EXHIBIT 9 RECEIVER'S, CRO'S AND DEBTOR'S

SECOND AMENDED PLAN OF REORGANIZATION (MAY 27, 2010)

LENDER TERM SHEETS OR MODIFICATION AGREEMENTS

EXHIBIT 9-1

ACKNOWLEDGEMENT AND AMNDMENT

This Acknowledgement and Amendment, dated November _' 2009 (this

"Amendment"), is between LIBERTY BANK (the "Lender"), and COUGAR SPRIGSASSISTED LIVNG AND MEMORY CAR COMMUNITY, LLC ("Cougar Springs") andSTAYTON SW ASSISTED LIVING, L.L.C., an Oregon limited liabilty company ("Stayton")(Stayton and Cougar Springs are collectively, "Borrower").

RECITALS

A. Borrower and Lender are paries to a Business Loan Agreement dated December

22,2008 (the "Loan Agreement"). In connection with the Loan Agreement, Borrower executedin favor of Lender a (i) Promissory Note, dated December 22, 2008, in the principal amount of$6,385,000 (the "Note") and (ii) Deed of Trust, dated December 22,2008, encumbering realpropert (the "Collaterar') located at 1920 SW Canyon Drive, Redmond, Oregon 97756 (the"Deed of Trust"). Collectively, the Loan Agreement, the Note, the Deed of Trust, and each otheragreement, instrent or other document executed by Borrower in connection with the Loan

Agreement, are the "Loan Documents." The financial accommodations extended to Borrower byLender pursuant to the Loan Documents constitute the "Loan."

B. Borrower is a "Receivership Entity," as that term is defined in the Order GrantingPreliminar Injunction and Appointing Receiver entered by the United States District Cour ofthe Distrct of Oregon (the "District Cour") on March 10,2009.

C. The Distrct Cour entered an order on October 2,2009 (the "Approval Order") in

Case Number 09-CV -6056-HO (the "SEC Enforcement Action") approving the Distrbution Plansubmitted by Clyde A. Hamstreet, Chief Restrctuing Offcer of Sunwest Mangement Inc., andMichael Grassmueck, the cour-appointed receiver in the SEC Enforcement Action. TheApproval Order recognzed that Borrower and several hundred affiliated entities (together the"Sunwest Enterprise") were operated as a unta enterprise and the Cour ordered that the assetsand liabilties of the Sunwest Enterprise, including those of Borrower, be consolidated into thebanptcy estate of Stayton and reorganzed in Stayton's Banptcy Case pending as USDCCase No. 09-cv-6082-HO (the "Banptcy Case"). Accordingly, Stayton holds equitable title tothe Collateral pursuant to the Approval Order and the Distribution Plan, although Cougar Springsretans bare legal title.

D. Borrower wil be subj ect to a plan of distribution and a plan of reorganzation (asit my be renamed) to be approved in the futue by the Distrct Cour (together, the "Plan"). Whenthe approved Plan is implemented, and provided the Loan payments are curent and nototherwse in default, the Loan may be assumed by and the Collateral transferred to a differentperson or entity which wil become obligated to Lender under the Loan Documents (the"Transferee").

E. Borrower and Lender wish, pursuant to the terms and conditions set fort in thisAmendment, to (i) amend the Note, (ii) clarify that the transactions to occur pursuant to the Plan,including any assumption of the Loan and/or transfer of the Collateral (the "Reorganzation

ACKNOWLEDGEMENT AN AMNDMENTPAGE i oF3

Tranactions"), wil not constitute an event of default under the Loan Documents and(iii) memorialize their agreement with respect to attorney fees incured by Lender.

Borrower and Lender therefore agree as follows:

1. Reorganzation Transaction Approved. Notwithstading any provision of any

Loan Document, the Reorganization Transactions, collectively and individually, wil be deemedapproved by Lender and will not constitute a default or breach under any Loan Document,provided that:

i. The Deed of Trust remains in place with the same priority and preferences

securg Borrower's (or the Transferee's) obligations under the Note;

ii. The Transferee wil execute assumption documents relating to the Loan

and the Collateral that Lender reasonably requires; and

111. Lender's attorney fees incured in negotiating with Borrower aferDecember 22, 2008, as approved by the District Cour, wil be added tothe principal balance of the Restated Note (as defined in Section 2).

2. Amendment to Note. Upon implementation of the Plan, the Note wil be amendedas follows without fuer action:

i. The sentence "Borrower will pay this loan in full imediately upon

Lender's demand" in the second paragraph ofthe Note (Payment) isdeleted.

ii. The sentence "This Note is payable on demand" in the second to last

paragraph of the Note (General Provisions) is deleted.

11. The Note wil be a 10-year note, payable, absent default, in 119 regularpayments of $43,051.65 each (as adjusted by Section l.ii), beginnngFebruar 1, 2009, and one iregular last payment estimated at$4,995,740.30 (as adjusted by Section l.ii) due Januar 1,2019, whichpayments include pricipal and interest at a rate of 6.375% per anum,based on a year of360 days.

iv. Borrower acknowledges that as of September 30, 2009, there remains due

and owing on the Loan the principal sum of $6,315,229.2 1, together withcurent interest of $32,444.60, and attorney fees of Lender incured afterDecember 22, 2008 of approximately $25,000.

Except as expressly modified by ths Amendment, all remainig terms of the Note will remain inful force and effect. Upon implementation of the Plan, Lender wil deliver a restated Note (the"Restated Note") to Borrower reflecting the above amendments and, upon receiving the signedRestated Note from Borrower, Lender will deliver the original signed Note to Borrower.

ACKNOWLEDGEMENT AN AMNDMENTPAGE20F3

3. Acknowledgement and Waiver. Lender acknowledges that as of the date of thisAmendment, Borrower has not breached any of its payment obligations under the LoanDocuments. Lender hereby waives any right it may have under the Loan Documents to declare adefault under the Loan Documents for any event that fist occured or failed to occur on or beforethe date of ths Agreement. This waiver extends, without limitation, to any event that firstoccured or failed to occur on or before the date of ths Agreement and that continues afer thedate of ths Agreement.

4. Vote to Approve the Plan. Lender will vote to approve the Plan when it is put to avote of Borrower's creditors.

5. Counterpars; Facsimile Signatues. This Amendment may be executed in

counterpars, each of which when so executed and delivered will be deemed an original and all ofwhich counterpars, taen together, wil constitute one and the same instrent. This

Amendment may be delivered by facsimle, and when so delivered wil have the same force andeffect as delivery of an original signatue.

LENDER: BORROWER:

LIDERTYBANK

c:'7~JQCOUGAR SPRIGS ASSISTED LIVING ANMEMORY CAR COMMITY, LLC~By:

Name:~;itl G'//h(' '\, Wc.-W Name:

Title: Title: erSTAYTON SW ASSISTED LIVING, L.L.C.

By: '\~Name:

Title: 0tV

034845/00001/1772894v3

ACKNOWLEDGEMENT AN AMNDMENTPAGE 3 oF3

EXHIBIT 9-2

SUMMARY TERM SHEETWELLS FARGO - SUNWEST - RESTRUCTURED LOAN

EXCLUDING THE TWO GRANTS PASS LOANS

i. Existing loans restructured as a single, multi-borrower loan.

2. Co-Borrowers are the SPEs that own the Absaroka, Churchil, Oswego Springs, Sellwood

Landing and Sugarland Ridge facilties (collectively, the nproperty").

3. Initial loan term wil be 3 years with two one year options to extend exercisable ifthe

following conditions are met: (a) no Event of Default exists; and (b) DSCR calculated as of thetwo most recently completed quarters at least 1.25: 1 (calculated assuming an 8% interest ratc).

4. Initial loan principal amount wil equal outstanding Joan principal amount as of date of

restructure, whicq wil be $47,943,349 less any principal payments received between now andthe restructure effective date.

5. Principal payable on the first day of each month starting 1/1/201 1 in amount of $159,811

(1/300th) of initial principal amount with balloon at maturity.

6. Interest rate: (n) first 3 years - 5.25%; (b) year 4 - WF Prime as of the first day of termplus 200 bps; and (c) year 5 - WF Prime as of the first day of term plus 20.0 bps.

7. Accrued and unpaid interest payable in arrears on the first day of each month and on thematurity date.

8. A restructuring fee equal to total of (a) accrued, non-default interest and late fees,(b) reasonable legal fees and (0) WF's other closing costs~ out-of-pocket fees and expenses shallbe paid in 16 equal quarterly installments on the first day of each quarter beginning on the firstday of the, third calendar month after the month in whi.ch the restrcture becomes effective,.provided that if the total restructuring fee exceeds $2.3 milion, additional quarterly installmentswil be added for each $143,750 (or portion thereof) by which the restructuring fee exceeds $2.3millon. Any portion of the restructuring fee remaining unpaid on maturity shall be paid onmaturity. .9. Within 90 days after each of the third and four years of the loan term, 10% of Borrowers'

excess cash flow. wil be applied to reduce loan principal in inverse order of maturity.

i O. Security for the loan wil be; (a) first mortgage lien/security interest on the Property and

all of borrowers' other assets; and (b) perfected first security interest in all assets ofTRS derivedfrom the Property (e.g., AIR from residents and in bank accounts containing collections fromProperty and reserves/impounds with respect to the Property), which security interest may beprovided by Borrowers' assigning a first security interest granted to them in such assets by TRS.

i 1. TRS to deposit collections from the Properties into one or more deposit accounts .containing only collections from one or more ofthe Properties (the lICollection Accounts") and if

-1-02941.0276/LEGA Ll688582J.2

such funds arc invested, shall be invested in one or more securities accounts containing onlyfunds invested from the Collection Accounts (the IISecurities Accountsll). Unless an Event of

Qefault exists, TRS may withdraw funds from the Collection Accounts and Securities Accountsnecessary to meet its obligations (whether with respect to the Properties or otherwise), providedsuch withdrwals (except withdrawals with respect to Property-related obligations) wil be madein a manner substantially proportionate to utilzation of other funds available to TRS which areapplied to obligations not directly related to the source generating such funds. WF's securityinterest in the Collection Accounts and the Securities Accounts wil be perfected by controlagreements that permit TRS to withdraw funds until WF gives notice to the bank or securitiesintermediary that an Event of Default exists.

12. The loan agreement wil contain one or more operating covenants, including a DSCR

covenant, based on Sunwests reasonably acceptable projections, with the covenant levels relaxedby approx. 15% from the projected financial condition. Operating covenants wil be measuredon a monthly or quarterly basis.

13. TRS wil maintain tax and insurance impounds, which impounds may be appliedanually to the payment of property taxes and insurance premhims, and TRS shall maintainreasonable operating reserves.

14. Leases of the Properties to TRS wil be on terms reasonably acceptable to WF, and TRSwil separately covenant with WF to perfonn its obligations under such i~ases.

15. Management contract(s) for the Property wiU be on tenns reasonably consistent withindustry standards; provided that the base management fee will- not exceed 6% of annualrevenue.

16. Revised loan documents (e.g., mortgages and deeds of trst), reps, wammties, covenantsand events of default typical of similar WF real estate,Íoan transactions in excess of $45 milion.

DATED: Septemberq" 2009

c~WELLS FARGO BANK, NATIONALASSOCIATION

By: 9J~Tite: 7d'¿et3'ïÙ::;v'T(/

-2-0294 i '(276fLEOALI6885823.2

SUMMARY TERM SHEETWELLS FARGO - SUNWEST - RESTRUCTURED LOAN

EXCLUDING THE TWO GRANTS PASS LOANS

1. Existing loans restructured as a single, multi-borrower loan.

2. Co-Borrowers are the SPEs that own the Absaroka, Churchil, Oswego Springs, Sellwood

Landing and Sugarland Ridge facilties (collectively, the nproperty").

3. Initial loan term wil be 3 years with two one year options to extend exercisable if the

following conditions are met: (a) no Event of Default exists; and (b) DSCR calculated as of thetwo most recently completed quarters at least 1.25: i (calculated assuming an 8% interest rate).

4. Initial loan principal amount wil equal outstanding loan principal amount as of date of

iestructurc, which wil be $47,943,3491ess any principal payments received between now andthe restructure effective date.

5. Principal payable on the first day of each month starting 1/1/2011 in amount of $159,81 i

(1/300th) of initial principal amount with balloon at maturity.

6. Interest rate: (n) first 3 years - 5.25%; (b) year 4 - WF Prime as of the first day of termplus 200 bps; and (c) year 5 - WF Prime as of the first day oftenn plus 20.0 bps.

7. Accrued and unpaid interest payable in arrears on the first day of each month and on thematurity date.

8. A restructuring fee equal to total of (a) accrued, non-default interest and late fees,(b) reasonable legal fees and (c) WF's other closing costs, out-of-pocket fees and expenses shallbe paid in 16 equal quarterly installments on the first day Drench quarter beginning on the firstday of the, third calendar month after the month in whi.ch the restrcture becomes effective,.provided that if the total restructuring fee exceeds $2.3 milion, additional quarterly installmentswil be added for each $143,750 (or portion thereoi) by which the restructuring fee exceeds $2.3milion. Any portion of the restructuring fee remaining unpaid on maturity shall be paid onmaturity. .9. Within 90 days after each of the third and four years ofthc loan term, 10% of Borrowers'excess cash flow. wiH be applied to reduce loan principal in inverse order of maturity.

10. Security for the loan wil be; (a) first mortgage lien/security interest on the Property and

all of borrowers' other assets; and (b) perfected first security interest in all assets ofTRS derivedfrom the Property (e.g., AIR from residents and in bank accounts containing collections fromProperty and reserves/impounds with respect to the Property), which security interest may beprovided by Borrowers' assigning a first security interest granted to them in such assets by TRS.

i i. TRS to déposit collections from the Properties into one or more deposit accounts

containing only collections from one or more of the Properties (the "Collection Accounts") and if

-1-0294 i .0216/LEGA L16885823.2

such funds are invest~d) shall be invested in one or more securities accounts containing onlyfunds invested from the Collection Accounts (the IISecurities Accountsll). Unless an Event ofQefault exists) TRS may withdraw funds from the Collection Accounts and Securities Accountsnecessary to meet its obligations (whether with respect to the Properties or otherwise), providedsuch withdrwals (except withdrawals with respect to Property-related obligations) wil be madein a manner substantially proportionate to utilzation of other funds available to TRS which arcapplied to obJigations not directly related to the source generating such funds. WF's securityinterest in the Collection Accòunts and the Securities Accounts wiI be perfected by controlagreements that permit TRS to withdraw funds until WF gives notice to the bank or securitiesintermediary that an Event of Default exists.

12. The loan agreement wil contain one or more operating covenants, including a DSCR

covenant, based on Sunwests reasonably acceptable projections, with the covenant levels relaxedby approx. 15% from the projected financial condition. Operating covenants wil be measuredon a monthly or quarterly basis.

13. TRS wil maintain tax and insurance impounds) which impounds may be applied

anually to the payment of propert taxes and insurance premiums) and TRS shaH maintainreasonable operating reserves.

14. Leases of the Properties to TRS wil be on tenus reasonably acceptable to WF, and TRSwil separately covenant with WF to perfonn its obligations under such leases.

15. Management contract(s) for the Property wil be on tenns reasonably consistent withindustry standards; provided that the base management fee wil'not exceed 6% of annualrevenue.

16. Revised loan documents (e.g., mortgages and deeds of trst), reps, wai:anties, covenantsand events of default typical of similar WF real estate.íoan transactions in excess of $45 millon.

DATED: Septemberq,) 2009

~C~CRO

WELLS FARGO BANK, NATIONALASSOCIATION

By: ~~Title: ;¡J~t'~(/

-2-02941.(276fLEOA1.l6885823.2

EXHIBIT 9-3

Loan Re.'ltrctue Tenn Sheet - Atlantic 5

This Ten Sheet has been prepared to faciltate restrctue discussions concergthe loan known as the Atlantic 5 (the "Loan"), which includes the five senior livingfacilties 'kown as Emerald Estate, Remington House, Georgian Place, Laurl Gardensand Lex.ington Garens (the "Projects"). NebraskaLd National Bank (Lender) is thelead lender for this transaction and the current pricipal loan balance is $21,191,514.85.

Ths tenns sheet is to faciltate restrcture discussions and is for discussion

puroses only. Nothing in this Tenn Sheet is binding on any pary and no pary wil bebound to any agreement until such time, ifany, as a fonnal written agreement shall havebeen executed and delivered among the parties. NebraskaLand National Ban wil berequired to obtain the consent of paricipating banks per the tens of their parcipationagreeent to coinplete this transaction and ths tenn sheet and any agreement are subjectto parcipant approvaL.

The goal of the Tenn Sheet is to faciltate a transaction extending andrestrcturing the Loan. The date on which the transaction becomes effective is the"Closing Date" which shall be the date of the entr of an order approving this transaction.

The restrcture contemplated by tils Ten Sheet shall be effective durng anybanptcyproceedíng, and shall, without any additional agreement by the pares,constitute a stipulation for adequaté protection payments and shall constitute theagreement of the paries for the use of Cash Collateral, as that ten is defined under theBanptcy Code, and shall be effective and binding on Lender and the Borrowers in anybanptcy proceing.

. Borrwers. The existing Borrwers shall remain as Borrower until a plan of

restructurig and distrbution is approved by the Court. Tranfers of ownership orcontrol by the existing Borrwers to other entities or perons as provided in a planof distrbution and restructung approved by the Cour shall be allowed, provided

that the Loan shall not be furter modified except as may be agree by theLender.

. Pricipal Balance. Thesurn of the outstading principal balances, plus arestrcturing fee of 50 bps of outstanding principal balances, plus reimbursementto the Lender for all reasonable closing costs of this trasaction, shall be the

principal balances of the restructued loans. The "exit fee" as defined in theWaterall agreement between Lender and Borrowers in the amount of

$423,830.30 shall reain due and payable, but shall not be paid except on a saleor refinance of anyone or more of the Projects. The "exit fee" shall not accreinterest and calculated in a maner that does not include any prior default rate ofinterest.

. Interest Rate. Fixed interest rate of 5.0% for the initial ter of three years if theLender opts to advance an additional $500,000.00 at closing into the DeferredMaintenance I Cap Ex Reserve Accunt. Or, a Fixed rate of 4.75% for the initialter of thee years if the Lender does not opt to advance an additional$500,000.00 at closing into the Deferred Maintenance I Cap Ex Reserve Account.A rate floor of 5.0% shall be included for the adjustment perods. A rate ceilng

of 7.0% shall be included for the adjustment penods.

. Term. The restructued Loan shall mature three years after the Closing Date.Borrower shall be entitled to two separate one-year extensions upon thir daysprior wrtten notice subject to the Following: (a) no Event of Default shall haveoccurred, (b) the interest rate shall adjust for the fortcoming year to a fixed rateequal to the National Prime rate on the date of the adjustment plus 200 bps;provided that if the DSCR for the most recent 12-month perod equals or exceeds1.25, the 200 basis points wil be reduced to 175 basis points; (c) payment in cashof an extension fee equal to 25 bps of the principal balance and (d) receipt byLender of an apprdisal from a licensed appraiser selected by Lender showing' aloan to value ratio of no more than 85% at the time of the extension.

· Amortization: Payments. Monthly payments of principal and interest shallcommence on the twenty-fifth day of the first month following the Closing Dateand shall be payable on the 25th day of each month with a five day-grace perod.Monthly payments shall be in an amount necessar to amortize all principal andinterest owing on the loan in 300 equal, monthly payments of principal andinterest if the Lender opts to advance an additional $500,000.00 at closing into theDeferred Maintenance I Cap Ex Reserve Accunt. If the Lender does not opt toadvance an additional $500,000 at closing to the Deferred Maintenance I Cap ExResere, the monthly payments shall be interest only for 12-months from theclosing date, and then, on the fit anversary of the restrctue closing shall

convert to monthly payments in anatount necear to amortize all of theprincipal and interest ownng on the loan in 300 equal, monthly payments ofprincipal and interest. If an extension option is utilized, the monthly paymentsshall be recalculated based on the new interest rate to contiue the amortzation ofthe debt based on the original schedule.

· Management Fee. Sunwest Management, Inc. ("Sunwest") shall continue to serveas property manager thrugh the date of approval by the Cour of a plan ofdistrbution and restructung. Upon Cour approval of the plan of distributionand restrcturing, the management fee shall remain at 7% until twelve monthsfrom the date of the approval by the Cour of a plan of distbution andrestrctung and reduce to 6% thereafter. Thereafter, Sunwest or its successorwìl serve as propery manager according to the plan of distrbution andrestructuring. Lender shall have the right to terminate Sunwest (or its successor)as manager if Borrowers (or their successors) default under the restrcture Loanand do not timely cure the default as may be provided under tenus of the LoanAgreeent as restrctued.

· Elimination of Deferals Under the Forbearance Agreeents. The Lender shall

forgive any deferrls of default interest that is currently accred in conjunctionwith the closing of the proposed restructure.

· Costs and Expenses. The Lender shall be reimbured for any reasonable out-of-pocket closing expeses associated with the closing of this transaction. The loandocuments shall contain tyical provisions requiring Borrower to reímbureLender for reasonable out-of-pocket expenses on a going forward basis.

· Default Rate. The inital default rate shall be 4% over the contract rate. At suchtime as Borrwer has made 24 monthy payments, ifno Event of Default hasoccured the default rate shall reduce to 3% over the contract rate.

· Impounds. Borrowers would make monthly payments of impounds for taxes andinsurce. Impounds would be made available for taes and insurce.

Impounds for insurance will not be required if insurance payments are made on amonthly basis, but failure to make such inslJance payment or failure to maintaininsurance would constitute an Event of Default.

· CapEx and Deferred Maintenance Reserves. The Projections include line itemsfor Càpital Expenditues and Defered Maintenance. The projected amount shallbe paid each month to Lender as a reserve and made available to Borrower tofud Capital Expenditures andDeterred Maintenance. The monthly deposit

requirement shall be calculated prior to closing and wil adjust based on whetherthe Lender opts to advance the $500,000.00 to this Reserve account at closing perthe said Lender's option in the "payment" section of this ter sheet.

· Cash Management. Cash Management proceures shall be continued so that theLender maintans the depository account.'l for all securing properes thoughremote capture serices at its customar fee. The curent "lockbox" arangementwm be modified to provide to a "springing lockbox" which may be enforced atLender's option if an Event of Default occurs. Under the "springing lockboxagreement" the Lender's perfected security interst in project revenue and can beassured that all project revenue is used for budgeted project expees and notdiverted for other use. If an Event of Detàult occur, the "lockbox" agreeentbetwee the Lender and Borrowers shall continue with the Lender prvidingremote capture services and lockbox services at its customar fee. The "spriginglockbox" agreement shall be modified to where the waterall of fuds shall be (1)Operating Expenses including taxes and insurance, (2) the Management Fees, (3)Principal and interst payments, (4) Scheduled Deposit to the Deferred

Maintenace I Cap Ex Resere (5) any fuds after fully fuding the Cap ExResere and Working Capital Reserve shall be available for owners distrbutions.Provided, however, that the failure to pay the principal and interest payment underthe terms of the note evidencing the Loan, as restructured, shall be an event ofdefault under the Loan Documents.

· Finanial Projections. The paries are using the attached financial projections (theProjections) for modeling purposes.

· Financial Rellrtng. Borrower shall deliver monthy financial statements insimilar fonnat to what is currently being provided within 45 days of month end,that among other things, show a comparson to the Projections.

· Financial Covenants. The restrctured loans shall contain a debt service coverageratio as set fort in the existing loan documents or as otherwise agreed to by theparties.

· No Prepayment Premium. The Loans may be prepaid in par or in full at anytime without payment of any prepayment premium.

· Owner Distrbutions. Distrbutions to equity holders and tenant in commoninvestors will not be peritted until all debt serice requirements are met and thereseres are fully funded. No distributions will be allowed if an Event of Defaulthas occurred.

· Loan Documents. The Loan Documents will contain representations, waranties,covenants, events of default, and other provisions typically found in firstmortgage loans secured by senior living facilties.

· Loan Assumption. The loan would be assumable by a third pary transfereesubject to (a) such transferee satisfying Lender's then customar requirements fornew borrowers (e.g. hackground checks/financial review), (b) payment of a 1 %assumption fee, and (c) the principals of any new borrower shall provide theLender with a bad boy guanty.

· Guaranties. Lender and all guarators wil execute mutual releases.

· Releases. It is contemplated that this Trasaction wil be approved by an Orderentered by the Court. The Order wil include a release of Lender from all claims,known and unown, by the Borowers, the Receiver, and all ReceiverslùpEntities. The assertion of any claim against the Lender by the Borrowers, or theirsuccessors, arsing from the beginnng of time though the date of the Courapproval of the restrcturing agreement shall constitute an event of default underthe Loan as restrctued.

· Drop Dead Provision. Borrowers shall agree that if the Loan as restrctued is indefault and if the default is not cured within 1 o days following the sending of awritten notice of default, specifying the detàult and the perfonnance necessar tocure the default, the Lender may have relief frm the automatic stay under 1 1USC §362 or under the injunction entered in the pending SEC litigation.

