AMENDED AND RESTATED MASTER LEASE AGREEMENT BETWEEN HEALTH CARE REIT, INC., HCRI TEXAS PROPERTIES, LTD. AND HCRI WISCONSIN PROPERTIES, LLC AND LIFECARE REIT 1, INC. June 6, 2007

Exhibit 10.1

AMENDED AND RESTATED

MASTER LEASE AGREEMENT

BETWEEN

HEALTH CARE REIT, INC.,

HCRI TEXAS PROPERTIES, LTD.

AND

HCRI WISCONSIN PROPERTIES, LLC

AND

LIFECARE REIT 1, INC.

June 6, 2007

TABLE OF CONTENTS

(i)

(ii)

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(iv)

(v)

AMENDED AND RESTATED MASTER LEASE AGREEMENT

This AMENDED AND RESTATED MASTER LEASE AGREEMENT (“Lease”) is made effective as of June 6, 2007 (the “Amended Effective Date”) between HEALTH CARE REIT, INC. , a corporation organized under the laws of the State of Delaware (“HCN” and a “Landlord” as further defined in §1.4 below), having its principal office located at One SeaGate, Suite 1500, P.O. Box 1475, Toledo, Ohio 43603-1475, HCRI TEXAS PROPERTIES, LTD. , a limited partnership organized under the laws of the State of Texas (“HCRI-TX” and a “Landlord” as further defined in §1.4 below), having its principal office located at One SeaGate, Suite 1500, P.O. Box 1475, Toledo, Ohio 43603-1475, and HCRI WISCONSIN PROPERTIES, LLC , a limited liability company organized under the laws of the State of Wisconsin (“HCRI-WI” and a “Landlord” as further defined in §1.4 below), having its principal office located at One SeaGate, Suite 1500, P.O. Box 1475, Toledo, Ohio 43603-1475, and LIFECARE REIT 1, INC. , a corporation organized under the laws of the State of Delaware (“Tenant”), having its chief executive office located at 5560 Tennyson Parkway, Plano, Texas 75024.

R E C I T A L S

A. Effective as of May 2, 2007, Landlord and Tenant entered into a Master Lease Agreement (“Master Lease”).

B. As of the date hereof, Landlord acquired the Leased Property (defined below) located in Waukesha, Wisconsin.

C. Landlord and Tenant desire to amend certain provisions of the Master Lease and do hereby restate the Master Lease in its entirety as set forth herein.

NOW, THEREFORE, Landlord and Tenant agree as follows:

ARTICLE 1: LEASED PROPERTY, TERM AND DEFINITIONS

1.1 Leased Property . Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the Leased Property, subject, however, to the Permitted Exceptions and subject to the terms and conditions of this Lease.

1.2 Indivisible Lease . This Lease constitutes one indivisible lease of the entire Leased Property. The Leased Property constitutes one economic unit and the Base Rent and all other provisions have been negotiated and agreed to based on a lease of all of the Leased Property as a single, composite, inseparable transaction. This Lease would not have been made on these terms if it was not a single indivisible lease. Except as expressly provided herein for specific, isolated purposes (and then only to the extent expressly otherwise stated), all provisions of this Lease shall apply equally and uniformly to all the Leased Property as one unit and any Event of Default under this Lease is an Event of Default as to the entire Leased Property. The parties intend that the provisions of this Lease shall at all times be construed, interpreted and applied so as to carry out their mutual objective to create a single indivisible lease of all the Leased Property and, in particular but without limitation, that for purposes of any assumption, rejection or assignment of this Lease

under the Bankruptcy Code, this is one indivisible and nonseverable lease and executory contract dealing with one legal and economic unit which must be assumed, rejected or assigned as a whole with respect to all (and only all) the Leased Property covered hereby. The parties agree that the existence of more than one Landlord under this Lease does not affect the indivisible, nonseverable nature of this Lease. The parties may amend this Lease from time to time to include one or more additional Facility Properties as part of the Leased Property and such future addition to the Leased Property shall not in any way change the indivisible and nonseverable nature of this Lease and all of the foregoing provisions shall continue to apply in full force.

1.3 Term . The initial term (“Initial Term”) of this Lease commenced on the Effective Date and expires at 12:00 Midnight Eastern Time on December 31, 2022 (the “Expiration Date”); provided, however, that Tenant has one option to renew the Lease pursuant to Article 12.

1.4 Definitions . Except as otherwise expressly provided, [i] the terms defined in this section have the meanings assigned to them in this section and include the plural as well as the singular; [ii] all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles as of the time applicable; and [iii] the words “herein”, “hereof” and “hereunder” and similar words refer to this Lease as a whole and not to any particular section.

“Acquisition Payment” means any payment by Landlord to acquire Leased Property.

“ADA” means the federal statute entitled Americans with Disabilities Act, 42 U.S.C. §12101, et seq .

“Additional Rent” has the meaning set forth in §2.4.

“Affiliate” means any person, corporation, partnership, limited liability company, trust, or other legal entity that, directly or indirectly, controls, or is controlled by, or is under common control with Tenant or Guarantor. “Control” (and the correlative meanings of the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such entity. “Affiliate” includes, without limitation, each Entity Guarantor.

“Amended Commencement Date” means the Amended Effective Date if such date is the first day of a month, and if it is not, the first day of the first month following the Amended Effective Date.

“Amended Effective Date” means the Amended Effective Date set forth in the introductory paragraph of an amendment to this Lease.

“Annual Budget” means such entity’s projection of its financial statement for the next fiscal year (or the 12-month rolling forward period, if applicable), which shall include the balance sheet, statement of income, statement of cash flows, statement of shareholders’ equity and statement of capital expenditures for the applicable period.

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“Annual Facility Budget” means Tenant’s projection of the Facility Financial Statement for the next fiscal year (or the 12-month rolling forward period, if applicable) for each Facility or combined for all Facilities after the second Rent Adjustment Date.

“Annual Financial Statements” means [i] an audited balance sheet, statement of income, and statement of cash flows for the most recent fiscal year provided by LifeCare Holdings on a consolidated basis, to include all Affiliates including, but not limited to, Company, Tenant and Guarantor; [ii] for Tenant and Subtenant an unaudited balance sheet, statement of income, and statement of cash flows for the most recent fiscal year on an individual facility and consolidated basis; [iii] for each Facility, an unaudited Facility Financial Statement for the most recent fiscal year; and [iii] for each Entity Guarantor, an unaudited balance sheet and statement of income for the most recent fiscal year.

“Annual Rent Increase” means the sum of the product of the Investment Amount as of the Rent Adjustment Date times the applicable Increaser Rate.

“Assumed Lease” means the ground lease for the San Antonio Facility assumed by Landlord and identified as a “Permitted Exception” on Exhibit B hereto

“Bankruptcy Code” means the United States Bankruptcy Code set forth in 11 U.S.C. §101, et seq. , as amended from time to time.

“Base Rent” has the meaning set forth in §2.1, as increased from time to time pursuant to §2.2.

“Business Day” means any day other than a Saturday, Sunday, or national holiday.

“C of O” means a certificate of occupancy issued for a Development Project or for Project Improvements.

“C of O Date” means the date of the issuance of a C of O.

“CERCLA” means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended from time to time.

“Closing” means, for each Facility, the closing with Tenant of the lease for the Leased Property relating to such Facility.

“Commencement Date” means June 1, 2007.

“Company” means Lifecare Management Services, L.L.C., a limited liability company organized under the laws of the Commonwealth of Louisiana.

“Construction Funding Termination Date” means, for each Facility that is a Development Project or for Project Improvements, the earlier of [i] the first day of the month following the date that is 45 days after issuance of the final certificate of occupancy for the Facility; or [ii] the Mandatory Completion Date for the Facility.

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“Construction Term” means, with respect to each Development Project and for Project Improvements, the period of time commencing on the date that Landlord disburses the first Contingent Payment and ending on the date that the final Contingent Payment for the Development Project or for the Project Improvements, as the case may be, is first disbursed by Landlord to either of the following: [i] Tenant pursuant to satisfaction of the disbursement conditions set forth in §3.3 of the Disbursing Agreement, or [ii] an escrow account pursuant to the provisions of §5.1 of the Disbursing Agreement.

“Contingent Payment” means any payment by Landlord pursuant to the terms of this Lease excluding Acquisition Payments.

“Contingent Payment Request” means Tenant’s written request for a Contingent Payment on the form attached as Exhibit H.

“CPI” means the Consumer Price Index for Urban Wage Earners and Clerical Workers, U.S. Cities Average, All Items (1982-84 = 100) published by the Bureau of Labor Statistics of the U.S. Department of Labor; provided that if compilation of the CPI in its present form and calculated on its present basis is discontinued or transferred to any other governmental department or bureau, then the index most nearly the same as the CPI published by the Bureau of Labor Statistics shall be used. If there is no such similar index, a substitute index which is then generally recognized as being similar to the CPI shall be used, such substitute index to be reasonably selected by Landlord.

