BLP PARTNERSHIP PROMISSORY NOTE - PLEASANTON ASSISTED LIVING 6/3/03

PROMISSORY NOTE (Pleasanton Assisted Living) $949,805 Pleasanton, California Jk,ae- 3_, 2003 FOR VALUE RECEIVED, the undersigned BLP Partnership, Inc., a California nonprofit public benefit corporation (the "Borrower") hereby promises to pay to the order of the City of Pleasanton, P.O. Box 520, Pleasanton, California (the "Holder"), a principal amount equal to Nine Hundred Forty-Nine Thousand Eight Hundred Five Dollars ($949,805). 1. Borrower's Obligation. This promissory note (the "Note") evidences the Borrower's obligation to pay the Holder the principal amount of Nine Hundred Forty-Nine Thousand Eight Hundred Five Dollars ($949,805) for the funds loaned to the Borrower by Holder to finance the development of the Property pursuant to the Predevelopment Loan Agreement between the Borrower and the Holder of even date herewith (the "Loan Agreement"). All capitalized terms not otherwise defined in this Note shall have the meanings set forth in the Loan Agreement. 2. Interest. The principal balance of this Note shall bear no interest. 3. Term and Repayment Requirements. The term of this Note (the "Term"), shall commence with the date of this Note and shall expire as set forth in Section 1.8 of the Loan Agreement. 4. No Assumption. This Note shall not be assumable by the successors and assigns of Borrower without the prior written consent of the Holder, except as provided in Section 2.3 of the Loan Agreement. 5. accuniy. 1 bis Note is secured as set forth in Section 1.3 of the Loan Agreement. 6. Terms of Payment. All payments due under this Note shall be paid in currency of the United States of America, which at the time of payment is lawful for the payment of public and private debts. (a) All payments on this Note shall be paid to Holder at City of Pleasanton, P.O. Box 520, Pleasanton, California 94566, Attention: City Manager, or to such other place as Lilt Voider of this 'voce may from time to dm: ueiignace. (b) This Note shall be nonrecourse to Borrower and the Holder shall only be entitled to the security described in Section 1.3 of the Loan Agreement, and the Borrower shall not be personally liable for repayment under this Note. 144\105\159065.5