
Agreement) under the Loan Documents (as defined in the Credit
Agreement).

     

    F.           
The below defined Property is an Eligible Facility.

     

    
      
         

      

      
        A-4

        
          

        

      

      
         

      

    

     

    F.           
The Agent and the Lenders have required as a condition of their making Revolving
Credit Loans from time to time that the Borrower cause the Mortgagor to enter
into this Mortgage, and the Borrower has agreed to cause the undersigned
Mortgagor to execute this Mortgage, in order to induce the Agent and the Lenders
to make the Revolving Credit Loans and thereby benefit the Borrower and its
Subsidiaries by providing funds to the Borrower for the purposes described in
Schedule 2.8 of the Credit Agreement.

     

    Now,
therefore, as required by the Credit Agreement and in consideration of
the premises and other good and valuable consideration, the receipt and
sufficiency whereof are hereby acknowledged, Mortgagor does hereby covenant and
agree as follows:

     

    
      
         

      

      
        A-5

        
          

        

      

      
         

      

    

     

    SECTION
1       Grant
and Secured Obligations.

     

    1.1          Grant. For
the purpose of securing payment and performance of the Secured Obligations
defined and described in Section 1.2 below, Mortgagor hereby irrevocably
and unconditionally grants, bargains, sells, conveys, mortgages and warrants to
Mortgagee, [with
power of sale] and with right of entry and possession, all estate, right,
title and interest which Mortgagor now has or may later acquire in and to the
following property (all or any part of such property, or any interest in all or
any part of it, as the context may require, the “Property”):

     

    1.1.1       The
real property located in the County of _____, State of ________, as described in
Exhibit A, together with all existing and future easements and rights
affording access to it (the “Premises”); together with

     

    1.1.2       All
buildings, structures and improvements now located or later to be constructed on
the Premises (the “Improvements”); together with

     

    1.1.3       All
existing and future appurtenances, privileges, easements, franchises and
tenements of the Premises, including all minerals, oil, gas, other hydrocarbons
and associated substances, sulphur, nitrogen, carbon dioxide, helium and other
commercially valuable substances which may be in, under or produced from any
part of the Premises, all development rights and credits, air rights, water,
water rights (whether riparian, appropriative or otherwise, and whether or not
appurtenant) and water stock, and any Premises lying in the streets, roads or
avenues, open or proposed, in front of or adjoining the Premises and
Improvements; together with

     

    1.1.4       All
existing and future leases, subleases, subtenancies, licenses, occupancy
agreements and concessions (“leases”) relating to the use and enjoyment of all
or any part of the Premises and Improvements, and any and all guaranties and
other agreements relating to or made in connection with any of such leases;
together with

     

    1.1.5       All
real property and improvements thereon, and all appurtenances and other property
and interests of any kind or character, whether described in Exhibit A or
not, which may be reasonably necessary or desirable to promote the present and
any reasonable future beneficial use and enjoyment of the Premises and
Improvements; together with

     

    1.1.6       All
goods, materials, supplies, chattels, furniture, fixtures, equipment and
machinery now or later to be attached to, placed in or on, or used in connection
with the use, enjoyment, occupancy or operation of all or any part of the
Premises and Improvements, whether stored on the Premises or elsewhere,
including all pumping plants, engines, pipes, ditches and flumes, and also all
gas, electric, cooking, heating, cooling, air conditioning, lighting,
refrigeration and plumbing fixtures and equipment, all of which shall be
considered to the fullest extent of the law to be real property for purposes of
this Mortgage and any manufacturer’s warranties with respect thereto; together
with

     

    1.1.7       All
building materials, equipment, work in process or other personal property of any
kind, whether stored on the Premises or elsewhere, which have been or later will
be acquired for the purpose of being delivered to, incorporated into or
installed in or about the Premises or Improvements; together with

     

    
      
         

      

      
        A-6

        
          

        

      

      
         

      

    

     

    1.1.8       All
of Mortgagor’s interest in and to all operating accounts, the Loan funds,
whether disbursed or not, all reserves set forth in the Budget relating to the
Property, [REFERENCE ANY OTHER ACCOUNTS SPECIFIC TO TRANSACTION, E.G. TENANT
SECURITY DEPOSIT ACCOUNTS, CAPITAL IMPROVEMENT RESERVES AND IMPOUNDS] and any
other bank accounts of Mortgagor; together with

     

    1.1.9       All
rights to the payment of money, accounts, accounts receivable, reserves,
deferred payments, refunds, cost savings, payments and deposits, whether now or
later to be received from third parties (including all earnest money sales
deposits) or deposited by Mortgagor with third parties (including all utility
deposits), contract rights, development and use rights, governmental permits and
licenses, applications, architectural and engineering plans, specifications and
drawings, as-built drawings, chattel paper, instruments, documents, notes,
drafts and letters of credit (other than letters of credit in favor of
Mortgagee), which arise from or relate to construction on the Premises or to any
business now or later to be conducted on it, or to the Premises and Improvements
generally and any builder’s or manufacturer’s warranties with respect thereto;
together with

     

    1.1.10     All
insurance policies pertaining to the Premises and all proceeds, including all
claims to and demands for them, of the voluntary or involuntary conversion of
any of the Premises, Improvements or the other property described above into
cash or liquidated claims, including proceeds of all present and future fire,
hazard or casualty insurance policies and all condemnation awards or payments
now or later to be made by any public body or decree by any court of competent
jurisdiction for any taking or in connection with any condemnation or eminent
domain proceeding, and all causes of action and their proceeds for any damage or
injury to the Premises, Improvements or the other property described above or
any part of them, or breach of warranty in connection with the construction of
the Improvements, including causes of action arising in tort, contract, fraud or
concealment of a material fact; together with

     

    1.1.11     All
books and records pertaining to any and all of the property described above,
including computer-readable memory and any computer hardware or software
necessary to access and process such memory, but not including, to the extent
required by applicable laws and rules concerning resident privacy, resident
files (“Books and Records”); together with

     

    1.1.12     All
proceeds of, additions and accretions to, substitutions and replacements for,
and changes in any of the property described above.

     

    Capitalized
terms used above and elsewhere in this Mortgage without definition have the
meanings given them in the above defined Credit Agreement.

     

    1.2             
         Secured
Obligations.

     

    1.2.1       Mortgagor
makes the grant, conveyance, and mortgage set forth in Section 1.1 above,
and grants the security interest set forth in Section 3 below for the
purpose of securing the following obligations (the “Secured Obligations”) in any
order of priority that Mortgagee may choose:

     

    
      
         

      

      
        A-7

        
          

        

      

      
         

      

    

    (b) Payment
of all obligations at any time owing under (1) the  various promissory
notes (the “Note”) dated as of November 18, 2010, payable by Borrower, as maker
in the aggregate principal amount of Twenty-Five Million and No/100 Dollars
($25,000,000.00) to the order of Lenders, (2) that certain Intercompany Note of
the Mortgagor dated as of the date hereof payable to Borrower and assigned to
Agent, (3) those certain Intercompany Notes of the other Subsidiary Guarantors
from time to time, as maker(s), payable to Borrower and assigned to Agent
(together with the Note, the “Notes”), and (4) the Subsidiary
Guaranty;

     

    (c) Payment
and performance of all Guaranteed Obligations (as defined in the Subsidiary
Guaranty);

     

    (d) Payment
and performance of all obligations of Mortgagor under this
Mortgage;

     

    (e) Payment
and performance of all obligations of Borrower under the Credit Agreement and
the other Loan Documents;

     

    (f) Payment
and performance of any obligations of Mortgagor and the other Loan Parties
(including each other Subsidiary Guarantor) under the other Loan
Documents;

     

    (g)
Payment and performance of all future advances and other obligations that
Mortgagor or any successor in ownership of all or part of the Property may agree
to pay and/or perform (whether as principal, surety or guarantor) for the
benefit of Mortgagee, when a writing evidences the parties’ agreement that the
advance or obligation be secured by this Mortgage; and

     

    (h) Payment
and performance of all modifications, amendments, extensions, and renewals,
however evidenced, of any of the Secured Obligations.

     

    1.2.2       All
persons who may have or acquire an interest in all or any part of the Property
will be considered to have notice of, and will be bound by, the terms of the
Secured Obligations and each other agreement or instrument made or entered into
in connection with each of the Secured Obligations.  Such terms
include any provisions in the Notes or the Credit Agreement which permit
borrowing, repayment and reborrowing, or which provide that the interest rate on
one or more of the Secured Obligations may vary from time to time.

     

    SECTION
2      Assignment
of Rents.

     

    2.1          
            Assignment.  Mortgagor
hereby irrevocably, absolutely, presently and unconditionally assigns to
Mortgagee all rents, royalties, issues, profits, revenue, income, accounts,
proceeds and other benefits of the Property, whether now due, past due or to
become due, including all prepaid rents and security deposits (some or all
collectively, as the context may require, “Rents”).  This is an
absolute assignment, not an assignment for security only.

     

    2.2                   
    Grant of License.  Mortgagee hereby confers
upon Mortgagor a license (“License”) to collect and retain the Rents as they
become due and payable, so long as no Event of Default, as defined in Section
6.2 below, shall exist and be continuing.  If an Event of Default has
occurred and is continuing, Mortgagee shall have the right, which it may choose
to exercise in its sole discretion, to terminate this License without notice to
or demand upon Mortgagor, and without regard to the adequacy of Mortgagee’s
security under this Mortgage.

     

    
      
         

      

      
        A-8

        
          

        

      

      
         

      

    

     

    2.3                 
     Collection and Application of
Rents.  Subject to the License granted to Mortgagor under Section 2.2
above, Mortgagee has the right, power and authority to collect any and all
Rents.  Mortgagor hereby appoints Mortgagee its attorney-in-fact to
perform any and all of the following acts (if an Event of Default has occurred
and is continuing) if and at the times when Mortgagee in its sole discretion may
so choose:

     

    2.3.1       Demand,
receive and enforce payment of any and all Rents; or

     

    2.3.2       Give
receipts, releases and satisfactions for any and all Rents; or

     

    2.3.3       Sue
either in the name of Mortgagor or in the name of Mortgagee for any and all
Rents.

     

    Mortgagee
and Mortgagor agree that the mere recordation of the assignment granted herein
entitles Mortgagee immediately to collect and receive rents upon the occurrence
(and during the continuance) of an Event of Default without first taking any
acts of enforcement under applicable law, such as, but not limited to, providing
notice to Mortgagor, filing foreclosure proceedings, or seeking and/or obtaining
the appointment of a receiver.  Further, Mortgagee’s right to the
Rents does not depend on whether or not Mortgagee takes possession of the
Property as permitted under Subsection 6.3(c).  In Mortgagee’s sole
discretion, Mortgagee may choose to collect Rents either with or without taking
possession of the Property.  Mortgagee shall apply all Rents collected
by it in the manner provided under Section 6.6.  If an Event of
Default occurs while Mortgagee is in possession of all or part of the Property
and is collecting and applying Rents as permitted under this Mortgage, Mortgagee
and any receiver shall nevertheless be entitled to exercise and invoke every
right and remedy afforded any of them under this Mortgage and at law or in
equity.

     

    
      
         

      

      
        A-9

        
          

        

      

      
         

      

    

     

    2.4                      Mortgagee
Not Responsible.  Under no circumstances shall Mortgagee have any duty
to produce Rents from the Property.  Regardless of whether or not
Mortgagee, in person or by agent, takes actual possession of the Premises and
Improvements, unless Mortgagee agrees in writing to the contrary, Mortgagee is
not and shall not be deemed to be:

     

    2.4.1       A
“mortgagee in possession” for any purpose; or

     

    2.4.2       Responsible
for performing any of the obligations of the lessor under any lease;
or

     

    2.4.3       Responsible
for any waste committed by lessees or any other parties, any dangerous or
defective condition of the Property, or any negligence in the management,
upkeep, repair or control of the Property; or

     

    2.4.4       Liable
in any manner for the Property or the use, occupancy, enjoyment or operation of
all or any part of it.