“Default Rent” has the meaning set forth in §8.6.

“Development Project” means the construction of a new Facility for which Contingent Payments are made by Landlord pursuant to §22.4.

“Development Project Budget” means the budget of total costs of acquiring, developing, construction, furnishing and equipping a Development Project Facility. The Development Project Budget is attached as an Exhibit to the Disbursing Agreement.

“Development Project Contingent Payment Schedule” means the schedule attached as an Exhibit to the Disbursing Agreement setting forth Tenant’s estimate of the dates and amounts of the Contingent Payments required for a Development Project.

“Disbursing Agreement” means any Disbursing Agreement between Landlord and Tenant setting forth the terms and conditions pursuant to which Landlord shall make Contingent Payments to Tenant for certain Project Improvements or Development Projects and any amendments thereto or substitutions and replacements therefor.

“Effective Date” means May 2, 2007.

“Entity Guarantor” means LifeCare Holdings and each Subtenant, individually and collectively.

“Environmental Laws” means all federal, state, and local laws, ordinances and policies the purpose of which is to protect human health and the environment, as amended from time to time, including, but not limited to, [i] CERCLA; [ii] the Resource Conservation

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and Recovery Act; [iii] the Hazardous Materials Transportation Act; [iv] the Clean Air Act; [v] Clean Water Act; [vi] the Toxic Substances Control Act; [vii] the Occupational Safety and Health Act; [viii] the Safe Drinking Water Act; and [ix] analogous state laws and regulations.

“Event of Default” has the meaning set forth in §8.1.

“Expiration Date” has the meaning set forth in §1.3.

“Facility” means each facility located or to be constructed on a portion of the Land, including the Facility Property associated with such Facility. References in this Lease to “the Facility” shall mean each Facility individually unless expressly stated otherwise.

“Facility Financial Statement” means an unaudited financial statement for each Facility which shall include the balance sheet, statement of income, statement of cash flows, statement of shareholders’ equity, occupancy census data (including payor mix), statement of capital expenditures and a comparison of the actual financial data versus the Annual Facility Budget for the applicable period.

“Facility Name” means the name under which a Facility has done or will do business during the Term. The Facility Name in use by each Facility on the Effective Date (or upon commencement of operations in the case of a Development Project) is set forth on the attached Exhibit C. Exhibit C shall be amended for each Development Project that does not have an identified Facility Name on the date of the Lease. Further, Tenant will have the right to change the Facility Name from time to time during the Term by giving written notice to Landlord 30 days prior to a change in the Facility Name.

“Facility Property” means the portion of the Land on which a Facility is located or will be constructed, the legal description of which is set forth beneath the applicable Facility Name on Exhibit A, the Improvements on such portion of the Land, the Related Rights with respect to such portion of the Land, and Landlord’s Personal Property with respect to such Facility.

“Facility State” means the State in which a respective Facility is located or will be constructed.

“Facility States” means, collectively, the States in which the Leased Property is located or will be constructed.

“Facility Uses” means the uses relating to the operation of a Facility as an acute care hospital receiving Medicare reimbursement as a long term acute care hospital and operating the number of beds and units set forth on Exhibit C with respect to such Facility

“Fixtures” means all permanently affixed equipment, machinery, fixtures and other items of real and/or personal property (excluding Tenant’s Property), including all components thereof, now and hereafter located in, on or used in connection with, and permanently affixed to or incorporated into the Improvements, including, without limitation, all furnaces, boilers, heaters, electrical equipment, heating, plumbing, lighting, ventilating, refrigerating, incineration, air and water pollution control, waste disposal,

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air-cooling and air-conditioning systems and apparatus, sprinkler systems and fire and theft protection equipment, built-in oxygen and vacuum systems, towers and other devices for the transmission of radio, television and other signals, all of which, to the greatest extent permitted by law, are hereby deemed by the parties hereto to constitute real estate, together with all replacements, modifications, alterations and additions thereto.

“Government Authorizations” means all permits, licenses, approvals, consents, and authorizations required to comply with all Legal Requirements, including, but not limited to, [i] zoning permits, variances, exceptions, special use permits, conditional use permits, and consents; [ii] the permits, licenses, provider agreements and approvals required for licensure and operation of each Facility in accordance with its respective Facility Uses and certified as a provider under the federal Medicare and state Medicaid programs; [iii] environmental, ecological, coastal, wetlands, air, and water permits, licenses, and consents; [iv] curb cut, subdivision, land use, and planning permits, licenses, approvals and consents; [v] building, sign, fire, health, and safety permits, licenses, approvals, and consents; and [vi] architectural reviews, approvals, and consents required under restrictive covenants.

“Guarantor” means each Entity Guarantor, individually and collectively.

“Guaranty” means each Unconditional and Continuing Lease Guaranty entered into by a Guarantor to guarantee payment and performance of the Obligor Group Obligations and any amendments thereto or substitutions or replacements therefor.

“Hazardous Materials” means any substance [i] the presence of which poses a hazard to the health or safety of persons on or about the Land, including, but not limited to, asbestos containing materials; [ii] which requires removal or remediation under any Environmental Law, including, without limitation, any substance which is toxic, explosive, flammable, radioactive, or otherwise hazardous; or [iii] which is regulated under or classified under any Environmental Law as hazardous or toxic, including, but not limited to, any substance within the meaning of “hazardous substance”, “hazardous material”, “hazardous waste”, “toxic substance”, “regulated substance”, “solid waste” or “pollutant” as defined in any Environmental Law.

“HCN” means Health Care REIT, Inc., a corporation organized under the laws of the State of Delaware.

“HCRI-TX” means HCRI Texas Properties, Ltd., a limited partnership organized under the laws of the State of Texas.

“HCRI-WI” means HCRI Wisconsin Properties, LLC, a limited liability company organized under the laws of the State of Wisconsin.

“HIPDB” means the Healthcare Integrity and Protection Data Bank maintained by the Department of Health and Human Services.

“Impositions” has the meaning set forth in §3.2.

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“Improvements” means all buildings, structures, Fixtures and other improvements of every kind on any portion of the Land, including, but not limited to, alleys, sidewalks, utility pipes, conduits and lines (on-site and off-site), parking areas and roadways appurtenant to such buildings and structures, now or hereafter situated upon any portion of the Land.

“Increaser Rate” means the most recent annual Medicare market basket inflation increase to the standard federal rate for long term acute care hospitals as determined by the Centers for Medicare and Medicaid Services and as published annually in the Federal Register (or a comparable measure if the same ceases to be used), but in no event will the cumulative average exceed .25% per annum.

“Initial Term” has the meaning set forth in §1.3.

“Investment Amount” is an aggregate concept and means the sum of all Landlord Payments outstanding at the applicable time.

“Land” means the real property described in Exhibit A attached hereto.

“Landlord” means HCN, HCRI-TX and HCRI-WI, individually and collectively.

“Landlord Payment” means any Acquisition Payment or Contingent Payment.

“Landlord’s Personal Property” means all Fixtures located at the Facility or, in the case of a Development Project, will be owned by Landlord and located at the Facility upon commencement of operations of the Facility, including, without limitation, all Fixtures listed on any bills of sale delivered to Landlord in connection with the Facility, together with any and all replacements thereof, and all Fixtures that pursuant to the terms of this Lease becomes the property of Landlord during the Term, but expressly excluding Tenant’s Property.

“Lease” means this Amended and Restated Master Lease Agreement, as amended from time to time.

“Lease Documents” means this Lease and all documents executed by Landlord and Tenant relating to this Lease or the Facility.

“Lease Payments” means the sum of the Base Rent payments (as increased from time to time) for the applicable period.

“Lease Year” means each consecutive period of 365 or 366 days throughout the Term. The first Lease Year commences on the Commencement Date and expires on the day before the first anniversary of the Commencement Date.

“Leased Property” means all of the Land, Improvements, Related Rights and Landlord’s Personal Property.

“Legal Requirements” means all laws, regulations, rules, orders, writs, injunctions, decrees, certificates, requirements, agreements, conditions of participation and standards of any federal, state, county, municipal or other governmental entity, administrative agency, insurance underwriting board, architectural control board, private third-party payor, accreditation organization,

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or any restrictive covenants applicable to the development, construction, condition and operation of the Facility by Tenant, including, but not limited to, [i] zoning, building, fire, health, safety, sign, and subdivision regulations and codes; [ii] certificate of need laws (if applicable); [iii] licensure to operate as each Facility in accordance with its respective Facility Uses; [iv] Medicare and Medicaid certification requirements (if applicable); [v] the ADA; [vi] any Environmental Laws; and [vii] requirements, conditions and standards for participation in third-party payor insurance programs.

“LIBOR Business Day” means a Business Day on which dealings in dollar deposits are carried out in the London interbank market.

