-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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MIC-Info: RSA-MD5,RSA,
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<SEC-DOCUMENT>0000909518-01-500211.txt : 20010804
<SEC-HEADER>0000909518-01-500211.hdr.sgml : 20010804
ACCESSION NUMBER:		0000909518-01-500211
CONFORMED SUBMISSION TYPE:	SC 13D/A
PUBLIC DOCUMENT COUNT:		5
FILED AS OF DATE:		20010802
GROUP MEMBERS:		ADVISORS GENPAR, INC.
GROUP MEMBERS:		HUDSON ADVISORS ASSOCIATES, L.
GROUP MEMBERS:		HUDSON ADVISORS, L.L.C.
GROUP MEMBERS:		JOHN P. GRAYKEN
GROUP MEMBERS:		LONE STAR MANAGEMENT CO., LTD.
GROUP MEMBERS:		LONE STAR OPPORTUNITY FUND, L.
GROUP MEMBERS:		LONE STAR PARTNER, L.P.
GROUP MEMBERS:		LSOF GENPAR, INC.
GROUP MEMBERS:		TERLINGUA ADVISORS, INC.

FILED BY:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			LSOF POOLED EQUITY LP
		CENTRAL INDEX KEY:			0001110506
		STANDARD INDUSTRIAL CLASSIFICATION:	TEXTILE MILL PRODUCTS [2200]

	FILING VALUES:
		FORM TYPE:		SC 13D/A

	BUSINESS ADDRESS:	
		STREET 1:		600 NORTH PEARL STREET, SUITE1500
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75201
		BUSINESS PHONE:		2147548400

SUBJECT COMPANY:	

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			GREENBRIAR CORP
		CENTRAL INDEX KEY:			0000105744
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-SKILLED NURSING CARE FACILITIES [8051]
		IRS NUMBER:				752399477
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		SC 13D/A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	005-38763
		FILM NUMBER:		1696526

	BUSINESS ADDRESS:	
		STREET 1:		4265 KELLWAY CIRCLE
		CITY:			ADDISON
		STATE:			TX
		ZIP:			75244
		BUSINESS PHONE:		2144078400

	MAIL ADDRESS:	
		STREET 1:		4265 KELLWAY CIRCLE
		CITY:			ADDISON
		STATE:			TX
		ZIP:			75244

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MEDICAL RESOURCE COMPANIES OF AMERICA
		DATE OF NAME CHANGE:	19920703

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	WESPAC INVESTORS TRUST
		DATE OF NAME CHANGE:	19900605
</SEC-HEADER>
<DOCUMENT>
<TYPE>SC 13D/A
<SEQUENCE>1
<FILENAME>a8-2sc13da7.txt
<TEXT>
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                       ----------------------------------
                                  SCHEDULE 13D
                                 (Rule 13d-101)


           INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO
      RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)
                               (Amendment No. 7)1


                             GREENBRIAR CORPORATION
  -----------------------------------------------------------------------------
                                (Name of Issuer)


                     Common Stock, par value $0.01 per share
  -----------------------------------------------------------------------------
                         (Title of Class of Securities)

                                   393648-10-0
  ----------------------------------------------------------------------------
                                 (CUSIP Number)

                                    J.D. Dell
                        Lone Star Opportunity Fund, L.P.
                       600 North Pearl Street, Suite 1550
                               Dallas, Texas 75201
                                 (214) 754-8300
  -----------------------------------------------------------------------------
            (Name, Address and Telephone Number of Person Authorized
                     to Receive Notices and Communications)

                                 August 1, 2001
                       -----------------------------------
             (Date of Event which Requires Filing of this Statement)

         If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box [ ].

         NOTE: Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for
other parties to whom copies are to be sent.

                         (Continued on following pages)

                              (Page 1 of 123 Pages)


- --------
         1 The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.

         The information required on the remainder of this cover page shall not
be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).

<PAGE>

- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 2 of  123 Pages
- -----------------------------------------------------------------------------

=============================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
             LSOF POOLED EQUITY, L.P.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                      (a) [ ]
                                                                      (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                       OO
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                          [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        DELAWARE
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                      27, 475, 362
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                              4,729,157*
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                              27,475,362
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
        27,475,362
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                              [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
       79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        PN
=============================================================================
                      *SEE INSTRUCTIONS BEFORE FILLING OUT!

<PAGE>

- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 3 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        TERLINGUA ADVISORS, INC.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                     (a) [ ]
                                                                     (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*
        WC
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                         [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        DELAWARE
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                    2,200
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                      2,200
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
                                      2,200
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                              [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
        0.03%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        CO
===========================================================================

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!



<PAGE>

- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 4 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        LSOF GENPAR, INC.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                    (a) [ ]
                                                                    (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                     AF
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                        [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        TEXAS
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                           27,475,362
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                             4,729,157*
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                             27,475,362
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
        27,475,362
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                                        [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
        79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        CO
===========================================================================
                      *SEE INSTRUCTIONS BEFORE FILLING OUT!



<PAGE>
- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 5 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        LONE STAR OPPORTUNITY FUND, L.P.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                   (a) [ ]
                                                                   (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                    AF
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                       [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        DELAWARE
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                           27,475,362
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                             4,729,157*
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                             27,475,362
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
        27,475,362
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                                     [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
        79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        PN
===========================================================================

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>
- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 6 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        LONE STAR PARTNER, L.P.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                   (a) [ ]
                                                                   (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                    AF
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                       [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        DELAWARE
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                           27,475,362
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                             4,729,157*
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                             27,475,362
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
        27,475,362
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                                      [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
        79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        PN
===========================================================================

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>
- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 7 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        LONE STAR MANAGEMENT CO., LTD.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                   (a) [ ]
                                                                   (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                    AF
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                        [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        DELAWARE
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                           27,475,362
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                             4,729,157*
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                             27,475,362
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
        27,475,362
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                                        [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
        79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        CO
===========================================================================

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>
- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 8 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        HUDSON ADVISORS, L.L.C.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                  (a) [ ]
                                                                  (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                   AF
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                      [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        TEXAS
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                           27,477,562
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                             4,729,157*

- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                             27,477,562
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON*
         27,477,562
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
         CERTAIN SHARES*
                                                                      [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
         79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        OO
===========================================================================

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>
- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 9 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        HUDSON ADVISORS ASSOCIATES, L.P.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                  (a) [ ]
                                                                  (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                   AF
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                      [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        TEXAS
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                           27,477,562
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                             4,729,157*
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                             27,477,562
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON*
        27,477,562
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                                      [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
        79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
         PN
===========================================================================

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>
- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 10 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        ADVISORS GENPAR, INC.
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                  (a) [ ]
                                                                  (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                   AF
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                      [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        TEXAS
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                    27,477,562
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                       4,729,157*
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                       27,477,562
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON*
        27,477,562
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                                      [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
        79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        CO
===========================================================================

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>
- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 11 of  123 Pages
- -----------------------------------------------------------------------------

===========================================================================
1       NAMES OF REPORTING PERSON
        I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
        JOHN P. GRAYKEN
- -----------------------------------------------------------------------------
2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
                                                                  (a) [ ]
                                                                  (b) [ ]
- -----------------------------------------------------------------------------
3       SEC USE ONLY
- -----------------------------------------------------------------------------
4       SOURCE OF FUNDS*                   AF
- -----------------------------------------------------------------------------
5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
        ITEM 2(d) or 2(e)
                                                                      [ ]
- -----------------------------------------------------------------------------
6       CITIZENSHIP OR PLACE OF ORGANIZATION
        IRELAND
- -----------------------------------------------------------------------------
           NUMBER OF             7       SOLE VOTING POWER
            SHARES                                    27,477,562
         BENEFICIALLY
           OWNED BY
             EACH
           REPORTING
            PERSON
             WITH
- -----------------------------------------------------------------------------
                                 8       SHARED VOTING POWER
                                                       4,729,157*
- -----------------------------------------------------------------------------
                                 9       SOLE DISPOSITIVE POWER
                                                       27,477,562
- -----------------------------------------------------------------------------
                                 10      SHARED DISPOSITIVE POWER
- -----------------------------------------------------------------------------
11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
        27,477,562
- -----------------------------------------------------------------------------
12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
        CERTAIN SHARES*
                                                                      [ ]
- -----------------------------------------------------------------------------
13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
        79.1%
- -----------------------------------------------------------------------------
14      TYPE OF REPORTING PERSON*
        IN
===========================================================================

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>
- -----------------------------------------------------------------------------
CUSIP No. 393648-10-0                 13D               Page 12 of  123 Pages
- -----------------------------------------------------------------------------

ITEM 1.    SECURITY AND ISSUER.

         This statement relates to the common stock, $0.01 par value per share
(the "Common Stock"), of Greenbriar Corporation, a Nevada corporation
("Greenbriar"). The address of the principal executive offices of Greenbriar is
14185 Dallas Parkway, Suite 650, Dallas, Texas 75240.

ITEM 2.    IDENTITY AND BACKGROUND.

         This statement is filed on behalf of LSOF Pooled Equity, L.P., a
Delaware limited partnership ("Pooled Equity"). The general partner of Pooled
Equity is LSOF GenPar, Inc., a Texas corporation ("GenPar"). The sole
stockholder of GenPar is Lone Star Opportunity Fund, L.P., a Delaware limited
partnership ("Lone Star"). The general partner of Lone Star is Lone Star
Partner, L.P., a Delaware limited partnership ("Partner"). The general partner
of Partner is Lone Star Management Co., Ltd., a Delaware corporation
("Management"). Hudson Advisors, L.L.C., a Texas limited liability company
("Hudson"), is the asset manager of the securities of Greenbriar owned by Pooled
Equity, pursuant to an Asset Management Agreement. Hudson is the sole
stockholder of Terlingua Advisors, Inc., a Delaware corporation ("Terlingua").
Hudson Advisors Associates, L.P., a Texas limited partnership ("Associates"), is
the majority owner of the membership interests of Hudson. Advisors GenPar, Inc.,
a Texas corporation ("Advisors"), is the general partner of Associates. John P.
Grayken ("Grayken"), a citizen of Ireland, is the sole stockholder, sole
director and President of Management and the sole stockholder and sole director
of Advisors. GenPar, Lone Star, Partner, Management, Hudson, Associates,
Advisors and Grayken are herein referred to as "Control Persons."