. Mediation; Cour ApprovaL. This tenn sheet shall be presented to Judge Velurein connection with the ongoing voluntar mediation being conducted by JudgeVelure. Upon approval by Judge Velure, a fonnal agreement and new loandocuments wil be prepared and the paries wil seek the Approval Order fromJudge Hogan.

· Anpoval Order. The paries will obtain an order from Judge Hoganapproving the Transaction (the Approval Order). The Approval Order will (a)approve all of the tens and conditions of the Transaction, (b) release Lender and

the Projects from the injunction and dismiss Lender from the pending case(conditioned only upon execution of the restrcte agreement and all related

documents), (c) provide that Lender shall be entitled to exercise its legal nghtsand remedies upon the occurence of an Event of Default, (d) include a release ofLender from all claims, known and unkown, that would bind Borrower, SMT,the guarantors, the SEC receiver, tenant in common investors, and other thirdparies and (e) include a provision that in any plan consented to by any of theBorrowers, SMI, or the guartors, that the treatment of the Leder shall begoverned by the restrcture agreeent (including all related documents) .

· SEC Lawsuit Constitutes a Default. The commencement oflegal action againstthe Lender by the SEC shall consttute an Event of Default.

· Banptcy Filng. The pares agree that the Borrowers may file or be joined in apendîng Chapter 11.banptcy proceeng, provided that the Borrowers shallprovide for treatment of the Lender's claiin in their Chapter 11 plan in the manerprovided under this Agreement.

· Withdrawal from Appeal. Upon entr of the Approval Order, Lender wilwithdraw frm the appeal of the SEC Receivership injunction order.

By its signatue below, each par indicates that it approves ths Tenn Sheet. Signatubelow does not bind any pary but indicates the consent of such par to proceed withfurter steps regarding this transaction. Lender shall, upon acceptace of this Tenn Sheeby the last pary to sign, shall immediately seek any required approval of this transactionby the participants.

Yl

~..."

~~--_.-Mangement Committee Member

Loan Restrctue Term Sheet - Bridgeport

This Ten Sheet has been preared to faciltate restrctue discussions concerningthe loans known as the Bridgeport Loan (the "Loan"), which includes the senior livingfacilties opeated by Bridgeprt Senior Living, LLC, Bridgeport Assisted Living LLCand by Maplewood and Hertage Senior Living Facilties in Bridgeport, West Virginia(the "Projects"). (The Bridgeprt Senior Living, LLC and Bridgeport Assisted Living

LLC being referred to as the "Borrowers"). Nebr~kaLad National Ban ("Lender") isthe lead lender for this tranaction and the curent principal loan balances are$8,177 ,407 .65.

This terms sheet is to faciltate restrcture discussions and is for discussionpurposes only. Nothng in this Ter Sheet is binding on any pary and no pary wil be

bound to any agreement until such time, if any, as a formal wrtten agreement shall havebeen executed and delivered among the paries. NebrakaLand National Ban will berequired to obtain the consent of paricipating bans per the ter of their partcipation

agreement to complete this transaction and this ten shee and any agreement are subjectto parcipant approvaL.

The goal ofthe Ter Sheet is to faciltate a tranaction extending andrestrcturing the Loan. The date on which the transacton becomes effective is the"Closing Date" wmch shall be the date of the enti of an order approvig ths traction.

The restrctue contemplated by this Ter Sheet shall be effective during any banptcyproceeding, and shall, without any additional agreement by the pares, constitute astipulation for adequate protecion payments and shall constitute the agreement of thepates for the use of Cash Collateral, as that term is defined under the Bankrptcy Code,and shall be effective and binding on Lender and the Borrower in any banptcyproceeding.

· Borrowers. The existing Borrowers shall remain as Borrowers until a plan ofrestrctung and distrbution is approved by the Court. Transfer of ownership or

control by the existing Borrowers to other entities or persons as provided in a planof distrbution and restrcturing approved by the Cour shall be allowed, provided

that the Loan shall not be fuher modified except as may be agreed by theLender.

· Principal Balance. The ,sum of the outstanding principal balances, plus arestrcturng fee of 50 bps of outstanding principal balances, plus reimbursement

to the Lender for all reasonable closing cost of ths transaction, shall be theprincipal balances of the restrctured loans.

· Interest Rate. Fixed interest rate of 5.0% for the initial ten of thee years. Arate floor of 5.0% shall be included for the adjustment periods. A rate ceiling of7.0% shall be included for the adjustment periods.

· Ten. The restructued Loan shall matue thre yeas after the Closing Date.Borrower shall be entited to two separate one-year extensions upon thirt daysprior wrtten notice subject to the Following: (a) no Event of Default shall haveoccured (b) the interest rate shall adjust for the fortcoming year to a fixed rateequa to the National Prime rae on the date of the adjustment plus 200 bps;provided that if the DSCR for the most recnt l2-month period equals or excees1.25, the 200 basis points wil be reduce to 175 basis points; (c) payment in cashof an extension fee equal to 2S bps of the principal balance and (d) receipt byLender of an appraisal from a licensed appraiser selected by Lender showing aloan to value ratio of no more than 85% at the time of the extension.

· Amortization; Payments. Monthly payments of principal and interest shallcommence on the twenty-fifth. day of the first month following the Closing Dateand shall be payable on the 25th day of each month with a five day-grace period.Monthy payments shall be in an amount necessar to amortize all pricipal andinterest owing on the loan in 300 equal, monthly payments of principal andinterest. If an extension option is utilized, the monthy payments shall berecalculated based on the new interest rate to continue the amortization of the debtbased on the original schedule.

· Management Fee. Sunwest Management, Inc. ("Sunwest") shall continue to sereas property manager though the date of approval by the Cour of a plan ofdistribution and restrctng. Upon Cour approval of the plan of distrbutionand restrcturing, the management fee shall remain at 7% until twelve months

from the date of the approval by the Cour of a plan of distrbution andrestrctng and reduce to 6% thereafter. Thereaft, Sunwest or its successor

wil sere as pròperty manager according to the plan of distrbution and

restrctung. Lender shall have the right to terminate Sunwest (or its successor)as manager if Borrower (or their successors) default under the restrctued Loanand do not timely cure the default as may be provided under terms ofthe LoanAgreeent as restrctued.

· Costs and Expenses. The Lender shall be reimbured for any reasonable out-of-pocket closing expenses asociated with the closing of this transaction. The loandocuments shall contai tyical provisions requiring Borrower to reimburse

Lender for reasnable out-of-pocket expenses on a going foiward basis.

· Default Rate. The initial default rate shall be 4% over the contract rate. At suchtime as Borrower has made 24 monthly payments, if no Event of Default hasoccurred, the default rate shall reduce to 3% over the contract rate.

· Impounds. Borrowers would make monthly payments of impounds for taxes andinsurance. Impounds would be made available for taes and insurance.Impounds for insurace wil not be required if insurance payments are made on amonthy basis, but failure to make such insurance payment or failure to maintaininsurance would constitute an Event of Default.

· CapEx and Defered Maintenance Reseres. The Projections include line itemsfor Capital Expenditues and Deferred Maintenance. The projected. amount shallbe paid each month to Lender as a reere and made available to Borrwers tofud Capital Expenditures and Defered Maintenance. The Lender wil allow up

to $200,000 frm the currnt Debt Serce Reserve Account to be tranferred tothe Defered Maintenance I Capital Expenditure Resrve Account upon closing ofthe loan restrcture.

· Cash Management. Cash Management procedures.shall be continued so that theLender maintains the depository accounts for all secug properies thrughremote 'Cpture services at its eustomarfee. The curent "lockbox" argementwil be modified to provide to a ~~springing lockbox" which may be enforced atLender's option if an Event of Default occurs. Under the "springing lockboxagreement"the Lender's perfected security interest in project revenue and can beassured that all project revenue is used for budgeted project expenses and notdiverted for other use. If an Event of Default occurs, the "lockbox" agreementbetwee the Lender and Borrowers shall contiue with the Lender providingremote capture services and lockbox serces at its customar fee. The "spriging

lockbox" agreement shall be modified to where the waterall of funds shall be (1)Operating Expenses including taxes and insurance, (2) the Management Fees, (3)Principal and interest payments, (4) Scheduled Deposit to the DeferredMaintenance I Cap Ex Resere (5) any fuds after fully funding the Cap ExResere and Working Capital Resere shall be available for owners distrbutions.Provided, however, that the failure to pay the principal and interest payment underthetens of the note evidencing the Loan, as restrctued, shall be an event of

default under the Loan Documents.

· Financial Projections. The paries are using the attached financial projections (theProjections) for modeling purposes.

· Financial Reportng. Borrowers shall delìver monthly financial statements insimilar formatto what is curently being provided wit1û 45 days of month end,that among other items, shows a comparson to the Projections.

· Financial Covenants. The restrctured loans shall contan a debt service coverageratio as set fort in the existing loan docuents or as otherise agreed to by thepares.

· No Prepayment Premium. The Loans may be prepaid in par or in full at anytime without payment of any prepayment premium.

. Owner Distrbutions. Distrbutions to equity holder and tenant in commoninvestors wil not be peritted until all debt serice requirements are met and the

reserVes are fully fuded. No distrbutions wil be allowed if an Event of Defaulthas occed. Any distributions will be subject to the formula for the waterfallagreeent.

. Loan Documents. The Loan Documents wil contain representations, warnties,covenants, events of default, and other provisions typically found in firstmortgage loans secre by senor living facilties.

· Loan ASsuption. The loan would be assumable by a thd pary transferee

subject to (a) such transferee satisfying Lender's then customar requirements fornew borrowers (e.g. background checks/financial review), (b) payment of a 1 %assumption fee, and (c) the principals of any new borrower shall provide theLender with a bad boy guaranty.

· Guarnties. Lender and all guarantors wil execute mutual releases.

· Releaes. It is contemplated that this Transaction wil be approved by an Orderentered by the Cour. The Order wìl include a release of Lender from all claims,known and unown, by the Borrowers, the Receiver, and all ReceivershipEntities. The asserion of any claim against the Lender by the Borrowers, or their

successors, arsing from the beginning of time through the date of the Courapproval of the restrcturing agreement shall constitute an event of default underthe Loan as restrctued.

· Drop Dead Provision. Borrwers shall agree that if the Loan as restrctued is indefault and if the default is not cured within 10 days following the sending of awritten notice of default, specifyng the default imd the perormance necessar tocure the default, the Lender may have relief frm the automatic stay under 11USC §362 or under the injunction entered in the pending SEC litigation.

· Mediation; Cour Approval. This ter sheet shall be presented to Judge Velurein cOnnection with the ongoing voluntar mediation being conducted by JudgeVelure. Upon approval by Judge Velure, a formal agreement and new loandocuments wil be prepared and the paries wil seek the Approval Order fromJudge Hogan.

· Approval Orer. The paries wil obtain an order from Judge Hogan approving

the Traaction (the Approval Order). The Approval Order will (a) approve all ofthe ters and conditions of the Traaction, (b) release Leder and the Projectsfrom the injunction and dismiss Lender from the pending cae (conditioned onlyupon execution of the restructure agreement and all related documents), (c)provide that Lender shall be entitled to exercise its legal rights and reedes uponthe occurrence of an Event of Default, (d) include a release of Lender frm all

claims, known and unown, that would bind Borrower, SM!, the guarantors, theSEC reciver, tenant in coIfon investors, and other thrd paries and (e) includea provision that in any plan consented to by any of the Borrowers, SMI, or the

guarantors, that the treatment of the Lender shall be govered by the restrctueagreement (including all related documents) .

. SEC Lawsuit Constitutes a Default. The commenceent of legal action againstthe Lender by the SEC shall constitute an Event of Default.

. Bankruptcy Filng. The pares agree that the Borrowers may file or be joined in apending Chapter 11 banptcy proceeing, provided that the Borrower shallprovide for treatment of the Lender's claim in their Chapter 11 plan in the manerprovided under this Agreement.

. Withdrawal ;fom AppeaL. Upon entr of the Approval Order, Lender willwithdraw from the appeal of the SEC Receivership injunction order.

Byits signature below, each pary indicates that it approves this Ten Sheet.Signature below does not bind any pary but indicates the consent of such pary toproceed with fuher steps regarding this transaction. Lender shall, upon acceptanceof this Tenn Sheet by the last par to sign, shaH immediately seek any required

approval of this transaction by the parcipants.

Michael B. Jacobson, CNebraskaLand National

Management Committee Member

claims, known anJ unknuwn, that would bind I3urrowL:rs, SMI, thL: guarantors, theSEC receiver, tenant in common invL:stors, and other third parÏ\s and (e) includea provision that in any plan consented to by any otthe Borrowers, SMI, or theguarantors, that the treatment of the Lender shall be governed by the restructureagreement tincluding all related documents) .

. SEC Lawsuit Constitutes a Default. TIie commencement of legal aetion againstthe Lender hy the SEC shall constitute an Event ot Default.

. Bankruptcy riling. The parties agreL: that the Borrowers may tile or he joined in apending Chapter 11 hankruptcy proceeding. provided that the Borrowers shallprovidc tilr treatment of the L.ender's t:aim in their Chapter II plan in the mannerprovided under this Agreement.

. \Vithdraw.~il from ~!!, Lpon entry otthe Approval Order. Lender will

withdraw from the appeal otthe SEC Rci.eivership injunction order.

l:y its signature helow, each pary indicates that it approves this Term Sheet.Signature below does not bind any party but indü:ates the l:lHlsent of such party toproL:ci.d with further steps regarding this transaction. Lender shall, upon aei:cptanceof this Tenn Sheet by the last party to sign, shall immediately seck any requiredapproval of this transaction hy the participants.

../Uj_ulhdE~... ... ~":vichacl 1:, Jaeohson, Crr of~ebraskaLand National ank ..

... '--'._-_..-Clyde Hallstrccl. eRO

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EXHIBIT 9-4

From:Sent:To:Cc:

Subject:

Donahue, Terrence J. (TDonahue(gEisenhowerlaw.com)Sunday, November 15, 2009 12:01 PMShirley DunnYates, Greg; mmarcos(galvarezandmarsal.com; Hannah SchmidtRE: Sunwest/Settlement Discussions

Shirley, that is correct, with a 5 year term. Please see my second bullet point below.Good news. Thanks, TJD.

Terrence J. Donahue

EISENHOWEREISENHOWER & CARLSON, PLLC

1200 Wells Fargo Plaza

1201 Pacific AvenueTacoma, Washington 98402

tdonahue(eisenhowerlaw.com253.572.4500253.272.5732 (facsimile)

From: Shirley Dunn (mailto:SDunn(§hamstreet.net)sent: Thursday, November 12, 2009 4:24 PM

To: Donahue, Terrence J.Cc: Yates, Greg; mmarcos(ialvarezandmarsal.com; Hannah SchmidtSubject: RE: Sunwest/Settlement Discussions

Terry - I would like to clarify that the principal and interest amortization will be based upon equalpayments of P+i over the 30 years. With that clarification, we agree to the terms outlined below.ThanksShirley

Shirley DunnHamstreet & AssociatesOne S.W. Columbia, Suite 1000Portland, OR 97258office 503-223-6222fax 503-546-6579cell 503-709-4566www.hamstreet.net

From: Yates, Greg (mailto:gyates(isteptoe.com)sent: Saturday, October 31,20098:46 AMTo: Shirley Dunn; mmarcos(§alvarezandmarsal.comSubject: Fw: Sunwest/Settlement Discussions

Are we all signed off on the deal below?

Greg YatesSteptoe & Johnson LLP750 7th Avenue, 18th FloorNew York, New York 10019gyates~steptoe.comPhone: 212-506-3912Cell: 917-747-3393Fax: 212-506-3960

Internal Revenue Service Circular 230 Disclosure: As provided for in Treasury regulations, advice (if any)relating to federal taxes that is contained in this communication (including attachments) is not intended orwritten to be used, and cannot be used, for the purpose of (1) avoiding penalties under the InternalRevenue Code or (2) promoting, marketing or recommending to another party any plan or arrangementaddressed herein.

The Information contained in this e-mail message is intended only for the use of the individual or entity towhich it is addressed. It may contain information that is privileged, confidential, or otherwise protectedfrom disclosure under applicable law. If the reader of this transmission is not the intended recipient or theemployee or agent responsible for delivering the transmission to the intended recipient, you are herebynotified that any dissemination, distribution, copying or use of this transmission or its contents is strictlyprohibited. If you have received this transmission in error, please notify the e-mail sender atUgyates~steptoe.comu Thank you.

From: Donahue, Terrence J. -CTDonahue(QEisenhowerlaw.com;:

To: Yates, Gregsent: Fri Oct 3014:37:182009Subject: Sunwest/Settlement Discussions

Re: Sunwest/Settlement Discussions

Greg:

This is a follow up to our several emails and the secured creditors meeting on October 2'S, 2009.I believe we have agreed upon the following general terms concerning the treatment of First-Citizens Ban's secured claim on the Dry Creek facilty in Ellensburg, W A:

. Upon confirmation of the reorganization plan, interest wil commence to accrue at 5.75%per annum with a default interest of 8.36%.

. Commencing February 2010 or upon confirmation, monthly payments of principal andinterest based on a thirt year amortization wil commence.

. The note wil have a five year term to maturity from the date of confirmation.

. A reserve account for maintenance, tax, and capital improvements wil be established at an

amount equal to two (2) monthly pay.ments.

. There wil be no reserve for insuranc~. It wil be paid though premium financing providedby a third par source.

. Upon default of non-payment or non-compliance with the underlying loan documents,First-Citizens Ban can pursue its rights under the loan docs upon a fifteen-day notice onmonetar defaults and a thir-day notice or reasonable time to cure non-monetary

defaults.

. First-Citizens Ban waives its default interest, late charges, and penalties.

. Attorneys' fees and costs as allowed by the court or agreed upon by the paries wil beadded to the principal balance .

. All outstanding non-default interest wil be added to the principal balance.

. First-Citizens wil retain its secured interest with the same priority it had as of March2009.

. With the exception of the above referenced reserves, there wil be no cash controlaccounts.

. The current monthly payments of$53,618.48 wil continue until confrmation.Upon review of this matter, please confirm th~ understanding of our discussions in this regard.

TJD

Terrence J. DonahueEisenhower & Carlson, PLLC

1200 Wells Fargo Plaza1201 Pacific AvenueTacoma, Washington 98402

(253) 572-4500Fax (253) 272-5732E-Mail tdonahue(geisenhowerlaw.com

NOTICE: This Is a private and confidential communication for the sole viewing and use of the Intended recipient. Thiscommunication may contain Information protected by the attorney/client privilege or work product doctrine. If you are not theIntended recipient of this communication, please Immediately notify the sender and delete and destroy all copies of thiscommunication. The unauthorized disclosure, distribution. copying, or use of Information contained In this communication mayviolate the Electronic Communications Privacy Act, 18 U.S.C. 2610 et seq., the Washington Privacy Act. RCW 9.73, and Article i,section 7 of the Washington Constitution.

EXHIBIT 9-5

,!

STEPTOE &JOHNSONiil'ATTORNEYS AT LAW

Greg R. Yates202.429.8188gyates~steptoe.com

750 Seventh AvenueNew York. NY 10019

Tel 212.506.3900Fax 212.506.3950

steptoe.com

September 9,2009

By E-Mail Transmission

Glenn D. Gilett, Esq.U.S. Deparent of Justice1100 L Street, N.W., Room 10018Washington, DC 20005

Bar P. Caplan, Esq.Sussman Shan, LLP1000 SW Broadway, Suite 1400Portland, Oregon 97205

Re: Loan Restrcturing

Gentlemen:

On behalf of Clyde A. Hamstreet, Chief Restrcturing Offcer of Sun west Management, Inc. andrelated Receivership Entities, this letter shall serve as confirmation of the agreement to restrcture the

three HUD loans and the three Capmark loans in accordance with the attached term sheet. The CROwil work in good faith to dilgently document the agreement and to have it approved by the United

States District Court for the District of Oregon.

Thank you for your cooperation in negotiations concerning this agreement. Please give me a callif you have any questions.

cc: Clyde A. Hamstreet

WASHINGTON . NEW YORK . CHICAGO . PHOENIX . ios ANGELES . CENTURY CITY . LONDON . BRUSSELS

Term Sheet for Capmark and HUD mortgaged Ho1dco Properties

Capmark Properties

1. Spring Arbor No change in mortgage terms

2. Alpine Springs No change in mortgage terms

3. Heron Pointe No change in mortgage terms

HUD-held properties

1. Mountain Laurel Reduce interest rate to 6.25%

2. Woodside ALC No change in mortgage terms

3. River Rock Lodge No change in mortgage terms

Conditions to all the above loans (HUD-held or FHA-insured)

1. Operator wil enter into a Regulatory Agreement with HUD

Release RFR to cover $50Kof agreed deferredmaintenance and agree todefer RFR deposits for 12- 1 8months

No deferred maintenance butdefer RFR deposits for 12-18months

Release RFR to cover up toRFR balance of agreeddeferred maintenance anddefer RFR deposits for 12-18months

Defer RFR deposits for 12- 18monthsRecapitalize mortgagearearage

Defer RFR deposits for 12- 18months

Defer RFR deposits for 12- 18months

2. New ownership and management entities wil obtain Prior Participation Clearance, HUDForm 2530

3. The Sunwest Enterprise wil make application for modified TPA agreements for owners

4. Leases wil conform to HUD requirements

5. HUD wil not assert clause to change management upon 30-day written notice (withoutcause) for a period of2-3 years (CRO wants 3 years). For cause termination is notwaived.

EXHIBIT 9-6

AFTER RECORDING, RETURN TO:

STERLING SA VINGS BANKAttn: Daniel Halstrom1 I I North Wall StreetSpokane, Washington 9920 I

Document Title:

Reference No. ofDocument Modified:

Grantor:

Trustee:

Beneficiary :

Modification of Promissory Note and Deed of Trust

2006-21338 and 2006-21339

Hillside Senior Living Community, LLC

AmeriTitie

Sterling Savings Bank

MODIFICATIONOF PROMISSORY NOTE AND DEED OF TRUST

THIS MODIFICATION AGREEMENT is entered into as of this 1st day of October,2009, by and between HILLSIDE SENIOR LIVING COMMUNITY, LLC,an Oregon limitedliability company (hereinafter referred to as "Borrower"), and STERLING SAVINGS BANK(hereinafter referred to as "Lender").

RECITALS

1. On or about September 13, 2006, Borrower made, executed and delivered toLender its Promissory Note (hereinafter "Note"), in writing, in the original principal amount of$20,000,000.00, together with interest thereon at the rate equal to the one month LIBOR Rate(London Interbank Offer Rate) as published in the Wall Street Journal plus 3.00%. The Noteprovides for maturity on October 1, 2009.

2. At the same time as the execution and delivery of the Note, and in order to securerepayment of the same, Borrower executed, in favor of Lender, a Deed of Trust, Assignment ofRents and Securitr, Agreement (hereinafter "Deed of Trust"), encumbering certain real p'ropertylocated in YamhlU County, Oregon (the "Property"), and legaI1y described in Exhibit "A"attached hereto. The Deed of Trust was thereafter recorded on September 15, 2006 underYamhil County Recorder's No. 2006-21338, records of Yamhil County, Oregon.

3. At the same time as the execution and delivery of the Note and Deed of Trust, andin order to further secure repayment of the obligation of the Note, Borrower executed anddelivered to Lender an Assignment of Leases and Cash CoUateral (hereinafter "Assignment"),wherein Borrower assigned to Lender aU of its rights under the leases, rents and income of the

L:\wdixlspokmanIH 13 i 412U441SU074594. DOC

Propert. The Assignment was recorded on September 15, 2006 under Yamhill CountyRecorder's No. 2006-21339, records of Yamhil County, Oregon.

4. At the same time as the execution and deliver)' of the Note and Deed of Trust,Borrower executed and delivered to Lender (i) its Certifcate and Indemnity RegardingHazardous Substances, which warrants to Lender that the Property has been and wil continue tobe used in conformity and in compliance with all local, state and federal ordinances, statutes,rules and regulations relating to the use, disposal, storage or transfer of hazardous substances,and a~rees to indemnitY and hold Lender harmless from any loss or damage caused by a breachof said warranties, and (ii) its .Building Laws lndemnity,. which .warrants. to Len~er that theProperty has been and will continue to be used in conformity and in compliance with all locaL,state and federal ordinances, statutes, rules and re~ulations relating to the ôevelopment, use andoperation of the Propert, including the Americans With Disabilities Act, and agrees toindemnitY and hold Lender harmless from any loss or damage caused by a breach of saidwarranties (hereinafter collectively referred to as the "Indemnity").

5. Borrower is desirous of extending the maturity of the Note. Lender is wiling toextend the maturity of the Note upon the other terms and conditions set forth herein.

6. The Note, the Deed of Trust, the Assignment, Indemnity, and this ModificationAgreement, and any other document executed in connection therewith or referred to therein, mayhereinafter be referred to as the "Loan Documents."