“LIBOR Rate” means, as of any date, the rate per annum (rounded to the nearest 1/100 ^th of one percent) quoted by the Reference Bank at approximately 11:00 a.m. London time (or as soon thereafter as practicable) two LIBOR Business Days prior to such date as the rate at which the Reference Bank is offered dollar deposits in the London interbank market where the LIBOR and foreign currency and exchange operations of the Reference Bank are customarily conducted, having a term of one month and in an amount comparable to the applicable Investment Amount.

“LifeCare Credit Facilities” means, with respect to LifeCare Holdings or any of its subsidiaries, one or more debt facilities (including the Credit Agreement entered into among LifeCare Holdings, certain of its subsidiaries, the lenders party thereto in their capacities as lenders thereunder, JPMorgan Chase Bank, N.A., as Administrative Agent, GECC Capital Markets Group, Inc., as Syndication Agent, and Banc of America Securities LLC, as Documentation Agent), or commercial paper facilities with banks or other institutional lenders or investors or indentures providing for revolving credit loans, term loans, receivables financing, including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against receivables, letters of credit or other long-term indebtedness, including any guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions, renewals, restatements or refundings thereof and any indentures or credit facilities or commercial paper facilities with banks or other institutional lenders or investors that replace, refund or refinance any part of the loans, notes, other credit facilities or commitments thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount borrowable thereunder or alters the maturity thereof.

“LifeCare Holdings” means LifeCare Holdings, Inc., a Delaware corporation, and the parent of Tenant and Company.

“LifeCare Senior Subordinated Debt” means the Indebtedness represented by [i] LifeCare Holding’s Senior Subordinated Notes due 2013 in the original aggregate principal amount of $150,000,000.00 and [ii] any guarantees in respect thereof.

“Mandatory Completion Date” means the date by which Tenant shall satisfy all conditions for final disbursement to Tenant pursuant to §3.3 of the Disbursing Agreement, which date may be extended pursuant to the force majeure provisions of the Disbursing Agreement. The Mandatory Completion Date is set forth in the applicable subsection of Article 22.

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“Material Obligation” means [i] any indebtedness secured by a security interest in the accounts receivable of Tenant, Subtenant or Entity Guarantor or any Tenant’s Property; [ii] any indebtedness or lease (other than this Lease) of Tenant, Subtenant or Guarantor or of any other party that has been guaranteed by Tenant, Subtenant or Guarantor that has an outstanding principal balance or obligation in an amount greater than $500,000.00; and [iii] any sublease of the Leased Property.

“Maximum Contingent Payments Amount” means the maximum amount of Contingent Payments that Landlord has committed to make for a particular purpose pursuant to Article 22.

“Maximum Investment Amount” has the meaning set forth in the Term Sheet for the San Antonio Facility and for the Waukesha Facility.

“Net Operating Income” means the pre-tax net income of Tenant or Subtenant plus [i] the amount of the provision for depreciation and amortization; plus [ii] the amount of the provision for interest and lease payments, if any; plus [iii] the amount of the provision for Rent payments; plus [iv] the amount of the provision for management fees.

“Net Worth” has the meaning set forth in §15.7.1.

“Obligor Group Obligations” means all payment and performance obligations of Tenant, Subtenant and Guarantor to Landlord, including, but not limited to, all obligations under this Lease, any loans extended to Tenant, Subtenant or Guarantor by Landlord and all documents executed by Tenant, Subtenant or Guarantor in connection with this Lease, any loan or any other obligation.

“Occupancy” means the average daily census divided by the number of licenses beds.

“Organization State” means the State in which an entity is organized.

“Organizational Documents” means [i] for a corporation, its Articles of Incorporation certified by the Secretary of State of the Organization State, as amended to date, and its Bylaws certified by such entity, as amended to date; [ii] for a partnership, its Partnership Agreement certified by such entity, as amended to date, and the Partnership Certificate, certified by the appropriate authority, as amended to date; and [iii] for a limited liability company, its Articles of Organization certified by the Secretary of State of the Organization State, as amended to date, and its Operating Agreement certified by such entity, as amended to date.

“Payment Amount” means the amount of any Landlord Payment. The first Landlord Payment is the Acquisition Payment made on the Effective Date.

“Payment Date” means the date on which Landlord makes a Landlord Payment.

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“Periodic Financial Statements” means [i] for Tenant and Subtenant, an unaudited balance sheet and statement of income for the most recent quarter; [ii] for the Facility, an unaudited Facility Financial Statement for the most recent month; and [iii] for each Entity Guarantor, an unaudited balance sheet and statement of income of Guarantor for the most recent quarter.

“Permitted Exceptions” means the Assumed Lease, all easements, liens, encumbrances, restrictions, agreements and other title matters existing as of the Effective Date with respect to the San Antonio Facility and on the Amended Effective Date with respect to the Waukesha Facility, including, without limitation, the exceptions to title set forth on Exhibit B attached hereto, and any sublease of any portion of the Leased Property made in complete accordance with Article 18.

“Permitted Liens” means [i] liens granted to Landlord; [ii] liens customarily incurred by Tenant or Subtenant in the ordinary course of business for items not delinquent, including mechanic’s liens and deposits and charges under workers’ compensation laws; [iii] liens for taxes and assessments not yet due and payable; [iv] any lien, charge, or encumbrance which is being contested in good faith pursuant to this Lease; [v] the Permitted Exceptions; [vi] purchase money financing and capitalized equipment leases for the acquisition of personal property provided, however, that Landlord obtains a nondisturbance agreement from the purchase money lender or equipment lessor in form and substance as may be satisfactory to Landlord if the original cost of the equipment exceeds $150,000.00; and [vii] liens granted pursuant to the LifeCare Credit Facilities.

“Personal Property” means all machinery, equipment, furniture, furnishings, movable walls or partitions, computers (and all associated software), trade fixtures and other personal property (but excluding consumable inventory and supplies owned by Tenant) used in connection with the Leased Property, together with all replacements and alterations thereof and additions thereto, except items, if any, included within the definition of Fixtures or Improvements.

“Portfolio Cash Flow” has the meaning set forth in §15.7.1.

“Portfolio Coverage Ratio” has the meaning set forth in §15.7.1.

“Pro Forma Statement” means a financial forecast for the Facility for the next five-year period (or in the case of a Development Project, the first five-year period of operation) prepared in accordance with the standards for forecasts established by the American Institute of Certified Public Accountants.

“Project Approval Letter” means the letter issued by Landlord pursuant to the Term Sheet setting forth the terms for each Development Project approved by Landlord.

“Project Improvements” means any addition to or major renovation of a Facility for which Contingent Payments are made by Landlord pursuant to §22.3.

“Qualified Improvements” means those improvements made at a Facility and capitalized on the books of Tenant or Subtenant for any of the following: replacement of furniture, fixtures and equipment, including refrigerators, ranges, major appliances, bathroom

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fixtures, doors (exterior and interior), central air conditioning and heating systems (including cooling towers, water chilling units, furnaces, boilers and fuel storage tanks) and major replacement of siding; major roof replacements, including major replacements of gutters, downspouts, eaves and soffits; major repairs and replacements of plumbing and sanitary systems; overhaul of elevator systems; major repaving, resurfacing and sealcoating of sidewalks, parking lots and driveways; repainting of entire building exterior; but excluding major alterations, renovations, additions and normal maintenance and repairs.

“Receivables” means [i] all of Tenant’s or Subtenant’s rights to receive payment for providing resident care and services as set forth in any accounts, contract rights, and instruments, and [ii] those documents, chattel paper, inventory proceeds, provider agreements, participation agreements, ledger sheets, files, records, computer programs, tapes, and agreements relating to Tenant’s or Subtenant’s rights to receive payment for providing resident care services.

“Reference Bank” means a bank appearing on the display designated as page “LIBOR” on the Reuters Monitor Money Rates Service (or such other page as may replace the LIBOR page on that service for the purpose of displaying London interbank offered rates of major banks); provided, that, if no such offered rate shall appear on such display, “Reference Bank” shall mean a bank in the London interbank market as selected by Landlord.

“Related Rights” means all easements, rights (including bed operating rights) and appurtenances relating to the Land and the Improvements.

“Renewal Date” means the first day of each Renewal Term.

“Renewal Fee” means a fee equal to 1% of the Investment Amount.

“Renewal Option” has the meaning set forth in §12.1.

“Renewal Term” has the meaning set forth in §12.1.

“Rent” means Construction Rent, Base Rent, Additional Rent and Default Rent.

“Rent Adjustment Date” means June 1, 2008 and each anniversary thereafter; provided, however, that upon issuance of the certificate of occupancy for the Waukesha Facility, the Rent Adjustment Date will be adjusted by Landlord in accordance with the example set forth on Exhibit I, by using June 1, 2008 and the Waukesha C of O Date to provide for one Rent Adjustment Date that will be applicable thereafter for both Facilities.

“Rent Schedule” means the schedule issued by Landlord to Tenant showing the Base Rent to be paid by Tenant pursuant to the terms of this Lease, as such schedule is amended from time to time by Landlord. The initial Rent Schedule is attached to this Lease as Schedule 1 or will be attached following Closing if the Rent Schedule cannot be determined until the day of Closing.