         The address of the principal offices and business address of Pooled
Equity, Lone Star, Partner and Management is 600 North Pearl Street, Suite 1550,
Dallas, Texas 75201. The address of the principal offices and business address
of Hudson, Terlingua, Associates and Advisors is 600 North Pearl Street, Suite
1500, Dallas, Texas 75201. The business address of Grayken, is 50 Welbeck
Street, London, United Kingdom, W1M7HE.

         Pooled Equity, GenPar, Lone Star, Partner, Management, Terlingua,
Hudson, Associates and Advisors are all part of a private investment partnership
investing in a broad range of primarily real estate related investments. Lone
Star's investors are primarily pension funds and other institutional investors.
Grayken's principal occupation is serving in the aforementioned offices of
Management.

         None of Pooled Equity, GenPar, Lone Star, Partner, Management,
Terlingua, Hudson, Associates, Advisors or Grayken has, during the last five
years, been convicted in a criminal proceeding (excluding traffic violations and
similar misdemeanors).

         None of Pooled Equity, GenPar, Lone Star, Partner, Management,
Terlingua, Hudson, Associates, Advisors or Grayken has, during the last five
years, been a party to a civil proceeding of a judicial or administrative body
of competent jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.

Other Information
- -----------------

           Attached as Schedule I hereto is a list of (a) directors and
executive officers of GenPar, Terlingua, Management and Advisors and (b) the
officers and member of Hudson which contains the following information with
respect to each person:

           (i)    name;


<PAGE>

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CUSIP No. 393648-10-0                 13D               Page 13 of  123 Pages
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           (ii)   principal business address; and

           (iii)  present principal occupation or employment.

           None of the entities or persons identified on Schedule I hereto has,
during the last five years, been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors). None of the entities or persons
identified on Schedule I hereto has, during the last five years, been a party to
a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting or
mandating activities subject to, federal or state securities laws or finding any
violation with respect to such laws. Each person identified on Schedule I hereto
is a United States citizen, other than Grayken, who is a citizen of Ireland.

ITEM 3.    SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.

         On January 13, 1998, Lone Star purchased (i) 1,400,000 shares of
Greenbriar's Series F Senior Convertible Preferred Stock (the "Series F
Preferred"), $0.10 par value per share, at a purchase price of $10.00 per share
and (ii) 800,000 shares of Greenbriar's Series G Senior Non-Voting Convertible
Preferred Stock $0.10 par value per share (the "Series G Preferred"), at a
purchase price of $10.00 per share. The Series F Preferred and Series G
Preferred (collectively, the "Preferred Stock") were convertible, subject to the
terms of the Preferred Stock, into shares of Common Stock, based on a conversion
price of $17.50 per share of Common Stock. The aggregate purchase price for the
Preferred Stock was $22,000,000 and was funded by capital contributions from
Lone Star's partners. Lone Star assigned the Preferred Stock to LSOF Greenbriar,
L.L.C., a Delaware limited liability and wholly owned subsidiary of Lone Star
("LSOF Greenbriar"), pursuant to an Assignment and Assumption Agreement dated
January 13, 1998. On July 23, 1998, LSOF Greenbriar assigned the Preferred Stock
to Pooled Equity.

         The terms of the Preferred Stock are set forth in (i) the Stock
Purchase Agreement dated as of December 31, 1997 between Greenbriar and Lone
Star filed as Exhibit 1 (the "Stock Purchase Agreement"), (ii) the Certificate
of Voting Powers, Designations, Preferences and Relative, Participating,
Optional or other Special Rights of Series F Senior Convertible Preferred Stock
filed as Exhibit 2 (the "Series F Certificate of Designation") and (iii) the
Certificate of Voting Powers, Designations, Preferences and Relative,
Participating, Optional or Other Special Rights of Series G Senior Non-Voting
Convertible Preferred Stock filed as Exhibit 3 (the "Series G Certificate of
Designation," and together with the Series F Certificate of Designation, the
"Certificates of Designation").

         On February 1, 2000 Greenbriar redeemed 189,381 shares of Series G
Preferred owned directly by Pooled Equity for an aggregate price of $2,500,000,
which equals a price of $13.20 per share. Such redemption was pursuant to a
letter agreement between LSOF Greenbriar and Greenbriar dated January 31, 2000
(the "First Letter Agreement"), filed as Exhibit 6, whereby Greenbriar agreed to
use all proceeds, after payment of reasonable out-of-pocket expenses, from the
sale or refinancing of capital assets to redeem shares of Preferred Stock. On
March 1, 2000, LSOF Greenbriar assigned all of its rights in such letter
agreement to Pooled Equity pursuant to an Assignment of Rights filed as Exhibit
8 (the "Assignment of Rights").

         On February 4, 2000, Greenbriar redeemed 75,722 shares of Series G
Preferred owned directly by Pooled Equity for an aggregate price of $1,000,000,
which equals a price of $13.20 per share. Such redemption was pursuant to a
letter agreement between LSOF Greenbriar and Greenbriar dated February 4, 2000
filed as Exhibit 7. On March 1, 2000, LSOF Greenbriar assigned all of its rights
in such letter agreement to Pooled Equity pursuant to the Assignment of Rights.

<PAGE>
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CUSIP No. 393648-10-0                 13D               Page 14 of  123 Pages
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         On April 14, 2000 Greenbriar redeemed 37,200 shares of Series G
Preferred owned directly by Pooled Equity for an aggregate price of $500,000,
which equals a price of $13.44 per share. Such redemption was pursuant to a
letter agreement between Pooled Equity and Greenbriar dated April 14, 2000 filed
as Exhibit 9. 2

         While conducting due diligence in response to certain discussions with
Greenbriar to modify and/or extend certain provisions of the Certificates of
Designation, Pooled Equity learned and verified through review of Greenbriar's
corporate records that, since the date of issuance of the Series F Preferred and
the Series G Preferred, Greenbriar had issued (the "Option Issuances") various
options (each a "Stock Option") to purchase shares of Common Stock to certain
employees, officers and directors of Greenbriar for a consideration per share
that was less than the conversion price of the Series F Preferred and the Series
G Preferred. Greenbriar failed to provide written notice to Pooled Equity, its
affiliates or its representatives of these issuances, as required by the terms
of the Certificates of Designation. These Option Issuances triggered the
antidilution provisions under the Certificates of Designation, which provisions
provide that the conversion price for the Preferred Stock shall be adjusted
downward so that the conversion price is equivalent to the lowest exercise price
per share of Common Stock with respect to these Option Issuances. The lowest
exercise price for any Stock Option issued by Greenbriar was $0.69 per share of
Common Stock. Consequently, the conversion price for the Series F Preferred and
the Series G Preferred was automatically (and without further action on the part
of Greenbriar or Pooled Equity) adjusted downward from $17.50 per share of
Common Stock to $0.69 per share of Common Stock. As a result, each share of
Preferred Stock, which had a liquidation preference of $10.00 per share, has
become convertible into approximately 14.49 shares of Common Stock.

         On October 26, 2000, Terlingua purchased 2,200 shares (the "Terlingua
Shares") of Common Stock on the open market for a purchase price of $0.75 per
share. The aggregate purchase price for the Terlingua Shares was $1650.00 and
was funded from working capital of Terlingua.

         On October 30, 2000, Pooled Equity delivered to Greenbriar a written
Notice of Conversion (the "Conversion Notice"), filed as Exhibit 10, whereby
Pooled Equity elected to convert the (i) 1,400,000 shares of Series F Preferred
and (ii) 497,697 shares of Series G Preferred owned by it (a total of 1,897,697
shares of Preferred Stock) into 27,502,855 shares of Common Stock.3 The
Conversion Notice directed Greenbriar to immediately issue to Pooled Equity the
lesser of (i) 6,955,135 shares of Common Stock and (ii) such number of shares of
Common Stock that would equal 49.8% of the outstanding Common Stock. The
Conversion Notice also directed Greenbriar to issue the remaining shares (the
"Remaining Common Shares") of Common Stock due to Pooled Equity as a result of
the conversion of the Preferred Stock upon written notice from Pooled Equity
that the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976 had expired or terminated (or such act was no longer applicable) with
respect the conversion of the Preferred Stock.

         On October 31, 2000, Greenbriar notified Pooled Equity that, in
Greenbriar's opinion, the Conversion Notice may be invalid and/or that Pooled
Equity may not have perfected its conversion rights with respect to the
Preferred Stock.

- ----------
2 At the hearing held on March 29, 2001, described below, Pooled Equity agreed
that Greenbriar had redeemed an additional 1,897 shares of Series G Preferred on
April 14, 2000, and that the correct number of shares of Common Stock to be
issued to Pooled Equity as of October 30, 2000, was 27,475,362.

3 At the hearing held on March 29, 2001, described below, Pooled Equity agreed
that Greenbriar had redeemed an additional 1,897 shares of Series G Preferred on
April 14, 2000, and that the correct number of shares of Common Stock to be
issued to Pooled Equity as of October 30, 2000, was 27,475,362.

<PAGE>

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CUSIP No. 393648-10-0                 13D               Page 15 of  123 Pages
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         In response to Greenbriar's allegation that the Conversion Notice may
be invalid and/or that Pooled Equity may not have perfected its conversion
rights with respect to the Preferred Stock, on November 3, 2000, Pooled Equity
filed a petition (the "Petition") in State District Court in Dallas County,
Texas (the "District Court") seeking a judgment declaring that the Conversion
Notice is valid and effective as of October 30, 2000 and that it is entitled to
convert the Preferred Stock into Common Stock at a price of $0.69 per share of
Common Stock. Additionally, Pooled Equity sought a permanent injunction barring
Greenbriar from taking any action that would impair or prejudice Pooled Equity's
rights in the Preferred Stock and Common Stock. A copy of the Petition has been
filed as Exhibit 11.

         On November 20, 2000, Greenbriar filed its Original Answer and
Counterclaim (the "Answer") denying the allegations contained in the Petition
and alleged by counterclaim (the "Counterclaim") that Pooled Equity breached an
agreement with Greenbriar regarding Greenbriar's sale of assets necessary to
redeem the Preferred Stock. Pooled Equity will vigorously defend the
Counterclaim. A copy of the Answer has been filed as Exhibit 12.

         On December 5, 2000, Pooled Equity delivered a Notice of Default
("Notice of Default") to Greenbriar notifying Greenbriar that it was in breach
of Section 6.26 of the Stock Purchase Agreement for failure to comply with the
Conversion Notice. A copy of the Notice of Default has been filed as Exhibit 13.