AGREEMENT

NOW, THEREFORE, in consideration of their mutual benefits contained herein, andother good and valuable consideration, the receipt and suffciency of which are herebyacknowledged, Borrower and Lender hereby agree that the Loan Documents are modified asfo1lows:

A. Borrower promises and agrees to pay principal and interest under the Note, asmodified herein (a copy of the Modified Promissory Note is attached hereto as Exhibit "B" andby this reference made a part hereof), to Lender clo Intervest-Mortgage Investment Company,5005 S.W. Meadows Road, Suite 400, Lake Oswego, Oregon 97035, or at such other place asLender may direct, in such coin or currency of the United States of America as at the time ofpayment shaIl be legal tender for the payment of private and public debts. AIl references to theNote and the Loan Documents are hereby amended and modified to refer to the ModifiedPromissory Note.

B. Borrower shall remit to Lender monthly payments of reserves for Impositions (asdefined in the Deed of Trust) and capital expenditures. Disbursements of Impositions shall bemade as set forth in Section f .08e. of the Deed of Trust. Disbursements for capital expendituresshall be made pursuant to a budget reasonably acceptable to Lender, from wliich the Borrowershall not materially deviate. For purposes of this Section B, a material deviation from the budgetshall be a deviation of more than i 0% on a line item basis or i 0% on a cumulative basis(measured quarterly).

. C. The Deed of Trust includes a security agreement wherein Borrower granted toLender a security interest in Borrower's personal property. As to all of the personal propertywhich is or which hereafter becomes a "fixture" under ap'plicable law, this Agreement constitutesa fixture filing under the Oregon Uniform Commercial Code, as amended or recodified fromtime to time. Borrower hereby authorizes Lender to fie a financin~ statement, with or withoutBorrower's signature, to perfect Lender's lien and security interest in the Personal Propert andImprovements as described in the Loan Documents (including any reguired continuationstatements, amendment statements or other such documents necessary to perfect and continue the

L:lwdoc,lspokmwnlKI JI412U44\SOIJ74l94 DDC

2

lien) and Borrower hereby expressly ratifies any financing statements Lender may have fiedprior to the date of this Modification Agreement.

D. Borrower understands and agrees that the language of the Deed of Trust isamended in the foIlowing respects:

1. Section 1.20 is deleted in its entirety and the following replaces it:

1.20 Financial Statements.

a. Grantor will keep full, complete and correct books of accountreflecting transactions relating to the Property and at any and all times permitBeneficiary by its agents or attorneys to examine all of his books of accounts,

records, reports and other papers relating to the Propert, and to take copies andextracts therefrom and to examine the Propei:. Commencin~ January 3 1,2010,Grantor will furnish to the Beneficiary the following financial information:

(I) Within thirty (30) days after the end of each calendar monthtrue and correct copies of operating statements showing the gross income(itemized as to source) during the month received from the operations ofthe Property and the expenses of maintaining the Property (itemizedincluding depreciation charges) during the preceding month.

(2) Within one hundred twenty (120) days of the end of each fiscalyear of Grantor until the Loan has been paid in full, financial statementsrelating to the Property which have been audited by a certified publicaccountant acceptable to Beneficiary, such financial statements to include,without limitation, balance sheets and profit and loss statements, completewith all notes and comments, prepared in accordance with generally

accepted accounting principles ("GAAP");(3) Within thirty (30) days of the end of each calendar quarter

of Grantor until the Loan has been paid in full, financial statementsrelating to the Propert which have been internally prepared, suchfinancial statements to include, without limitation, balance sheets andprofit and loss statements, certified as true and correct by an executiveoffcer of Grantor, prepared in accordance with GAAP;

(4) Within one hundred twenty days (120) of each fiscal yearend, a rent roll relating to the Property, including but not limited to alisting of each tenant, the space occupied, the amount of rent and theexpiration of the lease.

(5) Any other financial information which may reasonably berequired by Beneficiary. .

The Grantor's required monthly and quarterly financial reporting to Beneficiaryshall be accompanied by a sworn affdavit in the form attached nereto as Exhibit"C". Failure to comply with these reporting requirements will be considered anEvent of Default.

b. At reasonable intervals, and without notice, but no more often thanonce a year, Lender may audit, or cause to have audited, Grantor's books andrecords at Grantee's expense, and Grantor shall permit Lender or other partiesemployed by Lender to enter upon Grantor's premises and inspect Grantor's booksand records, to make extracts therefrom and to discuss Grantor's affairs withGrantor's employees, offcers and directors.

L. Iwdocslspokmanl813 14\2044\S11074594.DOC

3

c. Commencing period ending April 30, 2013, the ratio of Borrower'sCash Flow to Borrower's Total Debt Service shall not be less than 1 :00 to 1 :00measured quarterly for the trailng twelve (12) months. For purposes of thisSection, (A) "Cash Flow" means Borrower's net income, plus its interest expense,depreciation expense, depletion allowance, amortization expense and capitalcontributions, minus draws and distributions paid to equity owners; and (B)"Total Debt Service" means the current portion of Borrower's long term debt plusinterest expense. In the event that the applicable Project does not satisfy theapplicable DSCR as of the end of any calendar quarter (based on the trailingtwelve-month period) (a "Cash Trap Event"), such failure shall not constitute anEvent of Default but all excess cash shall be trapped in a lockbox account untilsuch time as Borrowers satisfies the applicable quarterly DSCR (based on thetrailng twelve-month period) FOR TWO MEASURMENT PERIODS, at whichtime the Cash Trap Event shall terminate.

d. Grantor wil promptly notify Lender of any material change inGrantor's financial condition or business prospects and of the occurrence of anyEvent of Default. Grantor wil notify Lenôer immediately upon the occurrence ofany adverse action by professional, local, state or federal licensin~ or regulatoryaEencies. Failure to cure adverse action notices, to the satisfaction of Lender,within thirty (30) days of notice by any regulatory or licensing agencies wil resultin an Event otDefault.

3. Section 4.01 is deleted in its entirety and the following replaces it:

4.01 Events of Default. Any of the following events shall be deemed anevent of default hereunder:

a. If Grantor shall fail to make any payment of any installment ofprincipal or interest on the Note or any other sum secured hereby when due; or

b. Other than Case No. 6:09-CV-0682-HO captioned In re: StaytonSW Assisted Livin~i LLC et al. pending in the United States Federal Court,District of Oregon, if Grantor shall fie a voluntary tetition in bankruptcy or shaHbe adjudicated as bankrupt or insolvent, or shal fie any petition or answerseeking or acquiescing in any reorganization, arrangement, composition,readjustment, liquidation, dissolution or similar relief for itself under any presentor future federal, state or other statute, law or regulation relating to bankruptcy,insolvency or other relief for debtors; or shaH seeK or consent to or acquiesce inthe appointment of any trustee, receiver or liquidator of Grantor or of aH or anypart of the Trust Estate, or of any or aH of the royalties, revenues, rents, issues orprofits thereof, or shall make any general assi~nment for the benefit of creditors,or shall admit in writing its inabilty to pay 1ts debts generally as they becomedue; or

c. Other than Case No. 6:09-CV-0682-HO caJ'tioned In re: StaytonSW Assisted Living, LLC et al. rending in the United States Federal Court,District of Oregon, if a court 0 competent jurisdiction shall enter an order,judgment or decree al?proving a petition fied against Grantor seeking anr.reorganization, dissolution or similar relief under any present or future federa,state or other statute, law or regulation relating to bankruptc)', insolvency or otherrelief for debtors; or if any trustee, receiver or liquidator of Grantor or of all or

L. IwdoCJlspokmainlR 13 1 4I2ii44\S0074S94.DOC

4

any part of the Trust Estate, or of any or all ofthe royalties, revenues, rents, issuesor profits thereof, shall be appointed without the consent or acquiescence ofGrantor; or

d. If a writ of execution or attachment or any similar process shall beissued or levied against all or any part of or interest in the Trust Estate, or anyjudgment involving monetary damages shall be entered against Grantor whichshall become a lien on the Trust Estate or any portion thereof or interest therein;or

e. If Grantor shall transfer, assign, alienate, mortgage, encumber,pledge, hypothecate or grant an interest in Trust Estate without Lender's priorwritten consent, other dtan a transfer pursuant to an order entered on notice inCase No. 6:09-CV-0682-HO captioned In re: Stayton SW Assisted Living, LLC eta/. pending in the United States Federal Court, District of Oregon, unlessotherwise allowed by the terms of this Deed of Trust; or

f. If Grantor shall default under any other loan, extension of credit,security agreement or any other agreement, whether now in effect or arising in thefuture, in favor of Lender; or

g. If Grantor shall default under any loan, extension of credit, securityagreement, or any other a~reement, whether now in effect or arising in the future,in favor of any other creditor or person that may materially affect any of Grantor'sproperty or Grantor's ability to repay the Note or perform Grantor's obligationsunder the Note or any of the Loan Instruments; or

i. If there is any occurrence of any material change in managementor other structural change in Grantor or in the partners, shareholders, venturers ormembers of Grantor, including, without limitation, any (Jartnership, corporate,joint venture or member dispute which Lender determines, In its sole and absolutediscretion, may have a material adverse effect on Grantor's abilty to repay theNote, on the Propert or the Improvements, or on the abilty of Grantor or itspartners, shareholders, venturers or members to perform their obligations underthe Loan Instruments, other than pursuant to a notice order entered in Case No.6:09-CV-0682-HO captioned In re: Stayton SW Assisted Living, LLC et a/.pending in the United States Federal Court, District of Oregon; or

j. If there is disqovered any hazardous materials in, on or about thePropert or Improvements; or

k. If Grantor becomes aware of any event of default hereunder andfails to notify Lender within fifteen (15) days of becoming so aware; or

i. There has occurred a breach of or default under any term,covenant, agreement, condition, provision, representation or warranty containedin any oftne Loan Instruments or any part tJiereof, not otherwise referred to inthis Section 4.01, after the date hereof.

If any event of default set forth above, other than a default inpayment, is capable of being cured, Grantor shall have the opportunity to curesuch default if, after receiving written notice from Lender demanding cure of suchdefault: (1) Grantor cures the default within fifteen (15) days; or (2) if the curerequires more than fifteen (15) days, Grantor immediately initiates steps whichLender, in its sole discretion, deems to be sufficient to cure the default, and

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Grantor thereafter dilgently continues and completes all reasonable and necessarysteps to cause the default to be cured.

4. In addition to Lender's remedies upon default provided in Section 4.02 ofthe Deed of Trust, the following remedies are added:

e. To the extent permitted by applicable law, exercise its right tosetoff in all of Grantor's accounts with Lender whether checking, savings, or someother account. This includes all accounts Grantor holds jointly with another partand all accounts Grantor may open in the future. Grantor hereby authorizesLender, to the extent permitted l:y applicable law, to charge or setoff all sumsowing on the indebtedness against any and all such accounts, and, at Lender'soption, to administratively freeze all such accounts to allow Lender to protectLender's charge and setoff rights provided herein; and

f. Enter upon the Propert, either by itself or through its agent, forthe purpose of conducting, at Grantor's expense, an MAl appraisal of the Propertand Improvements. The cost of the appraisal shall be payable by Grantor toLender on demand, and shall bear interest at the Note rate. It is expressly agreedand understood by Grantor that the occurrence of such a default shall be deemedto increase Lender's risk hereunder, thereby creating a need for Lender to have theinformation contained in an MAl appraisal of the Propert and Improvements.

5. Section 4.08 is deleted in its entirety and the following replaces it:

4.08 Sale. Transfer. Vacation or Encumbrance of Pr08e~ Prohibited.Other than pursuant to a noticed order entered in Case No. 6: 9~V-0682-HOcaptioned In re: Stayton SW Assisted Living. LLC et al. l'ending in the UnitedStates Federal Court, District of Oregon, so long as any obIigation secured herebyremains unpaid, Grantor covenants and agrees that neither said Property nor anyportion thereof nor interest therein nor a ,greater than 10% cumulative ownershipinterest in Grantor (if a corporation or Iimited liability company) nor a generalpartnership interest in Grantor (if a partnership) shall be sold, conveyed,transferred or encumbered by Grantor without Lender's prior written consent. Iftitle to said Property or any portion or interest in said Propert or a weater than10% cumulative ownership interest in Grantor (if a co~oration or limited liabiltycompany) or a general partnership interest in Grantor if a partnership) shall passfrom Grantor by deed or otherwise, voluntarily or invo untarily or if said Propertyor any portion or interest therein is sold on contract, or if the Propert or anyportion or interest therein is vacated b~ Grantor, or if said Property or any portionor interest therein or a ~reater than 10Yo cumulative ownership interest in Grantor(if a corporation or limited liability company) or a general partnership interest inGrantor (if a partnership) is further encumbered without tile consent of Lender,such change in title or occupanc¥ or interest of Grantor or further encumbranceshall be deemed to increase the riskof Lender, and Lender may declare all sumssecured hereby immediately due and payable, or may at its sole option consent tosuch change in title or occupancy or interest of Grantor and increase the interestrate on the indebtedness hereby secured. In the event Lender accelerates saidindebtedness pursuant to the terms of this paragraph, Grantor shall pay, inaddition to the indebtedness, the prepayment bonus as set forth in the Note, if any.

In the event ownership of the Property or any portion thereof becomesvested in a person other than Grantor herem named, or if a controllng interest inGrantor (if a corporation or limited liabilty company) or a general partnershipinterest in Grantor (if a partnership) is sold or encumbered, Lender may, withoutnotice to Grantor herein named, whether or not Lender has given written consent

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í

to such change in ownership, deal' with such successor or successors in interestwith reference to this Deed of Trust and the obligations secured hereby, in thesame manner a~ with Grantor herein named, without in any way vitiating ordischarging Grantor's liability hereunder or the obligations hereby secured.

This Section 4.08 shall not apl'IY to a transfer of the Property pursuant to anoticed order entered in Case No. 6:09-CV-0682-HO captionedln re: Stgfton SWAssisted Living, LLC et af. pending in the United States Federal Court, District ofOregon.

E. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVESANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSEOF ACTION (a) ARISING UNDER THE LOAN DOCUMENTS, INCLUDING,WITHOUT LIMItATION, ANY PRESENT OR FUTURE MODIFICATION THEREOF,OR (b) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THEDEALINGS OF THE PARTIES HERETO, OR ANY OF THEM, WITH RESPECT TOTHE LOAN DOCUMENTS (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHERINSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED INCONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO ORTHERETO, IN EACH CASE WHTHER SUCH CLAIM, DEMAND, ACTION ORCAUSE OF ACTION IS NOW EXISTING OR HEREAFTER ARISING, ANDWHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACHPARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND,ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIALWITHOUT A JURY AND THAT AN PARTY TO THIS AGREEMENT MAY FILE ANORIGINAL COUNTERPART OR A COpy OF THIS AGREEMENT WITH ANYCOURT AS WRTTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETOTO THE WAIVER OF ANY RIGHT THEY MIGHT OTHERWISE HAVE TO TRIALBY JURY.

F. Borrower makes the following additional representations and warranties:

(a) As of the date of this Modification Agreement, (i) the Loan Documentsare in full force and effect; (ii) Borrower is liable to Lender for the payment andperformance of all of its obligations under the Loan Documents, as set forth therein, inaccordance with their terms and without set off, recoupment, or counter claim; (iii)Lender has performed all of its obligations with respect to the Loan Documents to thisdate; and (iv) there are no events of default under the Loan Documents that are nototherwise resolved by this Agreement.

(b) As of the date of this Modification Agreement, Borrower has no disputeswith or claims against Lender, and expressly waive(s) any claim with respect to breach orviolation by Lender, if any, of the terms and conditions of the Loan Documents inexistence as of this date.

(c) There are no other loan commitments, verbal or written, made or claimedto have been made by Lender to Borrower which are not contained in this ModificationAgreement and the Loan Documents.

(d) Borrower shall indemnify, defend (using counsel reasonably acceptable toLender) and hold Lender harmless from and against any and all losses, costs, damages,claims, or expenses (including reasonable attorneys' fees) which have been or may beasserted against or incurred oy Lender as a result of or in connection with the abovematters represented and warranted to Lender by Borrower.

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G. It is agreed and understood that all ofthe agreements, covenants and conditions ofthe Loan Documents shall remain in full force and effect, except for the amendments andmodifications expressly mentioned herein.

H. Nothing herein contained shall in any manner affect the validity or priority of thelien established by the Deed of Trust encumbering the propert referred to in Paragraph 2 above.

i. The recitals set forth in Paragraphs 1 through 6 above are incorporated into thesubstantive provisions of this Agreement.

J. UNDER OREGON LAW, MOST AGREEMENTS, PROMISES ANCOMMITMENTS MADE BY A LENDER CONCERNING LOANS AND OTHERCREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY ORHOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER'SRESIDENCE, MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNEDBY THE LENDER TO BE ENFORCEABLE.

BORROWER:

HILLSIDE SENIOR LIVING COMMUNITYLLC, an Oregon limited liabilty company

~,L_._. --By~Its C r?State of Oregon ~

. ss.Countyof~ ~.I certify that I know or have satisfactory evidence that is theperson who appeared before me, and said person acknowle ge t at e s e signed thisInstrument, on oath stated that, he/she 'Nas authorized to execute the instrument andacknowledged it as the ah~f6~d~ of Hillside Senior Living Community, LLC, tobe the free and voluntary act õšarty, for the uses and purposes mentioned in theinstrument. .

DATED:~ '1 ~OFFICIAL SEAlDOREEN DAVIS

,J,; NOTARY PUBLIC . OREGONv, COMMISSION NO, 419176MY COMMISSIOIJ EXPIRES AUG. 6, 2011

tate. _ L _.l. · 1\ ,. f\.._O\f'IM-W ~h.SE'I~2,0/1 OR

L.lwdoc,lspokminIR 131412U441S0I174594,POC

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LENDER:

Brts

State of~ ss.

County of

I certify that I know or have satisfactory evidence th~t lMu ~Mpersonally appeared before me, an on oat stated tpat \~ was aut oozed to execute theInstrument ana acknowledged it, as \t ' oTSERLING SAVINGS BANK, tobe the free and voluntary act of suc p son, or t e uses and purposes mentioned in theinstrument.

DATED~ ~ '210."".