     

    2.5                      Leasing.  Mortgagor
shall not accept any deposit or prepayment of rents under the leases for any
rental period exceeding one (1) month without Mortgagee’s prior written consent,
which shall not be unreasonably withheld, delayed or conditioned. Mortgagor
shall not lease the Property or any part of it except strictly in accordance
with the Credit Agreement.

     

    SECTION
3      Grant
of Security Interest.

     

    3.1                
      Security Agreement.  The parties
intend for this Mortgage to create a lien on the Property, and an absolute
assignment of the Rents, all in favor of Mortgagee.  The parties
acknowledge that some of the Property and some or all of the Rents may be
determined under applicable law to be personal property or
fixtures.  To the extent that any Property or Rents may be or be
determined to be personal property, Mortgagor as debtor hereby grants Mortgagee
as secured party a security interest in all such Property and Rents, to secure
payment and performance of the Secured Obligations.  This Mortgage
constitutes a security agreement under the Uniform Commercial Code of the State
in which the Property is located, covering all such Property and
Rents.

     

    3.2                 
     Financing Statements.  Mortgagor hereby
authorizes Mortgagee to file one or more financing statements.  In
addition, Mortgagor shall execute such other documents as Mortgagee may from
time to time reasonably require to perfect or continue the perfection of
Mortgagee’s security interest in any Property or Rents.  As provided
in Section 5.9 below, Mortgagor shall pay all fees and costs that Mortgagee may
incur in filing such documents in public offices and in obtaining such record
searches as Mortgagee may reasonably require.  In case Mortgagor fails
to execute any financing statements or other documents for the perfection or
continuation of any security interest, Mortgagor hereby appoints Mortgagee as
its true and lawful attorney-in-fact to execute any such documents on its
behalf.  If any financing statement or other document is filed in the
records normally pertaining to personal property, that filing shall never be
construed as in any way derogating from or impairing this Mortgage or the rights
or obligations of the parties hereunder.

     

    
      
         

      

      
        A-10

        
          

        

      

      
         

      

    

    SECTION
4       Fixture
Filing.

     

    This
Mortgage constitutes a financing statement filed as a fixture filing under
Article 9 of the Uniform Commercial Code in the State in which the Property is
located, as amended or recodified from time to time, covering any Property which
now is or later may become fixtures attached to the Premises or
Improvements.  For this purpose, the respective addresses of
Mortgagor, as debtor, and Mortgagee, as secured party, are as set forth in the
preamble of this Mortgage

     

    
      
         

      

      
        A-11

        
          

        

      

      
         

      

    

     

    SECTION
5       Rights
and Duties of the Parties.

     

    5.1                     
 Representations and Warranties.  Mortgagor represents and
warrants that:

     

    5.1.1       Mortgagor
lawfully possesses and holds [fee simple] [leasehold] title to all of the
Premises and Improvements;

     

    5.1.2       Mortgagor
has or will have good title to all Property other than any portion thereof that
is personal property owned by any tenant;

     

    5.1.3       Mortgagor
has the full and unlimited power, right and authority to encumber the Property
and assign the Rents;

     

    5.1.4       This
Mortgage creates a first and prior lien on the Property subject only to
Permitted Liens;

     

    5.1.5       The
Property includes all property and rights which may be reasonably necessary or
desirable to promote the  present and any reasonable future beneficial
use and enjoyment of the Premises and Improvements;

     

    5.1.6       Except
for any portion thereof that is personal property owned by any tenant, Mortgagor
owns any Property which is personal property free and clear of any security
agreements, reservations of title or conditional sales contracts, and there is
no financing statement affecting such personal property on file in any public
office;

     

    5.1.7       Mortgagor
expects to derive a direct benefit (and its board of directors or other
governing body had determined that it may reasonably be expected to derive such
benefit) from:  (1) the Revolving Credit Loans and the Intercompany
Loans to finance its business; (2) the successful operations of Borrower and
each other Subsidiary Guarantor individually and as a group; (3) its rights of
contribution and subrogation against the Borrower and each other Subsidiary
Guarantor as provided in the Subsidiary Guaranty or under applicable law; and
(4) the Credit Agreement and the other Loan
Documents;  and

     

    5.1.8       Mortgagor’s
place of business, or its chief executive office if it has more than one place
of business, is located at the address specified below.

     

    5.2           
           Taxes, and
Assessments.  Mortgagor shall pay prior to delinquency all taxes,
levies, charges and assessments, in accordance with Section 6.6 of the Credit
Agreement.

     

    5.3          
            Performance
of Secured Obligations.  Mortgagor shall promptly pay and perform each
Secured Obligation to be performed by it under the Loan Documents in accordance
with its terms.

     

    5.4            
          Liens, Charges and
Encumbrances.  Mortgagor shall immediately discharge any lien on the
Property that is not a Permitted Lien and which Mortgagee has not otherwise
consented to in writing in accordance with the terms of Section 7.2 of the
Credit Agreement.

     

    
      
         

      

      
        A-12

        
          

        

      

      
         

      

    

    

      5.5                      Damages
and Insurance and Condemnation Proceeds.  In the event of any casualty
or condemnation of the Property, the provisions of Section 6.17 of the Credit
Agreement shall govern.

       

      5.6                      Maintenance
and Preservation of Property.

       

      5.6.1       Mortgagor
shall insure the Property as required by the Credit Agreement and keep the
Property in good condition and repair.

       

      5.6.2       Once
construction of the Premises has been completed, Mortgagor shall not remove or
demolish the Property or any part of it, or materially alter, restore or add to
the Property, or initiate or allow any change or variance in any zoning or other
Premises use classification which materially and adversely affects the Property
or any part of it, except as permitted or required by the Credit Agreement or
with Mortgagee’s express prior written consent in each instance, which consent
shall not be unreasonably withheld, delayed or conditioned.

       

      5.6.3       Once
construction of the Premises has been completed, if all or part of the Property
becomes damaged or destroyed, Mortgagor shall promptly and completely repair
and/or restore the Property in a good and workmanlike manner in accordance with
(and as required by) the Credit Agreement.

       

      5.6.4       Mortgagor
shall not commit or allow any act upon or use of the Property which would
violate (i) any applicable Laws or order of any Governmental Authority,
whether now existing or later to be enacted and whether foreseen or unforeseen,
in any material adverse manner; or (ii) any public or private covenant,
condition, restriction or equitable servitude affecting the
Property.  Mortgagor shall not bring or keep any article on the
Property or cause or allow any condition to exist on it, if that could
invalidate or would be prohibited by any insurance coverage required to be
maintained by Mortgagor on the Property or any part of it under the Credit
Agreement.

       

      5.6.5       Mortgagor
shall not commit or allow waste of the Property, including those acts or
omissions characterized under the Credit Agreement as waste which arises out of
Hazardous Material.

       

      5.6.6       Mortgagor
shall perform (or cause to be performed) all other acts which from the character
or use of the Property may be reasonably necessary to maintain and preserve its
value.

       

      5.7                      Releases,
Extensions, Modifications and Additional Security.  From time to time,
Mortgagee may perform any of the following acts without incurring any liability
or giving notice to any person:

       

      5.7.1       Release
any person liable for payment of the Secured Obligations;

       

      5.7.2       Extend
the time for payment, or otherwise alter the terms of payment, of the Secured
Obligations;

      
        
           

        

        
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      5.7.3       Accept
additional real or personal property of any kind as security for the Secured
Obligations, whether evidenced by deeds of trust, mortgages, security agreements
or any other instruments of security;

       

      5.7.4       Alter,
substitute or release any property securing the Secured
Obligations;

       

      5.7.5       Consent
to the making of any plat or map of the Property or any part of it;

       

      5.7.6       Join
in granting any easement or creating any restriction affecting the Property;
or

       

      5.7.7       Join
in any subordination or other agreement affecting this Mortgage or the lien of
it; or

       

      5.7.8       Release
the Property or any part of it.

       

      5.8                      Release.  When
the Secured Obligations have been paid in full and all fees and other sums owed
by Mortgagor under Section 5.9 of this Mortgage by Mortgagor and the other
Borrowers under the other Loan Documents have been received (and subject to the
terms and conditions of Section 7.7 of the Credit Agreement), Mortgagee shall
release this Mortgage, the lien created thereby, and all notes and instruments
evidencing the Secured Obligations.  In such event, Mortgagee shall,
at the request of Mortgagor, deliver to Mortgagor, in recordable form, all such
documents as shall be reasonably necessary to release this Mortgage and all
liens, security interests, conveyances and assignments created
hereunder.  Mortgagor shall pay any costs of preparation and
recordation of such release.

       

      5.9                      Compensation,
Exculpation, Indemnification.

       

      5.9.1       Mortgagor
agrees to pay a reasonable fee for any services that Mortgagee may render in
connection with this Mortgage, including Mortgagee’s providing a statement of
the Secured Obligations (but specifically excluding a fee, but not reimbursement
for costs or expenses, for providing the release pursuant to Section 5.8
above).  Mortgagor shall also pay or reimburse all of Mortgagee’s
reasonable out-of-pocket costs and expenses which may be incurred in rendering
any such services.  Mortgagor further agrees to pay or reimburse
Mortgagee for all actual, reasonable, out-of-pocket costs, expenses and other
advances which may be incurred or made by Mortgagee in any efforts to enforce
any terms of this Mortgage, including any rights or remedies afforded to
Mortgagee under Section 6.3, whether any lawsuit is filed or not, or in
defending any action or proceeding arising under or relating to this Mortgage,
including attorneys’ fees and other legal costs, costs of any Foreclosure Sale
(as defined in Subsection 6.3(i) below) and any cost of evidence of
title.  If Mortgagee chooses to dispose of Property through more than
one Foreclosure Sale, Mortgagor shall pay all costs, expenses or other advances
that may be incurred or made by Mortgagee in each of such Foreclosure
Sales.  In any suit to foreclose the lien hereof or enforce any other
remedy of Mortgagee under this Mortgage or the Note, there shall be allowed and
included as additional indebtedness in the decree for sale or other judgment or
decree all expenditures and expenses which may be paid or incurred by or on
behalf of Mortgagee for reasonable attorneys’ costs and fees (including the
costs and fees of paralegals), survey charges, appraiser’s fees, inspecting
engineer’s and/or architect’s fees, fees for environmental studies and
assessments and all additional expenses incurred by Mortgagee with respect to
environmental matters, outlays for documentary and expert evidence,
stenographers’ charges, publication costs, and costs (which may be estimated as
to items to be expended after entry of the decree) of procuring all such
abstracts of title, title searches and examinations, title insurance policies
and similar data and assurances with respect to title as Mortgagee may deem
reasonably necessary either to prosecute such suit or to evidence to bidders at
any sale which may be had pursuant to such decree the true
condition  of the title to, the value of or the environmental
condition of the Property.  All expenditures and expenses of the
nature in this Subsection mentioned, and such expenses and fees as may be
incurred in the protection of the Property and maintenance of the lien of this
Mortgage, including the fees of any attorney (including the costs and fees of
paralegals) employed by Mortgagee in any litigation or proceeding affecting this
Mortgage, the Notes or the Property, including probate and bankruptcy
proceedings, or in preparation for the commencement or defense of any proceeding
or threatened suit or proceeding, shall be immediately due and payable by
Mortgagor, with interest thereon at the Default Rate and shall be secured by
this Mortgage.

      
        
           

        

        
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      5.9.2       Mortgagee
shall not be directly or indirectly liable to Mortgagor or any other person as a
consequence of any of the following:

       

      (b) Mortgagee’s
exercise of or failure to exercise any rights, remedies or powers granted to
Mortgagee in this Mortgage;

       

      (c) Mortgagee’s
failure or refusal to perform or discharge any obligation or liability of
Mortgagor under any agreement related to the Property or under this Mortgage;
or

       

      (d) Any
loss sustained by Mortgagor or any third party resulting from Mortgagee’s
failure to lease the Property, or from any other act or omission of Mortgagee in
managing the Property, during the continuance of an Event of Default, unless the
loss is caused by the gross negligence, willful misconduct or bad faith of
Mortgagee.