         On December 5, 2000, Pooled Equity also delivered a letter (the "Make
Whole Letter") notifying Greenbriar that Pooled Equity was demanding payment of
$8,587,059 (the "Make Whole Amount"). Pursuant to that certain Agreement (the
"Make Whole Agreement"), dated as of December 31, 1997, by and between
Greenbriar and Lone Star, the Make Whole Amount became due on the tenth business
day after the date on which all of the Preferred Stock was converted into shares
of Common Stock. A copy of the Make Whole Agreement has been filed as Exhibit
14.

         On December 11, 2000, Pooled Equity filed a Demand for Arbitration
Before the American Arbitration Association (the "Arbitration Demand") seeking
to consolidate and enforce its claims contained in the Petition, the Notice of
Default and the Make Whole Letter. Pooled Equity's claims under the Stock
Purchase Agreement and the Make Whole Agreement require all disputes arising
thereunder to be resolved by arbitration with the American Arbitration
Association. On January 5, 2001, Greenbriar filed a Motion to Stay Arbitration
(the "Motion to Stay") with the District Court. As of the date hereof, the
District Court has not ruled on the Arbitration Demand or the Motion to Stay.

         On January 11, 2001, Pooled Equity made an application for a temporary
restraining order with the District Court to prevent the automatic conversion of
its Preferred Stock into Common Stock on January 13, 2001 in accordance with the
Certificates of Designation. The District Court denied Pooled Equity's
application for a temporary restraining order.

         On January 12, 2001, Pooled Equity delivered a Notice of Default (the
"Second Notice of Default") to Greenbriar notifying Greenbriar that Events of
Default have occurred under the covenants contained in Sections 6.8(e), 6.29,
6.30, 6.31, 6.32 and 6.33 of the Stock Purchase Agreement. As a result of such
Events of Default, Greenbriar owes Pooled Equity additional dividends of 12% per
annum and Pooled Equity may put the Preferred Stock to Greenbriar for 20% of
such Preferred Stock's liquidation value. In addition, interest on all unpaid
dividends is accruing at the rate of 12% per annum. As a result of Greenbriar's
failure to comply with the foregoing covenants, and its failure to pay such
accrued additional dividends for two consecutive quarters, Pooled Equity,
through its ownership of Series F Preferred, has the right to appoint 70% of the
Board of Directors membership of Greenbriar. All such remedies arose prior to
the mandatory conversion of the Preferred Stock described below. A copy of the
Second Notice of Default has been filed as Exhibit 15.

<PAGE>

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CUSIP No. 393648-10-0                 13D               Page 16 of  123 Pages
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         On January 12, 2001, Pooled Equity also delivered a notice (the
"Observer Notice") to Greenbriar of Pooled Equity's exercise of its right, under
the Series F Certificate of Designation and the Stock Purchase Agreement, to
attend all Board of Directors meetings and any committees thereof. A copy of the
Observer Notice has been filed as Exhibit 16.

         On January 13, 2001, Greenbriar delivered notices (the "Mandatory
Conversion Notices") that pursuant to Section 6.3 of each of the Certificates of
Designation, Pooled Equity's 1,400,000 shares of Series F Preferred and 444,854
shares of Series G Preferred were automatically converted at a conversion price
of $17.50 per share of Common Stock into 800,000 and 254,202 shares of Common
Stock, respectively. In addition, Greenbriar notified Pooled Equity that, based
upon its records, Greenbriar owes Pooled Equity a total of $27,166,714 under the
Make Whole Agreement (the "Make Whole Payments"). Greenbriar further stated in
the Mandatory Conversion Notices that it was unable to make the Make Whole
Payments at this time but that it intends to do so pursuant to the terms of the
Make Whole Agreement and as permitted by Section 78.288 of the Nevada Revised
Statutes. Copies of the Mandatory Conversion Notices have been filed as Exhibits
17 and 18.

         On January 15, 2001, Pooled Equity delivered a letter to Greenbriar
responding to the Mandatory Notices (the "Mandatory Conversion Response
Letter"). Pooled Equity stated in the Mandatory Conversion Response Letter that:

         (i)      the proper conversion price for the Preferred Stock was $0.69
                  per share of Common Stock;

         (ii)     the number of shares of Series G Preferred owned by Pooled
                  Equity is 497,6974, not 444,854 as stated in the Mandatory
                  Conversion Notice;

         (iii)    Pooled Equity never agreed to the alleged redemption of 50,946
                  shares of Series G Preferred on December 20, 2000. The
                  proceeds of $760,000 received in such alleged redemption was
                  never discussed and it is Pooled Equity's view that such
                  amount should apply to amounts owing to Pooled Equity under
                  the Make Whole Amount; and

         (iv)     Greenbriar's calculation of the liquidation value of the
                  Preferred Stock fails to include penalty dividends accruing
                  since at least June 30, 2000, late interest on such dividends
                  accruing at 12% per annum and Pooled Equity's cost and
                  expenses payable pursuant to the Stock Purchase Agreement.

         A copy of the Mandatory Conversion Response Letter has been filed as
Exhibit 19.

         On February 8, 2001, Pooled Equity filed a Motion for Partial Summary
Judgment in District Court (the "Motion") seeking a judgment that (i) the
conversion price of the Preferred Stock was adjusted to $0.69 per share, the
lowest exercise price for the Stock Options; (ii) on October 30, 2000, Pooled
Equity properly exercised its right to convert the Preferred Stock at $0.69 per
share of Common Stock; and (iii) the conversion price of the Preferred Stock was
not readjusted due to any subsequent rescission of the Stock Options. A copy of
the Motion is filed as Exhibit 20.


- ----------
4 At the hearing held on March 29, 2001, described below, Pooled Equity agreed
that Greenbriar had redeemed an additional 1,897 shares of Series G Preferred on
April 14, 2000, and that the correct number of shares of Common Stock to be
issued to Pooled Equity as of October 30, 2000, was 27,475,362.

<PAGE>

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CUSIP No. 393648-10-0                 13D               Page 17 of  123 Pages
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         On March 29, 2001, the District Court held a hearing on Pooled Equity's
Motion. At the end of the hearing, the District Court granted Pooled Equity's
motion on all counts.

         On April 5, 2001, the District Court entered an order (the "Order")
granting the Motion. A copy of the Order is attached hereto as Exhibit 21.

         On August 1, 2001, Pooled Equity and Greenbriar entered into a Master
Settlement Agreement (the "Settlement"). A copy of the Settlement is attached
hereto as Exhibit 22. Under the terms of the Settlement, Greenbriar will
repurchase all of Pooled Equity's ownership interests in Greenbriar, and Pooled
Equity will release all claims in exchange for $4,000,000 in cash and the
conveyance of 11 assisted living properties out of the 25 owned and operated by
Greenbriar, subject to any indebtedness thereon. Greenbriar will then release
Pooled Equity from all claims.

         In addition, certain stockholders of Greenbriar have entered into a
consent agreement (the "Consent), pursuant to which such holders consented to
the Settlement and such holders have given Pooled Equity an irrevocable proxy
and power of attorney to vote their shares of Common Stock - a total of
4,729,157 shares - with respect to any matter related to the Settlement that is
presented to Greenbriar's stockholders for a vote.

         A copy of the Consent, including a Form of Irrevocable Proxy and Power
of Attorney, is attached hereto as Exhibit 23.

         The closing of the Settlement is expected to occur by the end of the
third quarter of 2001.

ITEM 4.  PURPOSE OF THE TRANSACTION.

         The transactions described in Item 3 above occurred as a result of
privately negotiated transactions with Greenbriar. In each case, Lone Star
acquired the Preferred Stock and the Common Stock issuable upon conversion
thereof and Terlingua acquired the Terlingua Shares for investment purposes.

         As described above, upon closing the Settlement, Pooled Equity will
have disposed of all of its shares of Greenbriar Common Stock. Terlingua,
Hudson, Associates, Advisors and Grayken will continue to beneficially own 2,200
shares of Greenbriar Common Stock.

         Other than in connection with the Settlement, none of Pooled Equity,
Terlingua or any Control Person has any present plans or intentions which would
result in or relate to any of the transactions described in subparagraphs (a)
through (j) of Item 4 of Schedule 13D.

ITEM 5.    INTEREST IN SECURITIES OF THE ISSUER.

         Upon closing the Settlement, none of Pooled Equity, GenPar, Lone Star,
Partner or Management will beneficially own any shares of Common Stock as
described above. Upon closing the Settlement, Terlingua, Hudson, Associates,
Advisors and Grayken each will, until such shares are otherwise sold or
transferred, beneficially own and have the sole power to vote and dispose of
2,200 shares of Common Stock as described above (approximately 0.03% of the
shares of Common Stock based on the information as to the number of shares of
Common Stock outstanding on May 14, 2001, as reported in Greenbriar's Quarterly
Report on Form 10-Q for the quarter ended March 31, 2001).

         Prior to closing the Settlement, Pooled Equity, GenPar, Lone Star,
Partner, and Management each beneficially owns and has the sole power to vote
and dispose of 27,475,362 shares of Common Stock as described above
(approximately 79.1% of the shares of Common Stock based on the information as
to the number of shares of Common Stock outstanding on May 14, 2001, as reported

<PAGE>

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CUSIP No. 393648-10-0                 13D               Page 18 of  123 Pages
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in Greenbriar's Quarterly Report on Form 10-Q for the period ended March 31,
2001). Hudson, Associates, Advisors and Grayken each beneficially owns and has
the sole power to vote and dispose of 27,477,562 shares of Common Stock as
described above (approximately 79.1% of the shares of Common Stock based on the
information as to the number of shares of Common Stock outstanding on May 14,
2001, as reported in Greenbriar's Quarterly Report on Form 10-Q for the period
ended March 31, 2001). Terlingua beneficially owns and has the sole power to
vote and dispose of 2,200 shares of Common Stock as described above
(approximately 0.03% of the shares of Common Stock based on the information as
to the number of shares of Common Stock outstanding on May 14, 2001, as reported
in Greenbriar's Quarterly Report on Form 10-Q for the period ended March 31,
2001).

         Except as described in Item 3, none of Pooled Equity, Terlingua or any
Control Person has effected any transaction in any shares of Common Stock during
the past sixty days.


ITEM 6.    CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
           TO SECURITIES OF THE ISSUER.


           Other than as described in this Schedule 13D, none of Pooled Equity,
           Terlingua or any Control Person has any contracts, arrangements,
           understandings or relationships with any person with respect to any
           securities of Greenbriar.