r Notary Public

State of WashingtonJANAURION

b MY COMMISSION EXPIRES

~~~ June 17.2013

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EXHIBIT" A"

Parcel I:

A tract of land in Section 19, Township 4 South, Range 4 West of the Wilamette Meridian, in aportion of the Solomon Berry Donation Land Claim No. 54, Yamhill County, Oregon, beingmore particularly described as fol1ows:

Beginning at an iron rod in the East line of Lot 1, C.S. 2219, Volume G, Page 85, said iron rodbeing South 8939'00" West 2025.41 feet and North OóbO'37" West 1873.94 feet from theNorthwest corner of the S.F. Staggs Donation Land Claim No. 55; thence South 89'58'26" West747.75 feet along the North line of that tract of land described in Deed from Kauer, House andAl1en to Church of the Nazarene, recorded in Film Volume 167, Page 1448, Yamhil CountyDeed Records, to an iron rod on the East margin of Hil Road (40 feet from center line) asdescribed in Deed to the City of McMinnvile and recorded in Film Volume 151, Page 2118,Deed R~co.rds; thence North 04'7'13" East 194.18 feet along. said East margin to an iron rod atthe beginning of a curve concave to the Southeast and havinp a radius of 400.0 feet; thenceNortheasterly 364.27 feet along said East line (chord = 3ó'4l48' East 351.81 feet) to an iron rod;thence Nordi 56'47'08" East 163.90 feet along said East line to an iron rod in the South margin ofHil Road; thence South 89' 6'50" East 67.01 feet to an iron rod at an angle in said margin;thence North 2ts7'59" East 32.41 feet along said South margin to a point on the North line ofLot 1 of C.S. 2219; thence South 89' 7'47" East 3.13 feet along said North line to the Southwestcorner of that certain tract of land described in Deed to Hilside Manor, a Christian RetirementCenter, Inc. and recorded in Film Volume 252, rage 71,. Deed and Mortßage. Records; thenceNorth 2923'07" East 270.29 feet along the West line of said tract to a 3/4 lOch iron pipe; thencecontinuing North 2923'07" East 4.41 feet to the West line of Parcel 2 of that tract of landdescribed in deed to Hilside Manor, Inc. and recorded in Instrument No. 1997-00837, Deed andMortßage Records; thence North 0ó'2'll" East 28.43 feet to the Northwest corner of saidHilside Manor, Inc. tract; thence South 8937'47" East 390.88 feet to the Northeast corner of saidHilside Manor, Inc. tract; thence South 0ó'44'11" West 270.37 feet along the East line of saidHilside Manor, Inc. tract to an iron rod on the North line of the Solomon Berry Donation LandClaim No. 54; thence South 8929'50" East 560.87 feet along said North line to the Northwestcorner of Parcel A of that certain tract of land described in Deed to the City of McMinnvile,recorded in Film Volume 285, Page 1423, Deed and Mortgage Records; thence Southerly 138.70feet along the West line of said Parcel A, which is a non-tangent curve concave to the Easthaving a radius of 575.00 feet (chord = South 06'3'34" East IJ8.36 feet) to the beEinning of acurve concave to the West having a radius of 553.56 feet; thence Southerl¥ 54.77 feet (chord =South 1 ó'8'07" East 54.75 feet) along said West line to a point on the East line of Parcel 1 of thattract of land described in Deed to Hilside Manor, a Christian Retirement Center, Inc. andrecorded in Film Volume 252, Page 71, Deed and Mortgage Records; thence South OóbO'24"East 156.52 feet along said East line to the North corner of Parcel B of that tract of landdescribed in Deed to City of McMinnvile, recorded in Film Volume 285, Page 1423, Deed andMortgage Records; thence Southerly 54.77 feet along the West line of said Parcel B which is anon-tangent curve concave to the West having a radius of 553.56 feet (chord = South 1d'7'19"West 54.75 feet) to the beginning of a curve concave to the East havin~ a radius of 575.00 feet;thence Southerly 138.46 feet along said West line (chord = South 06'5329" West 138.12 feet) tothe Northwest corner of Parcel A of that tract of land described in Deed to The City ofMcMinnvile, recorded in Instrument No. 1998-02613, Deed and Mortgage Records; thenceSoutherly 176.91 feet along the West line of said Parcel A (chord = South Oir49'14" East 176.21

feet) to a point on the East line of said Parcel 1 of said Hilside Manor tract; thence SouthOdbO'24" East 333.49 feet along said East line to the North corner of Parcel B of that tract of landdescribed in Deed to the City of McMinnvile, recorded in Instrument No. 1998-02613, Deedand Mortgage Records, being the beginning of a curve concave to the West and having a radiusof450.00 feet; thence South 10.81 feet (chord = South 1t18'04" West 10.18 feet) along the Westline of said Parcel B to the beginning of a curve concave to the East having a radius of 450.00

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feet; thence Southerly 149.07 feet (chord = South 0929'57" West 148.39 feet) along the Westline of slIid Parcel B; thence South OdbO'33" West 24.50 feet along said West line to theNorthwest corner of that certain tract of land described in deed to tIie City of McMinnvile,recorded in Instrument No. 1998-02612, Deed and Mortgage Records; thence South OdbO'24"East 456.82 feet along the West line of said Cit~ of McMinnvile tract to the North line ofCountry Crossings Su1:division; thence South 89'4035" West 172.09 feet to the Northwest cornerof Country Crossings Subdivision; thence South OdbO'24" East 760.00 feet along the West line ofCountry Crossings Subdivision to the North margin of West Second Street (30.00 feet fromcenterline); thence South 89'9'00" West 437.74 feet along said North margin to the Southeastcorner of Parcel 2 of Yamhil County Partition No. 1990-14; thence North 0000'10" West 311.16feet to the Northeast corner of said Parcel 2; thence South 89'9'00" West 140.00 feet to theNorthwest corner of said Parcel 2; thence North OdbO'10" West 905.46 feet along the West lineof Parcel 1 of said Partition Plat to the Northwest corner of said Parcel 1 and the Southwestcorner of Parcel i of that tract of land described in Deed to Hilside Manor, a ChristianRetirement Center, Inc., recorded in Film Volume 252, Page 71, Deed and Mortgage Records;thence North odbo'io" East 627.47 feet along the West lme of said Parcel i to the point ofbeginning.

Parcel II:

A tract ofland in Section 18, Township 4 South, Range 4 West of the Wilamette Meridian inYamhill County, Oregon, being part of that tract of land described in Deed from Vierra to MarkSmith, recorded in Film Volume 240, Page 51 I, Deed and Mortgage Records, and being moreparticularly described as follows:

Beginning at the Southeast corner of that tract of land described in Deed from Mark Smith toMcMinnvile School District No. 40, said Southeast corner being on the West margin of HilRoad (30 feet from centerline); thence South 89'47'49" East, 30.00 feet to the centerlìne of HilRoad; thence South 0d'2'll" West, 514.90 feet along said centerline and the Southerly extensionof said centerline to the Southeast corner of that tract of land described in Deed to Fred W. Muhsand Anna K. Muhs and recorded in Book 117, Page 283, Deed Records; thence North 89'6'50"West, 555.12 feet along the South line of said Muhs tract (South line of Section 18); thenceNortherlM 33.36 feet along a curve concave to the East having a radius of 550.00 feet (chord =North 2058'16" East, 33.35 feet); thence continuin~ Northerly 340.1 1 feet along said curve(chord = North 46'5'26" East, 334.71 feet) to the begmning ofa curve concave to the Northwesthaving a radius of 450.00 feet; thence Northerly, 361.84 feet along said curve (chord = North4d46'12" East 352.17 feet) to the Southerly line of said McMinnvile School Ùistrict No. 40tract; thence South 6:f2'01" East 45.74 feet to the point of beginning.

EXCEPT the following described tract of land:Beginning at the Southeast corner of that tract of land described in Deed to Fred W. Muhs andAnna K. Muhs and recorded in Book 117, Page 283d thence North 89'1' West, 133.94 feet to aniron pipe on the edge of the road; thence North 31::6'30" East, 271 feet to an iron pipe on theedge 0 the road; thence South otio" West, 232.46 feet to the point of beginning.

ALSO EXCEPTING all that portion of the above described tract lying in public roads.

Parcel II:

A tract ofland in Section 19, Township 4 South, Ran~e 4 West of the Wilamette Meridian, inYamhil County, Oregon, being more particularly described as follows:

Beginning at an iron rod set in CSP-7633 at the Northwest corner of that tract of land describedin Deed to the City of McMinnvile and recorded in Film Volume 151, Page 21 18, being a pointon the Southerly margin of Hil Road (30 feet from the centerline); thence North 89'6'50" West,151.53 feet to the intersection of said Southerly margin with the Easterly margin of Hil Road(30 feet from the centerline); thence South 0436'24" West, 146.84 feet along said EasterlyL'\wdoCllspokmanlKl J 14\204180074594 DOC

Ii

margin to an iron rod; thence Northeasterly, 174.59 feet along the Westerly line of said City ofMcMinnvile tract, which is a non-tangent curve concave to the Southeast and having a radius of480.00 feet (chord = North 46'1'56" East, 173.63 feet) to an iron rod; thence North 56'47'08"East, 45.00 feet to the point of beginning.

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EXHIBIT "B"

MODIFIEDPROMISSORY NOTE

$20,000,000.00 McMinnville, OregonAs of October 1, 2009

The undersigned, join~)' and severally ÇMaker"), for value received, promises to pay tothe order of STERLING SAVINGS BANK ('Lender") the principal sum of Twenty MilionDollars ($20,000,000.00), and to pay interest on the unpaid principal thereof from the date ofdisbursement of principal at the rates hereinafter set forth, together with all costs and fees,including reasonable attorneys' fees, incurred by Lender in enforcing the obligations of thisNote. The principal hereof and interest and 8remium, if any, hereon are payable to Lender c/oIntervest-Mortgage Investment Company, 50 5 S.W. Meadows Road, Suite 400, Lake Oswego,Oregon 97035, or such other place as Lender may direct, in such coin or currency of the UnitedStates of America as at the time of payment shall be legal tender for the payment of public andprivate debts. Principal and interest shall be payable as follows:

a. Effective on the date hereof, the indebtedness shall bear interest on theoutstanding balance at the rate equal to three percent (3.00%) in excess of the one monthLIBOR Rate (London Interbank Offer Rate) as published in the Wall Street Journal at thedate hereof. The interest rate shall be adjusted on the first day of each month, to equalthe then present published one month LIBOR Rate plus three percent (3.00%). LIBORRate is based on the British Banker's Association average of interbank offered rates fordollar deposits in the London market based on quotations at 16 major banks. If the onemonth LIBOR Rate ceases to be published or announced, Lender will set the interest rateby using a comparable index or reference rate. Reference rate, as used herein, or anyprime rate used as a substitute therefore, is only a standard or index for measuring rates.It is not itself necessarily a rate commonly charged to any class of borrowers, nor is itnecessarilr the lowest or best rate offered by Lender. Commencing December 1, 2009,the annua rate of interest on the outstanding balance shall be equal to fixed annual rate offive and eight tenths percent (5.80%) continuing until this Note is paid in full (except asmodified in the event of default hereunder).

b. Commencing October 10, 2009 and on the tenth day of each monththereafter until April i 0, 201 i, accrued interest on the outstanding principal balance shallbe paid to Lender. Thereafter on May 10, 2011 and on the tenth day of each monththereafter, equal monthly payments of principal and interest shall be paid to Lender in anamount necessary to amortize this Note in 300 months.

c. The entire 8rincipal and any accrued interest on this Note shall be paid infull on or before May i, 2 15.

Maker shall have the right, at any time, to prepay the whole or any part hereof withoutpenalty. Any partial prepayment shall be applied a~ainst the principal amount outstanding andshall not postpone the due date of any subsequent Installments or change the amount of suchinstallments, unless Lender shall otherwise agree in writing.

Following default in the payment of any installment of principal or interest when duehereunder, or default under any of the covenants or conditions of the Deed of Trust whichsecures this Note or any other document executed in connection with or to secure this Note (the"Loan Documents"), Lender may elect to (i) declare the. whole amount then unpaid due andcollectible, whether due by latise of time or not, and/or (ii) declare an increase in the rate ofinterest so that this Note sha i thereafter bear interest at the rate contained herein, plus two

VlwdoC5lspoknunlK IJ 141204IS11074S94 DOC

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MODIFIEDPROMISSORY NOTE

$20,000,000.00 McMinnville, OregonAs of October 1, 2009

The undersigned, jointly and severally ("Maker"), for value received, promises topay to the order of STERLING SAVINGS BANK ("Lender") the principal sum ofTwenty Milion Dollars ($20,000,000.00), and to pay interest on the unRald principalthereof from the date of disbursement of principal at the rates hereinafter set forth,together with all costs and fees, including reasonable attorneys' fees, incurred by Lenderin enforcing the obligations of this Note. The principal hereof and interest and premium,if any, hereon are payable to Lender c/o Intervest-Mortgage Investment Company, 5005S.W. Meadows Road, Suite 400, Lake Oswego, Oregon 97035, or such other place asLender may direct, in such coin or currency of the United States of America as at the timeof payment shall be legal tender for the payment of public and private debts. Principaland interest shall be payable as follows:

a. Effective on the date hereof, the indebtedness shall bear interest onthe outstanding balance at the rate equal to three percent (3.00%) in excess of theone month LIB OR Rate (London Interbank Offer Rate) as pubhshed in the WallStreet Journal at the date hereof. The interest rate shall be adjusted on the firstday of each month, to equal the then present published one month LIBOR Rateplus three percent (3.00%). LIBOR Rate is based on the British Banker'sAssociation average of interbank offered rates for dollar deposits in the Londonmarket based on quotations at 16 major banks. If the one month LIBOR Rateceases to be published or announced, Lender wil set the interest rate by using acomparable index or reference rate. Reference rate, as used herein, or any primerate used as a substitute therefore, is only a standard or index for measuring rates.It is not itself necessarily a rate commonly charged to any class of borrowers, noris it necessarily the lowest or best rate offered by Lender. CommencingDecember 1,2009, the annual rate of interest on the outstanding balance shaH be

. equal to fixed annual rate of five and eight tenths percent (5.80%) continuing untilthis Note is paid in fuH (except as modified in the event of default hereunder).

b. Commencing October 10, 2009 and on the tenth day of each monththereafter until April 10, 2011, accrued interest on the outstanding principalbalance shall be paid to Lender. Thereafter on May 10, 2011 and on the tenth dariof each month tliereafter, equal monthly payments of principal and interest sha ibe paid to Lender in an amount necessary to amortize tliis Note in 300 months.

c. The entire principal and any accrued interest on this Note shall bepaid in full on or before May 1,2015.

Maker shall have the right, at any time, to prepay the whole or any part hereofwithout penalty. Any partial prepayment shall be applied against the principal amountoutstanding and shall not postpone the due date of any subsequent installments or changethe amount of such installments, unless Lender shall otherwise agree in writing.

Following default in the payment of any installment of principal or interest whendue hereunder, or default under any of the covenants or conditions of the Deed of Trustwhich secures this Note or any other document executed in connection with or to securethis Note (the "Loan Documents"), Lender may elect to (i) declare the whole amount thenunpaid due and collectible, whether due by lapse of time or not, and/or (ii) declare anincrease in the rate of interest so that this Note shall thereafter bear interest at the ratecontained herein, plus two percent (2.00%) per annum, initially determined on the date ofdefault and adjusted as any variable rate changes. Lender may exercise either or both of

MODIFIED PROMISSORY NOTE - PAGE 1

" t

the foregoing remedies, and failure to exercise either of these options shall not constituea waiver of the right to exercise the same at any other time.

In the event that any payment or portion thereof is not paid within five (5) daysafter the date it is due, Lender may collect, and Maker agrees to pay with such payment, a"late charge" of Four Cents ($0.04) for each dollar so over due as liquidated damages forthe additional expense of handling such delinquent payments. Such late chargerepresents the reasonable estimate by the parties of a fair average compensation due tothe failure of Maker to make timely payments. Such late charge shall be paid withoutprejudice to the rights of the Lender to collect any other amounts provided to be paid orto declare a default hereunder, under the Deed of Trust or under the Loan Documents.

In the event that Lender consults an attorney in connection with the default byMaker regardin,& the enforcement of any of Lender's rights under this Note or the Loan

Documents, or if this Note is placed in the hands of an attorney for collection or if suit bebrought to enforce this Note or the Loan Documents, Maker prom ises to pay all coststhereof, including reasonable attorneys' fees. Said costs and reasonable attorneys' fees

shall include, without limitation, costs and reasonable attorneys' fees incurred in anyappeal or in any proceedings under the Bankruptcy Code or state receivership statutes.Maker and any endorsers severally waive presentment, protest and demand, notice ofprotest, . demand of dishonor, and expressly agrees that this Note, or any paymenthereunder, may be extended from time to time without in any way affecting the liabiltyof Maker and any endorsers hereof.

This Note is given for an actual loan of the above amount and secured by a Deedof Trust, Assignment of Rents and Security Agreement ("Deed of Trust") on real andpersonal property situated in Yamhill County, Oregon, dated September 13,2006, and anAssignment of Leases and Cash Collateral ("Assignment") dateâ September 13, 2006, asboth modified by a modification agreement of even date herewith, which is a lien uponthe property therein described, to which reference is hereby made for a description of thenature and extent of the security provided thereby and the rights and limitations of rightsof Lender and Maker in respect of such security.

Maker acknowledges that the Deed of Trust contains certain provisions restrictingthe conveyance, transfer or further encumbrance of the property encumbered by the Deedof Trust without the prior written consent of Lender.

. Maker particularly waives the right to demand any marshallng of assets as acondition to or in connection with the bringing of action hereon against it. Lender mayaccept additional or substitute security, or may release in whole or in part the securitydescribed in the Loan Documents now or hereafter securing the Note without in any wayaffecting or impairing the indebtedness evidenced hereby or the liability of Maker andany endorsers, guarantors or sureties hereof.

This Note is to be governed by and construed in accordance with the laws of theState of Oregon. At the option of Lender, the venue of any action hereon may be laid inYamhil County, Oregon, or in any county wherein is situate propert subject to the Deedof Trust or the Loan Documents. In the event of any action hereon or for the enforcementhereof or in the event of the referring of this Note for collection, the Maker promises topay all costs pertaining to the security therefor and all sums required to be paiâ under anyof the Loan Documents.

EACH AND EVERY MAKER HEREOF AGREES THAT IT HAS RECEIVEDV ALUABLE CONSIDERATION HEREUNDER, THAT IT SIGNS THIS NOTE ASMAKER AND NOT AS A SURETY, AND THAT ANY AND ALL SURETYSHIPDEFENSES ARE HEREBY WAIVED.

MODIFIED PROMISSORY NOTE - PAGE 2

"

UNDER OREGON LAW, MOST AGREEMENTS, PROMISES ANDCOMMITMENTS MADE BY A LENDER CONCERNING LOANS AND OTHERCREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY ORHOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER'SRESIDENCE, MUST BE IN WRITING, EXPRESS CONSDIERATION AN BESIGNED BY THE LENDER TO BE ENFORCEABLE.

HILLSIDE SENIOR LIVING COMMUNITYLLC, an Oregon limited liabilty company

~BY~'Its

MODIFIED PROMISSORY NOTE - PAGE 3

EXHIBIT 9-7

Plan Term Sheet

Yakima Scnior Living Property, LLe, is a relief entity in an SEC receivershipcase in the U.S. District Court in Oregon, SEC I'. Simwest Management, Inc, et (II, Cn~cNo.09-CV-6056-I10. Yakima Senior Living Property, LLC is also a debtor in 11 (,hupter1 I case in the District of Oregon (case number 6:09-cv-06087-HO). The Reccivcr andthe CRO lor Sunwest affliated companies propose to altcr the rights of various creditors,including secured creditors, in those proposed proceedings and a proposcd consolidatedChapter i 1 case pursuant to the terms flir the SEC Receivers' Plan of Distribution (the"SEC Plan") and a Chapter I I pI un (the "Ch.iteC J J.-lnn") contemplnted in the

consolidated Chapter 11 case. The SEC Plan and the Chapter 11 Plan arc collectivelyreferred to as the "Plans". The purpose of this tonn sheet (the "Tcrm_ Sheet") is to

memorialize the agreement of Prudential (defined below) regarding a compromise andsettlement of the rights and obligalions of the debtor and its affliates which wil becontained in a plan 0 f reorganization. The form of the Chapter 1 I Plan incorporating theprovisions olthis Term Sheet shall be acceptable to Prudential. and Pnii.ential retnins theright to ol1iect to any such plan that is fied that it does not approve and that isinconsistent with the terms set forth in this Term Shect.

1.1 Prudcntial Mortgage SL, LLC ("P-JJ~jmtiltn, as successor to PrudentinlMortgage Capital Company LLC. is the senior secured lender on real and personalproperty and certain other collateral located in Yakima. Washington known asEnglewood Heights (the ".lLQpçrjy"). The debtor fill' this property is Yakima SeniorLiving Property, i ,LC (the "Englcwm~g.. QeQ1Qr"). Other related entities iind certaintenants in common are bound under the original Loan Documents (deJincd below). Theowner of the Property and the principul obligor to Prudential shall be Yiiki11U 8eni(irLiving Property, LLC. In the event that the identities of other parties under the LoanDocuments are altered, the Loan Documents shall be amended us necessary to provideidentical obligations on the part of such other purties as were in existence prior to anysuch change and the duties on the part of thc lessee/licensee fbI' the tìicilitics nnd on themanagcment company shall remain unchanged.

1.2 "Loan Documents" shall mean all of the documents executed by thedebtor and various other paries in conjunction with the loan (the "l~rJ.!qcl.tjllll&al1")made by Prudcntial on or about March 30, 2007 nnd nil nincndments thereto. ThePrudential Loan is secured by the Property nnd the monthly income from the tenantK (the"Rents"). The collateral f()r the Prudential i ,Dan is collectively referenced as the"Prudential Colla.terlll." All such rightii in the Prudential Collateral shall continue

without alteration and in accordance with the I,oun Documents until Prudential has beenpaid in futl.

1.3 All of the tcmis of the Lo.m Documents shall remain in rull three and

ctlèet except as specifically provided in this Term Sheet. 'thc SEC Plan, the Chapter i IPlan and the orders contìrming the Chapter i i Plnn shall not contain any additionalnltemtions of the Loan Documents or the rights of PrudentiaL. As of the etlective date ofthe Chapter i 1 Plun. existing defaults under the Loan Documents shall be waived inaccordance with the terms of this Term Shcet. To the extent iiiplcmciilation or a

provision or tht: Chapter 11 Plan eonst.itutes a deli-iull or fti opportunity lor Prudential todeclurc a default. such provision. if consistent with this Term fohcct shall be of no lorceand elfect as oftheeflectivc date ofthe (,hapter 11 Plan.

1.4 Prudential's allowed sccured claim shall be in the disi~nunted principal

amount of $9.500.000 (the "Allowed Se~.mr~~. Clnim"). The Allowed Secured Claimshull be paid on lID interest only basis fhr the I1rst year at the current contract rate. Thesecond and third years !tnd any extensions shall be puid 011 an amortizing 25-yearschedule with interest as follows and as provided in Scction 1.8 hereof: The interest ratewil be floating and accrue at the greater of 30-day i ,i BOR or 2.5%. plus 250 hasispoints.

1.5 Prudential shall heuJlowed lin unsecured deliciency c1llim against the

Sunwest Unitary Enterprise. Stayton SW Assisted Living. Ll.e. as determined by theOctober 2, 2009 Order in 09-cv-6056-HO. and Case No. 09-cv-6082-HO withdrawing thercièr~nce of Bankruptcy Case No. 08-3663 7-lmb Ii. f,ir its entire indehtcdncss less theAllowed Secured Claim. including ull charges allowed unùer the Loan Documents,~xcept default interest nnd default charges shall nol he allowed (the ",/\ iip~cd lIn,Sç.çJ.!!'çlll'Iaim"). The Allowed Unsecured Claim shall rCllHiin secured hy the liens in thePrudential Collatcml nnd shall be rc-instated as parI of the Allowed Secured Claim in theevent of a future payment dcrUlJIt by the Englewood Dehtor.

1.6 All cash flow from the Prudential Collntcrul shull be applied in thefollowing priorities: (I) operating expenses tor the Property; (2) paymcnt of debt service;and (3) taxes and insurance and reserves lor taxes and insurance. In any month in whichitems (1). (3) arc fully paid. any CxceSs shall be distributed as directed in the Plans