       

      Mortgagor
hereby expressly waives and releases all liability of the types described above,
and agrees that no such liability shall be asserted against or imposed upon
Mortgagee.

      
        
           

        

        
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      5.9.3       Mortgagor
agrees to indemnify Mortgagee against and hold it harmless from all losses,
damages, liabilities, claims, causes of action, judgments, court costs,
attorneys’ fees and other legal expenses, cost of evidence of title, cost of
evidence of value, and other costs and expenses which it may suffer or
incur:

       

      (b) In
performing any act required or permitted by this Mortgage or any of the other
Loan Documents or by law;

       

      (c) Because
of any failure of Mortgagor to perform any of its obligations under this
Mortgage or the other Loan Documents; or

       

      (d) Because
of any alleged obligation of or undertaking by Mortgagee to perform or discharge
any of the representations, warranties, conditions, covenants or other
obligations in any document relating to the Property other than the Loan
Documents, unless this loss is caused by the gross negligence, willful
misconduct or bad faith of Mortgagee.

       

      This
agreement by Mortgagor to indemnify Mortgagee shall survive the release and
cancellation of any or all of the Secured Obligations and the full or partial
release of this Mortgage.

       

      5.9.4       Mortgagor
shall pay all obligations to pay money arising under this Section 5.9 promptly
upon demand by Mortgagee.  Each such obligation shall be added to, and
considered to be part of, the principal of the Note, and shall bear interest
from the date the obligation arises at the Default Rate.

       

      5.10        Defense
and Notice of Claims and Actions.  At Mortgagor’s sole expense,
Mortgagor shall protect, preserve and defend the Property and title to and right
of possession of the Property, and the security of this Mortgage and the rights
and powers of Mortgagee created under it, against all adverse
claims.  Mortgagor shall give Mortgagee prompt notice in writing if
any claim is asserted which does or could materially affect any such matters, or
if any action or proceeding is commenced which alleges or relates to any such
claim.

       

      5.11        Subrogation.  Mortgagee
shall be subrogated to the liens of all encumbrances, whether released of record
or not, which are discharged in whole or in part by Mortgagee in accordance with
this Mortgage or with the proceeds of any loan secured by this
Mortgage.

       

      5.12        Site
Visits, Observation and Testing.  Mortgagee and its agents and
representatives shall have the right at any reasonable time to enter and visit
the Property for the purpose of performing appraisals, observing the Property,
taking and removing soil or groundwater samples, and conducting tests on any
part of the Property.  Mortgagee has no duty, however, to visit or
observe the Property or to conduct tests, and no site visit, observation or
testing by Mortgagee, its agents or representatives shall impose any liability
on any of Mortgagee, its agents or representatives.  In no event shall
any site visit, observation or testing by Mortgagee, its agents or
representatives be a representation that Hazardous Material are or are not
present in, on or under the Property, or that there has been or shall be
compliance with any law, regulation or ordinance pertaining to Hazardous
Material or any other applicable governmental law.  Neither Mortgagor
nor any other party is entitled to rely on any site visit, observation or
testing by any of Mortgagee, its agents or representatives.  Neither
Mortgagee, its agents or representatives owe any duty of care to protect
Mortgagor or any other party against, or to inform Mortgagor or any other party
of, any Hazardous Material or any other adverse condition affecting the
Property.  Mortgagee shall give Mortgagor reasonable advance notice
before entering the Property.  Mortgagee shall make reasonable efforts
to avoid interfering with Mortgagor’s use of the Property in exercising any
rights provided in this Section 5.12.

      
        
           

        

        
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      5.13       
Notice of Change. Mortgagor shall give Mortgagee prior written notice of any
change in (a) the location of its place of business or its chief executive
office if it has more than one place of business; (b) the location of any of the
Property, including the Books and Records; and (c) Mortgagor’s name, business
structure or jurisdiction of organization. Unless otherwise approved by
Mortgagee in writing, all Property that consists of personal property (other
than the Books and Records) will be located on the Premises and all Books and
Records will be located at Mortgagor’s place of business or chief executive
office if Mortgagor has more than one place of business.

       

      SECTION
6     Accelerating
Transfers, Default and Remedies.

       

      6.1                      Accelerating
Transfers.

       

      6.1.1       “Accelerating
Transfer” means any transfer not expressly permitted under Sections 7.7 or 10.12
of the Credit Agreement.

       

      6.1.2       Mortgagor
acknowledges that Lenders are making one or more advances under the Credit
Agreement in reliance on the expertise, skill and experience of
Mortgagor.  In consideration of Mortgagee’s reliance, Mortgagor agrees
that Mortgagor shall not make any Accelerating Transfer, unless the transfer is
preceded by Mortgagee’s express written consent to the particular transaction
and transferee.  Mortgagee may withhold such consent in its sole
discretion.  If any Accelerating Transfer occurs, Mortgagee in its
sole discretion may declare all of the Secured Obligations to be immediately due
and payable, and Mortgagee may invoke any rights and remedies provided by
Section 6.3 of this Mortgage.

       

      6.2                      Events
of Default.  Mortgagor will be in default under this Mortgage upon the
occurrence of any “Event of Default” under the Credit Agreement or any other
Loan Document.

       

      6.3                      Remedies.1  At any time
after an Event of Default, Mortgagee shall be entitled to invoke any and all of
the rights and remedies described below, in addition to all other rights and
remedies available to Mortgagee at law or in equity.  All of such
rights and remedies shall be cumulative, and the exercise of any one or more of
them shall not constitute an election of remedies.

       

      6.3.1       Acceleration.  Mortgagee
may declare any or all of the Secured Obligations to be due and payable
immediately.

      

        

      

      
        
          1 Remedies
to be conformed for specific State laws.

        

      

      
        
           

        

        
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      6.3.2       Receiver.  Mortgagee
shall, as a matter of right, without notice and without giving bond to Mortgagor
or anyone claiming by, under or through Mortgagor, and without regard for the
solvency or insolvency of Mortgagor or the then value of the Property, to the
extent permitted by applicable law, be entitled to have a receiver appointed for
all or any part of the Property and the Rents, and the proceeds, issues and
profits thereof, with the rights and powers referenced below and such other
rights and powers as the court making such appointment shall confer, and
Mortgagor hereby consents to the appointment of such receiver and shall not
oppose any such appointment.  Such receiver shall have all powers and
duties prescribed by applicable law, all other powers which are necessary or
usual in such cases for the protection, possession, control, management and
operation of the Property, and such rights and powers as Mortgagee would have,
upon entering and taking possession of the Property under subsection (c)
below.

       

      6.3.3       Entry.  Mortgagee,
in person, by agent or by court-appointed receiver, may enter, take possession
of, manage and operate all or any part of the Property, and may also do any and
all other things in connection with those actions that Mortgagee may in its sole
discretion consider necessary and appropriate to protect the security
of  this Mortgage.  Such other things may
include:  taking and possessing all of Mortgagor’s or the then owner’s
Books and Records; entering into, enforcing, modifying or canceling leases on
such terms and conditions as Mortgagee may consider proper; obtaining and
evicting tenants; fixing or modifying Rents; collecting and receiving any
payment of money owing to Mortgagee; completing any unfinished construction;
and/or contracting for and making repairs and alterations.  If
Mortgagee so requests, Mortgagor shall assemble all of the Property that has
been removed from the Premises and make all of it available to Mortgagee at the
site of the Premises.  Mortgagor hereby irrevocably constitutes and
appoints Mortgagee as Mortgagor’s attorney-in-fact to perform such acts and
execute such documents as Mortgagee in its sole discretion may consider to be
appropriate in connection with taking these measures, including endorsement of
Mortgagor’s name on any instruments.

       

      6.3.4       Cure;
Protection of Security.   Mortgagee may cure any breach or
default of Mortgagor, and if it chooses to do so in connection with any such
cure, Mortgagee may also enter the Property and/or do any and all other things
which it may in its sole discretion consider necessary and appropriate to
protect the security of this Mortgage, including, without limitation, completing
construction of the improvements at the Property contemplated by the Credit
Agreement.  Such other things may include: appearing in and/or
defending any action or proceeding which purports to affect the security of, or
the rights or powers of Mortgagee under, this Mortgage; paying, purchasing,
contesting or compromising any encumbrance, charge, lien or claim of lien which
in Mortgagee’s sole judgment is or may be senior in priority to this Mortgage,
such judgment of Mortgagee or to be conclusive as among the parties to this
Mortgage; obtaining insurance and/or paying any premiums or charges for
insurance required to be carried under the Credit Agreement; otherwise caring
for and protecting any and all of the Property; and/or employing counsel,
accountants, contractors and other appropriate persons to assist
Mortgagee.  Mortgagee may take any of the actions permitted under this
Subsection 6.3(d) either with or without giving notice to any
person.  Any amounts expended by Mortgagee under this Subsection
6.3(d) shall be secured by this Mortgage.

      
        
           

        

        
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      6.3.5       Uniform
Commercial Code Remedies.  Mortgagee may exercise any or all of the
remedies granted to a secured party under the Uniform Commercial Code in the
State in which the Property is located.

       

      6.3.6       Foreclosure;
Lawsuits.  Mortgagee shall have the right, in one or several
concurrent or consecutive proceedings, to foreclose the lien hereof upon the
Property or any part thereof, for the Secured Obligations, or any part thereof,
by any proceedings appropriate under applicable law.  Mortgagee or its
nominee may bid and become the purchaser of all or any part of the Property at
any foreclosure or other sale hereunder, and the amount of Mortgagee’s
successful bid shall be credited on the Secured Obligations.  Without
limiting the foregoing, Mortgagee may proceed by a suit or suits in law or
equity, whether for specific performance of any covenant or agreement herein
contained or in aid of the execution of any power herein granted, or for any
foreclosure under the judgment or decree of any court of competent
jurisdiction.  In addition to the right provided in Subsection 6.3(a),
upon, or at any time after the filing of a complaint to foreclose this Mortgage,
Mortgagee shall be entitled to the appointment of a receiver of the property by
the court in which such complaint is filed, and Mortgagor hereby consents to
such appointment.

       

      6.3.7       Other
Remedies.  Mortgagee may exercise all rights and remedies contained in
any other instrument, document, agreement or other writing heretofore,
concurrently or in the future executed by Mortgagor or any other person or
entity in favor of Mortgagee in connection with the Secured Obligations or any
part thereof, without prejudice to the right of Mortgagee thereafter to enforce
any appropriate remedy against Mortgagor.  Mortgagee shall have the
right to pursue all remedies afforded to a mortgagee under applicable law, and
shall have the benefit of all of the provisions of such applicable law,
including all amendments thereto which may become effective from time to time
after the date hereof.

       

      6.3.8       Sale
of Personal Property.  Mortgagee shall have the discretionary right to
cause some or all of the Property, which constitutes personal property (but
excluding the personal property of any of the patients or residents of the
Property), to be sold or otherwise disposed of in any combination and in any
manner permitted by applicable law.

       

      (b) For
purposes of this power of sale, Mortgagee may elect to treat as personal
property any Property which is intangible or which can be severed from the
Premises or Improvements without causing structural damage.  If it
chooses to do so, Mortgagee may dispose of any personal property, in any manner
permitted by Article 9 of the Uniform Commercial Code of the State in which the
Property is located, including any public or private sale, or in any manner
permitted by any other applicable law.