ITEM 7.    MATERIAL TO BE FILED AS EXHIBITS.

1.       Stock Purchase Agreement dated as of December 31, 1997 between
         Greenbriar and Lone Star.

2.       Certificate of Voting Powers, Designations, Preferences and Relative,
         Participating, Optional or Other Special Rights of Series F Senior
         Convertible Preferred Stock of Greenbriar Corporation.

3.       Certificate of Voting Powers, Designations, Preferences and Relative,
         Participating, Optional or Other Special Rights of Series G Senior
         Non-Voting Convertible Preferred Stock of Greenbriar Corporation.

4.       Registration Rights Agreement dated as of January 13, 1998 between
         Greenbriar and Lone Star.

5.       Agreement dated as of December 31, 1997 between Greenbriar and Lone
         Star.

6.       Letter Agreement dated as of January 31, 2000 between LSOF Greenbriar
         and Greenbriar.

7.       Letter Agreement dated as of February 4, 2000 between LSOF Greenbriar
         and Greenbriar.

8.       Assignment of Rights dated March 1, 2000 between LSOF Greenbriar and
         Pooled Equity.

9.       Letter Agreement dated as of April 14, 2000 between Pooled Equity and
         Greenbriar.

10.      Notice of Conversion dated as of October 30, 2000 from Pooled Equity to
         Greenbriar.

11.      Pooled Equity's Original Petition (Cause No. 00-08824-I), filed on
         November 3, 2000, in State District Court, Dallas County, Texas.


<PAGE>

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CUSIP No. 393648-10-0                 13D               Page 19 of  123 Pages
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12.      Greenbriar's Original Answer and Counterclaim, filed on November 20,
         2000, in State District Court, Dallas County, Texas.

13.      Notice of Default, dated December 5, 2000.

14.      Make Whole Letter, dated December 5, 2000.

15.      Second Notice of Default, dated January 12, 2001.

16.      Observer Notice, dated January 12, 2001.

17.      Mandatory Conversion Notice, dated January 13, 2001.

18.      Mandatory Conversion Notice, dated January 13, 2001.

19.      Mandatory Conversion Response Letter, dated January 15, 2001.

20.      Motion, dated February 8, 2001.

21.      Order, dated April 5, 2001.

22.      Master Settlement Agreement dated as of August 1, 2001, among
         Greenbriar Corporation, the Assignors named therein, and LSOF Pooled
         Equity, L.P.

23.      Consent Agreement dated as of August 1, 2001, by and among LSOF Pooled
         Equity, L.P. and certain Stockholders.

24.      Joint Filing Agreement dated August 2, 2001, by and among LSOF Pooled
         Equity, L.P., Terlingua Advisors, Inc., LSOF GenPar, Inc., Lone Star
         Opportunity Fund, L.P., Lone Star Partner, L.P., Lone Star Management
         Co., Ltd., Hudson Advisors, L.L.C., Hudson Advisors Associates, L.P.,
         Advisors GenPar, Inc. and John P. Grayken.

<PAGE>
                                                                  Page 20 of 123


                                                  SIGNATURE

         After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.




Date: August 2, 2001             LSOF POOLED EQUITY, L.P.

                                 By:    LSOF GenPar, Inc., its General Partner


                                        By:  /s/ J.D. Dell
                                           -----------------------------------
                                           J.D. Dell
                                           Vice President



Date: August 2, 2001             LSOF GENPAR, INC.


                                 By:    /s/ J.D. Dell
                                    ------------------------------------------
                                      J.D. Dell
                                      Vice President



Date: August 2, 2001             LONE STAR OPPORTUNITY FUND, L.P.

                                 By:    Lone Star Partner, L.P.,
                                        its General Partner

                                        By:   Lone Star Management Co., Ltd.,
                                               its General Partner


                                              By:    /s/ J.D. Dell
                                                 -----------------------------
                                                   J.D. Dell
                                                   Vice President

<PAGE>
                                                                  Page 21 of 123



Date: August 2, 2001             LONE STAR PARTNER, L.P.

                                 By:    Lone Star Management Co., Ltd.,
                                        its General Partner


                                        By:   /s/ J.D. Dell
                                           -----------------------------------
                                            J.D. Dell
                                            Vice President




Date: August 2, 2001             LONE STAR MANAGEMENT CO., LTD.


                                 By:  /s/ J.D. Dell
                                    ------------------------------------------
                                      J.D. Dell
                                      Vice President



Date: August 2, 2001             HUDSON ADVISORS, L.L.C.


                                 By:  /s/ Steven R. Shearer
                                    ------------------------------------------
                                      Steven R. Shearer
                                      Vice President



Date: August 2, 2001             TERLINGUA ADVISORS, INC.


                                 By:    /s/ Steven R. Shearer
                                    ------------------------------------------
                                      Steven R. Shearer
                                      Vice President



Date: August 2, 2001             ADVISORS GENPAR, INC.


                                 By:    /s/ J.D. Dell
                                    ------------------------------------------
                                      J.D. Dell
                                      Vice President



<PAGE>
                                                                  Page 22 of 123


Date: August 2, 2001             HUDSON ADVISORS ASSOCIATES, L.P.

                                 By:    Advisors GenPar, Inc.
                                        its General Partner


                                        By:   /s/ J.D. Dell
                                           -----------------------------------
                                            J.D. Dell
                                            Vice President





  Date: August 2, 2001           /s/ John P. Grayken
                                 ---------------------------------------------
                                 John P. Grayken







<PAGE>
                                                                  Page 23 of 123


                                  EXHIBIT INDEX

99.1     Stock Purchase Agreement dated as of December 31, 1997 between
         Greenbriar and Lone Star. (1)

99.2     Certificate of Voting Powers, Designations, Preferences and Relative,
         Participating, Optional or Other Special Rights of Series F Senior
         Convertible Preferred Stock of Greenbriar Corporation. (1)

99.3     Certificate of Voting Powers, Designations, Preferences and Relative,
         Participating, Optional or other Special Rights of Series G Senior
         Non-Voting Convertible Preferred Stock of Greenbriar Corporation. (1)

99.4     Registration Rights Agreement dated as of January 13, 1998 between
         Greenbriar and Lone Star. (1)

99.5     Agreement dated as of December 31, 1997 between Greenbriar and Lone
         Star. (1)

99.6     Letter Agreement dated January 31, 2000 between LSOF Greenbriar and
         Greenbriar. (2)

99.7     Letter Agreement dated February 4, 2000 between LSOF Greenbriar and
         Greenbriar. (2)

99.8     Assignment of Rights dated March 1, 2000 between LSOF Greenbriar and
         Pooled Equity. (2)

99.9     Letter Agreement dated April 14, 2000 between Pooled Equity and
         Greenbriar. (3)

99.10    Notice of Conversion dated as of October 30, 2000 from Pooled Equity to
         Greenbriar. (4)

99.11    Pooled Equity's Original Petition (Cause No. 00-08824-I), filed on
         November 3, 2000, in State District Court, Dallas County, Texas. (5)

99.12    Greenbriar's Original Answer and Counterclaim, filed on November 20,
         2000, in State District Court, Dallas County, Texas. (6)

99.13    Notice of Default, dated December 5, 2000. (6)

99.14    Make Whole Letter, dated December 5, 2000. (6)

99.15    Second Notice of Default, dated January 12, 2001. (6)

99.16    Observer Notice, dated January 12, 2001. (6)

99.17    Mandatory Conversion Notice, dated January 13, 2001. (6)

99.18    Mandatory Conversion Notice, dated January 13, 2001. (6)

99.19    Mandatory Conversion Response Letter, dated January 15, 2001. (6)

99.20    Motion, dated February 8, 2001. (7)


<PAGE>
                                                                  Page 24 of 123


99.21    Order, dated April 5, 2001. (8)

99.22    Master Settlement Agreement dated as of August 1, 2001 among Greenbriar
         Corporation, the Assignors named herein, and LSOF Pooled Equity, L.P.
         (8)

99.23    Consent Agreement dated as of August 1, 2001, by and among LSOF Pooled
         Equity, L.P. and certain Stockholders. (8)

99.24    Joint Filing Agreement dated August 2, 2001, by and among LSOF Pooled
         Equity, L.P., Terlingua Advisors, Inc., LSOF GenPar, Inc., Lone Star
         Opportunity Fund, L.P., Lone Star Partner, L.P., Lone Star Management
         Co., Ltd., Hudson Advisors, L.L.C., Hudson Advisors Associates, L.P.,
         Advisors GenPar, Inc. and John P. Grayken. (8)


(1) Incorporated by reference to the Schedule 13D filed on behalf of Lone Star
Opportunity Fund, L.P. on January 22, 1998.

(2) Incorporated by reference to the Schedule 13D (Amendment No. 1) filed on
behalf of LSOF Pooled Equity, L.P. on April 6, 2000.

(3) Incorporated by reference to the Schedule 13D (Amendment No. 2) filed on
behalf of LSOF Pooled Equity, L.P. on March 3, 2000.

(4) Incorporated by reference to the Schedule 13D (Amendment No. 3) filed on
behalf of LSOF Pooled Equity, L.P. on November 2, 2000.

(5) Incorporated by reference to Schedule 13D (Amendment No. 4) filed on behalf
of LSOF Pooled Equity, L.P. on November 3, 2000.

(6) Incorporated by reference to Schedule 13D (Amendment No. 5) filed on behalf
of LSOF Pooled Equity, L.P. on January 25, 2001.

(7) Incorporated by reference to Schedule 13D (Amendment No. 6) filed on behalf
of LSOF Pooled Equity, L.P. on April 4, 2001.

(8) Filed herewith.



<PAGE>
                                                                  Page 25 of 123


                                   SCHEDULE I
                                   ----------

Instruction C. Information for (a) directors and executive officers of GenPar,
Terlingua, Management and Advisors and (b) the officers and member of Hudson.

