FIS 0518 (04/11) Office of Financial and Insurance Regulation Living Care Disclosure Statement Prospectus Instructions The following outline describes, in general, the subject matter to be covered in a typical disclosure statement and the extent of coverage necessary pursuant to the Living Care Disclosure Act, 1976 PA 440, as amended (the "Act") and Rules. The purpose of the disclosure statement is to inform prospective purchasers fully of all material facts concerning life interests, long-term leases and the facilities offering such contracts. The disclosure statement should be written in narrative form in CLEAR and CONCISE language and should be set in a type that is of a size, form and character that can be easily read by elderly persons. The disclosure statement should be used in accordance with the requirements of the Act, the rules, and any effective order(s) of the Office of Financial and Regulation (OFIR). The rules and sections 8, 22, and 23 of the Act, set forth the requirement to be incorporated in the disclosure statement. One copy of the disclosure statement is to be delivered to the OFIR together with the registration application. NOTE THAT THE NAME OF THE OFFICE OF FINANCIAL & INSURANCE REGULATION (the "OFIR"), WITH THE EXCEPTION OF THE DISCLAIMERS NOTED BELOW, MAY BE USED ONLY UPON WRITTEN APPROVAL OF THE OFIR. Cover Page The cover page should contain only the following (unless OFIR requires otherwise): 1. "Disclosure Statement" 2. Effective date of the disclosure statement (leave blank until notified of effectiveness) 3. Name of the facility Division of Securities Page I The following statements, double-spaced, in capital letter and at least 12-point type: 1. YOU HAVE THE RIGHT TO CANCEL YOUR PURCHASE AND RECEIVE A FULL REFUND WITHIN 7 DAYS AFTER YOU HAVE EITHER MADE A DEPOSIT AND RECEIVED A COPY OF THIS DICLOSURE STATEMENT OR EXECUTED THE CONTRACT AND RECEIVED A COPY OF THIS DISCLOSURE STATEMENT. YOU CANNOT BE REQUIRED TO MOVE INTO THE FACILITY BEFORE THE EXPIRATION OF THIS 7-DAY PERIOD. 2. THE PURCHASE OF A LIFE INTEREST OR A LONG TERM LEASE IS AN INVESTMENT THAT MAY INVOLVE A HIGH DEGREE OF RISK AND YOU SHOULD SEEK ADVICE FROM AN ATTORNEY OR OTHER FINANCIAL ADVISOR, INDEPENDENT OR OF THE FACILITY. American LegalNet, Inc. www.FormsWorkFlow.com FIS 0518 (04/11) Office of Financial and Insurance Regulation Living Care Disclosure Statement Prospectus Instructions The following information must appear in boldface type: 3. THIS DISCLOSURE STATEMENT IS REQUIRED BY LAW TO CONTAIN ALL MATERIAL FACTS REGARDING THE OFFERING MADE HEREBY. THE MICHIGAN OFFICE OF FINANCIAL AND INSURANCE REGULATION (OFIR) HAS NOT PASSED UPON THE ACCURACY OF THIS DISCLOSURE STATEMENT, NOR HAS OFIR APPROVED OR DISAPPROVED OF THE OFFERING DESCRIBED HEREIN. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL AND SHOULD BE REPORTED TO: OFFICE OF FINANCIAL & INSURANCE REGULATION SECURITIES DIVISION P.O. BOX 30701 LANSING, MI 48909-8201 TELEPHONE: 1-877-999-6442 4. NO OTHER PERSON IS AUTHORIZED TO MAKE ANY PROMISES IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS DISCLOSURE STATEMENT. 5. Where audited financial statements have been waived by the OFIR under Rules 63, 64, and 65 for a specific period of time, include the following statement. IF YOU BUY A LIFE INTEREST OR LONG-TERM LEASE DURING THE PERIOD WHEN UNAUDITED FINANCIAL STATEMENTS ARE BEING USED, YOU ARE ENTITLED TO DAMAGES OR RESCISSION, IF MATERIAL ADVERSE CONDITIONS EXISTED AT THE DATE OF THE FINANCIAL STATEMENT AND WERE NOT DISCLOSED. Division of Securities Page ii The following statement, double-spaced, in capital letters and at least 12 point type: MORE COMPLETE AND ADDITIONAL INFORMATION REGARDING (FACILITY) IS ON FILE AT THE OFFICE OF FINANCIAL AND INSURANCE REGULATION, SECURITIES SECTION, P.O. BOX 30701, LANSING, MI 48909, TELEPHONE 1 (877) 999-6442 AND IS AVAILABLE FREE OF CHARGE AT (INSERT LOCAL ADDRESS AND TELEPHONE NUMBER OF FACILITY'S MAIN OFFICE). American LegalNet, Inc. www.FormsWorkFlow.com FIS 0518 (04/11) Office of Financial and Insurance Regulation Living Care Disclosure Statement Prospectus Instructions Table of Contents and Table of Attachments page iii Include a table of all major headings contained in the disclosure statement with references to the corresponding page numbers. In the REMAINING PAGES of the disclosure statement, using the following capitalized headings, there should be set out under each heading, in narrative form, all material information pertaining to the heading. The following information where applicable shall be set in at least 12 point type. Organizational Information Include: 1. The name and address of the facility's principal business office. 2. State and date of incorporation. If the facility is not a corporation, describe the form of organization in detail. 3. Name(s) of affiliated parent, together with a statement of the legal relationship through which control exists and the location of the principal office of the parent. 4. Names(s) of the facility's subsidiaries, if any, together with a statement of the legal relationship through which control exists in each case and the location of the principal office of the subsidiaries. 5. IDENTITY of persons affiliated with the facility. Legal Actions Include information about legal actions, which in the facility's estimation could have a material effect upon the health, safety, welfare of Residents, or the financial stability of the facility. Financial Information Include a table that summarizes financial data, such as current assets, total assets, liabilities, revenues, and expenses that are extracted from the facility's financial statements. The summary should reference the facility's audited financial statements, and a statement to the effect that audited financials are available to residents upon request, free of charge. Medicare/Medicaid Participation Include a description of the level of participation a facility has with Medicare and Medicaid programs. American LegalNet, Inc. www.FormsWorkFlow.com FIS 0518 (04/11) Office of Financial and Insurance Regulation Living Care Disclosure Statement Prospectus Instructions Entrance Fees (Summary) 1. Include a financial table as an attachment. Disclose fully the entrance fee obligations required of members. 2. Where the entrance fee is not the same in all cases show the plan by which the different amounts are determined. 3. Include a statement showing what percentage of the entrance fee