       

      (c) In
connection with any sale or other disposition of such Property, Mortgagor agrees
that the following procedures constitute a commercially reasonable
sale:  Mortgagee shall mail written notice of the sale to Mortgagor
not later than thirty (30) days prior to such sale.  Mortgagee will
publish notice of the sale in a local daily newspaper of general
circulation.  Upon receipt of any written request, Mortgagee will make
the Property available to any bona fide prospective purchaser for inspection
during reasonable business hours.  Notwithstanding the foregoing,
Mortgagee shall be under no obligation to consummate a sale if, in its judgment,
none of the offers received by it equals the fair value of the Property offered
for sale.  The foregoing procedures do not constitute the only
procedures that may be commercially reasonable.

      
        
           

        

        
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      6.3.9       Single
or Multiple Foreclosure Sales.  If the Property consists of more than
one lot, parcel or item of property,  Mortgagee may:

       

      (b) Designate
the order in which the lots, parcels and/or items shall be sold or disposed of
or offered for sale or disposition; and

       

      (c) Elect
to dispose of the lots, parcels and/or items through a single consolidated sale
or disposition to be held or made under or in connection with judicial
proceedings, or by virtue of a judgment and decree of foreclosure and sale; or
through two or more such sales or dispositions; or in any other manner Mortgagee
may deem to be in its best interests (any such sale or disposition, a
“Foreclosure Sale;” and any two or more, “Foreclosure Sales”).

       

      If
Mortgagee chooses to have more than one Foreclosure Sale, Mortgagee at its
option may cause the Foreclosure Sales to be held simultaneously or
successively, on the same day, or on such different days and at such different
times and in such order as Mortgagee may deem to be in its best
interests.  No Foreclosure Sale shall terminate or affect the liens of
this Mortgage on any part of the Property which has not been sold, until all of
the Secured Obligations have been paid in full.

      
        
           

        

        
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      6.4                      Credit
Bids.  At any Foreclosure Sale, any person, including Mortgagor or
Mortgagee, may bid for and acquire the Property or any part of it to the extent
permitted by then applicable law.  Instead of paying cash for such
property, Mortgagee may settle for the purchase price by crediting the sales
price of the property against the following obligations:

       

      6.4.1       First,
the portion of the Secured Obligations attributable to the expenses of sale,
costs of any action and any other sums for which Mortgagor is obligated to pay
or reimburse Mortgagee under Section 5.9 above; and

       

      6.4.2       Second,
all other Secured Obligations in any order and proportions as Mortgagee in its
sole discretion may choose.

       

      6.5                      Application
of Foreclosure Sale Proceeds. Mortgagee shall apply the proceeds of any
Foreclosure Sale in the following manner:

       

      6.5.1       First,
to pay the portion of the Secured Obligations attributable to the expenses of
sale, costs of any action and any other sums for which Mortgagor is obligated to
reimburse Mortgagee under Section 5.9 of this Mortgage;

       

      6.5.2       Second,
to pay the portion of the Secured Obligations attributable to any sums expended
or advanced by Mortgagee under the terms of this Mortgage which then remain
unpaid;

       

      6.5.3       Third,
to pay all other Secured Obligations in any order and proportions as Mortgagee
in its sole discretion may choose; and

       

      6.5.4       Fourth,
to remit the remainder, if any, to the Mortgagor (or as a court of competent
jurisdiction may otherwise order).

       

      6.6                      Application
of Rents and Other Sums.  Mortgagee shall apply any and all Rents
collected by it, and any and all sums other than proceeds of a Foreclosure Sale
which Mortgagee may receive or collect under Section 6.3 above, in the
following manner:

       

      6.6.1       First,
to pay the portion of the Secured Obligations attributable to the costs and
expenses of operation and collection that may be incurred by Mortgagee or any
receiver;

       

      6.6.2       Second,
to pay all other Secured Obligations in any order and proportions as Mortgagee
in its sole discretion may choose; and

       

      6.6.3       Third,
to remit the remainder, if any, to the Mortgagor (or as a court of competent
jurisdiction may otherwise order).

       

      Mortgagee
shall have no liability for any funds which it does not actually
receive.

      
        
           

        

        
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      SECTION
7     Miscellaneous
Provisions.

       

      7.1                      Additional
Provisions.  The Loan Documents fully state all of the terms and
conditions of the parties’ agreement regarding the matters mentioned in or
incidental to this Mortgage.  The Loan Documents also grant further
rights to Mortgagee and contain further agreements and affirmative and negative
covenants by Mortgagor which apply to this Mortgage and to the
Property.

       

      7.2                      No
Waiver or Cure.

       

      7.2.1       Each
waiver by Mortgagee must be in writing, and no waiver shall be construed as a
continuing waiver.  No waiver shall be implied from any delay or
failure by Mortgagee to take action on account of any default of
Mortgagor.  Consent by Mortgagee to any act or omission by Mortgagor
shall not be construed as a consent to any other or subsequent act or omission
or to waive the requirement for Mortgagee’s consent to be obtained
in  any future or other instance.

       

      7.2.2       If
any of the events described below occurs, that event alone shall
not:  cure or waive any breach, Event of Default or notice of default
under this Mortgage or invalidate any act performed pursuant to any such default
or notice; or nullify the effect of any notice of default or sale (unless all
Secured Obligations then due have been paid and performed and all other defaults
under the Loan Documents have been cured); or impair the security of this
Mortgage; or prejudice Mortgagee or any receiver in the exercise of any right or
remedy afforded any of them under this Mortgage; or be construed as an
affirmation by Mortgagee of any tenancy, lease or option, or a subordination of
the lien of this Mortgage.

       

      (b) Mortgagee,
its agent or a receiver takes possession of all or any part of the Property in
the manner provided in Subsection 6.3(c).

       

      (c) Mortgagee
collects and applies Rents as permitted under Sections 2.3 and 6.6 above,
either with or without taking possession of all or any part of the
Property.

       

      (d) Mortgagee
receives and applies to any Secured Obligation any proceeds of any Property,
including any proceeds of insurance policies, condemnation awards, or other
claims, property or rights assigned to Mortgagee under Section 5.5
above.

       

      (e) Mortgagee
makes a site visit, observes the Property and/or conducts tests as permitted
under Section 5.12 above.

       

      (f) Mortgagee
receives any sums under this Mortgage or any proceeds of any collateral held for
any of the Secured Obligations, and applies them to one or more Secured
Obligations.

       

      (g) Mortgagee
or any receiver invokes any right or remedy provided under this
Mortgage.

       

      7.3                      Powers
of Mortgagee.

       

      7.3.1       If
Mortgagee performs any act which it is empowered or authorized to perform under
this Mortgage, including any act permitted by Section 5.7 or Subsection
6.3(d) of this Mortgage, that act alone shall not release or change the personal
liability of any person for the payment and performance of the Secured
Obligations then outstanding, or the lien of this Mortgage on all or the
remainder of the Property for full payment and performance of all outstanding
Secured Obligations.  The liability of the original Mortgagor shall
not be released or changed if Mortgagee grants any successor in interest to
Mortgagor any extension of time for payment, or modification of the terms of
payment, of the Secured Obligations.  Mortgagee shall not be required
to comply with any demand by the original Mortgagor that Mortgagee refuse to
grant such an extension or modification to, or commence proceedings against, any
such successor in interest.

      
        
           

        

        
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      7.3.2       Mortgagee
may take any of the actions permitted under Subsections 6.3(b) and/or
6.3(c) regardless of the adequacy of the security for the Secured Obligations,
or whether any or all of the Secured Obligations have been declared to be
immediately due and payable, or whether notice of default and election to sell
has been given under this Mortgage.

       

      7.3.3       From
time to time, Mortgagee may apply to any court of competent jurisdiction for aid
and direction in executing and enforcing the rights and remedies created under
this Mortgage.  Mortgagee may from time to time obtain orders or
decrees directing, confirming or approving acts in executing and enforcing these
rights and remedies.

       

      7.4                      Merger.  No
merger shall occur as a result of Mortgagee’s acquiring any other estate in or
any other lien on the Property unless Mortgagee consents to a merger in
writing.

       

      7.5                      [Intentionally
Omitted].

       

      7.6                      Applicable
Law. The creation, perfection and enforcement of the lien of this Mortgage shall
be governed by the law of the State in which the property is
located.  Subject to the foregoing, in all other respects, this
Mortgage shall be governed by the internal laws of the State of New York
applicable to contracts made and to be performed entirely within such State,
without regard to conflict of laws principles except Title 14 of Article 5 of
the New York General Obligations Law.

       

      7.7                      Successors
in Interest.  The terms, covenants and conditions of this Mortgage
shall be binding upon and inure to the benefit of the heirs, successors and
assigns of the parties.  However, this Section 7.7 does not waive
the provisions of Section 6.1 above.

       

      7.8                      Interpretation.

       

      7.8.1       Whenever
the context requires, all words used in the singular will be construed to have
been used in the plural, and vice versa, and each gender will include any other
gender.  The captions of the sections of this Mortgage are for
convenience only and do not define or limit any terms or
provisions.  The word “include(s)” means “include(s), without
limitation,” and the word “including” means “including, but not limited
to.”

       

      7.8.2       The
word “obligations” is used in its broadest and most comprehensive sense, and
includes all primary,  secondary, direct, indirect, fixed and
contingent obligations.  It further includes all principal, interest,
prepayment charges, late charges, loan fees and any other fees and charges
accruing or assessed at any time, as well as all obligations to perform acts or
satisfy conditions.

      
        
           

        

        
          A-23

          
            

          

        

        
           

        

      

      7.8.3       No
listing of specific instances, items or matters in any way limits the scope or
generality of any language of this Mortgage.  The Exhibits to this
Mortgage are hereby incorporated in this Mortgage.

       

      7.9                      [Intentionally
Omitted].

       

      7.10        Waiver
of Statutory Rights.  To the extent permitted by law, Mortgagor hereby
agrees that it shall not and will not apply for or avail itself of any
appraisement, valuation, stay, extension or exemption laws, or any so-called
“Moratorium Laws,” now existing or hereafter enacted, in order to prevent or
hinder the enforcement or foreclosure of this Mortgage, but hereby waives the
benefit of such laws.  Mortgagor for itself and all who may claim
through or under it waives any and all right to have the property and estates
comprising the Property marshalled upon any foreclosure of the lien hereof and
agrees that any court having jurisdiction to foreclose such lien may order the
Property sold as an entirety. Mortgagor hereby waives any and all rights of
redemption from sale under any judgment of foreclosure of this Mortgage on
behalf of Mortgagor and on behalf of each and every person acquiring any
interest in or title to the Property of any nature whatsoever, subsequent to the
date of this Mortgage.  The foregoing waiver of right of redemption is
made pursuant to the provisions of applicable law.

       

      7.11        Severability.  If
any provision of this Mortgage should be held unenforceable or void, that
provision shall be deemed severable from the remaining provisions and shall in
no way affect the validity of this Mortgage except that if such provision
relates to the payment of any monetary sum, then Mortgagee may, at its option,
declare all Secured Obligations immediately due and payable.

       

      7.12        Notices.
Any notice, demand, request or other communication which any party hereto may be
required or may desire to give hereunder shall be in writing and shall be deemed
to have been properly given (a) if hand delivered, when delivered;
(b) if mailed by United States Certified Mail (postage prepaid, return
receipt requested), three Business Days after mailing (c) if by Federal
Express or other reliable overnight courier service, on the next Business Day
after delivered to such courier service or (d) if by telecopier on the day
of transmission so long as copy is sent on the same day by overnight courier as
set forth below:

       

      
        	
                Mortgagor:

              	
                __________________________

              

      

       

      __________________________

       

      __________________________

       

      Attention:  _________________

       

      Telephone        (___)
___-_____

       

      Facsimile         (___)
___-_____

      
        
           

        

        
          A-24

          
            

          

        

        
           

        

      

      
        	
                With
      a copy to:

              	
                __________________________

              

      

       

      __________________________

       

      __________________________

       

      Attention:
_________________

      
         

        Telephone        (___)
___-_____

         

        Facsimile         (___)
___-_____

      

      
        
           

        

        
          A-25

          
            

          

        

        
           

        

      

      
        	
                Mortgagee:

              	
                KeyBank
      National Association

              

      

       

      Real
Estate Capital - Healthcare

       

      4900
Tiedeman Road

       

      4th
Floor

       

      Brooklyn,
Ohio  44114

       

      Attention:  Charles
W. Cashin, III

       

      Telephone:
(216) 813-6934

       

      Facsimile:
(216) 813-6943

       

      
        	
                With
      a copy to:

              	
                Schiff
      Hardin LLP

              

      

       

      233 South
Wacker Drive

       

      Suite
6600

       

      Chicago,
Illinois  60606

       

      Attention:
Sean T. Maloney

       

      Telephone:
(312) 258-5505

       

      Facsimile:
(312) 258-5700

       

      or at
such other address as the party to be served with notice may have furnished in
writing to the party seeking or desiring to serve notice as a place for the
service of notice.