                        OFFICERS AND DIRECTORS OF GENPAR

Name:                                  John P. Grayken

Present Principal Occupation or
Employment:                            President and Sole Director

Business Address:                      50 Welbeck Street
                                       London, United Kingdom WIM 7HE

Name:                                  J.D. Dell

Present Principal Occupation or
Employment:                            President

Business Address:                      LSOF GenPar, Inc.
                                       600 North Pearl Street
                                       Suite 1550
                                       Dallas, Texas 75201

Name:                                  Benjamin D. Velvin, III

Present Principal Occupation or
Employment:                            Vice President and Assistant Secretary

Business Address:                      LSOF GenPar, Inc.
                                       600 North Pearl Street
                                       Suite 1550
                                       Dallas, Texas 75201

Name:                                  Louis Paletta

Present Principal Occupation or
Employment:                            Vice President

Business Address:                      LSOF GenPar, Inc.
                                       600 North Pearl Street
                                       Suite 1550
                                       Dallas, Texas 75201


<PAGE>
                                                                  Page 26 of 123


                      OFFICERS AND DIRECTORS OF MANAGEMENT


Name:                                 John P. Grayken

Present Principal Occupation or
Employment:                           President and Sole Director

Business Address:                     50 Welbeck Street
                                      London, United Kingdom
                                      W1M 7HE

Name:                                 J.D. Dell

Present Principal Occupation or
Employment:                           Vice President

Business Address:                     Lone Star Management Co., Ltd.
                                      600 North Pearl Street
                                      Suite 1550
                                      Dallas, Texas 75201

Name:                                 Louis Paletta

Present Principal Occupation or
Employment:                           Vice President

Business Address:                     Lone Star Management Co., Ltd.
                                      600 North Pearl Street
                                      Suite 1550
                                      Dallas, Texas 75201

Name:                                 Benjamin D. Velvin III

Present Principal Occupation or
Employment:                           Vice President and Assistant Secretary

Business Address:                     Lone Star Management Co., Ltd.
                                      600 North Pearl Street
                                      Suite 1550
                                      Dallas, Texas 75201


<PAGE>
                                                                  Page 27 of 123


                       OFFICERS AND DIRECTORS OF ADVISORS

Name:                                                   Robert J. Corcoran

Present Principal Occupation or
Employment:                                             President

Business Address:                                       Advisors GenPar, Inc.
                                                        600 North Pearl Street
                                                        Suite 1550
                                                        Dallas, Texas  75201

Name:                                                   Benjamin D. Velvin, III

Present Principal Occupation or
Employment:                                             Vice President

Business Address:                                       Advisors GenPar, Inc.
                                                        600 North Pearl Street
                                                        Suite 1550
                                                        Dallas, Texas  75201

Name:                                                   J.D. Dell

Present Principal Occupation or
Employment:                                             Vice President

Business Address:                                       Advisors GenPar, Inc.
                                                        600 North Pearl Street
                                                        Suite 1550
                                                        Dallas, Texas  75201

Name:                                                   John P. Grayken

Present Principal Occupation or                         Sole Director
Employment:

Business Address:                                       50 Welbeck Street
                                                        London, United Kingdom
                                                        WIM 7HE



<PAGE>
                                                                  Page 28 of 123


                          OFFICERS AND MEMBER OF HUDSON


Name:                                   Robert J. Corcoran

Present Principal Occupation or
Employment:                             President and Chief Financial Officer

Business Address:                       Hudson Advisors, L.L.C.
                                        600 North Pearl Street
                                        Suite 1500
                                        Dallas, Texas 75201

Name:                                   J.D. Dell

Present Principal Occupation or
Employment:                             Executive Vice President

Business Address:                       Hudson Advisors, L.L.C.
                                        600 North Pearl Street
                                        Suite 1550
                                        Dallas, Texas 75201

Name:                                   Steven R. Shearer

Present Principal Occupation or         Vice President
Employment:

Business Address:                       Hudson Advisors, L.L.C.
                                        600 North Pearl Street
                                        Suite 1550
                                        Dallas, Texas 75201


Name:                                   Hudson Advisors Associates, L.P.

Present Principal Occupation or
Employment:                             Managing Member

Business Address:                       Hudson Advisors, L.L.C.
                                        600 North Pearl Street
                                        Suite 1550
                                        Dallas, Texas 75201



<PAGE>
                                                                  Page 29 of 123


                       OFFICERS AND DIRECTORS OF TERLINGUA

Name:                                     Robert J. Corcoran

Present Principal Occupation or
Employment:                               Director and President

Business Address:                         Terlingua Advisors, Inc.
                                          600 North Pearl Street
                                          Suite 1500
                                          Dallas, Texas 75201

Name:                                     J.D. Dell

Present Principal Occupation or
Employment:                               Director and Vice President

Business Address:                         Terlingua Advisors, Inc.
                                          600 North Pearl Street
                                          Suite 1550
                                          Dallas, Texas 75201

Name:                                     Steven R. Shearer

Present Principal Occupation or
Employment:                               Vice President

Business Address:                         Terlingua Advisors, Inc.
                                          600 North Pearl Street
                                          Suite 1500
                                          Dallas, Texas 75201

Name:                                     Len W. Allen, Jr.

Present Principal Occupation or
Employment:                               Vice President

Business Address:                         Terlingua Advisors, Inc.
                                          600 North Pearl Street
                                          Suite 1550
                                          Dallas, Texas 75201

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>3
<FILENAME>a8-2ex99_21.txt
<DESCRIPTION>EXHIBIT 99.21
<TEXT>
                                                                  Page 30 of 123


Exhibit 99.21


LSOF POOLED EQUITY, L.P.           ss.               IN THE DISTRICT COURT
                                   ss.
                                   ss.
                                   ss.
v.                                 ss.               162ND JUDICIAL DISTRICT
                                   ss.
                                   ss.
                                   ss.
GREENBRIAR CORPORATION             ss.               DALLAS COUNTY


                                      ORDER
                                      -----

                  On March 29, 2001, the Court considered the Motion for Partial
Summary Judgment and Brief in Support (the "Motion") filed by Plaintiff LSOF
Pooled Equity, L.P. ("LSOF"), the Opposition to Plaintiff's Motion for Partial
Summary Judgment (the "Opposition") filed by Defendant Greenbriar Corporation
("Greenbriar"), Plaintiff LSOF Pooled Equity L.P.'s Reply to Defendant
Greenbriar Corporation's Opposition to Plaintiff's Motion for Partial Summary
Judgment (the "Reply"), and the Motion to Strike and Objections to LSOF Pooled
Equity, L.P.'s Reply to Defendant Greenbriar Corporation's Opposition to
Plaintiff's Motion for Partial Summary Judgment filed by Greenbriar (the "Motion
to Strike"). Having considered the Motion, the Opposition, the Reply, and the
Motion to Strike, along with arguments of counsel, the Court finds and concludes
as follows:

         1. The Court STRIKES the Affidavit of T. Ray Guy in Support of
Plaintiff's LSOF Pooled Equity L.P.'s Partial Motion for Summary Judgment, filed
on March 29, 2001.

         2. The Court STRIKES the Supplemental Affidavit of J.D. Dell in Support
of Plaintiff LSOF Pooled Equity, L.P.'s Motion for Partial Summary Judgment and
Brief in Support, filed on March 29, 2001, attached as Exhibit A to the Reply.

         3. The Court STRIKES the letter attached as Exhibit B to the Reply.

         4. The Court STRIKES the Supplemental Affidavit of Rita Aybar-Townsend
in Support of Plaintiff LSOF Pooled Equity, L.P.'s Motion for Partial Summary
Judgment and Brief in Support, filed on March 29, 2001, attached as Exhibit C to
the Reply.


<PAGE>
                                                                  Page 31 of 123


         5. The Court DENIES Greenbriar's Motion to Strike with respect to the
Reply itself, filed on March 29, 2001.

         6. The Court GRANTS LSOF's motion for partial summary judgment as
follows:

         (a) The correct conversion price of the Series F and Series G Preferred
Stock was $0.69 per share based on Greenbriar's issuance of $0.69 per share
options.

         (b) LSOF's Conversion Notice complied with the requirements for
conversion under the Certificates of Designation.

         (c) The Conversion Price remained $0.69 per share even if Greenbriar
rescinded the $0.69 per share options after LSOF served its Conversion Notice at
$0.69 per share of Greenbriar Common Stock.

SIGNED this 5th day of April, 2001.

                                                         /s/ Bill Rhea
                                                         ---------------
                                                         JUDGE PRESIDING


APPROVED FOR ENTRY:

/s/ T. Ray Guy
- --------------------------
T. Ray Guy
State Bar No. 08648500
K. Todd Phillips
State Bar No. 24002767

WEIL, GOTSHAL & MANGES LLP
100 Crescent Court, Suite 1300
Dallas, Texas 75201-6950
(214) 746-7700 Telephone
(214) 746-7777 Facsimile
ATTORNEYS FOR PLAINTIFF

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>4
<FILENAME>a8-2ex99_22.txt
<DESCRIPTION>EXHIBIT 99.22
<TEXT>
                                                                  Page 32 of 123

Exhibit 99.22








                           MASTER SETTLEMENT AGREEMENT

                           dated as of August 1, 2001

                                      among

                             GREENBRIAR CORPORATION,

                           THE ASSIGNORS NAMED HEREIN,

                                       and

                            LSOF POOLED EQUITY, L.P.,






<PAGE>
                                                                  Page 33 of 123


ARTICLE I         DEFINITIONS..................................................2

ARTICLE II        TRANSFER OF CONSIDERATION....................................9

         2.1      Consideration................................................9

         2.2      Transfer of Assets..........................................10

         2.3      Assumption of Liabilities...................................10

         2.4      Closing.....................................................11

         2.5      Prorations..................................................12

         2.6      Allocation of Consideration.................................12

         2.7      Damages.....................................................12

         2.8      Intentionally Deleted.......................................12

         2.9      Filings.....................................................12

         2.10     Pre-Closing Escrow..........................................13

ARTICLE III       REPRESENTATIONS AND WARRANTIES..............................13

         3.1      Representations and Warranties of the Assignors.............13

                  (a)      Organization.......................................13

                  (b)      Authorization and Effect of Agreement..............14

                  (c)      Conflicts..........................................14

                  (d)      Consents...........................................14

                  (e)      Stockholder Matters................................14

                  (f)      Absence of Certain Changes and Events..............14

                  (g)      Subsidiaries.......................................15

                  (h)      Litigation; Decrees................................15

                  (i)      Deposits...........................................16

                  (j)      Real Property......................................16

                  (k)      Physical Assets and Properties.....................17

                  (l)      Intangible Assets and Properties...................17

                  (m)      Contracts..........................................18

                  (n)      Contract Defaults..................................18

                  (o)      Compliance With Laws...............................19

                  (p)      Environmental Matters..............................19

                  (q)      Insurance..........................................19

<PAGE>
                                                                  Page 34 of 123