1.7 The current state court receivcr (Orace Management. Inc.) lhr thePnidential C()llalcral shall remain in control of the operution of the Property until atransition of manugem~ni 01' the Property is cllcetuated and approved hy the United'States District Court Il)r the District of Oregon or the United States Bankruptcy Court lorthe Oistrict of Oregon and the new management entity has all appJicnble regulatorylicenses to operute the facility. The management Ice charged hy the new iminagemcntcompany wil he at u customary Ilnrket rate. In addition. any accrued tces and costsowed to Grace Management shull have been paid in liill from the proceeds or thePrudential t'oIJaterul prior to Grace Managements terminution and assumption ofmanagement by the new management entity.

1.8 The term orthe revised paymcnt provision on the Allowed Secured Claim

will he three years /i'om the earlier oren) the effective dutc of the lhupter I I PiUJl or (b)January 15. 20 i 0 (thc "InitiaL. rerni"). In addition to the Initial Term. the EnglewoodDebtor shull have two one-yeur extensions thnt may he exercised if there is no default liSof the then applicable maturity date. Upon muturi ty. the Allowed Secured Claim shull bedue in fulL.

I..) The receiver OJ new management entity. Ui: upplicuble, will provide thereorganized Englewood Debtor and Prudcntiiil with monthly operating reports and ii

- 2-

~

statement of the stutus of deferred or anticipated maintenance Hud/or ciipitul repairs andthe currcnt amount in the reserve uecount(s).

i. 10 The Chapter I I Plan shall provide that Prudential is released IhHll alldaÏJns by the Englcwood Debtor. the giimmitors. Englewood Dentor's princi(1als find allal1liates and related entities.

1.11 Upon implementation of the temis rdlectcd in this l'cl1n Sheet, Prudentialshall release any guarantees related to the Property.

1.12 The Englewood Debtor, eRO and snc Receiver shall fully support, andshall submit the agreement reflected hy this Tcrm Sheet to the United States DistrictCourt for the District of Oregon or the United States Bankruptcy Court for the District of()rel:ol1 for approval and if the terms in the SEC Plan and thc Chapter I I Plun to be licdand any related order atleeting the rights of the parties hereto is satisfactory to Prudentialin its sole discretion, as evidenced in writing executed by Prudential, the seitlcmcntretlectcd in this Term Sheet wil remain in effect and Prudential wil not oppose approvaland confirmation of the SEC 1.lan and Chapter II Plan, 01' related orders ¡md lIncr the

etlcctivc date orthe Plans. shull withdruw as li party tu any pending appeals.

1.13 Prudential will vote to accept II Chapter I I Piiin thiit treats Prudtmtiul inaccordancc with this TCI111 Sheet, iind thut provides for such other provisions und

documents us are customary in such u circumstance including. without Iimilation. unyamendment to documents, dctìuilt provisions, remedies fiir delault. and miy otherprovisions that arc in addition to the provisions in the Loim Documents.

Agreed to this J1. day orß~¡ 2009

Yakima Senior Livin~ I.roperty, LLC

By: . _~___ By:

- J -

EXHIBIT 9-8

SETTLEMENT TERM SHEETCharter Bank Loan Regarding Moses Lake Senior Care, L.L.C.

This Settlement Term Sheet ("Term Sheet") has been prepared to memorialize the general termsof the proposed settlement concerning the loan held by Charter Bank and its participants("Charter Bank") to the Debtor ("Debtor") in the bankruptcy case of In re Stayton SW AssistedLiving, L.L. C., USDC Case No. 6:09-cv-06082-HO (consisting of the Consolidated SunwestRelatedEntities including the Debtor in In re Moses Lake Senior Care, L.L,C., Bankruptcy CaseNo. 09-30675-tmb11 (Reference Withdrawn) U.S. District Court Civil Case No. 6:09-cv-06086-HO ("Bankrptcy Case"). The terms of this Agreement may be supplemented and enforcedthrough a Plan of Reorganization arising out of or related to the Bankruptcy Case and thereceivership proceedings arising out of the United States District Court for th~ District of

Oregon, currently pending as Securities and Exchange Commission v. Sunwest Management, Inc.et. ai., Case No. 6:09-CV-06056-HO ("Receivership Case"), which terms shall be consistentherewith.

Upon execution of this Term Sheet, the parties shall immediately work on a loan modificationagreement for the Restructured Loan and the Additional Loan to be implemented as of theEffective Date.. The "Effective Date" shall be the Effective Date as defined in the Plan ofReorganization, as may be amended, fied by the Debtor in the Bankruptcy Case.

The goal of this Term Sheet is to faciltate a transaction (the "Transaction") extending andrestructuring the Loan ("Restructured Loa,n") and providing for the Additional Loan as follows:

· Interest Brought' Current. Debtor shall continue to make current interest payments in atimely manner. Pursuant to a cash collateral order entered in the Bankruptcy Case, Debtorhas brought past due interest current on the Loan by payment of the $151,324.93previously held by Charter Bank in the reserve account held by Charter Bank and byDebtor paying Charter Bank $11,692.91. .

· Borrower. The existing Borrower, Moses Lake Senior Care, LLC ("MLSC"), shall

remain as the borrower of the existing loan ("Loan") with Charter Bank and wil beborrower of the Restructured Loan and Additional Loan, as defined herein. Transfers ofownership or control by MLSC to other entities or persons as provided in a Plan ofDistribution or a Plan of Reorganization ("Plan") approved by the Court shall be allowed.

· CollateraL. At all times, Charter Bank wil retain its security interests in its collateral withthe same validity, priority and extent that it held as of February 5, 2009.

· Principal Amount of Loan. Charter l3ank and MLSC agree that the principal amount of

the Loan is $5,196,934.37. .

Additional Loan. On the Effective Date, the indebtedness owed by MLSC to CharterBank for fees and costs as provided below shall be evidenced and repaid by MLSC toCharter Bank pursuant to the terms of an additional indebtedness facilty ("AdditionalLoan"). The Additional Loan shall consist ofthe costs and fees incurred by Charter Bankthrough July 31, 2009, in the amount of $300,000 plus reasonable fees and costs ofJordan Schrader Ramis PC from and after June 15,2009 and the fees and costs of Ryan,Swanson & Cleveland, PLLC from and after June 1, 2009, all of which fees and costs

Page 1 - SETTLEMENT TERM SHEET - Charter Bank S051.37938 2047639 ßDOClk/S11012010584443,02

have not yet been reviewed or agreed upon and all rights to dispute said fees and costs areexpressly reserved. Any allowed reasonable fees and costs incurred by Charter Bankthereafter and up to the Effective Date shall also be added to the principal balance of theAdditional Loan. To the extent there is any dispute as to the amount of the additional fees

and costs, such dispute shall be resolved by mutual consent or determined by the Court inthe Bankruptcy Case.. Except as otherwise provided for herein, the terms of the

Additional Loan shall be substantially the same as the terms of the Restructured Loan.MLSC's obligations under the Additional Loan shall also be secured by a lien against thesame collateral that is collateral for the Restructured Loan with a priority junior only tothe Restructured Loan. Following the Effective Date, all fees and costs incurred by

Charter Bank shall be subject to the regular terms of the Restructured Loan and

Additional Loan.

Term. The initial maturity date for the Restructured Loan and the Additional Loan shallbe three years from the Effective Date. In addition, each loan may be extended, at theoption of the Borrower, for two additional one-year terms, provided there is no defaultexisting and continuing as of the maturity date.

Interest Rate. The interest rate for the initial three-year term of the Restructured Loan andthe Additional Loan shall be a fixed rate equal to 5.25 percent. In the event Borrowersexercise their right to extend the Restructured Loan and/or the Additional Loan, then theinterest rate for such 10an(s) shall be adjusted to a fixed annual interest rate for the termof the extension equal to prime plus 150 basis points for the first extension with a floor of5.0 percent and a cap of 5.75 percent. The rate for the second extension would be a fixedánnual interest rate for the term of the extension equal to prime plus 150 basis points witha floor of 5.0 percent and a cap of 6.75 percent. The default rate wil be 200 basis pointsin excess of the non-default rate.

Restructuring Fee. There wil be no restructuring or extension fees.

· Amortization; Payments. Pending approval of this Term Sheet, Debtor shall continue to

make monthly interest payments to Charter Bank pursuant to the cash collateral order.During the first year following the Effective Date, monthly payments shall be interestonly on the Restructured Loan. During the First year following the Effective Date,monthly payments on the Additional Loan shall be $5,000 per month principal plusinterest on the unpaid principal balance. From and after the thirteenth month followingthe Effective Date, monthly payments on the Loan and the Additional Loan shall be in anamount necessary to amortize all principal and interest owing on each of the loans in 300equal, monthly payments of principal and interest. The loans shall be paid in full upon theexpiration of the term as set forth above. The monthly payments of interest and/orprincipal, as applicable, shall be payable on the 10th day of each month, with a five-daygrace period.

Financial Projections. Debtor wil deliver to Charter Bank financial projections that willinclude projections for capital expenditures and real estate taxes. The amounts of thecapital expenditure reserves and tax reserves wil be determined from such financialprojections. All such reserves shall be available to be drawn upon by Borrower as needed.

Page 2 - SETTLEMENT TERM SHEET - Charter Bank S0Sl-379382047639_6.DOClnk/SIIOI2010584443.02

· Cash Collateral and Relief From Stay. So long as Debtor is current and not in default ofits payments and obligations to Charter Bank, Debtor shall be entitled to continued use ofcash collateral in accordance with reasonable budgets prepared by it from time to time. Inthe event that Debtor defa.ults on its obligations to Charter Bank and fails to timely curesuch defaults, Charter Bank shall be entitled to seek termination of the use of cash

collateraL. If a Plan of Reorganization is confirmed in the Bankruptcy Case, Charter Bankshall be entitled to the remedies provided for in such Plan, which remedies wil beconsistent with the terms of this Term Sheet. If no Plan of Reorganization is confirmed,Charter Bank shall retain all rights and remedies under its loan agreements with MLSC asmodified by the terms of this Term Sheet.

· Management. Debtor shall continue to manage the propert through the Effective Date.The Debtor's administrative allocation shall be ten percent. Thereafter, Debtor or itssuccessor wil serve as propert manager according to the plan of distribution and Plan ofReorganization.

· Taxes. Real and personal propert taxes wil be brought current on or before 18 monthsfollowing the Effective Date.

· Financial Covenants. There wil be no debt yield tests, loan-to-value tests, minimumrevenue/income or other financial covenants, except as provided in this Term Sheet.There shall be a two-year holiday during which there shall be no Debt Service CoverageRatio ("DSCR") requirements. Commencing on the third anniversary of the Closing Date,there shall be a debt service coverage ratio covenant of 1.0 to 1.0, calculated as of the endof each calendar quarter for the trailng twelve-month period. In the event that MLSCdoes not satisfy the applicable DSCR as of the end of any calendar quarter (a "Cash TrapEvent"), such failure shall not constitute an Event of Default but all excess cash shall betrapped in a lockbox account until such time as Borrower satisfies the applicablequarterly DSCR, at which time the Cash Trap Event shall terminate.. I

· Releases. The Order approving this Term Sheet shall include a release of Charter Bankfrom all claims, known and unknown, by MLSC, the Receiver, and all ReceivershipEntities, unless such claims are asserted within 90 days following the entry of the Order.In the event a claim is asserted by the Receiver within the 90-day period, then the claimsof the Receiver wil be submitted to mediation. Absent a mediated resolution, the TermSheet wil be deemed void and of no further force and effect on the 120th day followingthe entry of the Order.

· Withdrawal From All Appeals. Promptly following execution of the final loandocuments or Court approval of this Term Sheet or Plan of Reorganization, whicheveroccurs first, Charter Bank wil withdraw from any and all appeals including the appeal ofthe appointment of the Receiver in the Receivership Case.

· State Court Receivership. Promptly following execution of this Term Sheet, a StipulatedOrder shall be entered in Charter Bank v. Moses Lake Senior Care, L.L. C., et ai, SuperiorCourt of Washington, County of Grant, Case No. 08-2-01545-5 ("State Court

Receivership Proceeding") staying all activity in that case. Charter Bank may make finalpayment to the Receiver and his counsel for their fees.' The State Court Receivership

Page 3 - SETTLEMENT TERM. SHEET ~ Charter Bank S05l.37932047639_6.DOClnklSII0120JO584443.02

Proceeding shall be dismissed upon approval of a Plan of Reorganization in the

Bankruptcy Case that includes the terms of this Term Sheet. .

· Guaranties. Promptly following the date that MLSC, the Receiver, and all Receivership

Entities release Charter Bank, Charter Bank and all guarantors wil execute mutualreleases.

Plan Acceptance. Charter Bank wil vote to accept a Plan of Reorganization that treats itin accordance with this Term Sheet.

By its signature below, each party indicates that it approves this Term Sheet. Except with respectto the last bullet point, signature below does not bind any part, but indicates the intent of eachsuch part to proceed to documentation of definitive agreements memorializing the Transaction.

It is understood that the Transaction is not binding until the earlier of the date the definitivedocuments have been executed and delivered by all parties and subsequently approved by theCourt, or the Court has entered its Order confirming the Plan of Reorganization.

CHARTER BANKBY~~Its VlÇL Pr¿5:~~d-

CL YDE HAMSTREET, CRO

ByIts

. MICHAEL GRASSMUCK, RECEIVER

ByIts

Page 4 - SETTLEMENT TERM SHEET - Charter Bank S0SJ-379382047639ß,DOClnklSII0/2010584443.02

EXHIBIT 9-9

SETTLEMENT TERM SHEET - BANK OF AMERICA, N.A., as Trustee ofMARATHON REAL ESTATE CDO 2006-1 GRANTOR TRUST (successor-in-

interest to MARATHON STRUCTURED FINANCE FUND L.P., a Delawarelimited partnership)

(Lender)

This Settlement Term Sheet ("Term Sheet") has been prepared to faciltatesettlement and, if necessary or appropriate, mediation, concerning a loan (the "Loan")held by Bank of America, N.A., as Trustee of Marathon Real Estate CDO 2006-1Grantor Trust (successor-in-interest to Marathon Structured Finance Fund L.P., aDelaware limited partnership) and its participants ("Lender" or "Lenders") to ChrisRidge Senior Living, LLC, Albuquerque Memory Care Community, LLC, FranklinSenior Living, LLC, and Ashland Senior Living, LLC (collectively, "Borrowers")which are now subject to bankuptcy proceedings pending under the caption StaytonSW Assisted Living, LLC, consisting of the Sunwest Unitary Enterprise asdetermined as entered in U.S. District Court Case No. 09-CV -6056-HO ("SECReceivership Case"), Debtor and Debtor-in-Possession ("Debtor"). This Term Sheetis to facilitate settlement and mediation, and is for discussion purposes only. Nothingin this Term Sheet is binding on any party and no part wil be bound to anyagreement until such time, if any, as a formal written agreement shall have been

executed and delivered among the parties.

The goal of this Term Sheet is to faciltate a transaction (the "Transaction")extending and restructuring the Loan. The date on which the Transaction becomeseffective is the "Closing Date," which shall be the effective date of a plan ofdistribution and restructuring, or if earlier, as soon as possible after entry of theApproval Order (defined below), which order may be part of an order approving aSection 363 sale of the Holdco Properties.

. Borrowers. The Borrowers shall remain as the borrowers of the Loan.Transfers of ownership or control of the existing Borrowers to an entity whichacquires substantially all of the approximately 164 Holdcd Properties (whetherREITCO or a buyer at a Section 363 sale) as provided in a plan ofreorganization or a Section 363 sale order approved by the Court shall beallowed.

. CollateraL. At all times, Lender wil retain its security interest in its collateralwith the same priority that it had as of March 2, 2009.

. Term. The term for each Loan shall be three years with 2 one year extensionsfrom the Closing Date. Each extension shall require upon sixty days priorwritten notice and be subject to the following: (a) no Default or Event of

2433410v7 4/iO/201012/22I2GGY 1'30-07 PMIG:22 AM 6056,001

Default shall have occurred and be continuing, and (b) payment in cash of anextension fee equal to 25 bps of the principal balance.

. Interest Rate. The interest rate during the initial term shall be a variable rateequal to 30-day LIBOR plus 300 bps. The rate wil be fixed at 5.75% in year 4and 6.75% in year 5. Marathon wil purchase a derivative to hedge the risk inchanging to a fixed rate. The cost of this hedge wil be shared 50/50 by theBorrower and Lender when incurred by Lender, but the Borrower's portionwil not exceed $500,000. The default rate wil be as provided in the existingdocumentation of the Loan (the "Loan Documents").

. Amortization; Payments. Monthly payments shall continue as provided in theLoan Documents. During the first year following the Closing Date, paymentsshall be interest-only, with no principal amortization. Thereafter, monthlypayments shall include amortization of principal in the amount of 1/360th of theprincipal balance on the Closing Date.

. Principal Balance. The principal balance at the Closing Date wil be equal to

the principal owing on the Loan, together with any accrued and unpaid interestcalculated at the non-default rate plus reasonable fees incurred by Lender inconnection with the negotiation of this Transaction, the SEC ReceivershipCase, the bankuptcy proceedings and other litigation pertaining to the Loan.

. Cash Management. Cash management procedures shall be continued so thatthe Lender maintains a perfected security interest in Pròject revenue and can beassured that all Project revenue is used for budgeted Project expenses and notdiverted to other uses. The lockbox arrangement shall be continued, but priorto an Event of Default Borrower may withdraw funds from the lockbox controlaccounts.

. Reserves. Borrowers wil make monthly payments of reserves for taxes,insurance and capital expenditures as currently provided in the LoanDocuments. Absent an Event of Default, such reserves shall be available to bedrawn on by Borrowers as needed for such expenditures.

. Financial Projections. Borrowers wil deliver to Lender financial projectionsthat wil include projections for capital expenditures, insurance premiums andreal estate taxes, as well as other financial reporting as currently provided inthe Loan Documents.

. Management. Sunwest Management Inc. ("SMI") shall continue to managethe properties through the Closing Date for a management fee of no more than7%. Thereafter, the manager wil be subject to Lender's reasonable approvaland a collateral assignment of management agreement and, if the manager andBorrowers are then affiliates, a subordination of management fees, consistent

-2-

with Lender's standard commercial practices. Monthly management fees shallbe the lesser of 6% or the percentage base fee charged for Sunwest projectsgenerally.

. Financial Covenants. The Loan Documents wil contain a debt servicecoverage ratio covenant of 1.15 to 1.00 calculated as currently provided in theLoan Documents. Lender wil agree to drop the current project yield covenant.

. Releases. It is contemplated that (i) the Purchase wil be authorized by a plan.

of reorganization confirmed by the Court and/or (ii) a final settlement andmodification between Debtor and Lender (if agreed to by Debtor and Lender)(a "Debtor Settlement") wil be approved by an Order entered by the Court (ineither instance, an "Authorization Order"). An Authorization Order wil(a) authorize the Lender to modify the Loan Documents (pursuant to a DebtorSettlement and/or the Transaction), (b) vacate the existing injunction in theSEC Receivership Case as to the Lender and the Purchased Projects, and (c)include a release of Lender in substantially the same scope as the releaseobtained by General Electric Capital Corporation pursuant to paragraph 8 ofthe Stipulated Order Approving the Restructuring of Indebtedness Held byGeneral Electric Capital Corporation and GE Business Financial Services Inc.(fied 11/2/09 as Document 510-2). The Transaction is contingent onobtaining an Authorization Order.

. Guaranties. Lender and all guarantors wil execute mutual releases. The new

ultimate "parent" entity of the Borrowers (REITCO or the new joint ventureacquiring the Borrowers at the Section 363 sale) shall provide Lender with aguaranty as to "bad boy" acts consistent with Lender's customary practice.

. No Prepayment Premium; Exit Fee. The Loan may be prepaid in part or in fullat any time without payment of any prepayment premium. However, theexisting exit fee shall continue as currently provided in the Loan Documents.

. Loan Documents. Except as otherwise specifically noted herein, the LoanDocuments wil remain unchanged. Any amendment or other modificationagreement incorporating the terms herein wil contain representations,waranties, covenants, conditions precedent and other provisions typicallyfound in modifications to first mortgage loans secured by senior livingfacilities and otherwise consistent with those in the Loan Documents.

· Plan Acceptance. Lender wil vote to accept a plan of reorganization thattreats Lender in accordance with this Term Sheet.

· Claims; Bar Date. Lender shall not be required to fie a claim in thebankptcy case(s) of Borrowers or the Oebtor (or with respect to the PlumRidge Loan noted below) until the bar date in each applicable case.

-3-

. Plum Ridge Loan. Reference is made to the loan (the "Plum Ridge Loan") byLender to Plum Ridge Care Community LLC ("Plum Ridge Borrower"), anentity materially owned and controlled by Jon Harder, in the original principalamount of $4,600,000 on or about July 18, 2007. As part of the Transaction,the ownership of the Plum Ridge Borrower wil be transferred to the newowner of the Borrowers, but the existing loan documents with respect to thePlum Ridge Loan shall continue unmodified (except as to a release of anyguarantors and Lender, and the provision of a "bad boy" act guaranty as

described above, with respect to the Loan), and the existing lease of thepropert owned by the Plum Ridge Borrower shall continue unmodified (saidlease being assumed in the bankuptcy proceeding, if applicable).

. By its signature below, each party indicates that it tentatively approves this

Term Sheet. However, signature below does not bind any part, but indicatesthe intent of each such part to proceed to documentation of definitive

agreements memorializing the Transaction and, in the case of Lender, to

endeavor to obtain its credit committee and other internal approvals necessarybefore Lender may sign binding documents, as well as endeavoring to obtainsuch approvals from Lender's participant (which are also necessary beforeLender may sign binding documents as to the Loan). It is understood that theTransaction is not binding until definitive documents have been executed anddelivered by all parties and the Court has entered its Approval Order approvingthe definitive agreements and the transactions contemplated thereby.

CLYDE HAMSTREET, CRO, on behalf ofDebtor, Borrowers and Plum Ridge Borrower

LENDER:

BANK OF AMRICA, N.A., AS TRUSTEE OFMATHON REAL ESTATE CDO 2006-1GRANTOR TRUST

By: Marathon Asset Management, LP, as

collateral manager and special servicer

By:Name:Its:

-4-034845/00001/1594811vl

EXHIBIT 9-10

srnTLEMI1:NT TERM siumT - lJmlJqlUl B:Ulb.

'I'his Settement Term Sheet ("Tenn Sheet") has been prepared to faciltate settlement and, ifnecessary 01' uppl'pl'iate, mediation, concerning loans held by Umpqua Bank and its paitiuipullts("Lender" or "Lenders") to Stayton SW Assisted Living, LLC, consisting of the Suiiwest UnitaryEntcrpiise as determined as entered in U.S. District Court Case No. 09-CV-6056-HO ("SECReceîvership Case"), Debtor and Debtor-in-Possession ("Debtor"). This '1em1 Sheet is totàciltate settlement and mediation, and is for discussion purposes only. Nothing in this TermSheet is binding on any paity and no party wil be bound to any agreement until such time, ifany, as a formal written agreement shall have been executed and delivered among the parties.

The goal ofthis Term Sheet is to faciltate a tranimction (the "Tml1saction") eXhmding andrestructuring each Loan. 'rhe date on which the Trammction becomes effective is the "ClosingDate," which shall be the Eftective Date ofl plan of distribution and restrU(~tiiring.

.. ßQIlQwers. Debtor shall remain as Borrower until a plan of reOlganization is approved

by the Court. Ti'aiisicrs of ownership or control by the existing Borrower to other entitiesor persons as provided in a plan of reorganization approved by the Court shull beallowed.

ti Collatcr!ll. At all times, Lender wil retain its semil'ity interest in its collateral that it has

as of Miwch 2,2009.

· Term. The term for each Loan shall be five yeurs from the Closing Date.

.. Intel'estRat£. The interest shall be a fixed rate equal to 5.75 percent. The default rate

wil be 200 basis points in excess of the noii-default rate.

.. AnlQrtizatton; PaYl1ellt.~. Monthly payments shall be payable on the 10th day of each

month, with a five~day grace period. During thefirst year following the Closing Date,

payments shall he inici'est-only, with no principal amoitizatioii. Thereafter, monthlypayments shall be in an aniount necessary to amortize all prill~ipal and interest owing onthe loan in 300 equa'l, monthly payments ofprincipul and intei'(~st.

· lxjneJnal Balance. The principal balance at the Closing Date wil be equal to thepl'inüIpal owing on the Loan, together with any accrucd and uni)aid intcrest calculated atthe non~detault rate plus reasoniihle legal fees incurred hy Lender in connection with thenegotiation of this Tl'unsuction.