       

      Any
notice or demand delivered to the person or entity named above to accept notices
and demands for Mortgagor shall constitute notice or demand duly delivered to
Mortgagor, even if delivery is refused.

       

      7.13       
Future Advances.2 The
total amount of indebtedness secured hereby may increase or decrease from time
to time, but the total unpaid principal balance of indebtedness secured hereby
(including disbursements that the Lenders may, but shall not be obligated to,
make under this Mortgage, the Loan Documents or any other document with respect
thereto) at any one time outstanding may be substantially less but shall not
exceed Twenty-Five Million and No/100 Dollars ($25,000,000.00), plus interest
thereon, and any disbursements made for the enforcement of this Mortgage and the
other Loan Documents and any remedies hereunder, payment of taxes, special
assessments, utilities or insurance on the Property or any other Project and
interest on such disbursements and all disbursements by Mortgagee pursuant to
applicable law (all such indebtedness being hereinafter referred to as the
maximum amount secured hereby). This Mortgage shall be valid and have priority
to the extent of the maximum amount secured hereby over all subsequent liens and
encumbrances, including statutory liens, excepting solely taxes and assessments
levied on the Property given priority by law.

      

        

      

      
        
          2 To be
conformed to State law requirements.

        

      

      
        
           

        

        
          A-26

          
            

          

        

        
           

        

      

      7.14        Mortgagee’s
Lien for Service Charge and Expenses.  At all times, regardless of
whether any Loan proceeds have been disbursed, this Mortgage secures (in
addition to any Loan proceeds disbursed from time to time) the payment of any
and all loan commissions, service charges, liquidated damages, expenses and
advances due to or incurred by Mortgagee not to exceed the maximum amount
secured hereby.

       

      7.15        WAIVER
OF TRIAL BY JURY. MORTGAGOR HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES ANY RIGHT THAT IT MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION ARISING
IN ANY WAY IN CONNECTION WITH THIS MORTGAGE, THE NOTE, OR ANY OF THE OTHER LOAN
DOCUMENTS, THE LOAN OR ANY OTHER STATEMENTS OR ACTIONS OF MORTGAGOR OR
MORTGAGEE. MORTGAGOR ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF
THIS MORTGAGE AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL
SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS DISCUSSED THIS WAIVER WITH SUCH
LEGAL COUNSEL. MORTGAGOR FURTHER ACKNOWLEDGES THAT (i) IT HAS READ AND
UNDERSTANDS THE MEANING AND RAMIFICATIONS OF THIS WAIVER, (ii) THIS WAIVER IS A
MATERIAL INDUCEMENT FOR MORTGAGEE TO MAKE THE LOAN, ENTER INTO THIS MORTGAGE AND
EACH OF THE OTHER LOAN DOCUMENTS, AND (iii) THIS WAIVER SHALL BE EFFECTIVE AS TO
EACH OF SUCH OTHER LOAN DOCUMENTS AS IF FULLY INCORPORATED THEREIN.

       

      7.16        Inconsistencies.
In the event of any inconsistency between this Mortgage and the Credit
Agreement, the terms hereof shall be controlling as necessary to create,
preserve and/or maintain a valid security interest upon the Property, otherwise
the provisions of the Credit Agreement shall be controlling.

       

      7.17        UCC
Financing Statements. Mortgagor hereby authorizes Mortgagee to file UCC
financing statements to perfect Mortgagee’s security interest in any part of the
Property.  In addition, Mortgagor agrees to sign any and all other
documents that Mortgagee deems necessary in its sole discretion to perfect,
protect, and continue Mortgagee’s lien and security interest on the
Property.

       

      7.18        Certain
Matters Relating to Property Located in the State of
___________.  With respect to the Property which is located in the
State of ________, notwithstanding anything contained herein to the
contrary:

       

      [INSERT
LOCAL LAW PROVISIONS]

      
        
           

        

        
          A-27

          
            

          

        

        
           

        

      

      In
Witness Whereof, Mortgagor has executed this Mortgage as of the date
first above written.

       

      [CONFIRM
TO LOCAL SIGNATORY REQUIREMENTS (SEALS, WITNESSES, ATTESTATION,
ETC.)]

       

      
        
          
            	
                    Mortgagor:

                  
	 
      
	
                    [Mortgagor]

                  
	 
      
	
                    By:

                  
	 
      
	
                    Its

                  

          

        

      

      
        
           

        

        
          A-28

          
            

          

        

        
           

        

      

      [CONFIRM
TO LOCAL NOTARY REQUIREMENTS]

       

      STATE OF
_____________ )

       

      )           SS:

       

      COUNTY OF
___________  )

       

      The
foregoing instrument was acknowledged before me this ____ day of ____________,
______, by ____________________, the _________________ of _________________, a
___________________, on behalf of said________________.  He/She is
personally known to me or has produced a State of ______________ driver’s
license as identification.

       

      
        
          
            	
                    Sign
      Name:

                  
	 
	
                    Notary
      Public

                  
	 
      
	
                    Print
      Name:

                  
	 
      
	
                    Serial
      No. (if any):

                  
	 
      
	
                    [NOTARIAL
      SEAL]

                  

          

        

      

       

      My
Commission Expires:  ____________________

      
        
           

        

        
          A-29EXHIBIT
10.1

    ASSET
PURCHASE AND SALE AGREEMENT

    

    This ASSET PURCHASE AND SALE AGREEMENT
(this “Agreement”)
is entered into, and dated, as of November 18, 2010, by and between RASER
TECHNOLOGIES, INC., a Delaware corporation (“Seller”
or “RZ
Group”), as seller, and VIA AUTOMOTIVE, INC., a Delaware corporation
(“Buyer”),
as buyer.

    

    WITNESSETH:

    

    A.         WHEREAS,
Seller is the owner of certain tangible and intangible property comprising or
used in connection with Seller’s Transportation and Industrial Business Segment,
more particularly described on Schedule 2.1 attached hereto (the “TI
Assets”); and

    

    B.          WHEREAS,
Seller desires to sell, and Buyer desires to buy, the TI Assets, upon and
subject to the terms, conditions, and provisions of this Agreement;

    

    NOW,
THEREFORE, in consideration for the mutual obligations of the parties hereto,
and other good and valuable consideration, the receipt and legal sufficiency of
which are acknowledged by the parties, Buyer and Seller agree as
follows:

    

    ARTICLE
1. DEFINED TERMS

    

    The
following terms shall have the following meanings in this
Agreement:

    

    1.           “Affiliate”
means, with respect to any specified Person, a Person that directly, or
indirectly through one or more intermediaries, controls, is controlled by, or is
under common control with, such specified Person. As used herein, “control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such entity, whether through
ownership of voting securities or other interests, by contract or
otherwise.

    

    2.           “Ancillary
Agreements” means each agreement or instrument to be entered into in
connection with the transfer of the TI Assets to Buyer, including the
Shareholders’ Agreement (hereinafter defined) and any exhibits, schedules,
attachments, tables or other appendices thereto, and each other agreement and
other instrument contemplated herein or in any of the foregoing, all as may be
amended from time to time.

    

    3.           “Cash
Consideration” means, the $2.5 million, which is the cash portion of the
Purchase Consideration.

    

    4.           “Closing”
means the consummation of the transaction contemplated by this Agreement in
accordance with the provisions of Article 8 hereof.

    

    5.           “Closing
Date” means the date hereof.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    6.           “Consents”
means all of the consents, permits or approvals of government authorities and
other third parties necessary to transfer the TI Assets to Buyer or otherwise to
consummate the transaction contemplated hereby.

    

    7.           “Intellectual
Property” means all intellectual property rights owned or used by any
member of the RZ Group or affiliates in connection with the TI Business, more
particularly described on Schedule 1.8, whether
protected, created or arising under the laws of the United States or any other
jurisdiction, including, without limitation:  (i) all patents and
applications therefor, including continuations, divisionals,
continuations-in-part, or reissues of patent applications and patents issuing
thereon, and all similar rights arising under the laws of any jurisdiction
(collectively, “Patents”), (ii) all
trademarks, service marks, trade names, service names, brand names, corporate
names, trade dress rights, logos, rights to use Internet domain names, and other
general intangibles of a like nature, together with the goodwill associated with
any of the foregoing, and all applications, registrations and renewals thereof
(collectively, “Marks”),
(iii) copyrights and registrations and applications therefor, works of
authorship and mask work rights (collectively, “Copyrights”),
(iv) discoveries, concepts, ideas, research and development, know-how, formulae,
inventions, compositions, technical data, procedures, designs, drawings,
specifications, databases, and other proprietary and confidential information,
including, without limitation, lists and databases of attendees, speakers,
exhibitors and sponsors, customer lists, supplier lists, pricing and cost
information, and business and marketing plans and proposals of any member of the
RZ Group or affiliates, in each case excluding any rights in respect of any of
the foregoing that comprise or are protected by Copyrights or Patents
(collectively, “Trade
Secrets”), (v) all Software and Technology owned or used by any member of
the RZ Group or affiliates, and (vi) all rights to any of the foregoing granted
to any member of the RZ Group or affiliates pursuant to any Intellectual
Property License (hereinafter defined), but specifically excluding any of the
foregoing to the extent used by any member of the RZ Group for purposes that are
other than in connection with the TI Business.

    

    8.           “Intellectual
Property License” means (i) any grant to a third Person of any right to
use any of the Intellectual Property, and (ii) any grant to RZ or its affiliates
of a right to use a third-person’s intellectual property rights.

    

    9.           “Liabilities”
means all claims, liabilities and indebtedness related specifically to the TI
Business or the TI Assets, including those set forth on Schedule 2.3 hereto,
other than the Retained Liabilities.

    

    10.         “Licenses”
means all of the operating licenses, permits, and other authorizations and any
other federal, state or local governmental authorities, if any, required in
connection with the ownership of the TI Assets and the operation of the TI
Segment.

    

    11.         “Permitted
Liens” means liens and encumbrances on the Intellectual Property in favor
of Pratt & Whitney.

    

    12.         “Person”
means an individual, a partnership, a corporation, a limited liability company,
an association, a joint stock company, a trust, a joint venture, an
unincorporated organization and a governmental entity or any department, agency,
or political subdivision thereof.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    13.         “Purchase
Consideration” means the purchase consideration specified in Section 2.4
hereof.

    

    14.         “Retained
Assets” means all (x) tax returns and tax refunds relating to any tax
period ending on or before the Closing Date, (y) all stock books and corporate
organizational documents of the RZ Group, and (z) assets of the RZ Group, not
devoted exclusively to the TI Business, such as computers and IT systems that,
although they are used to process or store information for the TI Business, are
used primarily for the businesses and operations of the RZ Group other than the
TI Segment.

    

    15.         “Retained
Liabilities” means the indebtedness of Seller owing to Pratt &
Whitney and all liabilities of the RZ Group arising prior to the date hereof,
including liabilities pertaining to the TI Business prior to the date hereof,
but not including the liabilities set forth on Schedule 2.3 hereto.

    

    16.         “RZ”
means Raser Technologies, Inc., a Delaware corporation.

    

    17.         “RZ
Group” means RZ and RZ Subsidiary.