                  (r)      Employee Matters...................................20

                  (s)      Labor Matters......................................20

                  (t)      Solvency...........................................21

                  (u)      Warranty and Product Liability Claims..............21

                  (v)      Licenses, Permits, Etc.............................21

                  (w)      Employees and Consultants..........................21

                  (x)      Disclosure.........................................21

                  (y)      Taxes and Fees.....................................22

                  (z)      Finders............................................22

                  (aa)     Books of Account...................................22

                  (bb)     Sufficiency of Assets..............................22

                  (cc)     Cash Position......................................22

                  (dd)     Bankruptcy.........................................22

         3.2      Representations and Warranties of Assignee..................23

                  (a)      Corporate Organization.............................23

                  (b)      Authorization and Effect of Agreement..............23

                  (c)      Conflicts..........................................23

                  (d)      Consents...........................................23

                  (e)      Finders............................................23

ARTICLE IV        AGREEMENTS..................................................24

         4.1      Conduct of Business.........................................24

         4.2      Inspection..................................................24

         4.3      Litigation Standstill.......................................25

         4.4      Employees...................................................25

                  (a)      Assignor Obligations...............................25

                  (b)      Employment by Assignor.............................25

         4.5      Agreement to Forward Orders, Inquiries and Leads............26

         4.6      Third Party Solicitations...................................26

         4.7      Employee Solicitation.......................................26

         4.8      Non-Competition.............................................26

         4.9      Confidentiality.............................................27

<PAGE>
                                                                  Page 35 of 123


         4.10     Cooperation.................................................27

ARTICLE V         CONDITIONS TO CLOSING.......................................28

         5.1      Conditions to Obligations of Assignee and Assignor..........28

         5.2      Conditions to Obligations of Assignee.......................28

         5.3      Conditions to the Obligations of Assignor...................31

ARTICLE VI        TERMINATION.................................................31

         6.1      Termination.................................................31

         6.2      Post-Termination Activity...................................33

         6.3      Effect of Termination.......................................33

ARTICLE VII       SURVIVAL AND INDEMNIFICATION................................33

         7.1      Survival of Representations, Warranties and Covenants.......33

         7.2      Indemnification by Assignor.................................34

         7.3      Indemnification by Lone Star Parties........................35

         7.4      Defense of Claims...........................................35

ARTICLE VIII      TRANSITION SERVICES.........................................37

         8.1      Use of Name.................................................37

         8.2      Permits.....................................................37

         8.3      Payment Received............................................37

         8.4      Copies of Records...........................................37

ARTICLE IX        MISCELLANEOUS...............................................38

         9.1      Notices.....................................................38

         9.2      Transfer Taxes..............................................39

         9.3      Non-Assignable Contracts....................................39

         9.4      Entire Agreement............................................39

         9.5      Non-Waiver..................................................40

         9.6      Curative Actions; Severability..............................40

         9.7      Governing Law...............................................40

         9.8      WAIVER OF JURY TRAIL........................................40

         9.9      Construction................................................41

         9.10     Counterparts................................................41

         9.11     Successors and Assigns......................................41


<PAGE>
                                                                  Page 36 of 123

         9.12     Cumulative Rights...........................................41

         9.13     Costs; Expenses.............................................41

         9.14     No Third Party Beneficiaries................................41

         9.15     Press Releases/Filings......................................41

         9.16     Time of the Essence.........................................42

         9.17     Acknowledgments.............................................42

         9.18     Assignment of Stock.........................................42




<PAGE>
                                                                  Page 37 of 123
<TABLE>
<S>                                 <C>
LIST OF SCHEDULES
         Schedule 1.1               Permitted Liens
         ------------
         Schedule 2.2               Excluded Assets
         ------------
         Schedule 2.3               Certain Assumed Liabilities of Assignor
         ------------
         Schedule 2.6               Allocation of Consideration
         ------------
         Schedule 3.1(a)            Jurisdictions of Qualification
         ---------------
         Schedule 3.1(d)            Consents
         ---------------
         Schedule 3.1(f)            Absence of Certain Changes and Events
         ---------------
         Schedule 3.1(h)(1)         Litigation
         ------------------
         Schedule 3.1(h)(2)         Litigation affecting the Assigned Assets or Businesses
         ------------------
         Schedule 3.1(i)            Deposits
         ---------------
         Schedule 3.1(j)            Real Property/Facility Leases
         ---------------
         Schedule 3.1(k)            Leased Tangible Property
         ---------------
         Schedule 3.1(l)            Intangible Properties
         ---------------
         Schedule 3.1(m)            Contracts
         ---------------
         Schedule 3.1(n)            Contract Defaults
         ---------------
         Schedule 3.1(p)            Environmental Matters
         ---------------
         Schedule 3.1(q)            Insurance Policies
         ---------------
         Schedule 3.1(r)            Employee Benefit Plans
         ---------------
         Schedule 3.1(s)            Labor Matters
         ---------------
         Schedule 3.1(u)            Warrant and Product Liability Claims
         ---------------
         Schedule 3.1(v)            Licenses and Permits
         ---------------
         Schedule 3.1(w)            Employment, Consulting, Service and Commission Agreements
         ---------------
</TABLE>


<PAGE>

                                                                  Page 38 of 123

                                LIST OF EXHIBITS

         Exhibit A - Mutual Release

         Exhibit B - Bill of Sale

         Exhibit C - Assumption Agreement

         Exhibit D - Consent Agreement

         Exhibit E - Pre-Closing Escrow Agreement









<PAGE>
                                                                  Page 39 of 123

                           MASTER SETTLEMENT AGREEMENT

         This Master Settlement Agreement (this "Agreement") is made as of
August 1, 2001, by and among LSOF Pooled Equity, L.P., a Delaware limited
partnership ("Lone Star"), Greenbriar Corporation, a Nevada corporation (the
"Company"), Berne Village, Inc., a North Carolina corporation ("Berne Village"),
Rose Tara Plantation, Inc., a North Carolina corporation ("RTP"), Windsor House
West, Incorporated, a South Carolina corporation ("Windsor"), The
Denison-Greenbriar, Inc., a Texas corporation ("DG"), The Terrace Retirement,
Inc., an Oregon corporation ("TRI"), Rose Garden Estates, Inc., a Nevada
corporation ("RGE"), Wedgwood Partners Ltd. Limited Partnership, a Nevada
limited partnership ("WPL"), Wedgwood Retirement Inns, Inc., a Washington
corporation ("Wedgwood"), and Transferco, Inc., a Nevada corporation
("Transferco," and together with Berne Village, RTP, Windsor, DG, TRI, WPL,
Wedgwood and RGE, each an "Assignor," and collectively the "Assignors").

                                    RECITALS
                                    --------

         WHEREAS, in January 1998, Lone Star's ultimate predecessor in interest,
Lone Star Opportunity Fund, L.P., purchased shares of the Company's Series F
Senior Convertible Preferred Stock and shares of the Company's Series G Senior
Convertible Preferred Stock (collectively, the "Preferred Stock") for
$22,000,000, which Preferred Stock was convertible into shares of the Company's
common stock;

         WHEREAS, on October 30, 2000, Lone Star delivered its notice of
conversion evidencing its desire to convert the Preferred Stock into shares of
the Company's common stock;

         WHEREAS, a dispute arose between the Company and Lone Star as to the
conversion price of the Preferred Stock and the number of shares of the
Company's common stock into which the Preferred Stock would be convertible;

         WHEREAS, all matters relating to the conversion of the Preferred Stock
are currently being litigated pursuant to the lawsuit styled: LSOF Pooled
Equity, L.P. v. Greenbriar Corporation, Cause No. 00-08824, in the 162nd
Judicial District Court (the "District Court") of Dallas County, Texas (the
"Lawsuit") asserting claims against the Company and seeking legal and equitable
relief;

         WHEREAS, on April 5, 2001, the District Court granted partial summary
judgment in favor of Lone Star;

         WHEREAS, a trial will be scheduled for the near future;

         WHEREAS, solely to avoid the prospect of prolonged, costly litigation,
Greenbriar and Lone Star desire to compromise and settle all claims between
them, including, but not limited to, all existing claims asserted or existing
claims that could have been asserted by any party;

         WHEREAS, each Assignor is a direct or indirect wholly-owned subsidiary
of the Company;

         WHEREAS, in connection with this Agreement and in consideration for the
releases contained herein, (i) the Assignors are transferring to Assignee all of
their respective right, title and interest, in and to the Assigned Assets, (ii)
the Company will pay to Lone Star $4,000,000 in immediately available funds, and


<PAGE>
                                                                  Page 40 of 123

(iii) for the same consideration, the Company is redeeming all of Lone Star's
Preferred Stock, any and all of the Company's common stock into which Lone
Star's Preferred Stock was purportedly converted, together with all of Lone
Star's right, title and interest to any and all claims and rights with respect
to its interest as a stockholder, equity interest holder or otherwise; and

         WHEREAS, this Agreement and the consideration transferred pursuant
hereto is to compromise and settle all disputed claims and to buy peace, and no
payment, release or other consideration given constitutes an admission of
liability by any party hereto, all such liability being expressly denied.

         NOW, THEREFORE, in consideration of the foregoing premises, the mutual
agreements contained in this Agreement and other consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement
hereby agree as follows:

                                    AGREEMENT
                                    ---------

                                    ARTICLE I

                                   DEFINITIONS
                                   -----------

         "Affiliate" shall mean, with respect to any Person, (a) each Person
that, directly or indirectly, owns or controls, whether beneficially, or as a
trustee, guardian or other fiduciary, five percent (5%) or more of the Capital
Stock having ordinary voting power in the election of directors of such Person,
(b) each Person that controls, is controlled by or is under common control with
such Person and (c) in the case of individuals, the immediate family members,
spouses and lineal descendants of individuals who are Affiliates of the Person.
For the purposes of this definition, "control" of a Person shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of its management or policies, whether through the ownership of voting
securities, by contract, by virtue of being an executive officer or a director
or otherwise.

         "Agreement" means this Master Settlement Agreement, as amended,
supplemented or otherwise modified from time to time.

         "Assigned Assets" shall have the meaning assigned in Section 2.2.

         "Assignee" shall mean Lone Star or its designated assignees in
accordance with Section 9.11.

         "Assignee Party" shall have the meaning assigned in Section 7.2.

         "Assignor" or "Assignors" shall have the meaning assigned in the
Preamble.

         "Assignor Party" shall have the meaning assigned in Section 7.3.