“Replacement Operator” has the meaning set forth in §15.9.1.

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“San Antonio Contingent Payments Amount” means the amount equal to the Maximum Investment Amount for the San Antonio Facility plus any additional amounts required to complete construction of the San Antonio Facility less the Acquisition Payment for the San Antonio Facility.

“San Antonio Facility” means the Facility located in San Antonio, Texas.

“Stabilization” means the earlier of [i] two years after a C of O has been issued for a Facility, or [ii] the date a Facility achieves an average Occupancy of 75% or more for a period of three months.

“Stabilized Facility” means any Facility that is not a Development Project and any Development Project Facility that has achieved Stabilization, individually and collectively.

“Subtenant” means the entity identified on Exhibit C that subleases the Facility from Tenant and is the licensed operator of the Facility, individually and collectively. References in this Lease to “Subtenant” shall mean each Subtenant individually and shall relate to such Subtenant’s respective Facility unless expressly stated otherwise.

“Tenant” has the meaning set forth in the introductory paragraph of this Lease.

“Tenant’s Property” has the meaning set forth in §11.1.

“Term” means the Initial Term and each Renewal Term.

“Term Sheet” means the Term Sheet for Development Master Lease dated February 28, 2007, as supplemented by any Project Approval Letter.

“Transaction Fee” has the meaning set forth in §2.8.

“Waukesha C of O Date” means the first day of the first month following the issuance of the certificate of occupancy for the Waukesha Facility.

“Waukesha Contingent Payments Amount” means the amount equal to the Maximum Investment Amount for the Waukesha Facility plus any additional amounts required to complete construction of the Waukesha Facility less the Acquisition Payment for the Waukesha Facility.

“Waukesha Facility” means the Facility to be constructed in Waukesha, Wisconsin.

1.5 Landlord as Agent . With respect to its respective Facility, each Landlord appoints HCN as the agent and lawful attorney-in-fact of such Landlord to act for such Landlord for all purposes and actions of Landlord under this Lease and the other Lease Documents. All notices, consents, waivers and all other documents and instruments executed by HCN pursuant to the Lease Documents from time to time and all other actions of HCN as Landlord under the Lease Documents shall be binding upon such Landlord. All Rent payable under this Lease shall be paid to HCN. If HCN is the only Landlord, this section shall have no force or effect.

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1.6 Ground Leased Facility .

1.6.1 General . Notwithstanding any other provision hereof to the contrary, Tenant acknowledges that Landlord does not possess a fee simple interest in the Land on which the San Antonio Facility is located. Instead, Landlord’s interest in the San Antonio Facility and the Leased Property related thereto consists of the tenant’s interest under the Assumed Lease. Therefore, Tenant’s interest in the San Antonio Facility is actually in the nature of a sublease, rather than a lease. Except as expressly set forth herein, the terms of this Lease shall apply to the sublease of the San Antonio Facility and related Facility Property to Tenant. Tenant acknowledges receipt of a copy of the Assumed Lease. Tenant acknowledges that Landlord has made no representation to Tenant with respect to the terms of the Assumed Leases and that Tenant is relying solely on its own review of the Assumed Lease with respect to the terms, provisions and status of the Assumed Lease.

1.6.2 Landlord Acceptance of Assumed Lease Obligations . As between Landlord and Tenant, Tenant acknowledges and agrees that Landlord has accepted the assignment of the Assumed Lease only as an accommodation to Tenant and that, therefore, Tenant agrees to undertake the performance of all obligations under the Assumed Lease or otherwise as hereinafter provided. Landlord’s agreement to accept the assignment of the Assumed Lease is being made in reliance upon the provisions hereof.

1.6.3 Compliance with Assumed Leases; Rent Payments Thereunder .

(a) Tenant’s Obligations . In addition to its other obligations under this Lease, Tenant hereby agrees to timely comply with each and every term applicable to the tenant under the Assumed Lease without notice or demand therefor by Landlord or the landlord under the Assumed Lease. Without limiting the foregoing, Tenant acknowledges and agrees that any and all amounts payable by tenant under the terms of the Assumed Lease, including rent, shall be the sole responsibility of Tenant and shall be deemed included in the definition of “Impositions” as set forth in this Lease. Such amounts shall be in addition to all amounts payable under this Lease. Notwithstanding the foregoing and the provisions of §3.1 of the Lease, Tenant shall deposit with Landlord on the first day of each month a sum equal to the amount of any payment required under the Assumed Lease in the month next succeeding the month in which such payment is made to Landlord. Such sums shall be used by Landlord toward timely payment of such required payments. Tenant, on demand, shall pay to Landlord any additional funds necessary to pay and discharge the obligations arising under the Assumed Lease.

(b) Landlord’s Obligations . Landlord covenants, agrees and warrants to Tenant that Landlord will [i] not take any actions or fail to take any actions that Tenant is unable to take for Landlord, that would cause a default under the Assumed Lease; [ii] promptly deliver to Tenant copies of all notices and other documents received or given by the lessor under the Assumed Lease relating to a failure to comply with the terms of the Assumed Lease; and [iii] not amend or modify the term of the Assumed Lease to be less than the Term of this Lease (as may be extended from time to time). Landlord will indemnify Tenant and hold Tenant harmless from and against all damages caused to Tenant by reason of a monetary default under the Assumed Lease not caused by Tenant, provided that Tenant has timely deposited with Landlord all amounts required to be paid under the Assumed Lease.

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(c) Tenant Liability under Assumed Lease . Landlord and Tenant expressly agree that the liabilities and obligations under the Assumed Lease during the Term of this Lease shall be obligations of Tenant to Landlord, and Tenant shall have no direct obligations to the Landlord under the Assumed Lease. Nothing in this paragraph shall limit any obligation relating to the Assumed Lease and agreed to by Tenant under the terms of this Lease.

1.6.4 Termination or Expiration of Assumed Lease . Notwithstanding the provisions of §1.3 hereof, if Landlord’s rights to the San Antonio Facility are terminated under the Assumed Lease, then the Term of this Lease shall be deemed terminated with respect to the San Antonio Facility. Nothing in this §1.6.4 shall cause the Base Rent payable hereunder to be reduced nor the Investment Amount to be deemed reduced.

1.6.5 Remedies . In addition to the remedies provided for in §8.2 hereof, Landlord shall have the right, upon the occurrence of an Event of Default under the Lease or any Lease Document, to accelerate the payment of any or all amounts then or thereafter payable by tenant or lessee under the terms of the Assumed Lease, including rent (“Assumed Lease Rent”) and Tenant shall be liable for the present value of the Assumed Lease Rent, discounted at an annual rate equal to the then-current U.S. Treasury Note rate for the closest comparable term.

1.6.6 Renewal Option . Notwithstanding the provisions of §12.1(b) hereof, for so long as the Assumed Lease is outstanding, Tenant shall be obligated to give Landlord irrevocable notice of renewal of this Lease no later than the date which is 60 days prior to the time that the Assumed Lease requires Landlord to exercise the next occurring renewal option thereunder.

ARTICLE 2: RENT

2.1 Construction Rent . The Rent payable for a Development Project and for the San Antonio Project Improvements shall commence with the first Contingent Payment for Project Improvements and continue during the Construction Term (“Construction Rent”) shall be paid in arrears in consecutive monthly installments and shall be included by Landlord in each monthly Contingent Payment. Landlord will provide Tenant an informational copy of a Construction Rent invoice prepared in accordance with the terms of the Term Sheet each month. The final payment of Construction Rent shall be paid on the final day of the Construction Term. The Construction Rent for (i) each Development Project will be based upon the aggregate amount of the Acquisition Payments and the Contingent Payments made for such Development Project as of the applicable date, and (ii) for San Antonio Project Improvements will be based upon the aggregate amount of the Contingent Payments made for such Project Improvements as of the applicable date, and Landlord’s rate of return equal to the LIBOR Rate plus 4.35%, adjusted from month to month at the time and in accordance with the Term Sheet to reflect each change in the LIBOR Rate.

2.2 Base Rent . Tenant shall pay Landlord base rent (“Base Rent”) in advance in consecutive monthly installments payable on the first day of each month during the Term and Renewal Term commencing on the Amended Commencement Date. If the first day of the Term is not the first day of a month, Tenant shall pay Landlord Base Rent on the first day of the Term for the period from the first day of the Term until the Amended Commencement Date. The estimated Base Rent payable for the first Lease Year of the Term

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is as shown on the Rent Schedule, subject to adjustment pursuant to §2.3.2 (if applicable) For the second and each subsequent Lease Year of the Term, the Base Rent shall be paid in accordance with the most recent revised Rent Schedule provided by Landlord pursuant to §2.3, as applicable. The Base Rent for each Renewal Term will be determined in accordance with §12.2.