· RJ~stwves. Borrowers wil make monthly payments of reserves for taxes and capitalexpenditures. All such reserves shall be available to be drawn on by Borrowers asneeded.

· Financial l~~Qns. BOll'OWerS wil deliver to Lender tïnancial pl'jcctions that willinclude prqjectiol1s for capital expenditures and real estate taxes. 'rhe amounts of theexpenditure reserves and tax reserves will be determined from such financial projections.

Page I ~ SE1TLEMEN'l' TERM SH:EET

· MaDMement. Debtor shall eoiitimic to manage the properties through the date ofapproval by the Coui1 of n plan ofreorgaiiizatiou. The Debtor's administrative allocation

shall he 7%. ThcreaJìcr, Debtor's successor will serve as property manager according tothc plan of distribution and rcstructming.

· Financial Covenlints. Therc wil be no debt yield tests, l()an~to-vaiue tests, minimumrevenue/income or other financial covenants except as pl'vided het'cin. Tht~ loandocuments wil contain a debt service COVCl'ge ratio (DSCR) covenant. Upon theClosing Date, there shall be a three year covenant holiday. Thereafter, there shall be adebt service coverage ratio covenant of 1,0 to t calculated as ofthe end of each calendarquarter fbI' the truilng twcivc~month period. In the event that the applicable DSCR as ofthe end of any calendar quarter is not meet (Hn Cash l'rap Event"). such fitilii'e shall notconstitute an Event of Dcfault but all exccss cash shall be trapped in a lockbox accountuntil such time as Borrower siitisfies the applicable quarterly DSCR, at which lime theCash Trap Event shall temiinatc.

.. Releasef!. It is contemplated that this Transaction wil be appl'vtid by un Order enttwed

by the Court. The Order wil indude a releime of Lcndci' from all claims, known andiinknown, by the Receiver, and all Receivership Entities. unless such claims are assertedwithin 90 days following the entry of the Order. In the event a claim is asserted by theReceiver within the 90~day period, then the claims ofthé Receiver wil be submitted tomediation. Absent a mediated resolution, the Tnttsaction wil be deemed void and of nofurther fòrce and effect on the 1201h day fòUowing the entry of the Order.

· .ÇluamnttelJ. Lender and all guarantors wili~xccute mutual releases.

lI llftl1,.Aççeptanc.Q. Lender wil vote to accept u plan of t'corgnnization that treats l,ciidcr in

accol'dance with this Term Sheet.

By its signature below, each party indicates that it approves this Term Sheet. Except withrespect to the last bullet pöint. signatui'e below does not bind any party, but indicates the intent ofeach such party to p1'ceed to documentation of definitive agreements memorializing theTransaction. Jtis understood that the Transaction is not binding until definitive documents havebeen executed and delivered by all parties and the Coutt has entered its Order approving the phmofreorganizatioii, the definitive agrccments and the transactions contemplated thercby.

UMPQUA BANK

~l~By.... _It. _ ,,'ell _

CLYDE HAMSTREET, CRO"

ByIts

_".N"_"

Pagc 2 - SETTLEMENT 'I'ERM SBEEl'OJ4ll4S/OOOOI/15'J4llllvl

EXHIBIT 9-11

~r

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 1 of 12

Albert N.Kennedy, OSB No. 821429 (Lead Attorney)Telephone: (503) 802-2013

Facsimile: (503) 972-3713

Email: aL.keimedyúfonkoii.eom

Timothy J. Conway, OSB No. 851752Telephone: (503) 802-2027Facsimile: (503) 972-3727

Email: tiin.conwaY&itonkon.com

TONKON TORP LLP1600 Pioneer Tower888 S.W. Fift AvenuePortland, Oregon 97204

r L..:!: T ~ (: "r?~'::O : ("~5~ usrs .L~:~

Attorneys for Debtor

IN THE UNTED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

EUGENE DIVISION

!nre:

Debtor.

))

) Banptcy Cour) Case No. 08-36637-tmbl1

) (Reference Withdrawn)

))))

)

USDC Case No: 09-cv-6082-HO

STAYTON SW ASSISTED LIVING, L.L.C.,(the Consolidated Sunwest Related Entities)

STIPULATED ORDER APPROVINGRESTRUClRING OFINDEBTEDNESS HELD BY LEWIS &CLAR BANK

The Cour, having reviewed and considered the Motion for Approval of Stipulated Order

Approving Restrcturing of Indebtedness Held by Lewis & Clark Ban and the Cour being

duly advised in the premises, and good cause appeanng therefor, the Court finds, as follows:

A. This Court has jurisdiction over the matter pursuant to 28 U.S.C. § 1334. Venue

is proper in this Distrct pursuant to 28 U.S.C. § 1408 and 1409.

PAGE 1 STIPULATED ORDER APPROVING RESTRUCTURG OF INDEBTEDNESSHELD BY LEWIS & CLAR BANK

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 2 of 12

B. On December 1, 2008, Debtor filed a voluntar petition for relief under Chapter

11 of the United States Bankptcy Code.

C. On March 2, 2009, the United States Securties and Exchange Commission

("SEC") commenced an action in the United States Distrct Cour for the Distrct of Oregon

agaist Sunwest Management, Inc. ("SMI") and other persons and entities for violation of,

among other things, federal securties laws and seeking an injunction and appointment of a

receiver (the "Receiver') in SEC v. Sunwest Management, Inc. et al., U.S. District Cour Case

No. 09-cv-6056-HO ("SEC Receivership Case'). On March 10,2009, the Court entered its

Order granting an injunction and appointig Michael Grassmueck Receiver and Clyde Hamstreet

CRO to the Receiver Entities (the "Receivership Ordet'), as defined herein. Gresham Chestnut

Senior Living Proper, LLC ("Gresham Chestnut") is a Receivership Entity.

D. On October 2, 2009, in the SEC Receivership Case, the United States Distrct

Cour entered its Order (the "Approved Order") al'proving the Distrbution Plan of Receiver and

Chief Restrcturing Offcer for Sunwest Enterpri'se (the "Distrbution Plan"). The Distribution

Plan and the Approval Order provided for the consolidation of the assets and liabilties of the

Receivership Entities into Debtor's banptcy estate and the reorganzation of the Sunwest

Enterprise through Debtor's banptcy case.

E. On or about October 2,2009, the consolidated schedules of assets and liabilities

and the consolidated statement of fiancial affairs for the Receivership Entities were filed in ths

banptey case.

F. On November 12, 2009, Debtor, the Tenants-in-Common Committee and the

Unsecured Creditors' Committee filed their Joint Motion seeking substantive consolidation into

this case of the assets and liabilties of the Sunwest Entities (as identified in the Joint Motion),

PAGE 2 STIPULATED ORDER APPROVING RESTRUCTURG OF INDEBTEDNESSHELD BY LEWIS & CLARK BAN

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 3 of 12

including Gresham Chestnut. On December 22, 2009, the Cour entered its Order granting the

Joint Motion.

G. Debtor has continued in possesion of its propert and is continuing to operate

and manage its busines as debtor-in-possession pursuant to Secions 1107(a) and 1108 of the

Bantcy Code. No trtee or examner has been appointed in Debtor's case. Pursuant to the

Approval Order and the Consolidation Order, Debtor's assets and liabilities include the assets

and liabilties of Gresham Chestnut, and Debtor's business includes the operation of the facility

known as the "Chestnut Lane Facilty."

H. Lewis & Clark Ban holds the mortgage on the Chestnut Lane Facilty, in

Gresham, Oregon, securng indebtedness of aproximately $5,159,460.82 as of March 31, 2010,

consisting of approximately $5,025,000.00 of principal and $28,924.39 of non-default interest,

with the remainder being default interest, late fees and thrd-par fees. There are tenant-in-

common owners on this project.

I. During the SEC Receivership Case, Clyde Hamstreet, in his capacity as chief

restrctung officer (the "CRO") for cerain Receivership Entities paricipated in mediation with

many secured lenders, including Lewis & Clark Ban under the supervsion of the Honorable

Lyle Velure.

J. As par of such mediation, the CRO, in consultation with the Management

Commttee and under the supervsion of Judge Velure, entered into a term sheet with Lewis &

Clark Ban (the "Term Sheet") providing for restrcturing of the loan held by Lewis & Clark

Ban (the "Restrcturing"). The Term Sheet provides for restctug of the obligations to

Lewis & Clark Ban regardless of whether the ultimate disposition in this case is a stand-alone

PAGE 3 STIPULATED ORDER APPROVING RESTRUCTUG OF INDEBTEDNESSHELD BY LEWIS & CLAR BAN

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 4 of 12

Chapter 11 plan (with or without new investment) or a sale to a third-par buyer. A copy of the

Term Sheet is attached hereto as Exhibit 1.

K. The Restrcturing is integral to Debtor's efforts to achieve a successful outcome

of the SEC Receivership Case and the Chapter 11 banptcy cases.

L. The Cour fids the Restructuring has been negotiated at an's length and in good

faith by Lewis & Clark Ban and the CRO, that the Restrctung is a fair and equitable

restrctung of the existing Lewis & Clark loan and a compromise of the respective rights of the

paries, and tht consumation ofthe Restructurng is in the best interests of the Receivership

Estate, the banptcy estates and the tenant-in common owners.

THEREFORE, IT is ORDERED:

1. Debtor, on behalf of itself and Gresham Chestnut is authorized to execute and

deliver: (a) a new loan agreement with Lewis & Clark Ban; (b) modifications or renewals of

any currently existing mortgages, deeds of trst, and securty agreements encumbering any real

or personal propert of Debtor and Gresham Chestnut (the "Lien Modification Documents") in

favor of Lewis & Clark Ban or any trstee, title company or similar representative; and (c) such

other agreements, documents, and instruments relating to the new loan agreement with Lewis&

Clark Ban as the authorized representatives of Lewis & Clark Ban and Debtor shall consider

reasonable and appropriate to document and implement the restrcturng contemplated by the

tenn sheet attached hereto as Exhibit 1, and ths Order (all items referenced in this paragraph

being the "Lewis & Clark Ban Loan Documents").

2. Debtor, on behalf of itself and Gresham Chestnut is authorized to execute and

deliver: (a) an amendment to the existing management agreement covering Gresham Chestnut, or

in its discretion, one or more replacement management agreements, and (b) a Lender-Manager

PAGE 4 STIPULATED ORDER APPROVING RESTRUCTURG OF INDEBTEDNESSHELD BY LEWIS & CLAR BANK

Case 6:09-cv~06082-HO Document 1158 Filed 04/30/2010 Page 5 of 12

agreement with Lewis & Clark Ban (all items referenced in ths paragraph being the

"Management Documents"). The Management Documents will be commercially reasonable and

reasonably satisfactory to Debtor or the successor to Debtor, and to Lewis & Clark Ban.

3. Debtort on behalf of itself and Gresham Chestnut, is authorized to execute and

deliver the Lewis & Clark Ban Loan Documents and Management Documents, and to execute

and deliver any amendments, restatements, modifications and renewals thereof or any additional

agreements or documents reasonably required by Lewis & Clark Ban, all in such form as

Debtor considers advisable. Any Lewis & Clark Loan Document, any Management Document,

and any other such agreement or document so executed and delivered shall be legally valid and

binding and shall be enforceable against Lewis & Clark Ban, Debtor, Gresham Chestnut, and

any successor to Debtor, according to the teims of such document; provided; however, that the

five-yea teim of the loan shll be measured from the Effective Date of a plan of reorganzation,

or July 1,2010, whichever shall occur first.

4. Notwithstandig any contrar provisions in the governng documents of Debtor

and Gresham Chestnut, the CRO shall be the sole authoried representative of Debtor and

Gresham Chestnut and may deal with Lewis & Clark Ban and all third paries on behalf of

Debtor and Gresham Chestnut. The CRO shall have the authority to execute and deliver any

documents within the scope of this Order. This Order specifically overrdes any provisions of

such governing documents specifyng the authority of the members, managers or offcers of

Debtor and Gresham Chestnut.

5. Each Lien Modification document shall be effective to create a valid and

enforceable lien and securty interest on the real and personal property covered thereby to secure

the amounts set forth in such Lien Modification Document. The liens and security interests

PAGE 5 STIPULATED ORDER APPROVING RESTRUCTUNG OF INDEBTEDNESSHELD BY LEWIS Ri CLAR BANK

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 6 of 12

granted to Lewis & Clark Ban will remain first position liens on the real and personal property

used at Gresham Chestnut. Any title company or similar entity issuing title insuance to Lewis

& Clark Ban shall be entitled to rely on the provisions of this Order in general and this

paragraph in paricular.

6. The automatic stay imposed by 11 U.S.C. § 362(a) is hereby modified so that

Lewis & Clark Ban shall have relief from the automatic stay without fuer order of the Cour

in the event that (a) an Event of Default has occured under the Lewis & Clark Ban Loan

Documents, (b) Lewis & Clark Ban has provided wrtten notice thereof to Debtor, and (c)

Debtor has not cured the default with 10 days of receipt by Debtor of the wrtten notices. This

Court shall have and retai exclusive jursdiction over any dispute with respect to the occurence

or cure of any Event ofDefauIt under the Lewis & Clark Ban Loan Documents.

Notwithstanding the relief from stay granted herein, Lewis & Clar Ban shall be bound by the

terms of the plan of reorganzation if approved by the court and by any subsequent orders of this

court.

7. Lewis & Clark Ban and its employees, agents, representatives, and affliates (the

"Released Paries") are released and forever discharged from all claims, causes of action, and

liabilties of any type whatsoever, known or unown, that arse from, related to, or are

connected in any way with the Sunwest Entities (as dermed below) and that are held in whole or

in par by any of the Releasing Paries (as defined below), including claims that may be

subsequently assigned to the Receiver; provided that the foregoing shall not excuse Lewis &

Clark Ban for any of its obligations under the Lewis & Clark Ban Loan Documents and the

Management Documents. The Sunwest Entities shall include Debtor, Gresham Chestnut,

Sunwest Management, Inc. and the Receivership Entities. The Releasing Entities shall include

PAGE 6 STIPULATED ORDER APPROVING RESTRUCTURING OF INEBTEDNESSHELD BY LEWIS & CLAR BANK

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 7 of 12

the Sunwest Entities and the CRO, but shall not include the Receiver. Provisions in the attached

term sheet relating to release of clais asserted by the Receiver wil be subject to approval of the

plan of reorganization. The date when an order confirming the plan is entered shall trgger the

time periods set fort in the paragrph titled "releases" in the attached term sheet. For

avoidance of doubt, the SEC is not a Releasing Par and this paragraph does not apply to the

SEC. Furer, the commencement of legal action by the SEC against Lewis & Clark Ban will

not be a default under this Order or the Lewis & Clark Ban Loan Documents. All Releasing

Paries are forever enjoined from initiatig or pursuing against any Released Par any claim,

cause or action or liabilties that have been released hereunder.

8. Each Lewis & Clark Ban Document and each Management Document shall be

enforceable accordig to its terms. Subject to the provisions of paragrph 6 of ths Order, if any

Event of Default (as dermed in the Lewis & Clark Ban Loan Documents) shall occur, each

par thereto shall be entitled to enforce its legal rights and remedies against the other paries,

including foreclosure ofreal and personal property, obtaining the appointment of a receiver, and

termination of management agreements and the automatic stay in this banptcy case is .

terminated to permt the exercise of such rights and remedies.

9. Debtor shall incorporate the term of the Lewis & Clark Ban Loan Documents

into a plan of reorganzation and Lewis & Clark Ban wil support confirmation of a plan of

* * *

* * *

* * *

* * *

PAGE 7 STIPULATED ORDER APPROVING RESTRUCTURIG OF INDEBTEDNESSHELD BY LEWIS & CLAR .BANK

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 8 of 12

reorganization proposed by Debtor that incorporates the tenns of the Lewis & Clark Ban Loan

Documents and does not otherwise impair the rights of Lewis & Clark Ban.

Date thi~("Y of +L 2010

Presented by:

TONKON TORP LLP

By: /s/ Timothy J. ConwayAlbert N. Kenedy OSB No. 821429Timothy J. Conway OSB No. 8517521600 Pioneer TowerPortland, Oregon 97204Telephone: (503) 802-2013 (Kennedy)Telephone: (503) 802-2027 (Conway)Facsimile: (503) 972-3713 (Kennedy)

Facsimile: (503) 972-3727 (Conway)

Email: al.kennedy((tonkon.com

tini.conway(æ,tonkon.com

Attorneys for Debtor

PAGE 8 STIPULATED ORDER APPROVING RESTRUCTURG OF INDEBTEDNESSHELD BY LEWIS & CLARK BAN

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 9 of 12

Approved by:

CABLE HUSTON BENEDICT HAGENSEN & LLOYD LLP

By: lsI Laura WalkerLaura Walker OSB No. 794321001 SW 5th Avenue, Suite 2000Portland, Oregon 97204Telephone: (503) 224-3092Facsimle: (503) 224-3176

Email: Iwalker((Ùcablehuston.com

Attorneys for Lewis & Clark Ban

PAGE 9 STIPULA TED ORDER APPROVING RESTRUCTURIG OF INEBTEDNESSHELD BY LEWIS & CLAR BANK

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 10 of 12

SE'ILEMENT TltRM SHEET - Lewis & Clark Bank (Lender).' . f .This Settlement Term Sheet ("Tenn Sheet") has been prepared to faciltate settement and, if

necessary or appropriate, mediation, concerning loans held by Lewis & Clark Bank and its

pacipants ("Lender" or "Lenders") to Staytn SW Assisted Living, LLC, consisting of theSwiwest Unitary Enterpnse as determined as entered in U.S. Disrict Cour Case No. 09-CV-6056-HO ("SEC Receivership Cas"), Debtor and Debtor-in-Possession ("Debtor"). This TermShet is to faoiltate settlement and mediation, and is tor discussion purposes only. Nothing inthis Ter Sheet is bindng on MY pary und no party wil be bound to any agreement until such

time. if any. as a fonnal written agreement shalt have been executed and deUver among thepares.

The goal of this Tenn Sheet is to faciltate a tnuiaction (the "Tranactiontl) extending antirestmcturng eac Loan. The date on which the Transaction becomes effective is the "ClosingDate, It whch shall be the date of an entry of an order approving this tenn sheet.

. Borrowers. Debtor shall remain as Borrwer until a plan of reorganization is approved

by the Court. Trasfers of ownership or contro I by the existing Borrwer to otber entitiesor persons as provided in a plan ofrerguni:ation approved by the Court shull beallowed.

. CollaterL. At all times, Lender will retain its secunty interest in its collateml with the

same pnority that it had as of March 2, 2009.

. Tenn. The tenn for each toan shall be five yeai's from the closing date, which shall heentry of a court order approving tht: IOltIl mouificatioii or an order confinniiig the Chupter1 t plnn tùr the unitary enterprise, whichever is earlier.

. Interest Rate. The interest shl be a fixed rate eqiU\l to So/ perent for year one through

thre and 6'. percent for years four and tive. The default rate wHl be 200 basis points in

excess otthe non-default rate.

. Amortizaton; Payments. Monthly payments shall be payable on the 1 üth day of each

month, with a tivc"day grace penod. During the tirst year following the Closing Date,payments shall be interest-only, with no principal amortization. 'Oiereafter, monthlypayments shall be in an ßmountneccssary to amorti?.. all principal and interest owing onthe loan in 360 equal, monthly payments of piincipal and interest.

. Principql Balance. The principal balance at the Closing Date wil be equal to the

principaJ owing on the Loan and tmy accrued, unpaid attorneys fees. Accrued lute lè~s inthe amount of$25,618.33 wil be waived upon entry ofaii order approving this tonnsheet. Any past due interest (approximately $39,741) shall be paid from funds ondeposit in the deposit control account upon execution of a tenn sheet by boih paries,along with $10,000.00 to be applied to accrued attorneys fees. The portion of thepnncipul balance pertaining to remaining attorney tees of approximately $40,000 to$50,000 may be amortized over a six month period commencing July I. 2tl i 0 and paid in~\dditioii to the regular monthly inteiwt pnyments. Lender shall verify the ltccrucdattorneys lèes us of March 3 i, 2010.

Page 1 - SEl'I'LEMENTTERM SHEET

Exhibit 1

Page 1 of 3

Case 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 11 of 12

. Reserves. Borrowers will make monthly payments of reserves for taxes and capita

expenditures. All such reserves shall be available to be drawn on by Borrowers asneeded to pay taxes and capital expenditures.

. Financial Projections. Borrwers wil deliver to Lender financial projections that will

include projections tor cllpital expenditure and real estate taxes. The amounts of thecapital expenditure reserves and tax reserves, together with the terms of any finwicialcovenants, will be deteine from such financial projections.

. Management. Debtor shall continue to manage the propertes through the effective dateof a plan of reorganzation approved by the Court. The Debtor's administrativealloca.tion shall not excee 7%, provided that the applicable management tèe for thispropert shall be consistent with the management fee for any other properties undercommon management. Thereaftr, Debtor's successor wil serve as property managerllCCrding to the plan of reorganzation.

. f'inuncill Covenants. There wil be no debt yield tests, loan..to-vaJue tests, minimum

revenue/income or other financial covenimts.

. Releases. It is contemplated that this Transaction will be approved by un Order entere

hy the Court. The Order will include a release of Lender from all claims, known andunkown, by the Reciver, and aU Recei verslup Entities, unless such claims are assertedwithin 90 days following the entry ofthe Order. In the event n claim is asserted by theReceiver within the 90-day period, then the claims of the Receiv~r wil be submitte to

mediation. Absent a mediated resolution, the mutual releases set forth heren will hedeemed void and of no fuer force and effect on the 120th day following the entry of

the Order, but Lender shall be entitled to retain uny payments mnde pursuunt to this TennSheet and the modification iif loan terms shall remain in eftèct.

. Automatic Stay. Tne order approving the restructiuing of indebtedness held by Lender

shall provide that the automatic stay imposed by 11 U.S.C. 362(a) is modifed so thatLender shall have immediate relief from automatic stay and shall be permitted to procdwith foreclosure without further order of the Court in the event that (t¡) tui Event ofDetliult has occurred under the loan documents, (b) Lender has provided written noticetliercofto Debtor, and (c) Debtor has not cured the default within 10 days ofrcceipt byDebtor of the wdltcn notice. Further. the Court shull have and retain exclusivejurisdictin over any dispute with repect to the occurrence or cure of any Event ofUciimlt under the amended loan documents.

. Guaanties. Lender and all guarantors wil execute mutual releases.

. Plan Acceptance. Lender wiU vote to accept a plan ot'reorganization t1u\t treuts Lender inaccordimce with ths Term Sheet. (Lender rerves input concerning fonn of

documentation for lOWl inoditicntion)

By its sigmiture below, each pary indicates that it approves this Term Sheet. Except withrespect to the last bullet point, signature below dot-OS not bind any party, but indicates the intent of

each stich ptu1y to proceed to dOClUnentiitÎoii of dctinitivc ugi'coments mmiiorializing theTransaction. li is iinderstood thatlhc Tntlsltctiol1 is nul hinding until ddinitivc documents havePllg~ 2 - SETlLHMENT TERM SHEET

Exhibit 1

Page2of3

I ' 'lCase 6:09-cv-06082-HO Document 1158 Filed 04/30/2010 Page 12 of 12

been executed and delivered by all paies and the Court has entered its Order approving the pliinofl'eorganization, the definitive agreement and the trnsactions contemplated thereby.

LEWIS & CLARK BANK

~~'c/By G ,-Itll~¿~";

i

CLYDE HAMSTREET. CRO .

~~

Page J . SETlLEMENT TliRM SHEETU:14ftISlllllOO III W.IK Ilv I

Exhibit 1

Page 3 of 3

EXHIBIT 9-12

SETTL.EMENT TERM SHEET - CORNERSTONE COMMUNITY BANK

This Settlement Term Sheet ("Temi Sheet") has been prepared to faciltate settlement and, ifnecessary or appropriate, mediation, concerning loans held by Comerstone Community Bankaiid its participants ("Lender" or "Lenders") to Stayton SW Assisted Living, LLC, consisting ofthe Sunwcst UrtHaty Enterprise as determined as entered in U.S. District Coiirt Case No. 09-CV-6056-HO("SECRcceivership Case"), Debtor and Debtor-in-Possession ("Debtor"). This TermSheet is to faciltate settlement and mediation, and is for discussion purposes only. Nothing inthis Tenn Sheet is binding 011 any party and 110 party wil be bound to any agreement until suchtime, if any, as a formal written ahrrcement shall have been executed and delivered among theparties.

The goal of this Tenu Sheet is to faciltate a transaction (the "Transaction") extending andrestructuring each Loan. The date on which the Tnmsaction becomes effective is the "ClosingDate, II which shall be the Effective Date of a plan of distribution and restl1lCturing.

. Borrowers. Debtor shall remain as Bon'ower until a plan of reorganization is approvcd

hy the Comt. Transfers of ownership or control by the existing Borrower to other entitiesor persons as provided in a plan ofreoi'ganìzation approved by the Court shall beallowed.

" CollateraL. . Atall times, Lender wil retain its security interest in its collateral that it has

as öfMärch 2, 2Ú09.

. Temi. The term tòr each Loan shall be five years from the Closing Date.

. Interest Rate. The interest shall be a fixed rate equal to 5.25 percent for years one

th1'ugh three. For years four and five, the interest rate shall be adjusted at the beginningof the yeartöà fixed rate at the existing WSF prime rate plus 150 bps; the contractuall'tlteshall1iåve a floor ofS.25% for years four and five and a cap of at 5.75 percent foryearfour and 6;75 percent for yeär .five, The default tate wil be 500 basis points inexcess ofthe non-default !'te.