         "Assumed Liabilities" shall have the meaning assigned in Section 2.3.

         "Assumption Agreement" means that certain Assumption Agreement to be
executed by the Assignee and each of the Assignors substantially in the form of
Exhibit C hereto.


<PAGE>
                                                                  Page 41 of 123


         "Berne Village" shall have the meaning assigned in the Preamble.

         "Bill of Sale" means that certain Bill of Sale to be executed by each
of the Assignors substantially in the form of Exhibit B hereto.

         "Business" shall mean with respect to (i) Berne Village, the operation
and ownership of the assisted living facility and community known as Berne
Village located in New Bern, North Carolina; (ii) RTP, the operation and
ownership of the assisted living facility and community known as Rosa Tara
Plantation located in King, North Carolina; (iii) Windsor (or its assignee), the
operation and ownership of the assisted living facility and community known as
Windsor House West located in Spartanburg, South Carolina; (iv) DG, the
operation and ownership of the assisted living facility and community known as
Greenbriar at Denison located in Denison, Texas; (v) TRI, the operation and
ownership of the assisted living facility and community known as The Terrace
located in Portland, Oregon; (vi) RGE, the operation and ownership of the
assisted living facility and community known as Rose Garden Estates located in
Ritzville, Washington; (vii) Transferco, the operation and ownership of the
assisted living facilities and communities known as Villa de Sol and
Meadowbrook, each located in Roswell, New Mexico; (viii) WPL, the operation and
ownership of the assisted living facilities and communities known as Camelot
Assisted Living located in Harlingen, Texas and La Villa located in Roswell, New
Mexico; and (ix) Wedgwood, the operation and ownership of the assisted living
facility and community known as Summer Hill located in Oak Harbor, Washington.

         "Capital Stock" shall mean all shares, options, warrants, general or
limited partnership or membership interests or other equivalents (regardless of
how designated) of or in a corporation, partnership, limited liability company
or other Person, whether voting or nonvoting, including common stock, preferred
stock or any other "equity security" (as such term is defined in Rule 3a11-1 of
the General Rules and Regulations promulgated by the Securities and Exchange
Commission under the Securities Exchange Act of 1934, as amended).

         "Claims" means all claims and causes of actions that either were or
could have been asserted in the Lawsuit as more specifically set forth in the
Mutual Release.

         "Closing" has the meaning set forth in Section 2.4.

         "Closing Date" has the meaning set forth in Section 2.4.

         "Code" has the meaning assigned in Section 2.3(b).

         "Company" shall have the meaning assigned in the Preamble.

         "Consent Agreement" shall mean that certain Consent Agreement of even
date herewith executed by certain stockholders of the Company, including each of
the directors of the Company and Intervenors attached hereto as Exhibit D.

         "Crowne Point Escrow" shall have the meaning set forth in Section
2.10(b).

         "Crowne Point Proceeds" shall have the meaning set forth in Section
2.10(b).

         "DG" shall have the meaning assigned in the Preamble.


<PAGE>
                                                                  Page 42 of 123


         "Direct Claim" shall have the meaning set forth in Section 7.4(d).

         "District Court" shall have the meaning assigned in the Recitals.

         "Employee" shall have the meaning assigned in Section 3.1(r).

         "Employee Benefit Plans" shall have the meaning assigned in Section
3.1(r).

         "Environmental Laws" shall have the meaning assigned in Section 3.1(p).

         "ERISA" shall have the meaning set forth in Section 4.4.

         "ERISA Affiliate" shall have the meaning set forth in Section 3.1(r).

         "Escrow Amounts" shall have the meaning set forth in Section 2.10(b).

         "Excluded Assets" shall have the meaning assigned in Section 2.2.

         "Facility" shall mean any assisted living facility or community that is
an Assigned Asset.

         "Facility Leases" shall have the meaning assigned in Section 3.1(j)(v).

         "Former Employee" shall have the meaning assigned in Section 3.1(r).

         "GAAP" generally accepted accounting principles in the United States of
America.

         "Greenbriar Parties" shall mean the Company and each Assignor.

         "Harlingen" shall have the meaning assigned in the Preamble.

         "Indebtedness" means with respect to any Person, without duplication,
any liability of such Person (i) for borrowed money, (ii) evidenced by bonds,
debentures, notes or other similar instruments, (iii) constituting capitalized
lease obligations, (iv) incurred or assumed as the deferred purchase price of
property, or pursuant to conditional sale obligations and title retention
agreements, (v) for the reimbursement of any obligor on any letter of credit,
bankers' acceptance or similar credit transaction, (vi) for Indebtedness of
others guaranteed by such Person, (vii) for interest swap obligations, commodity
agreements and currency agreements and (viii) for Indebtedness of any other
Person of the type referred to in clauses (i) through (vii) which are secured by
any Lien on any property or asset of such first referred to Person, the amount
of such Indebtedness being deemed to be the lesser of the value of such property
or asset or the amount of the Indebtedness so secured.

         "Indemnifiable Losses" means any and all damages, losses, liabilities,
obligations, costs, and expenses, and any and all claims, demands, or suits (by
any person), including the costs and expenses of any and all actions, suits,
proceedings, demands, assessments, judgments, settlements, and compromises
relating thereto and including reasonable attorneys' fees and expenses in
connection therewith.

         "Indemnifying Party" means any person required to provide
indemnification under this Agreement.


<PAGE>
                                                                  Page 43 of 123


         "Indemnitee" means any person entitled to indemnification under this
Agreement.

         "Indemnity Payment" means any amount of Indemnifiable Losses required
to be paid pursuant to this Agreement.

         "Intervenors" American Realty Trust, Inc., Basic Capital Management,
Inc., One Realco Corporation (in its own capacity and as successor in interest
to Nanook Partners, L.P.), Tacco Financial Corporation, International Health
Products, Inc.

         "Law" shall mean any law (including common law), constitution, statute,
regulation, rule, ordinance, order, injunction, writ, decree or award of any
governmental authority of competent jurisdiction or of any arbitrator (including
ERISA, the Code, the Uniform Commercial Code, any applicable tax law, product
safety law, occupational safety or health law, Environmental Law and/or
securities laws).

         "Lawsuit" shall have the meaning assigned in the Recitals. "Leased
Tangible Property" shall have the meaning assigned in Section 3.1(k).

         "Licensed Intangible Properties" shall have the meaning assigned in
Section 3.1(l).

         "Lien" shall mean any mortgage, pledge, hypothecation, lien (statutory
or other), judgment lien, security interest, security agreement, charge or other
encumbrance, or other security arrangement of any nature whatsoever, including
any installment contract, conditional sale or other title retention arrangement,
any sale of accounts receivable or chattel paper, any assignment, deposit
arrangement or lease (including capital leases) intended as, or having the
effect of, security and the filing of any financing statement under the UCC or
comparable law of any jurisdiction.

         "Lone Star" shall have the meaning assigned in the Preamble.

         "Lone Star Parties" shall mean Lone Star and Assignee.

         "Mutual Release" shall mean the Mutual Release substantially in the
form of Exhibit A and all related exhibits thereto, including the Agreed Motion
to Dismiss and the Agreed Order Granting Motion to Dismiss.

         "Organizational Documents" shall mean with respect to a corporation,
the certificate or articles of incorporation and by-laws of such corporation;
with respect to a partnership, the certificate of partnership (or limited
partnership, as applicable) and partnership agreement, together with the
analogous documents for any corporate or partnership general partner; with
respect to a limited liability company, the certificate of formation or articles
of organization and operating agreement; and, in any case, any other document
governing the formation and conduct of business by such Person.

         "Owned Tangible Property" shall have the meaning assigned in Section
3.1(k).

         "Owned Intangible Property" shall have the meaning assigned in Section
3.1(l).


<PAGE>
                                                                  Page 44 of 123


         "Permitted Liens" means those liens set forth on Schedule 1.1, liens
for ad valorem taxes and assessments not yet due and payable, mechanics liens
incurred in the ordinary course of the Business consistent with past practice,
and other minor encumbrances which do not and will not adversely affect the
transferability, use or value of the Real Property as it is currently being used
in connection with such Assignor's Business.

         "Person" shall mean an individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or department or other agency or
political subdivision thereof.

         "Pre-Closing Escrow Agent" shall have the meaning assigned in Section
2.10(a).

         "Pre-Closing Escrow Agreement" shall have the meaning assigned in
Section 2.10(a).

         "Pre-Closing Escrow Amount" shall have the meaning assigned in Section
2.10(a).

         "Preferred Stock" has the meaning assigned in the Recitals.

         "Real Property" shall have the meaning assigned in Section 3.1(j)(i).

         "RGE" shall have the meaning assigned in the Preamble.

         "RTP" shall have the meaning assigned in the Preamble.

         "Solvent" shall mean, with respect to any Person on a particular date,
that on such date (a) the fair value of the property of such Person is greater
than the total amount of liabilities, including contingent liabilities, of such
Person; (b) the present fair salable value of the assets of such Person is not
less than the amount that will be required to pay the probable liability of such
Person on its debts as they become absolute and matured; (c) such Person does
not intend to, and does not believe that it will, incur debts or liabilities
beyond such Person's ability to pay as such debts and liabilities mature; and
(d) such Person is not engaged in a business or transaction, and is not about to
engage in a business or transaction, for which such Person's property would
constitute an unreasonably small amount of capital. The amount of contingent
liabilities (such as litigation, guarantees and pension plan liabilities) at any
time shall be computed as the amount which, in light of all the facts and
circumstances existing at the time, represents the amount which can reasonably
be expected to become an actual or matured liability.

         "Stock Certificates" shall mean any and all stock certificates
evidencing the Company's common stock into which Lone Star's Preferred Stock was
purportedly converted.

         "Subject Employee" shall have the meaning assigned in Section 3.1(w).

         "Subsidiary" shall mean with respect to any Person, (a) any corporation
(i) of which an aggregate of more than fifty percent (50%) of the outstanding
Capital Stock having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether, at the time, Capital
Stock of any other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at the time,
directly or indirectly, owned legally or beneficially by such Person and/or one
or more Subsidiaries of such Person or (ii) with respect to which any such
Person has the right to vote or designate the vote of fifty percent (50%) or
more of such Capital Stock, whether by proxy, agreement, operation of law or

<PAGE>
                                                                  Page 45 of 123


otherwise and (b) any partnership or limited liability company (i) in which such
Person and/or one or more Subsidiaries of such Person shall have an interest
(whether in the form of voting or participation in profits or capital
contribution) of more than fifty percent (50%) or (ii) of which any such Person
is a general partner or manager or may exercise the powers of a general partner
or manager.