    

    18.         “RZ
Subsidiary” means RT Patent Company, Inc. and Raser Technologies
Operating Company, Inc.

    

    19.         “Share
Consideration” means shares of common stock of Buyer, par value $0.01 per
share, constituting 39% of the equity of Buyer, which is the noncash portion of
the Purchase Consideration.

    

    20.         “Shareholders’
Agreement” means the agreement between Seller, Buyer and Buyer’s initial
investor, in the form attached hereto as Exhibit B.

    

    21.         “TI
Assets” means the tangible and intangible property comprising or used in
connection with Seller’s Transportation and Industrial Business Segment, as more
particularly described in Section 2.1 hereof.

    

    22.         “TI
Business” means the business of the TI Segment.

    

    23.         “TI
Segment” means RZ’s Transportation and Industrial Business Segment, as
that business segment operates as of the date hereof.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    ARTICLE 2. SALE AND PURCHASE
OF ASSETS

    

    2.1         Agreement
to Sell and Buy.  Subject to the terms, conditions and
provisions set forth in this Agreement, Seller hereby transfers and delivers to
Buyer on the Closing Date, and Buyer purchases and receives, effective as of the
Closing Date, all right, title and interest of Seller (itself or of a member of
the RZ Group) in and to the TI Assets, which are more particularly described in
Section 2.1 hereof, are conveyed, free and clear of any claims, liabilities,
liens, pledges or encumbrances of any nature whatsoever, except for the
Permitted Lien, and include the following:

     

    
      	
               
      

            	
              (a)

            	
              all
      computers, computer servers, test equipment, printers and laptops and
      other computer equipment (including spare parts) and Software allocated
      exclusively to or used exclusively in connection with the business of the
      TI Business;

            

    

    

    
      	
               
      

            	
              (b)

            	
              all
      machinery and equipment (including spare parts), business machines,
      automobiles and other vehicles or components thereof, furniture, fixtures,
      supplies, models, capital improvements in process, tools and all other
      tangible personal property allocated exclusively to or used exclusively in
      connection with the TI Business ;

            

    

    

    
      	
               
      

            	
              (c)

            	
              all
      marketing materials, investor materials and inventory that are used
      exclusively in connection with the TI
Business;

            

    

    

    
      	
               
      

            	
              (d)

            	
              all
      easements, rights of way, servitudes, leases, permits, licenses or options
      used or held for use in connection with the TI
  Business;

            

    

    

    
      	
               
      

            	
              (e)

            	
              all
      accounts receivable, notes receivable, reserves, prepaid deposits, and
      prepaid expenses allocated to or used in connection with the TI
      Business;

            

    

    

    
      	
               
      

            	
              (f)

            	
              all
      rights and claims, whether mature, contingent or otherwise, against third
      parties, whether in tort, contract or otherwise, including, without
      limitation, causes of action, unliquidated rights and claims under or
      pursuant to all warranties, representations and guarantees made by
      manufacturers, suppliers or vendors, claims for refunds, rights of off-set
      and credits of all kinds and all other general intangibles, to the extent
      related to the TI Business;

            

    

    

    
      	
               
      

            	
              (g)

            	
              all
      authorizations, consents, approvals, licenses, orders, permits and
      exemptions of, and filings or registrations with, any governmental
      authority, to the extent pertaining to the TI Business and transferable by
      the RZ Group;

            

    

    

    
      	
               
      

            	
              (h)

            	
              all
      of the Intellectual Property of the RZ Group related to the TI Business,
      including all marketing and promotional materials incorporating or
      utilizing any of the Marks related to the TI
  Business;

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (i)

            	
              all
      rights under any executory contract to which any member of the RZ Group is
      a party and which is related to the TI Business,
      including, without limitation, any license agreement, security agreement,
      indemnity agreement, subordination agreement, mortgage, equipment lease
      and other lease or sublease (whether or not capitalized), conditional sale
      or title retention agreement and any purchase order from any customer;
      and

            

    

    

    
      	
               
      

            	
              (j)

            	
              all
      other assets used or useful in the conduct of the business of the TI
      Business, whether or not reflected on the books and records of the TI
      Business, but essential or useful to the continuation of the business of
      the TI Business, including, without limitation, all credit balances of or
      inuring to the RZ Group under any state unemployment compensation plan or
      fund (related to employees who perform work in connection with the TI
      Business), employment contracts, restrictive covenants and obligations of
      present and former employees, agents, representatives, independent
      contractors and others who perform or performed work in connection with
      the TI Business, and all books, records, files and papers relating to, or
      useful or necessary to the conduct of, the business of the TI Business,
      including those related to corporate, contractual or regulatory
      compliance.

            

    

    

    2.2         Retained
Assets.  Notwithstanding the provisions of Section 2.1 above,
Seller and Buyer expressly understand and agree that Seller is not selling,
assigning, transferring, conveying or delivering to Buyer, and Buyer shall have
no right to or interest in any of the Retained Assets.

    

    2.3         Liabilities.  Seller
and Buyer agree that, effective as of November 1, 2010, Buyer is assuming the TI
Liabilities listed in Schedule 2.3 hereof and, from and after November 1, 2010
all other Liabilities related to the TI Business, other than the Retained
Liabilities.

    

    2.4         Purchase
Consideration.  The Purchase Consideration shall be the
aggregate of (i) the Share Consideration, (ii) the Cash Consideration, and (iii)
the undertaking and obligation of Buyer to close  on not less than $10
million of additional equity or equity-linked investment in Buyer (the “Additional
Initial Capital”), in accordance with the provisions of Section 6.7
hereof.

    

    2.5         Adjustments
and Prorations. All payment obligations under contracts for services or
utilities, and salaries and other benefits obligations in respect of employees
of Seller who shall become employees of Buyer as of the Closing Date, shall be
apportioned as of the Closing Date.

    

    2.6         Allocation
of Purchase Consideration.  The Purchase Consideration shall be
allocated, for purposes of Section 1060 of the Internal Revenue Code of 1986, as
amended (the “Code”),
among the Assets, as shall be agreed to by the parties prior to December 31,
2010.  Neither party hereto shall take a position on any tax return or
other filing with any federal, state or local authority that is inconsistent
with such allocation.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    ARTICLE 3. REPRESENTATIONS
AND WARRANTIES OF SELLER

    

    Seller
represents and warrants to Buyer as follows:

    

    3.1         Organization,
Standing and Authority.  Each member of the RZ Group is a
corporation duly formed, validly existing and in good standing under the laws of
the State of Delaware and is duly qualified to conduct its business in the State
of Utah and each other jurisdiction where the TI Business is conducted, where
the conduct of the TI Business requires such qualification and the failure to so
qualify would have a material adverse effect on such member of the RZ
Group.  Each member of the RZ Group has all requisite corporate power
and authority to own, lease, and use the TI Assets as presently owned, leased,
and used.  Seller has all requisite corporate power and authority to
execute and deliver this Agreement, the Ancillary Agreements and the documents
contemplated thereby, and to perform and comply with all of the terms, covenants
and conditions to be performed and complied with by Seller, hereunder and
thereunder.  No member of the RZ Group is a participant in any joint
venture or partnership with any other person or entity with respect to any part
of the TI Business.

    

    3.2         Authorization
and Binding Obligation.  The execution, delivery, and
performance of this Agreement and the Ancillary Agreements by Seller have been
duly authorized by all necessary corporate action on the part of
Seller.  This Agreement and the Ancillary Agreements have been duly
executed and delivered by Seller and constitute the legal, valid, and binding
obligations of Seller, enforceable against Seller in accordance with its terms
except as the enforceability hereof may be affected by bankruptcy, insolvency,
or similar laws affecting creditors’ rights generally, or by court-applied
equitable remedies.

    

    3.3         Absence
of Conflicting Agreements.  The execution, delivery, and
performance of this Agreement and the Ancillary Agreements, and the documents
contemplated hereby or thereby (with or without the giving of notice, the lapse
of time, or both):  (i) do not require the consent of any third party;
(ii) will not conflict with any provision of the articles of Incorporation and
By-Laws of Seller; (iii) will not conflict with, result in a breach of or
constitute a default under, any law, judgment, order, ordinance, decree, rule,
regulation or ruling of any court or governmental instrumentality, which is
applicable to Seller; (iv) will not conflict with, constitute grounds for
termination of, result in a breach of, constitute a default under, or accelerate
or permit the acceleration of any performance required by the terms of, any
material agreement, instrument, License or permit to which any member of the RZ
Group is a party or by which any member of the RZ Group may be bound; or (v)
will not voluntarily create any claim, liability, mortgage, lien, pledge,
condition, charge, or encumbrance of any nature whatsoever upon the TI
Assets.

    

    3.4         Licenses.  Seller
(itself or by way of its ownership of each RZ Subsidiary) has all Licenses, if
any, necessary to enable the continued ownership of the TI Assets and the
operation of the TI Business.  Schedule 3.4 includes a true
and complete list of the Licenses.  Seller has delivered to Buyer true
and complete copies of each of the Licenses listed on Schedule 3.4. Such Licenses
are issued in the name of Seller and are in full force and effect.

    

    3.5         Title to
and Condition of TI Assets.

    

    
      	
               
      

            	
              a.

            	
              Seller
      (itself or by way of its ownership of each RZ Subsidiary) has good, clean,
      and marketable title to its interest in the TI Assets, subject only to the
      possible lien on the Intellectual Property in favor of Pratt & Whitney
      (or its affiliates).  All of the TI Assets are being transferred
      to Buyer in their “AS IS” “WHERE IS” condition on the date
      hereof.

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      
        	
              	
                b.

              	
                Notwithstanding
      the provisions of paragraph a of this Section, Seller agrees to indemnify
      and hold harmless Buyer from and against any and all loss, cost and
      expense suffered or incurred by Buyer as a result of or in connection with
      claims by Pratt & Whitney (or its affiliates) of security interests
      in, liens upon or rights or interests in respect of the Intellectual
      Property, to the extent that Buyer suffers any loss of rights to use and
      enjoyment of the Intellectual Property that Buyer would have had if the
      Intellectual Property had been conveyed to Buyer on the date hereof free
      and clear of all claims and interests of Pratt & Whitney (or its
      affiliates) (“Seller’s
      IP Indemnification”).

              

      

    

    

    3.6         [reserved]

    

    3.7         Consents.  No
consent, approval, permit or authorization of, or declaration to or filing with
any governmental or regulatory authority, or any other third party is required
(i) to permit any Seller to consummate this Agreement or the Ancillary
Agreements and the transactions contemplated hereby and thereby, (ii) to permit
any Seller to assign or transfer the Real Property or Assets to Buyer, or (iii)
to enable Buyer to conduct the TI Business in essentially the same manner as
such business or operations are presently conducted.

    

    3.8         Intellectual
Property.  There are no claims or proceedings pending or, to
the knowledge of Seller, threatened against any member of the RZ Group asserting
that the ownership or use by the RZ Group of any of the Intellectual Property
infringes the rights of any other person, and Seller has no knowledge that any
ownership or any use thereof by any member of the RZ Group could give rise to
such a claim.  No member of the RZ Group has licensed or otherwise
assigned any interest in the Intellectual Property to any third
party.

    

    3.9         ‘34 Act
Reports.  Seller is current in the filing of all reports and
filings required by the Securities Exchange Act of 1934, as amended (the “Act”)
and the New York Stock Exchange.

    

    3.10       Taxes.  Seller
has filed or caused to be filed all federal income tax returns and all other
federal, state, county, local or city tax returns which are required to be filed
in connection with the TI Assets or TI Segment, and it has paid or cause to be
paid all taxes shown on said returns or on any tax assessment received by it to
the extent that such taxes have become due. To the best of Seller’s knowledge,
no events have occurred which could impose on Buyer any transferee liability for
any taxes, penalties or interest due or to become due from any member of the RZ
Group.