2.3 Base Rent Adjustments .

2.3.1 Annual Increase of Base Rent . Commencing on the second Rent Adjustment Date and on each Rent Adjustment Date thereafter, the monthly installment of Base Rent shall increase by an amount equal to 1/12th of the Annual Rent Increase. As of each Rent Adjustment Date, Landlord shall promptly calculate the Annual Rent Increase and shall deliver the revised Rent Schedule to Tenant no later than 30 days after the Rent Adjustment Date. Until the revised Rent Schedule is delivered to Tenant, Tenant shall pay the monthly Base Rent with the Annual Rent Increase calculated based upon an Increaser Rate of .25%. After the revised Rent Schedule is delivered to Tenant, if the actual monthly Base Rent is more than the monthly Base Rent paid pursuant to the preceding sentence, the difference shall be added to the monthly Base Rent payment made for the following month. Thereafter, Tenant shall make monthly Base Rent payments in accordance with the revised Rent Schedule.

2.3.2 Additional Landlord Payments . If Landlord makes a Landlord Payment other than the initial Acquisition Payment, the Base Rent will be increased effective on the Payment Date based upon the applicable rate of return to Landlord as set forth in the Term Sheet. Until Tenant receives a revised Rent Schedule from Landlord, Tenant shall for each month [i] continue to make installments of Base Rent according to the Rent Schedule in effect on the day before the Payment Date; and [ii] within 10 days following Landlord’s issuance of an invoice, pay the difference between the installment of Base Rent that Tenant paid to Landlord for such month and the installment of Base Rent actually due to Landlord for such month as a result of the Landlord Payment. On the first day of the month following receipt of the revised Rent Schedule, Tenant shall pay the monthly installment of Base Rent specified in the revised Rent Schedule.

2.4 Additional Rent . In addition to Base Rent, Tenant shall pay all other amounts, liabilities, obligations and Impositions which Tenant assumes or agrees to pay under this Lease including any fine, penalty, interest, charge and cost which may be added for nonpayment or late payment of such items (collectively the “Additional Rent”).

2.5 Place of Payment of Rent . Tenant shall make all payments of Rent to Landlord by electronic wire transfer in accordance with the wiring instructions set forth in Exhibit D attached hereto, subject to change in accordance with other written instructions provided by Landlord from time to time.

2.6 Net Lease . This Lease shall be deemed and construed to be an “absolute net lease”, and Tenant shall pay all Rent and other charges and expenses in connection with the Leased Property throughout the Term, without abatement, deduction, recoupment or setoff. Landlord shall have all legal, equitable and contractual rights, powers and remedies provided either in this Lease or by statute or otherwise in the case of nonpayment of the Rent.

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2.7 No Termination, Abatement, Etc . Except as otherwise specifically provided in this Lease, Tenant shall remain bound by this Lease in accordance with its terms. Tenant shall not, without the consent of Landlord, modify, surrender or terminate the Lease, nor seek nor be entitled to any abatement, deduction, deferment or reduction of Rent, or setoff or recoupment against the Rent. Except as expressly provided in this Lease, the obligations of Landlord and Tenant shall not be affected by reason of [i] any damage to, or destruction of, the Leased Property or any part thereof from whatever cause or any Taking (as hereinafter defined) of the Leased Property or any part thereof; [ii] the lawful or unlawful prohibition of, or restriction upon, Tenant’s use of the Leased Property, or any part thereof, the interference with such use by any person, corporation, partnership or other entity, or by reason of eviction by paramount title; [iii] any claim which Tenant has or might have against Landlord or by reason of any default or breach of any warranty by Landlord under this Lease or any other agreement between Landlord and Tenant, or to which Landlord and Tenant are parties; [iv] any bankruptcy, insolvency, reorganization, composition, readjustment, liquidation, dissolution, winding up or other proceeding affecting Landlord or any assignee or transferee of Landlord; or [v] any other cause, whether similar or dissimilar to any of the foregoing, other than a discharge of Tenant from any such obligations as a matter of law. Except as otherwise specifically provided in this Lease, Tenant hereby specifically waives all rights, arising from any occurrence whatsoever, which may now or hereafter be conferred upon it by law [a] to modify, surrender or terminate this Lease or quit or surrender the Leased Property or any portion thereof; or [b] entitling Tenant to any abatement, reduction, suspension or deferment of the Rent or other sums payable by Tenant hereunder. The obligations of Landlord and Tenant hereunder shall be separate and independent covenants and agreements and the Rent and all other sums payable by Tenant hereunder shall continue to be payable in all events unless the obligations to pay the same shall be terminated pursuant to the express provisions of this Lease or by termination of this Lease other than by reason of an Event of Default.

2.8 Transaction Fee . Tenant shall pay transaction fees to Landlord (individually and collectively “Transaction Fee”) in the amount and on the dates set forth in the Term Sheet. The Transaction Fee for the San Antonio Facility shall be paid upon issuance of the certificate of occupancy for the San Antonio Facility. The Transaction Fee for the Waukesha Facility shall be paid upon issuance of the certificate of occupancy for the Waukesha Facility.

ARTICLE 3: IMPOSITIONS AND UTILITIES

3.1 Payment of Impositions . Tenant shall pay, as Additional Rent, all Impositions that may be levied or become a lien on the Leased Property or any part thereof at any time (whether prior to or during the Term), without regard to prior ownership of said Leased Property, before any fine, penalty, interest, or cost is incurred; provided, however, Tenant may contest any Imposition in accordance with §3.7 and further provided that for an Imposition that is levied prior to expiration of the Term but relates to periods accruing after the Term, Tenant shall only be responsible for that portion of the Imposition accruing during the Term. Tenant shall deliver to Landlord [i] not more than five days after the due date of each Imposition, copies of the invoice for such Imposition and the check delivered for payment thereof, but only for Impositions that are not paid on a monthly basis; and [ii] not more than 30 days after the due date of each Imposition, a copy of the official receipt evidencing such payment or other proof of payment satisfactory to Landlord. Tenant’s obligation to pay such Impositions shall be deemed absolutely fixed upon the date such Impositions become a lien

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upon the Leased Property or any part thereof. Tenant, at its expense, shall prepare and file all tax returns and reports in respect of any Imposition as may be required by governmental authorities. Tenant shall be entitled to any refund due from any taxing authority if no Event of Default shall have occurred hereunder and be continuing and if Tenant shall have paid all Impositions due and payable as of the date of the refund. Landlord shall be entitled to any refund from any taxing authority if an Event of Default has occurred and is continuing. Any refunds retained by Landlord due to an Event of Default shall be timely applied to an obligation of Tenant in the order which Landlord may determine in Landlord’s reasonable discretion. Landlord and Tenant shall, upon request of the other, provide such data as is maintained by the party to whom the request is made with respect to the Leased Property as may be necessary to prepare any required returns and reports. In the event governmental authorities classify any property covered by this Lease as personal property, Tenant shall file all personal property tax returns in such jurisdictions where it may legally so file. Landlord, to the extent it possesses the same, and Tenant, to the extent it possesses the same, will provide the other party, upon request, with cost and depreciation records necessary for filing returns for any property so classified as personal property. Where Landlord is legally required to file personal property tax returns, Tenant will be provided with copies of assessment notices indicating a value in excess of the reported value in sufficient time for Tenant to file a protest. Tenant may, upon notice to Landlord, at Tenant’s option and at Tenant’s sole cost and expense, protest, appeal, or institute such other proceedings as Tenant may deem appropriate to effect a reduction of real estate or personal property assessments and Landlord, at Tenant’s expense as aforesaid, shall fully cooperate with Tenant in such protest, appeal, or other action. Tenant shall reimburse Landlord for all personal property taxes paid by Landlord within 30 days after receipt of billings accompanied by copies of a bill therefor and payments thereof which identify the personal property with respect to which such payments are made. Impositions imposed in respect to the tax-fiscal period during which the Term terminates shall be adjusted and prorated between Landlord and Tenant, whether or not such Imposition is imposed before or after such termination, and Tenant’s obligation to pay its prorated share thereof shall survive such termination.