.. Arnòrtization;Payinents. Monthly payments shall be payable on the i Oth day of eachmonth, with a five-day grace period and thirty days to cure after issuance of writtenl10ticeft01' Lender. DurÍlig thef1rst six months fòIlowingthe Closing Date. paymentsshaH be interest"only. with no principal amortization. Thereafter,iuonthly payments shallbe in an ainountneeessary to amortize aU principal and interest owing on the loan in 300

equal, monthly payments of pl'ncipal and intel'est.

. Balance. The principal balance at the Closing Date wil be equal to the"'iiig on the Loan, together with any accrued and únpaid interest calculated at

the non~detllUlt rate plus reasonable legal fees and costs incuned by Lender in connectionwith the negotiation of this Transaction.

Page I - SE'ITLEMENT TERM SHEET

. Reserves. BOl'owers wil make monthly payments of reserves for taxes and capitalexpenditures. All such reserves shall be available to be drawn on by Bon'owers asneeded. There is currently $206,275.43 of available funds in a replacement reserveaecount held by Lender. Lender a&'1ees to release funds to borrower for capitalimprovements and defen'ed maintenance subject to an acceptable budget, evidence thatthe work has been completed and lien releases. The remaining funds would be placed ina working capital account for Peachtree Vilage GA.

. Financial Proiections. Borrowers wil deliver to Lender annualfinanCÎal projections

broken down by each month that wil include projections for capital expenditures and realestate tGxes. The amounts of the expenditure reserves and tax reserves wil bedeterrined from such financial projections.

" Management. Debtor shall continue to manage the properties through the date ofapproval by the Court ofa plan of reorganization. Thereafter, Debtor's successor wilserve as property manager according to the plan of distribution and restructuring. TheDebtor's administrative allocation shall be 7%1 for the tìrst year and shall not exceed 6%for years 2 through 5.

. Fìnancial Covenartts. The loan documents shall contain a debt service coverage ratio

(DSCR)covenul1t. Upon the Closing Date, there sball be a two year covenant holiday.Thereafter, there shaU be a debt service coverage ratio covenantofL.O to 1 calculated as

of the end ()feach taleriar quarter for thetrailngtwc1ve-month period. In the event thattheappHcableDSCR aSuftheend of any calendar quarter (based upon thettailng

twelve~month period) is not men"a Cash Trap Event"), stlchfailure shall not constitutean Eventof.Default.butaU e~cess cash shall be trapped in a lockl:ox account until suchtime as BOtröwersatisfies the applicable quarterly DSCR, at which time the Cash TrapEvent shall terminate.

. Releases. It is contemplated that thisTransaction wil be approved by an Order enteredby the Court. The Order willinclude arelease of Lender from all claims, known andunkown, by the Receiver, (luclall Receivership Entities, tliless such claims ure asseitedwithin 90 days following the entry of the Order. In the event a claim is asserted by theRecciVenvithin the 90.dayperiod, then the claims of the Receiver wil be submitted tomediation. Absent a mediated resolution, the Transaction wil be deemed void and 01'110

further force undeffect on the 120th day following the entry of the Order.

. Guaranties. Lender and aU guarantors wil execute mutual releases. The Loan

documents wil contain a typical "Bad Boy" guarantee.

ePlanAcceptance. Lender wil vote to accept a plan of reorganization that treats Lender inaccordance with this Term Sheet.

By its signature below, each patty indicates that it approves this Term Sheet. Except withl'espect to the last bullet point, signature below does not bind iiny party, but indicates the intent ofeacb such party to proceed to documentation of def1nitive agreemçnts memorializing theTransaclion. It îs understood that the Transaction is not binding until definitive documents have

Page 2 ~ SETTLEMENT TERM SHEET

been executed and delivered by all parties and the Court has entered its Order approving the planof reorganization, the definitive agreements and the transactions contemplated thereby.

ByIts

Page 3 ~ SETTLEMENT TERM SHEET034845/00001/159481Ivl

CLYDE HAM STREET, eROBY~i\S~~

EXHIBIT 9-13

s 1)1) 2

SEttLEMENT TERM SHEET" HRST NATIONAL I~ANK OF W AUF' ACA

This Settlement Term Sheet ("Term Sheetll) has been prepared to faciltate settlement and, ifnecessar or appropriate, mediation, concernng loans held by First National :Ban ufWaupaoaand its. parcipants (if any) ("Lender" or "Lenders") to Stayton SW Assísted Livìng, LLC,consisting onile Sunwest Unitar Enterprise as detennined as enti:ied in u.s. District CourCase No. 09-CV-óOS64iO ("SEC Receivership Case"), Debtor a:id Debtor-in-Possession("Orøbtot'). This Temi Sheet is to faciltate settlement and mediation, and is for discussionp1.rposes only. Nothing:in ths Term Sheet is binding on ány par)' and no par wil be bound toanyaiteemøntunti such time, if any, as a fomia1 written agfeem~mt shall bave been executedand delivei-ed among the parties.

The goal of ths Temi Sheet is to faciltate a transaction (the "Transaction") extending andrestnctung each Loan. The date on which the Transaotion becoitr~e$ effective is the "Closingbate, ll which shall be the Effective Date of a plan of distribution add restctng.

· BolTOWèl'§. Debto,;s'shall remain as Borrowers unti a plan of restrctung and

distrbution is approved by the Cour. Transfers of ownership Or control by the existing

:Börtowers to other entities orpersons.iîprovided in a pIau of reorganization approved bythe Courtshall.be allowed.

. It Collaterah. Ata11 times,Umder wil retaIn its security Ínteeost in its collateral

that it hasasøfMaroh 2, 2009. . ,.., ....ø .1JI. The tenn för each Loan shall be thee years from the: Closing Date. In addition,

each Loar may be extended, at the option of the Borrower, for two additional one.yearterms, provided there is no default existing and continuing us of the maturity date andBörtowerpays an extension fee of25 basis points, which fhi~ wil be capitalized andadded to thep1'cipal 'balance of the Loan.

o Interest Rate. The interest rate for the initial thee-year term of the Loan shall be a fixedrate equal to 5.25 percent. In the event Borrowers exercise ';l1eir right to extend fur; Loan,tien. the interest :rate shall be adjusted to a fixed a:inual inteu\est rate for thø term of theexiet1id:i equal to the prime ratø as of the first day ofeach~,xtension plus

I 50 basispoints;provided,.howevef, that the interest rate wil not incWl,aseby more.than 150 basispohitsfor the. i(iri of any extension. The default rate WiirlJl~ 200 basis points in excessotthø tion-default rate. '

ø A10I1i?iation~ Paymel. Monthly payments shall be payab:le on the 10th day of eachm.onth, with a five-day siace period. Monthly payments sl~.aii be in an amountnecessltty to amortize all principal and interest owing on theiloan in 360 eq'ual, monthlypayments of principal and interest beginnng Jai.luar 1,2010.

ti Principal Balance. TIie prinoipal balance at the Closing Dat~i wil be equal to the

prinoipal owig on .the Loan, together with any accrued and ',mpaid ìnte:est calculated atthenOì'..efault tate plus reasonable fees inculT~d by Lender in connecton with tlenegötìation of ths Transactíon. Lender agrees to advance$~,SO.OOO for deferred

maintenance whíêh shall be added to the pnncipal amount out.standig.lage t - SETtLEMENT TERM SHEET

;..:

o :emlQ~:Jßlj(l~JtIÇLC£mtitltie..!..h~ru~. fOr il!ît'falms.!Mi.tJ:iØ e:iiiitip,g,mownt.i.ilt.fcl9i.l!. Those pay.ments shall continua until tho restructuring contemplatedby tbis tam. sheet il! llOCOìUJ.itislied

i¡ n,~(jff. Borrowers will makt' monthly payments of'rose rVtl$ fhr taxes and capital

expenditures. All such rel'Ol'tis shaH be avaílable to bo dmwn on by Butl'owtll'$ asneeded.

f/ ~çjLeroie.Ç.tiQn!l. Bor.i:Qwcrs have deIivered to r~nci('c financial proj el~til"11s that

:ili;deprQj~ctíona for capital mcpendltu:res and real estate taxes. The amounts oftb,étlxfJøiid.itu.ro:iCSCi'tl$ nod tax reswrves wil be deteitrid fjiom such finariciw.prójectiöiis.

/i Mitml.~niQm. Debtor shall continue to nerve IW Pl'Pt"Jty niaiiager tlixough the date ofapi):('víiJ by the Come of ;'t plan of rcorg¡\niintioii. Thti ))ehto!' s administrative allocations1tâllbe 1%. Theroafter. Sunwest or its tmcuøstlor wil servo 11$ propi~rty rmuuiger

accordg to the plan of disÍ)~'fbutìon aid restructuring,

*' FiXlncial.QQIê~q, 'rie loan. documents w11 oontain H dI,~ht servce coverage ratio(l)SCR) êovenant. Upon the Cloail1g Dato, there shall he ~i, two yeai' COV6J:i.ant holiday.Thet'eafter,thel'esb~ill bert debt aervicecoveragoratio CO'V(IL'laìt. of 1 ,0 to lcalctdated asø.ftlß øidofeuchcalendarqiiflrter fbr the trailing twelV(;HtlOnth period, In the event thatthøapplicablePSCR asoftheendohuy calC'I1daquurter j$ notmeetC'a Cash 'lt'tltJEveut"', sni:hfailureshall not constituto Uli Evønt(if Døfa1.lt bút all excess cMh shan bett,lpptidfua lookbox aocôUnt tmtilšuch th:i16 mi Borrówøl;'~1Lti!llít:R the applicableql.ia;rI~rly nSCR1tlt which tiniothe CashTt'ap Eve:ntshaU t(:miinato.

øB,eleas~. It is C011templatedthatthg TransactioJ:! wiUbc at1proved by an Order entered

i,ytbe Court. The .Orer wil inctude'ii reloase of Lendei' .f':iiiiall claims, known andUlikr()Wn. by tl,oReceiver, ¡lid a.ll R.aceiveJS1ùp Entities,'Uitess slwhcJaiis areassertødwithîn90 s £bUowi:ng theøntry otthcOrder. hi the evø¡\taclaittli~i~sertêd by theR.e()~iver . . tbe9Q~dayperod, thentbeclalnsoftbeRll1cøiver wm be submitted tomediation. Absent (1. mediated resolution, theTi~insaction wil becIeemfId void and of ¡'tofurter force andetíeotöii the 120m day to llowing the. enti';siofthe ()l'd(i:t.

" GU~almÇ"lì. Lender and an gmirantol's wile)Cecutømutualioeleascs.

f/ lA::ndt:'ngret'$ to d1'QI' par:¡uipntio~), :ii ttié aiipea.ls.

ii lJ&lAoç~á;1Øa. Lemlei' wil vote to aúC(lpt a plan ofl'eorga.lthmtkm that treats Le(lder inac4~t:irdUfCt1 with t.his. Term Sheet.

Byitssigi:iaturc høli¡w, each pary indicates that it appl'Veii ths Term Sheet. l~xccpt withre$pecto the la$tbulletpoil't, signatwe below does not bind ilJ.Y p;i;rty, but indiöttes the intent ofeach such páry töproceed to docu.ntentatiQl' of definitive ugt'e~ieTJts meiorializing theTrunsaøtiøn. It IsuiiderstOìd that the Trnfl$~llJti()l\ ¡snot binding Ulii: dtlfin,itive döcumeiits bave

:Page 2 - SEli'LEMEN! TERM SHEET

"

, 04

been exooutedand delivered by all pares and the Cour has entered its Order approving the planof reorganization, the definitive agreements and the transaotions ('Otttemplated thereby.

FlRST NATIONAL BAN OF WAUPACA CLYDE BASTREET, GRO

By :t0t .~~ i Q .~£Je6 6,t:Its ..A,c;.rf Jspvl

=: ~: ",¡t::l~-tbt~o~~

Pag~ :3 - SeTTLeMENT TERM SHEET0341145/O0llI1l594S! i vI

EXHIBIT 9-14

Date: t....\t ..,o(

Fìrst National Bank& Trust Co. of McAlester HemblrFDIC

Number of pagesIncluding cover sheet _"__.._~

'.,

CONFIDENTlAI.TY NOTICEThis facsimile tronsmìssìtJ Md the documents accompany ina It may contain oonrldentiallnformation befonging to thesender which is proteced by Federal Banking RegulatIons or other privleges. fhe Information is intemdt' only fordolivery to thø indivIdual or entiy named below. If you are not the intended flcipient. you hereby notifli that any

'-, disclosure, copying, dlstrlbutfon, or thfi taking of any action in reliance on the contents of thfs transmission fs strictly

prohibited. If you have received this transmission In error,please immeålatety notify us by telephone to arrange forreturn of the documents. .TO: ~\tu:i ~",~J FROM: r~$. N\il""~'

Fax Number: 5. ..SV~ v \t~i,

First National Bank & Tr. Co.P. Q. Box 948McAlester, Oklahoma 74502

Telephone: 918-426-0211Direct Line:

Fax Number: 918-426.6335

Telephone:

o Urgent o For your review o ReplyASAP o Please Comment

7 lldL&mm2 "2'i01/28/2010 18:09 FAX 918 42£ . ~

_111111111II11111121111FIRST NATIONAL BANK & 002/003

SIi:lll,EMEN1' Tfi~RM S11I1:Kr - ..'UtS1' NA110NAI. IiANK & llUIST CO. OJi'MeAI....;STfl;ll ("eoder)

This ScHIi:inenl Term SI1\)cI ("Term Shi:ct") hus been prcl"tlreJ 10 llicllituh: :-ljulimicnl undo ifllCCC~Silry or urpnil~l'ialt... I1I.!tJiiitiun. cunct:rnin~ k,lillS hdd hy 1''iI1lt Niiii.inal Uank &. Trust (, 'u.or McAlester cind its pui1icipmiis ("Li.mùcr" ur "Lenders") to Stayton S W Assi~t~~l Living,- LLl',cuiisistill!t uf the Sunwcst lJilitiiry Enterprise iis ùclcnnincll us entered in LI.S. District (. 'ourl('asc Nu. Ut).('V-6056-IH) ("SE(' Rt,-cdvcrship ('ase"), Di:blol ami Deblur-iii-PossessiunC'Debtor"). This Term Sheel iii 10 Hicililùic :)clllcmcnt and iiicdiaiion. umJ is I¡ir discussion(lUlTi:-i.S tUllY. Nuthing in tlds Term ShL,-cl is binding fill any pm1y iind nn i)urly wil he l'nuiid IUuny ag;I'cCI1Cnllintil such time. ifaiiy. as H runmll wriuen agrtic:mictl :-h.ill h;ivc hccn cxc:cuh..-d¡\nd dclivcn:i. 1Illnng.ihc pnrics.

The g.mLl lIf this T~rii ~htiel i~ tu nicilitatc tltrnnsaction (the "TnimltlCIÎn\l") cxtcnÙiñf: ¡\tdi'\.structudn~ C'~idi Loun. The ibilc \)1 which the'fninsactitlll liCiillCH cl1cctivc i:- the "('ol'ing

Dalc." which ~h,dl Oll thc ¡'llcclivc Dati: or à plan or dislrihlUiiin anu resinicIlI'¡llJl.

. Burru)Nl.r~. Dehtur shall rClll1ili as Bilrri)WCI' untili\ plan 01' n:orl!ani:t..\liun is tIPPI'IVi:Ûby the ('\lllrl. Tmnslèts uf iiwncrship (lr cniilrni by the exi::liiig Uurrowcr to uthe-i' entitiestir ~rsiins as provillci. in a plan ul rCll..gtlli~.ulÍnn appruwd hy th~ Courll'hilll heallnwcd.

. (\,I.Ia.tcrùl. At alllÎmcs. l.cuJcr wil retain iis scclIl'ity interest in its cnll:ill;ral with Ihe

saill:rrimity ihai it had as or Murch 2. 201N.

. Tcm.i. Thl. Ii;rm '(lr ci.i,h L.oun shaH be liw yours (rom ihe Closing Dole.

. J.uii;rcsl Rlll-'~. The intereiil Hh¡¡U he a t¡xed l't~ cl.Llùl tu 4,75 percellt Ihr yCnl1l OIlC

ihrmigh thi'c~. Fur Y~lIt: linir and fiw. ili~ interest ...1Ic iihtlll bciulJmited ¡LI the I:c~¡nnini:nl'thc Yl.nr tn ulÎxcc. rit~ Itt ihe Llxisting I'riiic nile. plus 150 bps with tiimixiniiillincrcm¡ùlhlJll ihe prcvinus yi.mr of llO llris. The dclliill nih: will he :mu hnsis poiiits in

i:xci:ss of ihl.nun.t\~niih mtc.

. A1JJ.lijl~,ii91l; PaYJncn!l. Munthly payincnt:- shall be payable on the 10th day or ~:ach

munth. wiih a nvc~duy gmcepcrìud. Beginning January 1, ::mlU. monthly payments shallhi: in an "mulIlIl iicccss¡\ry iu Ul1ut1Îzc all principal ..lId inicl'csl uwing Oil the: loan in JOtlciiuul. monthly fluyinenili or principiil and interest.

. I)rinciiiul HuhltW~. The principiil balance at thi: ('hlNing Date wil be ec.iunl to the

principnlliw¡llg UI1 the LtHln. ltlgcthcr wiih nny nccrli~(1 amI uiipnid inicrcsi \,ulcubh.:d iilthe lull\.dcil1l1ll rate plus reasunable lcgul lees ilicurn:lI hy Li.lllcr in iionneclion wilh lhencgutiiitiun ur ihis Tnimmciion.

. R...scry\),~. I\m'lllw...rs wil make iniinlhly Jliiyinc:nt:: or i..!servcs lì.ir iu:'c:- nod capÍlal

cXJ'lltlilurc:i. All slll'h i'cscrvcs l'hiil1 he availatilc tii he drawn un hy liolruwcrs ;i~nlxuc(l.

llai:~' I J SI':Tl1.HMEN l 'I'ERM sui.;:r

/003

It 1':h\~llcíal.Pi:I.i.kIj.H1W. !lUl'l\Wcr:- wil dclivçr to Lcnder liimm;iul prnjcctimi:i tltnt will

include (l11:ijcdioml Ihr ciipiial expendiiures and fl,UI i,:-tl1tC' luxes. The amuunis ol lhecxpi;mliturc l'cscrVC:i and Iil." rcs~rvcs will'c ,lcl~rmineJ frum such IìI1i1ncial prujcctiuiil'.

. MilimiiC1lCnl. lkhiui' .shall coniinue Iii muiiu~ti lhe prulicrticN ihruullh ihe cllcclivc \lulC'

nl ~i PlUil (II' ri:nr~i.ii:tiiiiun :irirruvcd hy Ihe ('ulIrl. The Dcbior's ni.minislmtivc11lluciltinn shnll he 7%, Thcfculicr. Debim's Siicccssnr wil scrw ¡IS property ll'IIl,Il,crammnlinp. itl Ihe Plô.l (If ri:'UlWini:tiiLiOli.

. Financå¡.iH.'nvC!)lIlIS. Th~ luan d()i;lln~ltl!\ wili'ontuin it ,kht l'crvkc cuvcmgc ruiio

,'ovcimni: hnw~vcr. Ihi:rc wil he a Iwo year holidt\Y from the cuvcmiil. F~ll ymmi Jthrough 5. Ihi: ùcbt si:rvjcc cuvemuil mtin wil he ).1 to i. In Ihe CWl11 Ih.il ih~ l'S( 'K

lesi is nol Sltlislici.. Ihe uilly CtlliscqUI.\'CC shall he ;1 ca:¡h Inii) which shall Oc suhji.i:t luCUT\ (i.C'. 1¡.¡llIC' hi stllisl') ihe IlSeR 'lCilt :-hull nut he It ildillllllllk'r 11K! Il.lUll lind ~h.11I

nol rl.l:;ult in liiiy lu¡¡nJ.llury prCriUYllcnl of the lunn).

il Ri.k.lh".i;~. II is cunh,'llphiktlihal ihis 'lransacliill will he ,ippmwl.lliy an ( )likr entered

hy ihe ('nurl. The ()I'ilcr wil include ~I ri.h.ul'"; uf I.culler lmm ull duiins, kimwn andlI11kmnvn, hy thi: ReccÎver. anù ~11I Receivcrship Enliticii. 1Illks:- sud. claims an.. .lSSCli....dwiihinlJl i.ays Itllll)wil1l: Ihe ciliry ulïhe (kdcr. In ih.... i:Wllt .. duim is iisscltl:d hy IheRi'c,-ivi.r wiihiiiihc 9(1~d¡¡y pcl"iml. theii the cl¡iiiim iiflhc R~cC'vcr wil nt submilli.t1 10nu:..II"Oull. Ahsciil II in~tJj:itèll ri,'soIUliul1. Ihe Trimi;uciii'ß wil h\: dccmi.d viiid ..1l1.1 "f IlllIlii'ihi'r J(ll;lJ and dlci.UH Ihi!120th i,hiy Ihlhiwing thl. ..:try nf Ihe ()rdcr.

.. (jml.r.illti\..~. I.elnler aiii alll1,uilliniors wil exec lite mutwil rdc.:.'lcs,

. 1~laIiAccl'Jlt~lni;'t. Li.ndci' will vole 10 ;u;i.cpl tl PIUliiil r~()Il~lIi:¡..ution ihai trenls I.cl1l~r in

Hccimlancc wiih Ihis lcrm SIil:i:I.

Ily its siv.1l111l1'e hchiw. cm:h part)' iiidicaloB thai il iippriivcoli ihi:i Tcnn Slll:i.l. I-:scclll with

l'I:SPèd IU ihe ¡uNI hullel puint, sii,niltlll'c hi:uw d(ws nul hind ¡iiiy f1l11y. hul imlicalcs the inlenl Ill'em.:h such J1urty III pwci.cd hi dUClII1lmtaiiim oldcliliillvC' 4lJ.ètmiimbII1Cl1ulÍ¡dir.iii¡L tlli.Tniiimdiiiii. II hi iinucrsiuud ihut the Tr~in~ictiuJ) is nol hinding until dclinitive documl.mis hawhi'~.11 ..~~l,ciilcli aiii deliverei. hy till rturtics tint! the ('mirt I1ml cntemd its ()l'icr iipprnvini, Ihe "hilIifMlf¡i.ini.....liull, Ihi. ddïniliw agrcct~i..mti; ¡.l1Ú the In.mmii:tiiiils i:nll~mplnted thereby.

1''1I~'' NATIONAL. BANK &, 'mi)s,\('o.01' ,i.; T'.Ily _ .. ~'IÚ1+ . ---__ Ily__ \.)4:~'i"_:':./_. , - ---.Iis . i-(tVi'C''~ ~,~ l~__.._............. Ils r..l¿P. .I?rr/:""s.J!~--..i.iri:..:,'.'l/ :~:':"'._.

('I, VnE I r AMSTREET, CRO

I'..¡.l.'~! - SHTTI.i~MFNT TFRM SI WEI'"4Itl"/.~1U1l11l "'.UII Ivl

EXHIBIT 9-15

"

SETTLEMENT TERM SHEET - THE National Bank - Graysonview Selinsgrove

This Settlement Term Sheet ("Tenn Sheet") has been prepared to faciltate settlement and, ifnecessary or appropriate, mediation, concerning loans held by THE National Ban and itsparticipants ("Lender" or "Lenders") to Stayton SW Assisted Living, LLC, consisting of theSunwestUnitar Enterprise as determined as entered in U.S, District Court Case No. 09-CV-6056-HO ("SEC Receivership Case"), Debtor and Debtor-in-Possession ("Debtor"). This TermSheet is tofaciHtate settlement and mediation, and is for discussion purposes only. Nothing inthis Term Sheet is binding on any patiy and no party wil be bound to any agreement unti suchtime, if any, as a formal written agreement shall have been executed and delivered among theparties.

The goal ofthis Term Sheet is to facilitate a transaction (the "Transaction") extending andrestructuring each Loan. The date on which the Transaction becomes effective is the "ClosingDate," whíchshall be the Effective Date of a plan of distribution and restructuring.

· Borrowers. Debtor shall remain as Borrower until a plan of reorganization is approvedby the Court. Transfers of ownership or control by the existing Borrower to other entìtiesor pel'sons as pl'ovided in a plan of reorganization approved by the Court shall beallowed.

· CollateraL. At all times, Lender wil retain its security interest in its collateral that it hasas of March 2, 2009.

· Term. The tenn for each Loan shall be thee years from the Closing Date. In addition,each note may be extended, at the option of the Borrower, for two additional one-yearterms, provided that no event of defaultshall have occurred and Borrower pays anextensiónfee of25 basis points computed on the then outstanding principal balance,which fee wil be capitalized and added to the principal balance of the Loan.

· InterestRate. The interest shall be a fixed rate equal to 4,9% percent for the il1itial threeyearsuftheloans. The interest rate for each extension period shall adjust on the first dayof each extension period to a fixed rate of the WSJ prime plus 150 bps, not to exceed5.75% and 6.75% in years 4 and 5 respectively. The default rate wil be 200 basis pointsin excessofthenon..default rate.

· Amortization; Pàyments. Monthly payments shall be payable on the 10th day of eachmoiith, with.a five~c;aygrace period. Monthly payments shall be in an amount necessaryto. amortize all principiHand interest owing on the loan Ìli300 equal, monthly paymentsof principal and interest beginning upon confinnation.

· Principal Balance. The principal balance at the Closing Date wil be equal to theprincipal owing on the Loan, together with any accrued and unpaid interest calculated atthe non~default rate plus reasonable legal fees and other costs incurred by Lender inconnection With the negotiation of this Transaction.

Page 1 - SETTLEMENT TERM SHEET

"

o Reserves. Borrowers wil make monthly payments of reserves for taxes and capitalexpenditures (calculated at $350 per year per licensed unit). All such reserves shall beavailable to be drawn on by Borrowers as needed.

. Financial Projections. BOlrowers have delivered to Lender financial projections that wil

include projections for capital expenditures and real estate taxes. The amounts of theexpendìture reserves and tax reserves wil be determined from such financial projections.

. Management. Debtor shall continue to manage the properties though the date ofapproval by the Court of a plan of reorganization. The Debtor's administratìve allocation

shall be 7% of revenues. Thereafter, Debtor's successor will serve as property manageraccotdingto the plan of distribution and restructuring.

. Financial Covenants. There wil be no debt yield tests, loan-to~value tests, mhiimumrevenue/income or other financial covenants. There shall be no defaults whìch are tied tothe occurrence of a "material adverse effect" or a determination by the Lender that it isnot fully secured.

. Releases. It is contemplated that this Transaction wil be approved by an Order entered

by the Court. The Order wil include a release of Lender from all claims, known andunkown, by the Receiver, and all Receivership Entities, unless such clairns are assertedwithin 90 days following the entry of the Order. In the event a claim is asserted by theReceiver within the 90~day period, then the claims ofthe Receiver wil be submitted to

mediation. Absent a mediated resolution, the Transaction wil be deemed void and of nofurther force and effect on the 120th day following the entry of the Order.

. Quaranties. Lender and all guarantors wil execute mutual releases.

. Plan Acceptance. Lender wil vote to accept a plan of reorganization that treats Lender inaccordance with this Term Sheet.

By itssigriatuie beloV',each pary indicates thatit approves this Tenn Sheet. Except withrespectto the last bullet point, signature below does not bind any paty, but indicates the intent

ofeach such pary to proceed tó documentation öf definitive agreements memorializing theTransaction. It is understood that the Transaction is not binding untí definitive documents havebeen executed and delivered by all parties and the Court has entered its Order approving the plan

ofre()rganization, the definitive agreements and the transactions contemplated thereby.

THE NATIONAL BANK

~~.)

'2~!I-/O

CLYDE HAMSTREET, CRO

BY~U~~~ .Its aO f2~;J4~Z- (f4 (lQ

Page 2 -SBTILEMENT TERM SHEET034845/OQOOl1l94811vl

EXHIBIT 9-16

~

SETTLEMENT TERM SHEET - THE National Bank - Minnetonka

This Settlement Term Sheet ("Term Sheet") has been prepared to faciltate settlement and, if

necessary or appi'opriate, mediation, concel'ing loans held by THE National Bank and itsparticipants ("Lender" or "Lenders") to Stayton SW Assisted Living, LLC, consisting of theSunWest Unitar Entel'pl'ise as determined as entered in U.S. District Court Case No. 09-CV-6056-HO ("SEC Receivership Case"), Debtor and Debtor-in-Possession ("Debtor"). This TermSheet is to faciltate settlement and mediation, and is for discussion purposes only. Nothing inthis Term Sheet is binding on any patty and no part wil be bound to any agreement until such

time, ifany, as a formal written agreement shall have been executed and delivered among theparties.

The goal of this Term Sheet is to facilitate a transaction (the "Transaction") extending andrestructuring each Loan. The date on which the Transaction becomes effective is the "ClosingDate," which shall be the Effective Date of a plan of distribution and restructuring.

. Borrowers. Debtor shall remain as BOlTower until a plan of reorganization is approved

by the Court. Transfers of ównership or control by the existing BOlTower to other entitiesor persons as provided in a plan of reorganization approved by the Court shall beallowed.

. CollateraL. Atall times, Lender wil retain its security interest in its collateral that it hasasofMátch 2,.2009.

. Tenn. The term for each Loan shall be three years from the Closing Date. In addition,each note may be extended, atthe option of the BorroWer, for two additional one-yearterms,provided that no event of default shall have occurred and Borrower pays anextension reeof25 basis points computed on the then outstanding principal balance,which fee willbe capitalized and added to the principal balance of the Loan.

. Interest Rate. The interest shall be a fixed rate equal to 4.9% percent for the initial three

years ofthe loans. The interest rate for each extension period shall adjust on the first dayof each extension period to a fixed rate of the WSJ prime plus i 50 bps, not to exceed5.75% and 6.75% in years4 and 5 respectively. The default rate will be 200 basis pointsin excess ofthe non-default rate.

. Amortizatíon; Payments. Monthly payments shall be payable on the ioth day of eachmonth, with a five-day grace period. Payments shall be interest only, until such time asprincipalamortizationshall begin. Monthly payments shall be in an amount necessary toamortze all principal and interest owing on the loan in 300 equal, monthly payments ofprincipal and interest be~inning in the sixth month after confirmation.

. Principal Balance. The principal balance at the Closing Date wil be equal to the

principal owing on the Loan, together with any accrued and unpaid interest calculated atthe non-default rate plus reasonable legal fees and other costs incu11ed by Lender inconnection with the negotiation of this Transaction.

Page i - SETTLEMENT TERM SHEET

. Reserves. B011owers wil make monthly payments of reserves for taxes and capital