    

    3.11       Claims,
Legal Actions.  Except as set forth in Schedule 3.11,  no
member of the RZ Group has been served with any claim, legal action,
counterclaim, suit, arbitration, governmental investigation or other legal,
administrative or tax, or condemnation or taking proceeding, nor any order,
decree or judgment, that is in progress or pending, nor to the knowledge of any
Seller has any such matter been threatened, against or relating to any Seller or
any of the TI Assets, nor does any Seller know of any basis for the same that
would materially impair the value of the TI Assets in the hands of Buyer after
the Closing Date.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    3.12       Compliance
with Laws.  To the best knowledge of Seller, each member of the
RZ Group has complied in all material respects with all federal, state and local
laws, rules and regulations and ordinances applicable to the TI
Business.

    

    3.13       Environmental
Matters.

    

    (a)           No
member of the RZ Group has received any written notice of violation, alleged
violation, noncompliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with regard to TI
Assets.  For purposes hereof, “Environmental
Laws” means any and all federal, state or local laws, statues, rules,
regulations, plans, ordinances, codes, licenses or other restrictions relating
to health, safety or the environment, including without limitation the Federal
Comprehensive Environmental Response, Compensation and Liability Act, the Clean
Air Act, the Safe Drinking Water Act, the Toxic Substances Control Act, and the
Occupational Health and Safety Act.

    

    (b)           To
the best knowledge of Seller, none of the TI Assets have been used to transport
or dispose of Hazardous Materials in violation of, or in a manner or to a
location which gives rise to liability under, Environmental Laws, nor have any
of the TI Asset been used to generate, treat, store or dispose of Hazardous
Materials in violation of, or in a manner that would give rise to liability
under, any applicable Environmental Laws.  For purposes hereof “Hazardous
Materials” means any toxic or hazardous wastes, substances, products,
pollutants or materials of any kind, including, without limitation, petroleum
and petroleum products, MTBE and other additives, and asbestos, or any other
wastes, substances, products, pollutants or material regulated under any
Environmental Laws.

    

    (c)           To
the best of Seller’s knowledge, there has been no release or threat of release
of Hazardous Materials arising from or related to the TI
Business.

     

    ARTICLE 4. REPRESENTATIONS
AND WARRANTIES OF BUYER

    

    Buyer
represents and warrants to Seller as follows:

    

    4.1         Organization,
Standing and Authority.  Buyer is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Delaware,
and is duly qualified to conduct its business in the State of Utah and each
other jurisdiction where the TI Business is conducted, where the conduct of the
TI Business requires such qualification and the failure to so qualify would have
a material adverse effect on Buyer.  Buyer has all requisite corporate
power and authority to execute and deliver this Agreement, the Ancillary
Agreements and the documents contemplated hereby and thereby, and to perform and
comply with all of the terms, covenants, and conditions to be performed and
complied with by Buyer hereunder and thereunder.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    4.2         Authorization
and Binding Obligation.  The execution, delivery and
performance of this Agreement and the Ancillary Agreements by Buyer have been
duly authorized by all necessary corporate action on the part of
Buyer.  This Agreement and the Ancillary Agreements have been duly
executed and delivered by Buyer and constitute the legal, valid, and binding
obligations of Buyer, enforceable against Buyer in accordance with its terms
except as the enforceability hereof may be affected by bankruptcy, insolvency,
or similar laws affecting creditors’ rights generally, or by court-applied
equitable remedies.

    

    4.3         Absence
of Conflicting Agreements.  The execution, delivery, and
performance of this Agreement, the Ancillary Agreements and the documents
contemplated hereby and thereby (with or without the giving of notice, the lapse
of time, or both):  (i) do not require the consent of any third party,
(ii) will not conflict with the Articles of Incorporation or By-laws of Buyer,
(iii) will not conflict with, result in a breach of, or constitute a default
under, or accelerate or permit the acceleration of any performance required by
the terms of, any material agreement, instrument, licenses, or permit to which
Buyer is a party or by which Buyer may be bound.

    

    4.4         Full
Disclosure.  No representation or warranty made by Buyer herein
nor any certificate, document or other instrument furnished or to be furnished
by Buyer pursuant hereto contains or will contain any untrue statement of a
material fact made intentionally or in bad faith, or intentionally or in bad
faith omits or will omit to state any material fact known to Buyer and required
to make the statements herein or therein not misleading.

    

    4.5         Litigation.  There
is no action, suit, investigation or other proceeding pending or, to Buyer’s
knowledge, threatened which may adversely affect Buyer’s ability to perform in
accordance with the terms of this Agreement or the Ancillary Agreements, and
Buyer is unaware of any facts which could reasonably result in any such
proceeding.

    

    ARTICLE 5. SURVIVAL OF
REPRESENTATIONS AND WARRANTIES

    AND
INDEMNIFICATION

    

    5.1         Representations
and Warranties.  Except with respect to representations that
are expressly limited to survival for a term of less than 18 months, all
representations and warranties contained in this Agreement or in the Ancillary
Agreements shall survive the Closing Date for a period of 18 months (the “Survival
Period “).  Any investigations by or on behalf of any party
hereto shall not constitute a waiver as to enforcement of any representation or
warranty contained herein.

    

    5.2         Indemnification
by Seller.  Seller shall indemnify and hold Buyer harmless
against and with respect to, and shall reimburse Buyer for:

    

    (a)          all
losses, liabilities, costs, expenses or damages resulting from any untrue
representation, or breach of warranty contained herein or in any certificate,
delivered by Seller to Buyer hereunder; and

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (b)         all
actions, suits, proceedings, claims, demands, assessments, judgments, and
reasonable costs and expenses, including reasonable legal fees and expenses,
incident to the foregoing.

    

    (c)          Seller’s
obligations hereunder shall survive the Closing of the transactions contemplated
hereunder.

    

    5.3        
 Indemnification
by Buyer.  Buyer
shall indemnify and hold Seller harmless against and with respect to, and shall
reimburse Seller for:

    

    (a)          all
losses, liabilities, costs, expenses or damages resulting from any untrue
representation, or breach of warranty contained herein or in any certificate
delivered by Buyer to Seller hereunder; and

    

    (b)          all
actions, suits, proceedings, claims, demands, assessments, judgments, and
reasonable costs and expenses, including reasonable legal fees and expenses,
incident to the foregoing.

    

    (c)           Buyer’s
obligations hereunder shall survive the Closing of the transactions contemplated
hereunder.

    

    5.4         Procedures
for Indemnification.  The procedures for indemnification shall
be as follows:

    

    a.           The
party claiming the indemnification (the “Claimant”)
shall promptly give notice to the party from whom indemnification is claimed
(the “Indemnifying
Party”) of any claim, whether between the parties or brought by a third
party, specifying (i) the factual basis for such claim, and (ii) the amount of
the claim. If the claim relates to an action, suit or proceeding filed by a
third party against Claimant, such notice shall be given by Claimant within five
(5) days after written notice of such action, suit or proceeding was given to
Claimant.

    

    b.           Following
receipt of notice from the Claimant of a claim, the Indemnifying Party shall
have thirty (30) days to make such investigation of the claim as the
Indemnifying Party deems necessary or desirable. For the purposes of such
investigation, the Claimant agrees to make available to the Indemnifying Party
and/or its authorized representative(s) the information relied upon by the
Claimant to substantiate the claim.  If the Claimant and the
Indemnifying Party agree at or prior to the expiration of said thirty (30) day
period (or any mutually agreed upon extension thereof) to the validity and
amount of such claim, or if the Indemnifying Party does not respond to such
notice, the Indemnifying Party shall immediately pay to the Claimant the full
amount of the claim. If the Claimant and the Indemnifying party do not agree
within said period (or any mutually agreed upon extension thereof), the Claimant
may seek appropriate legal remedy.

    

    c.     
      With respect to any claim by a third party
as to which the Claimant is entitled to indemnification hereunder, the
Indemnifying Party shall have the right at its own expense, to participate in or
assume control of the defense of such claim, and the Claimant shall cooperate
fully with the Indemnifying party subject to reimbursement for reasonable actual
out-of-pocket expenses, including reasonable attorneys’ fees, incurred by the
Claimant as the result of a request by the Indemnifying party.  If the
Indemnifying party elects to assume control of the defense of any third-party
claim, the Claimant shall have the right to participate in the defense of such
claim at its own expense.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    d.     
      If a claim, whether between the parties or
by a third party, requires immediate action, the parties will make all
reasonable efforts to reach a decision with respect thereto as expeditiously as
possible.

    

    e.      
      If the Indemnifying Party does not elect to
assume control or otherwise participate in the defense of any third party claim,
it shall be bound by the results obtained in good faith by the Claimant with
respect to such claim and the Indemnifying Party shall promptly reimburse
Claimant for its defense costs including reasonable attorney’s and other legal
fees and the fees of consultants used in the defense of Claimant.

    

    f.       
     The indemnification rights provided in Sections
5.2 and 5.3 shall extend to the shareholders, directors, officers, partners
employees and representatives, successors and assigns of the Claimant although
for the purpose of the procedures set forth in this Section 5.4, any
indemnification claims by such parties shall be made by and through the
Claimant.

    

    

    ARTICLE 6. SPECIAL COVENANTS
AND AGREEMENTS

    

    6.1           Broker.  Buyer
and Seller each represents and warrants to each other that neither it nor any
person or entity acting on its behalf has incurred any liability for any
finders’ or brokers’ fees or commissions in connection with the transaction
contemplated by this Agreement.  The representations and warranties
contained in this Section shall survive the Closing hereunder.

    

    6.2           Confidentiality.  Except
as specifically set forth herein, and except to the extent required by law, each
party hereto will keep confidential any information which is obtained from the
other party in connection with the transaction contemplated hereby and which is
not readily available to members of the general public, and will not use such
information for any purpose other than in furtherance of the transactions
contemplated hereby.  In the event this Agreement is terminated and
the purchase and sale contemplated hereby abandoned, each party will return to
the other party all documents, work papers and other written material obtained
by it in connection with the transaction contemplated hereby.  If a
disclosure is required by law, the disclosing party shall make reasonable
efforts to afford the other party an opportunity to review and comment on the
proposed disclosure prior to the making of such
disclosure.  Notwithstanding the foregoing, upon the execution of this
Agreement by both parties, Seller and Buyer shall have the right to issue a
press release, and file with the Securities and Exchange Commission a current
report on Form 8-K with respect to this Agreement and the transactions
contemplated hereby, which press release shall be mutually agreed to in form and
substance by both parties hereto prior to its release.

    

    6.3           Cooperation;
Reporting and  Disclosure.  Buyer and Seller shall
cooperate fully with each other and their respective counsel and accountants in
connection with any actions required to be taken as part of their respective
obligations under this Agreement, and Buyer and Seller shall execute such other
documents as may be necessary and desirable to the implementation and
consummation of the transactions contemplated by this Agreement. From and after
the Closing Date, Buyer shall cooperate with Seller in connection with Seller’s
public reporting and accounting and financial disclosure obligations that may
arise by reason of Seller’s ownership of Buyer’s common stock.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    6.4          Via
Automotive, Inc. Governance.

    

    (a)          Seller
and Buyer agree that, effective as of the Closing Date, the following persons
shall be the sole directors of Buyer:

    

    Directors:

    Carl E.
Berg;

    Kraig T.
Higginson; and

    Alan G.
Perriton.

    

    (b)         Effective
as of the Closing Date, the By-Laws of Buyer shall be in the form and substance
of Exhibit A attached
hereto and made a part hereof.

    

    6.5         Employees.  Effective
as of the Closing Date, Buyer shall employ each of the employees of Seller
listed on Schedule 6.5
on the terms set forth on Schedule 6.5.

    

    6.6         Corporate
Services; Audited Financial Statements.  For a period of 3
months after the Closing Date, unless earlier terminated by written notice from
Buyer to Seller, Seller shall provide accounting, tax preparation and
administrative services to Buyer related to the TI Business, at a reasonable
cost to be determined on the Closing Date. Additionally, Seller shall deliver to
Buyer on or before December 31, 2010, audited financial statements for the TI
Segment for the 12 months ended December 31, 2009 and for period from January 1,
2010 through the Closing Date.