3.2 Definition of Impositions . Subject to the last sentence of §3.2, “Impositions” means, collectively, [i] taxes (including, without limitation, all capital stock and franchise taxes of Landlord imposed by the Facility State or any governmental entity in the Facility State due to this lease transaction or Landlord’s ownership of the Leased Property and the income arising therefrom, or due to Landlord being considered as doing business in the Facility State because of Landlord’s ownership of the Leased Property or lease thereof to Tenant), all real estate and personal property ad valorem, sales and use, business or occupation, single business, gross receipts, commercial activity, transaction privilege, rent or similar taxes; [ii] assessments (including, without limitation, all assessments for public improvements or benefits, whether or not commenced or completed prior to the date hereof and whether or not to be completed within the Term); [iii] ground rents, water, sewer or other rents and charges, excises, tax levies, and fees (including, without limitation, license, permit, inspection, authorization and similar fees); [iv] all taxes imposed on Tenant’s operations of the Leased Property, including, without limitation, employee withholding taxes, income taxes and intangible taxes; [v] all taxes imposed by the Facility State or any governmental entity in the Facility State with respect to the conveyance of the Leased Property by Landlord to Tenant or Tenant’s designee, including, without limitation, conveyance taxes, capital gains taxes, and commercial

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activity taxes; and [vi] all other governmental charges, in each case whether general or special, ordinary or extraordinary, or foreseen or unforeseen, of every character in respect of the Leased Property or any part thereof and/or the Rent (including all interest and penalties thereon due to any failure in payment by Tenant), which at any time prior to, during or in respect of the Term hereof may be assessed or imposed on or in respect of or be a lien upon [a] Landlord or Landlord’s interest in the Leased Property or any part thereof; [b] the Leased Property or any part thereof or any rent therefrom or any estate, right, title or interest therein; or [c] any occupancy, operation, use or possession of, or sales from, or activity conducted on, or in connection with the Leased Property or the leasing or use of the Leased Property or any part thereof. Tenant shall not, however, be required to pay any tax based on net income imposed on Landlord by any governmental entity (including any tax attributable to Landlord’s taxable margin levied pursuant to Chapter 171 of the Texas Tax Code or any amendment or replacement thereof) other than the capital stock and franchise taxes described in clause [i] above, nor shall Tenant be required to pay any capital gains tax imposed upon Landlord in connection with the sale of the Leased Property or sums due in connection with any easement agreement entered into by Landlord after the Amended Effective Date without Tenant’s prior written consent.

3.3 Escrow of Impositions . If an Event of Default occurs and while it remains uncured, Tenant shall deposit with Landlord on the first day of each month a sum equal to 1/12th of the Impositions assessed against the Leased Property for the preceding tax year for real estate taxes, which sums shall be used by Landlord toward payment of such Impositions. In addition, if an Event of Default occurs and while it remains uncured, Tenant shall, at Landlord’s election, deposit with Landlord on the first day of each month a sum equal to 1/12th of the Impositions assessed against the Leased Property for the preceding tax year other than for real estate taxes, which sums shall be used by Landlord toward payment of such Impositions. Tenant, on demand, shall pay to Landlord any additional funds necessary to pay and discharge the obligations of Tenant pursuant to the provisions of this section. The receipt by Landlord of the payment of such Impositions by and from Tenant shall only be as an accommodation to Tenant, the mortgagees, and the taxing authorities, and shall not be construed as rent or income to Landlord, Landlord serving, if at all, only as a conduit for delivery purposes.

3.4 Utilities . Tenant shall pay, as Additional Rent, all taxes, assessments, charges, deposits, and bills for utilities, including, without limitation, charges for water, gas, oil, sanitary and storm sewer, electricity, telephone service, and trash collection, which may be charged against the occupant of the Improvements during the Term. If an Event of Default occurs and while it remains uncured, Tenant shall, at Landlord’s election, deposit with Landlord on the first day of each month a sum equal to 1/12th of the amount of the annual utility expenses for the preceding Lease Year, which sums shall be used by Landlord to pay such utilities. Tenant shall, on demand, pay to Landlord any additional amount needed to pay such utilities. Landlord’s receipt of such payments shall only be an accommodation to Tenant and the utility companies and shall not constitute rent or income to Landlord. Tenant shall at all times maintain that amount of heat necessary to ensure against the freezing of water lines. Tenant hereby agrees to indemnify and hold Landlord harmless from and against any liability or damages to the utility systems and the Leased Property that may result from Tenant’s failure to maintain sufficient heat in the Improvements.

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3.5 Discontinuance of Utilities . Landlord will not be liable for damages to person or property or for injury to, or interruption of, business for any discontinuance of utilities nor will such discontinuance in any way be construed as an eviction of Tenant or cause an abatement of rent or operate to release Tenant from any of Tenant’s obligations under this Lease.

3.6 Business Expenses . Tenant acknowledges that it is solely responsible for all expenses and costs incurred in connection with the operation of the Facility on the Leased Property, including, without limitation, employee benefits, employee vacation and sick pay, consulting fees, and expenses for inventory and supplies.

3.7 Permitted Contests . Tenant, on its own or on Landlord’s behalf (or in Landlord’s name), but at Tenant’s expense, may contest, by appropriate legal proceedings conducted in good faith and with due diligence, the amount or validity or application, in whole or in part, of any Imposition or any Legal Requirement or insurance requirement or any lien, attachment, levy, encumbrance, charge or claim provided that [i] in the case of an unpaid Imposition, lien, attachment, levy, encumbrance, charge or claim, the commencement and continuation of such proceedings shall suspend the collection thereof from Landlord and from the Leased Property; [ii] neither the Leased Property nor any Rent therefrom nor any part thereof or interest therein would be in any immediate danger of being sold, forfeited, attached or lost; [iii] in the case of a Legal Requirement, Landlord would not be in any immediate danger of civil or criminal liability for failure to comply therewith pending the outcome of such proceedings; [iv] in the event that any such contest shall involve a sum of money or potential loss in excess of $50,000.00, Tenant shall deliver to Landlord and its counsel an opinion of Tenant’s counsel to the effect set forth in clauses [i], [ii] and [iii], to the extent applicable; [v] in the case of a Legal Requirement and/or an Imposition, lien, encumbrance or charge, Tenant shall give such reasonable security as may be demanded by Landlord to insure ultimate payment of the same and to prevent any sale or forfeiture of the affected Leased Property or the Rent by reason of such nonpayment or noncompliance; provided, however, the provisions of this section shall not be construed to permit Tenant to contest the payment of Rent (except as to contests concerning the method of computation or the basis of levy of any Imposition or the basis for the assertion of any other claim) or any other sums payable by Tenant to Landlord hereunder; [vi] in the case of an insurance requirement, the coverage required by Article 4 shall be maintained; and [vii] if such contest be finally resolved against Landlord or Tenant, Tenant shall, as Additional Rent due hereunder, promptly pay the amount required to be paid, together with all interest and penalties accrued thereon, or comply with the applicable Legal Requirement or insurance requirement. Landlord, at Tenant’s expense, shall execute and deliver to Tenant such authorizations and other documents as may be reasonably required in any such contest, and, if reasonably requested by Tenant or if Landlord so desires, Landlord shall join as a party therein. Tenant hereby agrees to indemnify and save Landlord harmless from and against any liability, cost or expense of any kind that may be imposed upon Landlord in connection with any such contest and any loss resulting therefrom.

ARTICLE 4: INSURANCE

4.1 Property Insurance . At Tenant’s expense, Tenant shall maintain in full force and effect a property insurance policy or policies insuring the Leased Property against the following:

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(a) Loss or damage commonly covered by a “Special Form” policy insuring against physical loss or damage to the Improvements and Personal Property, including, but not limited to, risk of loss from fire, windstorm and other hazards, collapse, transit coverage, vandalism, malicious mischief, theft, earthquake (if the Leased Property is in earthquake zone 1 or 2) and sinkholes (if usually recommended in the area of the Leased Property). The policy shall be in the amount of the full replacement value (as defined in §4.5) of the Improvements and Personal Property and shall contain a deductible amount acceptable to Landlord. Landlord shall be named as an additional insured. The policy shall include a stipulated value endorsement or agreed amount endorsement and endorsements for contingent liability for operations of building laws, demolition costs, and increased cost of construction.

(b) If applicable, loss or damage by explosion of steam boilers, pressure vessels, or similar apparatus, now or hereafter installed on the Leased Property, in commercially reasonable amounts acceptable to Landlord.

(c) Consequential loss of rents and income coverage insuring against all “Special Form” risk of physical loss or damage with limits and deductible amounts acceptable to Landlord covering risk of loss during the first nine months of reconstruction, and containing an endorsement for extended period of indemnity of at least six months, and shall be written with a stipulated amount of coverage if available at a reasonable premium.

(d) If the Leased Property is located, in whole or in part, in a federally designated 100-year flood plain area, flood insurance for the Improvements in an amount equal to the lesser of [i] the full replacement value of the Improvements; or [ii] the maximum amount of insurance available for the Improvements under all federal and private flood insurance programs.

(e) Loss or damage caused by the breakage of plate glass in commercially reasonable amounts acceptable to Landlord.

(f) Loss or damage commonly covered by blanket crime insurance, including employee dishonesty, loss of money orders or paper currency, depositor’s forgery, and loss of property of patients accepted by Tenant for safekeeping, in commercially reasonable amounts acceptable to Landlord.

4.2 Liability Insurance . At Tenant’s expense, Tenant shall maintain liability insurance against the following:

(a) Claims for personal injury or property damage commonly covered by comprehensive general liability insurance with endorsements for incidental malpractice, contractual, personal injury, owner’s protective liability, voluntary medical payments, products and completed operations, broad form property damage, and extended bodily injury, with commercially reasonable amounts for bodily injury, property damage, and voluntary medical payments acceptable to Landlord, but with a combined single limit of not less than $5,000,000.00 per occurrence.