expenditues (calculated at $350 per year per licensed unit). All such reserves shall beavailable to be drawn on by Borrowers as needed.

. Financial Projections. Borrowers have delivered to Lender financial projections that wil

include projections for capital expenditures and real estate taxes. The amounts of theexpenditure reserves and tax reserves wil be determined from such financial projections.

. Management. Debtor shall continue to manage the properties through the date ofapproval by the Courl of a plan of reorganization. The Debtor's administrative allocationshall be 7% of revenues. Thereafter, Debtor's successor wil serve as property manageraccording to the plan of distribution and restructuring.

. Financial Covenants. There wil be no debt yield tests, loan-to-value tests, minimum

revenue/income or other financial covenants. There shall be no defaults which are tied tothe occurrence of a "material adverse effect" or a determination by the Lender that it isnot fully secured.

. Releases. It is contemplated that this Transaction wil be approved by an Order entered

by the Cour. The Order wil include a release of Lender from all claims, known andunkown, by the Receiver, and all Receivership Entities, unless. such claims are assertedwithin 90 days following the entry oftb.e Order. In the event a claim is asserted by the

ReceÌver within the 90-day period, then the claiins of the Receiver wil be submitted to

mediation. Absent a mediated resolution, the Transactiol1 wil be deemed void and of no

furtb.er force and effect on the 120th day following the entry of the Order.

. Guaranties. Lender and all guarantors wil execute mutual releases.

. Plan Acceptance. Lender wil vote to accept a plan of reorganization that treats Lender inaccordance with this Term Sheet.

By Ìts signature below, each party indicates that it approves this Term Sheet. Except withrespecttothe last bulletpoint, signature below docs 11t bind any party, but indicates the intent ofeach such party to pròceedtodocu111entation of definitive agreements memorializing the

Transaction. It is Uíderstood that the Transaction is not binding. until definitivedocumcnts havebeel1 executed anddelivered by all paries and the Court has entered its Order approving the plan

ofreotganization, the definitive agreements and the transactions contemplated thereby.

THE NATIONAL BANK CLYDE HAMSTREET, eRO

:~~,:;1

æ":/(-/CJ

~,,,

Page 2 - SE'lTLEMENT TERM SHEET034845/00001/ i 594811 v 1

EXHIBIT 9-17

Amendment to November 2009 Executed Settlement Term SheetWith Neilsen Manufacturing Incorporated

This Amendment modifies the terms of the executed Settlement Term Sheet entered intobetween the CRO and Neilsen Manufacturig Incorporated ("NMI") in November, 2009, a copyof which is attached as Exhibit 1. The paries agree to modify the terms of Settlement TermSheet as follows:

2. Lender and Securty: NMI was voluntaly dissolved on December 29,2009. As

expressly contemplated by the Settlement Term Sheet, NMI assigned the note, trust deed, andSettlement Term Sheet to its shareholders as follows: (1) Thomas E. Neilsen, Trustee of theThomas E. Neilsen Trust dated Februy 8, 1995, assignee as to 5.9% of the secured debt owedto NMI; (2) Chrstine H. Neilsen, Trustee of the Chrstine H. Neilsen Trust dated February 8,1995, assignee as to 5.9% of secured debt owed to NMI; (3) Stephane Sundborg, Trustee of theStephane Sundborg Trust dated Janua 31, 2005, assignee as to 42.75% of the secured debtowed to NMI; and

(4) Brent T. Neilsen, Trustee of the Brent T. Neilsen Trust dated December 5,2002, assignee as to 45.56% of the secured debt owed to NMI (hereinafer collectively as "theNeilsen Group"). The Lender under any modified loan documents shall collectively be theNeilsen Group. Lender shall retain as security for the modified loan the first position trst deedin the Neilsen Building.

3. Term: The restructured loan shall matue three years after the Cour approves aplan of reorganzation that includes and specifically incorporates the Settement Term Sheet asamended herein. Borrowers shall be entitled to two separate one-year extensions upon 30 daysprior wrtten notice subject to the following conditions: (a) no event of default shall have

occured; and (b) the payment of interest at the rates set fort below.

4. Interest Rate: The interest rate for the initial three year term shall be a fixed rateequal to 5%. The interest rate for the first one-year extension period shall be a fixed rate equal to5.5%. The interest rate for the second one-year extension period shall be a fixed rate equal to6%.

5. Amortization / Payments: Subject to the terms of paragraphs 8 and 9 below,upon execution of this Amendment to the Settlement Tenn Sheet, Borrower shall make monthlypayments of interest only at the applicable rate on the outstanding principal balance. Allmonthly payments shall be payable on the i Olh day of each month, with a five day grace period.

8. Additional Leasing Activity (propert NOT transferred to RElY): As described in

this paragraph, the monthly payment from Borrower may be increased following the first 12months of the restructued loan if the Neilsen Building is not trasferred to a REIT pursuant tothe Receiver's Distribution Plan and Reorganzation Plai. Staring with the fist month of thesecond year of repayment under the restrctured loan and continuing thereafer with the firstmonth of any subsequent one year period, Borrower shall allocate any additional monthly netincome from leasing activity (compared to the average monthy net income from leasing activityfor the prior year period) as follows: (i) 50% to Lender as an additional principal payment; (2)25% to the propert ta escrow (until and unless the propert taes are paid curent andthereafter retained by Borrower); and (3) 25% to Borrower.

AMENDMENT TO EXECUTED SElTLEMENT TERM SHEET WITHNEILSEN MAFACTURIG INCORPORATED

9. Additional Leasing Activity (property trsferred to REIT): If the NeilsenBuilding is transferred to a REIT and there is additional net income from leasing activity in thebuilding, any additional monthly payment required from Borrower (as calculated under theprovisions of paragraph 9) shall be allocated as foIlows: 50% to the propert tax escrow (untiland unless the propert taxes are paid current and thereafter retained by Borrower), and 50%shall be retained by Borrower.

11. ReLeases: Any Order approving this Settlement Term Sheet as amended and/or

any documents for the restrctured loan wil include a release ofNMI and the Neilsen Groupfrom all claims, known and unown, by Borrower, the Receiver, and all Receivership Entities.In the event that the Settlement Term Sheet as amended is not approved in a stand alone Order,but is expressly incorprated into an approved plan of reorganization, the Order approving that

plan shall effect the release described in the preceding sentence.

O 12. Guaranties: Lender and all guarantors wil execute mutual releases of all claimsL ~ relating to this loan.. ~ ~~,j 15. Banptcy Proceeding: The paries agree that the entire debt formerly owed to\ (l 'ï t\ NMI (.and n?w curently held by the Neilsen Group.) shall be an allowed secured claim to the full

t1 ;¡ amount ofthe outstanding balance under section 506(a) and (b) ofthe Banptcy Code without

offset, counterclaim, charge off, subordination, or reduction of any kind or natue and shall betreated in accordance with the terms of ths Settement Term Sheet as amended, which shall bespecifically incorporated into the plan of reorganization. The CRO agrees that it shall not seekany fuher modification of the loan (beyond that stated in ths Settlement Term Sheet asamended) in the banptcy proceeding. Lender will vote to accept a pLan of reorganization thattreats them in accordance with the terms of the Settlement Term Sheet as amended.

Any Order approving this Settlement Term Sheet as amended shall provide that: (a)Lender wiU be entited to exercise its rights and remedies upon the occurence of an event ofdefault of the restructued loan without interference from the Distrct cour whether in the SECReceivership Case or in any banptcy proceeding or other proceeding; and (b) The injunctionissued in the SEC Receivership Case and any banptcy case automatic stay are lifted andpermanently and irrevocably vacated as to Lender and the Neilsen Building. . In the event thatthere is no stand-alone Order approving this Settlement Term Sheet as amended, an Orderapproving a plan of reorganization that incorporates this term sheet shall have the effect of thepreceding sentence.

Except as expressly modified above, the paries hereby ratify the ters of the originalexecuted Settlement Term Sheet. Faxed or emailed copies of signatues shall be effective asoriginals. Ths document may be executed in counterparts.

/I /II

1/ /I /

/ /III

/11/1

2 AMENDMENT TO EXECUTED SETTLEMENT TERM SHEET WITHNEILSEN MANUFACTURIG INCORPORATED

.mi.¥' .2010 DATED tls _ day of ,2010,~.ktee

By:lyde Hamstrt

Its:Cbiet Restrcturig Offcer~Shirley DunIts: Chief Financial Offcer

DATED ths t1 ~y of l'~ ,2010~l/~J~~y:Chrstie H. Neilse, Trutee

DATED ths _ day of ,2010

Stephae Sundberg, Trutee

DATED this _ day of J 2010

Brent T. Neilsen, Tnistee

3 AMENDMENT TO EXECUTED SETTLEMENT TERM SHEET WITHNEILSEN MANACTURIG INCORPORATED

~AY-l ~-1 ~ 1 ~ :~4 ~~ SUHDBDRGS

DATED this _ day of __._,2010

Thomas :Ñeilseñ;Tnitce _.. -.._.-

DAmn this _ day of _-- 2010

31:5 870&1

DATED this _ day of ___,2010

fI Salem Associates. LLC

By:__eiyel; IIÍisireetIts:Chief ResUlJClunng OffceI'

By:_.Shirlei DunnIts; Chief Financial Offcer

i- - TII 1'~_'20io. . ~ _M . lJl\ ..J(Ul/~te an Sundb 8,Truee "tJ'

DATED his _ day of __._,2010

Bren'i T. . eilsen. Trustee

3 MENDMENT TO EXECUTED SE'n'LEMENT TER SHEET WlTHILSEN MANFACTURING INCORPORATEO

P.02

DATED ths _ day of .2010 DATED ths _ day of .2010

Thomas E. Neilse TrueHR Salem Assciates; LLC

By:Clyde HamstreetIts:Chief Resctg OffcerDATED this _day of .2010

By:Che H. Neilsn, Trutee Shirley Dun

Its: Chief Fincial Offcer

DATED ths _ day of .2010

Stephaie Sundborg, Trustee

2010

~r;~:,.,.~

3 AMME TO EXECUTD SETIEMENT TERM SHEET WITHNEllSEN MAACTUG INCORPORATED

Settlement Term Sheet-Nein Manufactring Incorporated

Ths Settlement Ter Shcot ("Ter Sheet") his be el(ecuted to memoniii7.c a

settement conct:g a loa betwen Neilse Manufactung Incorprad (UNMl') and

fI Salem Asociats, LLC ("HRAlJ), whh his ben nad as a Receivei .Etity

puruat to the Orer Grag Prelimiu Injunction and Appointig Receiver ente

by the United 8taii Dislret Court for the Distrt of Oren aD Ma 10, 2009 (th"Rceiverip Order'') in USDC tòr Oregon Cue No. 09..v.-S6.HO (UReceiversp

Case''). The purose of th Tem Sheet is to memonlLize the prma substtie tc

of th paes' settlement

On October i, 2009. the Court approved the Disaibulion PllI of'Receivcr andCluef Re.ct Offer for Sunwet Enterprie. A$ set fort in lht plan, the uiitaenterie compred of the consUdat asclS and liabUlties of HRA ai the otherrcceiversp entitiea wee to be placec in ih exiliog bI'pICY ca olIn Re StaytODSW Assste Living, LLC. USDC Cas No. 09-ov-l082.HO ("Bantcy Cas'').

Within 14 day! afr execution oflls Settement Toan Shut, HRSA shall sele entr ofan Ocder in 'te Bantcy Cas and/or Reciverhip Cas approvi tho SetemeDtTim Sheet. Aftr th enliy of an Orer approVÎg the Settment Tmm Shee thseement will be finized thugh the exection offorilloan extension/modification

docents.

L. Boagwem: The exig boirwer (HRA) shall rcmain as borrowe until a planof retuDg and disbution Is apprved by the Cour Tranfers or owuc:hip or 'contrl by ih exlstn¡ borrowet to other entities or perons u provided in the pill ofdistbuion and restcturig shall be alJowcd.

2. Lender and Security: The Limder slu1 originly be NM. However, the loan ii

lnut deed may be distributed to tts sbaoldem in th pross of windig up Ihecoipnit!on. The securty for. this loan shlLl reman th propert iid buildig forrlyowned by NMl as its maufactug facUity laçd at 3501 Portand Roii NESalem, Orcson (hereiner refed to as th "NM Buiding").

J. Im: The Dew due date for the loan sbl be Janua J I, 2012, at which tie all

unplld interest and prncipal shH be Que and payable.

4. fiiteNst Rate: The interoSl lUte for \he loan extension period shall be a fied rae

equa to S%.

S. Amortzation I PnygiAI§: Upon execution ofih Settement Ter Sheet, HRSA

shll ma montby payments of intcn only ii the mte of So/ per dMWD on theoutstanding principa balance for the ten of th extended loan. Monthly paymcn~ shallbe payable on me i o"t day of ea month, with a five day aic peod.

Exhibit iPage 1

6. Pnnçipal B¡IS: The pricipal balance sball be the pricipal amount, pius anyaccred and unpaid interest owing on the loa as of the dae of executon of Joanmodificatn documents. As of September 30,200, that amUnt wa $5,356,848.81.

7. Resrv: Upon execution of this Settlement Ter Sheet, HRSA win mae

monthly paymenta of S7 ,500 into an escrow acount tor tJe payment of ra prope!aes. HISA shall pay all insurce premiums diretly to the insurr. HRA shalpro'Yide Jlroof of payment of inuicc prewn to NM.

B. Additional Leasing Aciiviw (propert NOT transfem m RBlT): As dcsçlied in

tho following sub-pargraphs, the monthy paymcnttrm HRA may be increed if theNM Building is m! trfer to a RET puruant to the Rccivcr's Distrbuton Plaand Reorganizaion Plai lld if HRSA geites adilÍonal net income frm lèøsgspac in. th NMBuiJdllig. The baÜD &om whcb to incaswe additional oct incomefrm leaing activity shall be HRSA's averii monthly net income frm leaing activityin the NM Building for the six months ending on July 31, 20051. In the event ofadditioiu net ÌDcome from leaing activity in ih building, payments fhm HRA wiUincree as follows:

(a) Paymnts for Febru 2010 thrugh July 201 O. Efftive with theFebrw 2010 pByment. the amout ofHRA's additioiial mon1h1y payment wiU be thediference, if any, betw: (i) the uvve month net worn frm leasin actiVlty iuthe NMI Building for Augu 2009 dtugh Janua 20 1 0 an (h) the baelie averagemonthly net income ftm leasing activity in th buiJdi¡. The aditional monthypayment for Febnw 2010 thugh July 20 J 0 shal be aUoctecl as foJlows: 50% to NMIto be appUed l1gaiø.t the pricipal balance ofti loa 2$% to the proper ta csw(until and uness the prpert taxes 8J pad. cwrnt an thereer retaed by HRA),and 25% shall be retained by HRSA.

(b) Payments for Au~st 20 1 0 thugh Janui 20 I i; Effecve with theAugust 2010 payment, the amunt ot HRA's addirioii monthly payinnt will be

ditrernce, if any, between: (i) the ave1'ge monthy net income frm leasg lldvi~ inthe NMl BuUdig for Fcbniar 20 I 0 through July 2010 and (ii) th avere montly netincome from leasing Qctivity in the buldhiii for Augut 2009 thugh Januar 2010. Theaddltloaa monthy payment for August 2010 tluugh JlUua 2011 shall be aJocad as

follows: 50% to NM to be applied Ilgiùt the principal balance of the loan, 25% to theprope ta escrow (until and unles the pro laes arc: paid cumnt and thereerieLancd by HRSA), and 25% shall be retaine by HRA.

(c) Paymets for Febi 2011 though JuJy 20( i. Efteve with theFebn.201 I pa.yment, the amuntofHRSA's additiona monthy pament will bediffeicc, If any, betwen: (i) the averge monthy net incomo nom leasing BCúvlty in

the NM Building for Augusi 20 LO thrug Janua 2011. iud (ii) the l1visge monthly netincome frm (coine notivity in the buildiG for Febru 20LO thugb.July 2010 Theaddltionll monthly payment for Febrry 201 i though luly 201 I shall be allcxted asfollows: 50% to NMI to be applied against ihcprial balance aftho loan, 25% to the

2

Exhibit IPage 2

prpert tl escrow (until and unless th prpe tacs arc paid curent and theren:taine by HRA), and 2S% shall be retained by HRA.

(d) Payments for Augut 20 L 1 tliugb Janui 2012. Efective with thAugut 2011 payment, th iiunt ofHRA's lldiûonøJ monthy payent will be

diffeæncc. if any, betwn: (i) the Ilver monthy net iicome frm lClIing activity inthe NM Buildin for Febniry 2011 thugh July 201 liid (Ù) the averge monthy netincome frm leaing acvity in the buildiDg tor AU8\2010 thughJlIuary 201 1. Thciiditional mol1tJy paymCQ for AugWit 2011 thug JOUl 2012 shal be al1cd 81follows: 50% to NM( to be llplicd against th pnncipa baance of th lOaD, iS% to the

prope ta CSOW (until an uness the propey taes arc pad c:nt and thaf

mane by HRA). and 25% 91u1 be retained by HRA.

9. Additnal l.asiPg Actiyi (prope trsferr to BEII): (f the NMI Buildng

is trfered to a RE ii ther ii additona net income frm lea¡ activity in the

buildlg, any additionalmonthy payment n:iinid frm HRA (as calculated uner th

provisions of paagaph 8) shal be allocatid lI follows: SO''' to the prpe ta esrow(unti IId uncsstl propert taes arc paid curnt an thcr retaed by HRSA),aDd 50*1. sball be n. by HRA. If the NM Buiding is trsfeicd to a R:IT, NMwill not be entitled to reeive any payment towad outsdin priipa durng 1le termof the modiled loan desbed herein.

10. Mwgement: The propert sll contiue to be maged by Coldwell BaerConieNio1 (Rten Offce) durg th wm of lb loan Clteion.

i l. Reeass: The Order approving ths Settement Tenn Shet win include a relea

ofNM from al clai, kiown ar unown, by the Receiver, and all ReDiveripEntitles, uness such clai ar asertd with 90 days foUowiDg1lei en of the Ordr.Tn the eYent a olaim is usc by the Receiver dunl1g the 90 day period then the claimsof the Reiver wi be submitted to meiation. Absent a mediate n:luton, the loan

modificaon win be deemed void and of DO furter force and el&t on lbii l2d' dayfoUowig die order.

12. OuartieJ: Following the datc th HRA, tbe Reciver. and al Reivership

Bntitis reJca NMI, NMliud iil guantors will ~Kecuto mutuaJ reeaes of øll clai

n:ûn to ths loan

13. Meiation: In the event that the paes are unable to agre on the tem of loanextsion documents, they shall submit their dispute. to mediation. In the event th themeiotor is unble to faJitata ø. mulU1y~agn.ble resolution, he or she shaJl haveauthrity to impose ø.binding reslution on the pø.ies.

14. LeRal BxOse: Upon execution of the documents tòr the loan extension, flRSAshall pay NMI ii sum of money eq to the legal CXpcS iht it incurd thug the

lOM exllion proces.

3

Exhibit iPage 3

15. BanJaptev Proaeding: The paies agr lhot any plan ofrcriilzdon filedIn the Banptcy Cas wil iudi vidu!, clasify the enûre debt owed to NM as an

iilowed seciiclaim to be 1rted in accordance with the terms oftlls ScltJement Term

Sheel, which idll be attcbed ibeio os an ciibii. The CRO agr that it sba not

seek any furcr modification oftb loan (beyond that slated in this Sctllemcnt Term

Sheet) 1/1 the baptcy proceding.

DATED this _ day of November, 200

Neilsen ¥~utàcturing IncorpratedIIi¿~By: ,.¿-1L.

Its: l:ìl£S/l)'rT __ ______~.

OA T6D th _ day of November, 2009~_~a.~~-_.

Clyde Hiitret

Its:ChcfRcslnturing OffcerBY:~Shirley DUlnlis: Chif Fi.ancial Offcer

.1

Exhibit iPage 4

ASSIGNMENT AND ASSUMPTION AGREEMENT(D Salem Associates, LLC)

NEILSEN MANUACTURING, INCORPORATED, an Oregon corporationas Assignor,

hereby assigns, sells, transfers and conveys unto

THOMAS E. NEILSEN, as Trustee for THOMAS E. NEILSEN as to 5.9%,CHRlSTIN H. NEILSEN, as Trustee for CHRlSTIN H. NEILSEN as to5.79%, STEPHANIE A. SUNBORG as Trustee for STEPHANIE A.SUNBORG as to 42.75%, andBRENTT. NEILSEN, as Trustee for BRENTT. NEILSEN as to 45.56%, as Assignee,

the following:

1. Promissory Note dated January 30,2007, in the face amount of $5, i 70,000,

with HR Salem Associates, LLC as Borrower and Neilsen Manufacturing, Incorporated asLender, a copy of which is attached as Exhibit 1.

2. Trust deed dated January 30, 2007, securing payment ofthe note described in

paragraph 1 under which HR Salem Associates, LLC is the grantor, Ameritite is the trstee,and Neilsen Manufacturing, Incorporated is the beneficiar, which was recorded in the realpropert records of Maron County at Reel 2767, Page 112, on Januar 30, 2007. A copy ofthat trst deed is attched as Exhibit 2.

3. Settlement Term Sheet between Neilsen Manufacturig, Incorporated and HR

Salem Associates, LLC as part of the newly formed Sunwest Unified Entity executed inNovember 2009, a copy of which is attached as Exhibit 3.

Duly executed December U ,2009.

NEILSEN MANACTURG, INCORPORATED

//)lVBy ¿IiThomas E. Neilsen, its President

ASSIGNOR

SJS: pmm:\ W :\clients\NE6603\OO2\O0044868. WPD

Exhibit 1

Page 1

EXHIBIT 9-18

Page 1 - SETTLEMENT TERM SHEET—WELLS FARGO

SETTLEMENT TERM SHEET—WELLS FARGO This Settlement Term Sheet ("Term Sheet") has been prepared to facilitate settlement and, if necessary or appropriate, mediation, concerning loans made by Wells Fargo ("Lender") to certain entities that are Receivership Entities as that term is defined in that certain Order Granting Preliminary Injunction and Appointing Receiver entered by the United States District Court for the District of Oregon on March 10, 2009 (the "Receiver Order"). This Term Sheet is to facilitate settlement and mediation, and is for discussion purposes only. Nothing in this Term Sheet is binding on any party and no party will be bound to any agreement until such time, if any, as a formal written agreement shall have been executed and delivered among the parties.

The goal of this Term Sheet is to facilitate a transaction (the "Transaction") extending and restructuring each Loan. The date on which the Transaction becomes effective is the "Closing Date."

• Spring Meadows Cottages. It is contemplated that Spring Meadows Cottages will be offered for sale and sold in a transaction to be agreed to between Clyde Hamstreet, as CRO appointed pursuant to the Receiver Order (the "CRO"), and Wells Fargo. In the event Spring Meadows Cottages are not sold to a third party, then the Loan relating to Spring Meadows Cottages may be restructured as hereinafter set forth or the property may be sold, conveyed, surrendered or foreclosed upon as may be agreed by Wells Fargo and the CRO.

• Borrowers. The existing Borrowers shall remain as Borrowers until a plan of restructuring and distribution is approved by the Court. Transfers of ownership or control by the existing Borrowers to other entities or persons as provided in a plan of distribution and restructuring approved by the Court shall be allowed.

• Term. The term for each Loan shall be three years from the Closing Date. In addition, each Loan may be extended, at the option of the Borrower, for two additional one-year terms, provided there is no default existing and continuing as of the maturity date and Borrower pays an extension fee of 25 basis points, which fee will be capitalized and added to the principal balance of the Loan.

• Interest Rate. The interest rate for the initial three-year term of the Loans shall be a fixed rate equal to 4.25 percent. In the event Borrowers exercise their right to extend the Loan, then the interest rate shall be adjusted to a fixed annual interest rate for the term of the extension equal to LIBOR as of the first day of each extension plus 400 basis points; provided, however, that the interest rate will not increase by more than 150 basis points for the term of any extension. The default rate will be 200 basis points in excess of the non-default rate.

• Restructuring Fee. Borrowers will pay a restructuring fee of 50 basis points on the restructured principal balance. The fee will be capitalized on the Closing Date.

Page 2 - SETTLEMENT TERM SHEET—WELLS FARGO

• Amortization; Payments. Monthly payments shall be payable on the 10th day of each month, with a five-day grace period. During the first year following the Closing Date, payments shall be interest-only, with no principal amortization. Thereafter, monthly payments shall be in an amount necessary to amortize all principal and interest owing on the loan in 300 equal, monthly payments of principal and interest.

• Principal Balance. The principal balance at the Closing Date will be equal to the principal owing on each Loan, together with any accrued and unpaid interest calculated at the non-default rate plus reasonable fees incurred by Wells Fargo in connection with the negotiation of this Transaction.

• Reserves. Borrowers will make monthly payments of reserves for taxes and capital expenditures. All such reserves shall be available to be drawn on by Borrowers as needed.

• Financial Projections. Borrowers will deliver to Lender financial projections that will include projections for capital expenditures and real estate taxes. The amounts of the expenditure reserves and tax reserves, together with the terms of any financial covenants, will be determined from such financial projections.

• Management. Sunwest Management, Inc. shall continue to serve as property manager through the date of the approval by the Court of a plan of distribution and restructuring. Thereafter, the plan of distribution and restructuring will govern as it relates to the property manager.

• Financial Covenants. The loan documents will contain project yield and minimum occupancy financial covenants. The financial covenants will be negotiated after preparation of the financial projections.

• Releases. It is contemplated that this Transaction will be approved by an Order entered by the Court. The Order will include a release of Lender from all claims, known and unknown, by the Receiver, and all Receivership Entities, unless such claims are asserted within 90 days following the entry of the Order. In the event a claim is asserted by the Receiver within the 90-day period, then the claims of the Receiver will be submitted to mediation. Absent a mediated resolution, the Transaction will be deemed void and of no further force and effect on the 120th day following the entry of the Order.

• Withdrawal From Appeal. Upon the entry of the Order by the Court approving the Transaction, Lender will withdraw from the appeal of the Receiver Order.

• Guaranties. Lender and all guarantors will execute mutual releases.

By its signature below, each party indicates that it approves this Term Sheet. Signature below does not bind any party, but indicates the intent of each such party to proceed to documentation of definitive agreements memorializing the Transaction. It is understood that the Transaction is not binding until definitive documents have been executed and delivered by all parties and the

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Court has entered its Order approving the definitive agreements and the transactions contemplated thereby.

WELLS FARGO By Its

CLYDE HAMSTREET, CRO By Its

MICHAEL GRASSMUECK, RECEIVER By Its

MANAGEMENT COMMITTEE By Its Chairman

034845/00001/1594811v1