    

    6.7         Additional
Initial Capital.  Buyer is obligated to close not later than
February 28, 2011 on not less than $10 million of additional equity or
equity-linked investment in Buyer. In the event that Buyer does not close on any
portion of the $10 million of additional equity or equity linked investment
before June 30, 2011, Seller shall have the right obtain such investment on
Buyer’s behalf on terms reasonably acceptable to Buyer’s board of directors,
which investment of Additional Initial Capital shall be subject to the terms and
conditions of the Shareholders’ Agreement to be delivered by the Parties in
accordance with the provisions of Article 7 hereof.

    

    ARTICLE 7. CONDITIONS TO
OBLIGATIONS OF BUYER AND SELLER

    

    7.1         Conditions
of Obligations of Buyer.  All obligations of Buyer at the
Closing hereunder are subject to the fulfillment prior to and at the Closing
Date of each of the following conditions:

    

    a.           Representations
and Warranties.  The representations and warranties of Seller
in this Agreement shall be true and complete in all material respects at and as
of the Closing Date, as though such representations and warranties were made at
and as of such time, except for changes contemplated by this
Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    b.         
  Covenants
and Conditions.  Seller shall have in all material respects
performed and complied with the covenants, agreements, and conditions required
by this Agreement to be performed or complied with by it prior to or on the
Closing Date.

    

    c.        
   Deliveries.  Seller
shall have made all the deliveries to Buyer set forth in Section 8.2 hereof,
and  the Shareholders’ Agreement shall have been executed and
delivered by Buyer’s initial investor.

    

    7.2          Conditions
to Obligations of Seller.  The obligations of Seller at the
Closing hereunder are subject to the fulfillment prior to and at the Closing
Date of each of the following conditions:

    

    a.      
     Representations
and Warranties.  The representations and warranties of Buyer
contained in this Agreement shall be true and complete in all material respects
at and as of the Closing Date, except for changes contemplated by this
Agreement, as though such representations and warranties were made at and as of
such time.

    

    b.       
    Covenants
and Conditions.  Buyer shall have in all material respects
performed and complied with the covenants, agreements, and conditions required
by this Agreement to be performed or complied with by it prior to or on the
Closing Date.

    

    c.         
  Deliveries.  Buyer
shall have made all the deliveries set forth in Section 8.3 hereto and the
Shareholders’ Agreement.

    

    ARTICLE 8. CLOSING AND
CLOSING DELIVERIES

    

    8.1          Closing.  The
closing shall be completed on the date hereof (the “Closing
Date”), at the offices of Sichenzia Ross Friedman Ference LLP, New York,
NY or such other place as shall be mutually agreed to by Buyer and Seller, or,
if mutually agreed upon by the parties, shall be an escrow closing via the
mail.

    

    8.2           Deliveries
by Seller.  Prior to or on the Closing Date, Seller shall
deliver to Buyer the following, in form and substance reasonably satisfactory to
Buyer and its counsel:

    

    (a)           Counterparts.  Duly
executed counterparts of this Agreement, the Shareholders’ Agreement and each of
the Ancillary Agreements and an assignment and assumption of contracts, in
customary form and substance,, mutually acceptable to Buyer and
Seller;

    

    (b)           Transfer
Documents.  Duly executed quitclaim deeds, bills of sale,
assignments and other transfer documents which shall be sufficient to vest title
to the TI Assets in the name of Buyer or its permitted designees, free and clear
of any claims, liabilities, mortgages, liens, pledges, conditions, charges, or
encumbrances of any nature whatsoever, except for the Permitted
Lien.

    

    (c)           [reserved]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (d)           Officer’s
Certificate. Certificates, dated as of the Closing Date, executed by duly
authorized officers of Seller, certifying: (i) that the representations and
warranties of Seller contained in this Agreement are true and complete in all
material respects as of the Closing Date, as though made on and as of that date,
except for changes contemplated by this Agreement and except for representations
and warranties made as of a specific date which shall be certified true and
complete in all material respects as of such date; and (ii) that Seller has, in
all material respects, performed its obligations and complied with its covenants
set forth in this Agreement to be performed and complied with prior to or on the
Closing Date.

    

    (e)           Secretary’s
Certificate.  Certificates, dated as of the Closing Date,
executed by the Secretary or Clerk of Seller: (i) certifying that the
resolutions, as attached to such certificate, were duly adopted by Seller’s
shareholders and Board of Directors, authorizing and approving the execution of
this Agreement and the Ancillary Agreements by Seller and the consummation of
the transactions contemplated hereby and thereby and that such resolutions
remain in full force and effect; and (ii) providing, as attachments thereto, a
certificate of good standing certified by the Secretary of State of Delaware; as
of a date not more than fifteen (15) days before the Closing Date and by
Seller’s Secretary as of the Closing Date, and a copy of Seller’s Articles of
Incorporation and By Laws as in effect on the date hereof, certified by Seller’s
Secretary as of the Closing Date.

    

    (f)           Transfer
or Conveyance Taxes or Document Stamps.  Such amounts as are
necessary to pay for Seller’s obligations with respect to transfer or conveyance
taxes or documentary stamps.  Such amount may either be delivered by
Seller at Closing, or credited to Buyer against the Purchase Consideration at
Closing.

    

    8.3           Deliveries
by Buyer.  Prior to or on the Closing Date, Buyer shall deliver
to Seller the following, in form and substance reasonably satisfactory to Seller
and its counsel:

    

    (a)           Purchase
Consideration.  The Purchase Consideration; provided, however,
that Buyer is permitted to deliver to Seller up to $1 million of the Cash
Consideration after the date hereof, but on or before December 20,
2010;

    

    (b)           Counterparts.  Duly
executed counterparts of this Agreement, the Shareholders’ Agreement and each of
the Ancillary Agreements and an assignment and assumption of contracts, in
customary form and substance mutually acceptable to Buyer and
Seller;

    

    (c)           [reserved];

    

    (d)           [reserved].

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    ARTICLE
9. MISCELLANEOUS

    

    9.1          Notices.  Each
party giving any notice required or permitted under this Agreement or any
Ancillary Agreement will give the notice in writing and use one of the following
methods of delivery to the party to be notified, at the address set forth below
or another address of which the sending party has been notified in accordance
with this Section: (a) personal delivery; (b) facsimile or telecopy transmission
with a reasonable method of confirming transmission; (c) commercial overnight
courier with a reasonable method of confirming delivery; or (d) pre-paid, United
States of America certified or registered mail, return receipt requested. Notice
to a party is effective for purposes of this Agreement or any Ancillary
Agreement only if given as provided in this Section and will be deemed given on
the date that the intended addressee actually receives or refuses delivery of
the notice.

    

    If to
Seller:

    Raser
Technologies, Inc.

    5152
North Edgewood Drive

    Suite
200

    Provo,
Utah 84604

    Attention:
Nicholas Goodman, CEO

    

    with a
copy

    (which
shall not

    constitute
notice) to:

    

    Andrew M.
Smith

    Sichenzia
Ross Friedman Ference LLP

    61
Broadway, 32nd
Floor

    New
York,. NY 10006

    If to
Buyer:

    

    Via
Automotive, Inc.

    10050
Bandley Dr.

    Cupertino,
CA  95014

    

    with a
copy

    (which
shall not

    constitute
notice) to:

    

    Carl E.
Berg

    

    9.2           Benefit
and Binding Effect.  Neither party hereto may assign this
Agreement without the prior written consent of the other party hereto, except
that Buyer may assign its rights and obligations under this Agreement to any
affiliated entity, following which assignment Buyer shall be released from all
of its obligations hereunder.  This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    9.3           Governing
Law.  This Agreement shall be governed, construed, and enforced
in accordance with the laws of the State of Utah.

    

    9.4           Headings.  The
headings here are included for ease of reference only and shall not control or
affect the meaning or construction of the provisions of this
Agreement.

    

    9.5           Gender
and Number.  Words used herein, regardless of the gender and
number specifically used, shall be deemed and construed to include any other
gender, masculine, feminine or neuter; and any other number, singular or plural,
as the context required.

    

    9.6           Entire
Agreement.  This Agreement, all schedules and exhibits hereto,
and all documents and certificates to be delivered by the parties pursuant
hereto collectively represent the entire understanding and agreement between
Buyer and Seller with respect to the subject matter hereof.  All
schedules and exhibits attached to this Agreement shall be deemed part of this
Agreement and incorporated herein, where applicable, as if fully set forth
herein.  This Agreement supersedes all prior negotiations between
Buyer and Seller, and all letters of intent and other writings related to such
negotiations, and cannot be amended, supplemented or modified except by an
agreement in writing which makes specific reference to this Agreement or an
agreement delivered pursuant hereto, as the case may be, and which is signed by
the party against which enforcement of any such amendment, supplement or
modification is sought.

    

    9.7           Waiver of
Compliance: Consents.  Except as otherwise provided in this
Agreement, any failure of any of the parties to comply with any obligation,
representation, warranty, covenant, agreement or condition herein may be waived
by the party entitled to the benefits thereof only by a written instrument
signed by the party granting such waiver, but such waiver or failure to insist
upon strict compliance with such obligation, representation, warranty ,
covenant, agreement or condition shall not operate as a waiver of, or estoppel
with respect to, any subsequent or other failure.  Whenever this
Agreement requires or permits consent by or on behalf of any party hereto, such
consent shall be given in writing in a manner consistent with the requirements
for a waiver of compliance as set forth in this Section.

    

    9.8           Severability.  If
any provision of this Agreement or the application thereof to any person or
circumstance shall be invalid or unenforceable or any extent, the remainder of
this Agreement and the application of such provision to other persons or
circumstances shall not be affected thereby and shall be enforced to the greater
extent permitted by law.

    

    9.9           Counterparts.  This
Agreement may be signed in any number of counterparts with the same effect as if
the signature on each such counterpart were upon the same instrument and/or by
facsimile signatures, provided the original signatures shall be thereafter
promptly delivered to the party entitled thereto. Any party hereto shall be
fully protected in relying upon  facsimile delivery of this Agreement
which is believed by such party, in good faith, to be genuine.

    

    IN
WITNESS WHEREOF, this Agreement has been executed by Buyer and Seller as of the
day and year first above written.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          
            
              
                
                  	
                          SELLER:

                        	
                          RASER
      TECHNOLOGIES, INC.

                        	 
	 
      	 
      	 
	 
      	
                          By: 

                        	
                          /s/ Nicholas Goodman

                        	 
	 
      	
                          Name:
      Nicholas Goodman

                        	 
	 
      	
                          Title:
      CEO

                        	 
	 
      	 
      	 
	
                          BUYER:

                        	
                          VIA
      AUTOMOTIVE, INC.

                        	 
	 
      	 
      	 
	 
      	
                          By: 

                        	
                          /s/ Carl E. Berg

                        	 
	 
      	
                          Name:
      Carl E. Berg

                        	 
	 
      	
                          Title:
      President

                        	 

                

              

            

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    EXHIBITS TO ASSET PURCHASE
AND SALE AGREEMENT

    

    
      	
               
      

            	
              A.

            	
              By-Laws
      of Buyer

            

    

    
      	
               
      

            	
              B.

            	
              Shareholders’
      Agreement

            

    

    

    SCHEDULES TO ASSET PURCHASE
AND SALE AGREEMENT

    

    
      	
              1.8

            	
              List
      of Intellectual Property

            

    

    
      	
              2.1 

            	
              List
      of TI Assets

            

    

    
      	
              2.3 

            	
              Liabilities

            

    

    
      	
              3.4 

            	
              Licenses

            

    

    
      	
              3.11 

            	
              Claims;
      Legal Actions

            

    

    
      	
              6.5

            	
              Employees

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Exhibit
A

     

    By-Laws

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Exhibit
B

     

    Shareholders’
Agreement

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}]]