(b) Claims for personal injury and property damage commonly covered by comprehensive automobile liability insurance, covering all owned and non-owned automobiles, with commercially reasonable amounts for bodily injury, property damage, and for automobile medical payments acceptable to Landlord, but with a combined single limit of not less than $5,000,000.00 per occurrence.

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(c) Claims for personal injury commonly covered by medical malpractice and professional liability insurance in commercially reasonable amounts acceptable to Landlord.

(d) Claims commonly covered by workers’ compensation insurance for all persons employed by Tenant on the Leased Property. Such workers’ compensation insurance shall be in accordance with the requirements of all applicable local, state, and federal law.

4.3 Builder’s Risk Insurance. In connection with any construction, Tenant shall maintain in full force and effect a builder’s completed value risk policy (“Builder’s Risk Policy”) of insurance in a nonreporting form insuring against all “Special Form” risk of physical loss or damage to the Improvements, including, but not limited to, risk of loss from fire, windstorm and other hazards, collapse, transit coverage, vandalism, malicious mischief, theft, earthquake (if Leased Property is in earthquake zone 1 or 2) and sinkholes (if usually recommended in the area of the Leased Property). The Builder’s Risk Policy shall include endorsements providing coverage for building materials and supplies and temporary premises. The Builder’s Risk Policy shall be in the amount of the full replacement value of the Improvements and shall contain a deductible amount acceptable to Landlord. Landlord shall be named as an additional insured. The Builder’s Risk Policy shall include an endorsement permitting initial occupancy.

4.4 Insurance Requirements . The following provisions shall apply to all insurance coverages required hereunder:

(a) For Development Projects, the insurance coverage set forth in §§4.1 and 4.2 shall not be required until the Facility being constructed is completed as set forth in the Disbursing Agreement.

(b) The form and substance of all policies shall be subject to the approval of Landlord, which approval will not be unreasonably withheld, conditioned or delayed.

(c) The carriers of all policies shall have a Best’s Rating of “A-1” or better and a Best’s Financial Category of XII or higher and shall be authorized to do insurance business in the Facility State.

(d) Tenant shall be the “named insured” and Landlord shall be an “additional insured” on each policy.

(e) Tenant shall deliver to Landlord certificates or copies of policies showing the required coverages and endorsements. The policies of insurance shall provide that the policy may not be canceled or not renewed, and no material change or reduction in coverage may be made, without at least 30 days’ prior written notice to Landlord.

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(f) The policies shall contain a severability of interest and/or cross-liability endorsement, provide that the acts or omissions of Tenant or Landlord will not invalidate the coverage of the other party, and provide that Landlord shall not be responsible for payment of premiums.

(g) All loss adjustment shall require the written consent of Landlord and Tenant, as their interests may appear.

(h) At least 30 days prior to the expiration of each insurance policy, Tenant shall deliver to Landlord a certificate showing renewal of such policy and payment of the annual premium therefor and a current Certificate of Compliance (in the form delivered at the time of Closing) completed and signed by Tenant’s insurance agent.

4.5 Replacement Value . The term “full replacement value” means the actual replacement cost thereof from time to time, including increased cost of construction endorsement, with no reductions or deductions. Tenant shall, in connection with each annual policy renewal, deliver to Landlord a redetermination of the full replacement value by the insurer or an endorsement indicating that the Leased Property is insured for its full replacement value. If Tenant makes any Permitted Alterations (as hereinafter defined) to the Leased Property, Landlord may have such full replacement value redetermined at any time after such Permitted Alterations are made, regardless of when the full replacement value was last determined.

4.6 Blanket Policy . Notwithstanding anything to the contrary contained in this Article 4, Tenant may carry the insurance required by this Article under a blanket policy of insurance, provided that the coverage afforded Tenant will not be reduced or diminished or otherwise be different from that which would exist under a separate policy meeting all of the requirements of this Lease.

4.7 No Separate Insurance . Tenant shall not take out separate insurance concurrent in form or contributing in the event of loss with that required in this Article, or increase the amounts of any then existing insurance, by securing an additional policy or additional policies, unless all parties having an insurable interest in the subject matter of the insurance, including Landlord and any mortgagees, are included therein as additional insureds or loss payees, the loss is payable under said insurance in the same manner as losses are payable under this Lease, and such additional insurance is not prohibited by the existing policies of insurance. Tenant shall immediately notify Landlord of the taking out of such separate insurance or the increasing of any of the amounts of the existing insurance by securing an additional policy or additional policies.

4.8 Waiver of Subrogation . Each party hereto hereby waives any and every claim which arises or may arise in its favor and against the other party hereto during the Term for any and all loss of, or damage to, any of its property located within or upon, or constituting a part of, the Leased Property, which loss or damage is covered by valid and collectible insurance policies, to the extent that such loss or damage is recoverable under such policies. Said mutual waiver shall be in addition to, and not in limitation or derogation of, any other waiver or release contained in this Lease with respect to any loss or damage to property of the parties hereto. Inasmuch as the said waivers will preclude the assignment of any aforesaid claim by way of subrogation (or otherwise) to an

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insurance company (or any other person), each party hereto agrees immediately to give each insurance company which has issued to it policies of insurance, written notice of the terms of said mutual waivers, and to have such insurance policies properly endorsed, if necessary, to prevent the invalidation of said insurance coverage by reason of said waivers, so long as such endorsement is available at a reasonable cost.

4.9 Mortgages . The following provisions shall apply if Landlord now or hereafter places a mortgage on the Leased Property or any part thereof: [i] Tenant shall obtain a standard form of lender’s loss payable clause insuring the interest of the mortgagee; [ii] Tenant shall deliver evidence of insurance to such mortgagee; [iii] loss adjustment shall require the consent of the mortgagee; and [iv] Tenant shall provide such other information and documents as may be required by the mortgagee.

4.10 Escrows . After an Event of Default occurs hereunder, Tenant shall make such periodic payments of insurance premiums in accordance with Landlord’s requirements after receipt of notice thereof from Landlord.

ARTICLE 5: INDEMNITY

5.1 Tenant’s Indemnification . Tenant hereby indemnifies and agrees to hold harmless Landlord, any successors or assigns of Landlord, and Landlord’s and such successor’s and assign’s directors, officers, employees and agents from and against any and all demands, claims, causes of action, fines, penalties, damages (including consequential damages), losses, liabilities (including strict liability), judgments, and expenses (including, without limitation, reasonable attorneys’ fees, court costs, and the costs set forth in §8.7) incurred in connection with or arising from: [i] the use or occupancy of the Leased Property by Tenant or any persons claiming under Tenant; [ii] any activity, work, or thing done, or permitted or suffered by Tenant in or about the Leased Property; [iii] any acts, omissions, or negligence of Tenant or any person claiming under Tenant, or the contractors, agents, employees, invitees, or visitors of Tenant or any such person; [iv] any breach, violation, or nonperformance by Tenant or any person claiming under Tenant or the employees, agents, contractors, invitees, or visitors of Tenant or of any such person, of any term, covenant, or provision of this Lease or any law, ordinance, or governmental requirement of any kind, including, without limitation, any failure to comply with any applicable requirements under the ADA; [v] any injury or damage to the person, property or business of Tenant, its employees, agents, contractors, invitees, visitors, or any other person entering upon the Leased Property, provided the foregoing indemnification provisions shall not apply to any demand, claim, cause of action caused by the gross negligence or willful misconduct of Landlord or its employees or agents (provided that Tenant and any of Tenant’s employees, agents, contractors or invitees shall not be an agent of Landlord); [vi] any construction, alterations, changes or demolition of the Facility performed by or contracted for by Tenant or its employees, agents or contractors; and [vii] any obligations, costs or expenses arising under any Permitted Exceptions. If any action or proceeding is brought against Landlord, its employees, or agents by reason of any such claim, Tenant, upon notice from Landlord, will defend the claim at Tenant’s expense with counsel reasonably satisfactory to Landlord. All amounts payable to Landlord under this section shall be payable on written demand and any such amounts which are not paid within 10 days after demand therefor by Landlord shall bear interest at Landlord’s rate of return as provided in the Term Sheet. In case any action, suit or proceeding is

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brought against Tenant by reason of any such occurrence, Tenant shall use its best efforts to defend such action, suit or proceeding; provided Tenant may settle on terms acceptable to Tenant.

5.1.1 Notice of Claim . Landlord shall notify Tenant in writing of any claim or action brought against Landlord in which indemnity may be sought against Tenant pursuant to this section. Such notice shall be given in sufficient time to allow Tenant to defend or participate in such claim or action, but the failure to give such notice in sufficient time shall not constitute a defense hereunder nor in any way impair the obligations of Tenant under this section unless the failure to give such notice precludes Tenant’s defense of any such action.

5.1.2 Survival of Covenants . The covenants of Tenant contained in this section shall remain in full force and effect after the termination of this Lease until the expiration of the period stated in the applicable statute of limitations during which a claim or cause of action may be brought and payment in full or the satisfaction of such claim or cause of action and of all expenses and charges incurred by Landlord relating to the enforcement of the provisions herein specified.

5.1.3 Reimbursement of Expenses . Unless prohibited by law, Tenant hereby agrees to pay to Landlord all of the reasonable fees, charges and reasonable out-of-pocket expenses related to the Facility and required hereby, or incurred by Landlord in enforcing the provisions of this Lease.

5.2 Environmental Indemnity; Audits . Tenant hereby indemnifies and agrees to hold harmless Landlord, any successors to Landlord’s interest in this Lease, and Landlord’s and such successors’ directors, officers, employees and agents from and against any losses, claims, damages (including consequential damages), penalties, fines, liabilities (including strict liability), costs (including cleanup and recovery costs), and expenses (including expenses of litigation and reasonable consultants’ and attorneys’ fees) incurred by Landlord or any other indemnitee or assessed against any portion of the Leased Property by virtue of any claim or lien by any governmental or quasi-governmental unit, body, or agency, or any third party, for cleanup costs or other costs pursuant to any Environmental Law. Tenant’s indemnity shall survive the termination of this Lease. Provided, however, Tenant shall have no indemnity obligation with respect to [i] Hazardous Materials first introduced to the Leased Property subsequent to the date that Tenant’s occupancy of the Leased Property shall have fully terminated; or [ii] Hazardous Materials introduced to the Leased Property by Landlord, its agent, employees, successors or assigns. If at any time during the Term of this Lease any governmental authority notifies Landlord or Tenant of a violation of any Environmental Law or Landlord in good faith reasonably believes that a Facility may violate any Environmental Law, Landlord may require one or more environmental audits of such portion of the Leased Property, in such form, scope and substance as specified by Landlord, at Tenant’s expense. Tenant shall, within 30 days after receipt of an invoice from Landlord, reimburse Landlord for all costs and expenses incurred in reviewing any environmental audit, including, without limitation, reasonable attorneys’ fees and costs.

5.3 Limitation of Landlord’s Liability . Landlord, its agents, and employees, will not be liable for any loss, injury, death, or damage (including consequential damages) to persons, property, or Tenant’s business occasioned by theft, act of God, public enemy,

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injunction, riot, strike, insurrection, war, court order, requisition, order of governmental body or authority, fire, explosion, falling objects, steam, water, rain or snow, leak or flow of water (including water from the elevator system), rain or snow from the Leased Property or into the Leased Property or from the roof, street, subsurface or from any other place, or by dampness or from the breakage, leakage, obstruction, or other defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning, or lighting fixtures of the Leased Property, or from construction, repair, or alteration of the Leased Property or from any acts or omissions of any other occupant or visitor of the Leased Property, or from any other cause beyond Landlord’s control.

ARTICLE 6: USE AND ACCEPTANCE OF PREMISES

6.1 Use of Leased Property . Tenant shall use and occupy the Leased Property exclusively for the Facility Uses specified for each Facility and for all lawful and licensed ancillary uses, and for no other purpose without the prior written consent of Landlord. Notwithstanding the foregoing, Landlord and Tenant acknowledge that due to Medicare reimbursement and regulatory changes, the Facility Uses as defined herein may not be the highest and best use of a Facility in the future. If Landlord and Tenant mutually agree using their reasonable business judgment that there is an alternative healthcare use for a Facility that reasonably can be expected to provide sustainable Net Operating Income in excess of the Net Operating Income provided by the current Facility Use, then Landlord and Tenant will mutually agree to an alternative Facility Use for that Facility. If Landlord and Tenant mutually agree to an alternative healthcare use for a Facility, the Master Lease will be amended, as appropriate, to reflect the alternative use. Tenant shall obtain and maintain all approvals, licenses, and consents needed to use and operate the Leased Property as herein permitted. Tenant shall deliver to Landlord complete copies of surveys, examinations, certification and licensure inspections, compliance certificates, and other similar reports issued to Tenant by any governmental agency within 10 days after Tenant’s receipt of each item.

6.2 Acceptance of Leased Property . Tenant acknowledges that [i] Tenant and its agents have had an opportunity to inspect the Leased Property; [ii] Tenant has found the Leased Property fit for Tenant’s use; [iii] Landlord will deliver the Leased Property to Tenant in “as-is” condition; [iv] Landlord is not obligated to make any improvements or repairs to the Leased Property; and [v] the roof, walls, foundation, heating, ventilating, air conditioning, telephone, sewer, electrical, mechanical, elevator, utility, plumbing, and other portions of the Leased Property are in good working order or in the case of a Development Project, will be in good working order upon completion of construction of the Facility. Tenant waives any claim or action against Landlord with respect to the condition of the Leased Property. LANDLORD MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, IN RESPECT OF THE LEASED PROPERTY OR ANY PART THEREOF, EITHER AS TO ITS FITNESS FOR USE, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE OR OTHERWISE, OR AS TO QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, LATENT OR PATENT, IT BEING AGREED THAT ALL SUCH RISKS ARE TO BE BORNE BY TENANT.

6.3 Conditions of Use and Occupancy . Tenant agrees that during the Term it shall use and keep the Leased Property in a careful, safe and proper manner; not commit or suffer waste thereon; not use or occupy the Leased Property for any unlawful purposes; not

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use or occupy the Leased Property or permit the same to be used or occupied, for any purpose or business deemed extra-hazardous on account of fire or otherwise; keep the Leased Property in such repair and condition as may be required by the Board of Health, or other city, state or federal authorities, free of all cost to Landlord; not permit any acts to be done which will cause the cancellation, invalidation, or suspension of any insurance policy; and permit Landlord and its agents to enter upon the Leased Property at all reasonable times after prior notice to examine the condition thereof. Landlord shall have the right to have an annual inspection of the Leased Property performed and Tenant shall pay an inspection fee of $1,500.00 per Facility plus Landlord’s reasonable out-of-pocket expenses within 30 days after receipt of Landlord’s invoice.

ARTICLE 7: MAINTENANCE AND MECHANICS’ LIENS

7.1 Maintenance . Tenant shall maintain, repair, and replace the Leased Property, including, without limitation, all structural and nonstructural repairs and replacements to the roof, foundations, exterior walls, HVAC systems, equipment, parking areas, sidewalks, water, sewer and gas connections, pipes and mains. Tenant shall pay, as Additional Rent, the full cost of maintenance, repairs, and replacements. Tenant shall maintain all drives, sidewalks, parking areas, and lawns on or about the Leased Property in a clean and orderly condition, free of accumulations of dirt, rubbish, snow and ice. Tenant shall at all times maintain, operate and otherwise manage the Leased Property on a basis and in a manner consistent with the standards of the highest quality competing facilities in the market areas served by the Leased Property. All repairs shall, to the extent reasonably achievable, be at least equivalent in quality to the original work or the property to be repaired shall be replaced. Tenant will not take or omit to take any action the taking or omission of which might materially impair the value or the usefulness of the Leased Property or any parts thereof for the Facility Uses. Within 60 days after the end of each fiscal year, Tenant shall deliver to Landlord a certificate in the form of Exhibit G listing the Qualified Improvements made in the prior year. At least annually, at the request of Landlord, Landlord and Tenant shall review capital expenditures budgets and agree on modifications, if any, required by changed circumstances and the changed conditions of the Leased Property. Tenant shall permit Landlord to inspect the Leased Property at all reasonable times after prior notice, and if Landlord gives Tenant notice of maintenance problem areas, Tenant shall deliver to Landlord a plan of correction within 15 Business Days after receipt of the notice. Tenant shall diligently pursue correction of all problem areas within 60 days after receipt of the notice and, upon expiration of the 60-day period, shall deliver evidence of completion to Landlord or an interim report evidencing Tenant’s diligent progress towards completion and, at the end of the next 60-day period, evidence of satisfactory completion. Landlord shall waive an Event of Default for failure to complete any repairs upon presentation to Landlord of evidence reasonably satisfactory to Landlord, in Landlord’s sole discretion, that Tenant has diligently pursued correction all problems. Upon completion, Landlord shall have the right to re-inspect the Facility and Tenant shall pay Landlord’s reasonable out-of-pocket expenses within 30 days after receipt of Landlord’s invoice. At each inspection of the Leased Property by Landlord, the Facility employee in charge of maintenance shall be available to tour the Facility with Landlord and answer questions.

7.2 Required Alterations . Tenant shall, at Tenant’s sole cost and expense, make any additions, changes, improvements or alterations to the Leased Property, including structural alterations, which may be required by any governmental authorities, including

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those required to maintain licensure or certification under the Medicare and Medicaid programs (if so certified), whether such changes are required by Tenant’s use, changes in the law, ordinances, or governmental regulations, defects existing as of the date of this Lease, or any other cause whatsoever. All such additions, changes, improvements or alterations shall be deemed to be Permitted Alterations and shall comply with all laws requiring such alterations and with the provisions of §16.4.

7.3 Mechanic’s Liens . Tenant shall have no authority to permit or create a lien against Landlord’s interest in the Leased Property, and Tenant shall