         "Taxes" means all taxes, assessments, fees, levies, imposts, duties,
penalties, deductions, liabilities, withholdings or other charges of any nature
whatsoever, including interest and penalties, imposed by any governmental
authority.

         "Terminating Assignee's Breach" shall have the meaning assigned in
Section 6.1(c).

         "Terminating Assignor's Breach" shall have the meaning assigned in
Section 6.1(b).

         "Third Party Claim" means any claim, action, or proceeding made or
brought by any Person who is not a party to this Agreement or an Affiliate of a
party to this Agreement.

         "Transaction Documents" shall mean this Agreement, the Mutual Release,
the Bill of Sale, the Assumption Agreement, the Consent Agreement, and all other
agreements, instruments, documents and certificates now or hereafter delivered
to Lone Star or its Affiliates by the Company or its Affiliates pursuant to or
in connection with any of the foregoing.

         "Transferco" shall have the meaning assigned in the Preamble.

         "TRI" shall have the meaning assigned in the Preamble.

         "Wedgwood" shall have the meaning assigned in the Preamble.

         "Windsor" shall have the meaning assigned in the Preamble.

         "WTP" shall have the meaning assigned in the Preamble.

                                   ARTICLE II
                            TRANSFER OF CONSIDERATION

2.1      Consideration.
         -------------

                  (a) Subject to the terms hereof, (i) the Company agrees to (A)
         on the Closing Date, pay to Lone Star, a cash payment of Four Million
         Dollars ($4,000,000) in immediately available funds; and (B) cause each
         of the Assignors to assign, convey and transfer to Assignee on the
         Closing Date, the Assigned Assets as set forth below in Section 2.2;
         and (ii) the Company and the Intervenors shall fully and finally
         release all claims the Company or any of its Subsidiaries, stockholders
         (including, without limitation, the Intervenors), directors, officers,
         employees, representatives, agents or any of their Affiliates may have
         against the Lone Star Parties or any of their Affiliates pursuant to
         the terms and conditions of the Mutual Release.


<PAGE>
                                                                  Page 46 of 123


                  (b) Subject to the terms hereof, Lone Star agrees to accept
         (i) the cash payment referenced in clause (i)(A) above, and (ii) the
         transfer of the Assigned Assets in consideration of the following:

                           (i) the redemption by the Company of (A) all of Lone
                  Star's right, title and interest in and to Lone Star's Capital
                  Stock in the Company, including (1) Lone Star's Preferred
                  Stock and all attendant rights, including conversion rights
                  and default dividend claims, (2) Lone Star's 1,054,202 shares
                  of the Company's common stock, and (3) all other equity
                  interests in the Company that may be held by Lone Star; and
                  (B) all reimbursable expenses (other than the expenses related
                  to the transactions contemplated by the Transaction Documents)
                  due Lone Star by the Company and such reimbursable expenses
                  shall be compromised, waived and discharged;

                           (ii) the assumption by Lone Star of the Assumed
                  Liabilities as set forth in Section 2.3 below; and

                           (iii) the full and final release of all Claims that
                  Lone Star or any of its Subsidiaries, stockholders, directors,
                  officers, employees, representatives, agents or any of their
                  Affiliates (including, but not limited to Lone Star
                  Opportunity Fund, L.P. and LSOF Greenbriar L.L.C.) may have
                  against the Company, or any of its Subsidiaries, stockholders,
                  directors, officers, employees, representatives, agents or
                  their Affiliates pursuant to the terms and conditions of the
                  Mutual Release.

                  (c) All parties to this Agreement agree for federal income tax
         purposes to treat all consideration payable to Lone Star (except for
         reimbursable expenses referenced in Section 2.1(b)(i)(B), if any) as a
         payment to Lone Star in redemption of its Capital Stock of the Company.

                  Subject to the terms and conditions of this Agreement, it is
         the express intent of the Company and Lone Star to fully and finally
         resolve all disputes between them, including without limitation the
         Lawsuit, in a manner that settles and discharges all past and present
         differences of any kind or character and, to the greatest extent
         allowed by law.

         2.2 Transfer of Assets. Subject to the provisions of this Agreement,
the Company agrees to cause each of the Assignors, and each Assignor hereby
agrees, to assign to Assignee and Assignee hereby agrees to accept from each
Assignor, all of such Assignor's assets and properties of every kind and nature,
real, personal or mixed, tangible or intangible, wherever situated, including
all land, buildings, improvements, fixtures, machinery, tooling, furniture,
vehicles, equipment, tools, inventory, supplies, indemnification rights,
technology, know-how, patents, trademarks, tradenames, proprietary information,
trade secrets, computer programs, copyrights, customer lists, resident lists,
resident deposits refundable to residents held by the Company or any of its

<PAGE>
                                                                  Page 47 of 123


Subsidiaries related to the Businesses, demographic information, customer data,
goodwill and other intangible property rights of any kind whatsoever, licensing
agreements and other contractual rights, and all of such Assignor's books and
records relating to the operations of such Assignor's Business, as each of the
foregoing exists as of the Closing Date (such assets being sold by the Assignors
are collectively referred to herein as the "Assigned Assets"); excluding,
however, cash, cash equivalents, marketable securities, accounts receivable,
notes receivable, loan receivables, deferred income taxes and prepaid income
taxes, income tax refunds, accrued interest receivables, utility deposits,
insurance policies and claims thereunder (other than the proceeds of any claims
which relate to the Assigned Assets), and the other assets listed on Schedule
2.2 (collectively, the "Excluded Assets"). The Assigned Assets shall be sold and
transferred to Assignee "as is" free and clear of all Liens, other than
Permitted Liens.

         2.3 Assumption of Liabilities. Subject to the provisions of this
Agreement, the Assignee, in consideration of the other agreements related
thereto or entered into in connection therewith, shall assume the payment,
performance and discharge of the Assumed Liabilities. For purposes hereof,
"Assumed Liabilities" means only (i) the specific liabilities of each Assignor
under the contracts, purchase commitments, sales orders and arrangements listed
on Schedule 2.3 to the extent such obligations accrue following the Closing
Date, (ii) the Indebtedness specifically set forth on Schedule 2.3, and (iii)
all liabilities, obligations, costs and expenses incurred in the ordinary course
of business consistent with past practices prior to the Closing Date for goods
or services to be used by any of the Businesses after the Closing Date in an
aggregate amount not to exceed $250,000. Assignee does not and shall not agree
to pay, assume, perform, or discharge any of such Assignor's debts, obligations,
or liabilities (whether known or unknown, direct or indirect, absolute or
contingent, matured or unmatured, or otherwise), whether the same currently
exist or come to exist in the future, except the Assumed Liabilities. For the
avoidance of doubt, "Assumed Liabilities" shall not include any of the
following:

                  (a) any of the Assignor's liabilities for which assumption by
         Assignee would be prohibited under the terms of such contracts,
         commitments, orders or arrangements;

                  (b) any of the Assignor's liabilities or obligations with
         respect to the employment or termination of employment of any employee
         of any Assignor, payment of salary or severance or provision of
         benefits, including but not limited to the benefits payable under any
         Employee Benefit Plan with respect to the employment by any Assignor of
         any employee or independent contractor of any Assignor or of any former
         employee of any Assignor, and any liabilities or obligations of any
         Assignor arising out of or resulting from any Employee Benefit Plan or
         any other employee benefit agreement, arrangement, understanding,
         program or practice, including any liabilities or obligations arising
         under Section 4980B of the Internal Revenue Code of 1986, as amended
         (the "Code");


<PAGE>
                                                                  Page 48 of 123


                  (c) except as specifically set forth on Schedule 2.3, any of
         such Assignor's liabilities for Indebtedness;

                  (d) any of the Assignor's liabilities or obligations for Taxes
         other than those Taxes that shall be prorated as set forth in Section
         2.5 and the special assessment described on Schedule 2.3 with respect
         to the Facility known as "The Terrace";

                  (e) any of the Assignor's liabilities or obligations under
         contracts relating to any Assignor's equity or any Assignor's
         equityholders;

                  (f) any of the Assignor's liabilities or obligations with
         respect to any litigation or other claims arising in connection with
         the pre-Closing operations of the Assigned Assets or such Assignor's
         Business;

                  (g) any of the Assignor's liabilities or obligations arising
         out of Environmental Laws arising in connection with the pre-Closing
         operations of the Assigned Assets or the Business (including, without
         limitation, any off-site disposal activities) or the Real Property or
         any other real property (including previously-owned real property)
         owned, leased or operated by any Assignor or any predecessor of any
         Assignor or any prior owner of all or part of their respective business
         or assets (including, but not limited to, any liability under
         Environmental Laws as a result of hazardous materials present at, on or
         under any such real property as of or prior to the Closing).

         2.4 Closing. The consummation of the transactions contemplated herein
(the "Closing") shall take place at 10:00 a.m., local time, on the earlier to
occur of (i) three (3) business days after all of the conditions to Closing set
forth in Article V have been satisfied or waived, and (ii) August 31, 2001 at
the offices of Weil, Gotshal & Manges LLP, 100 Crescent Court, Suite 1300,
Dallas Texas 75201, or at such other time or place as the Lone Star and the
Company may agree in writing (the day on which the Closing takes place being
referred to herein as the "Closing Date"). At the Closing, the Company shall
deliver or cause to be delivered to the Lone Star Parties (i) $4,000,000 payable
in immediately available funds to an account designated by Lone Star, (ii) the
Assigned Assets, and (iii) the other documents required to be delivered by the
Greenbriar Parties pursuant to Article V hereof, including without limitation
the Mutual Release. At the Closing, Lone Star shall deliver to the Company the
Mutual Release, the Assumption Agreement and the Stock Certificates.

         2.5 Prorations. Utility charges, ad valorem taxes and property taxes
and personal property taxes on the Assigned Assets and rents and other charges
payable with respect to leases and other contracts assumed by Assignee will be
prorated between the respective Assignor, on the one hand, and Assignee, on the
other hand, as of 12:01 a.m. on the Closing Date. To the extent practicable, all
such prorations and payments will be made on the Closing Date, with the balance
to be made as soon as practicable following the Closing Date in one or more
payments.


<PAGE>
                                                                  Page 49 of 123


         2.6 Allocation of Consideration. For federal income and other
applicable tax purposes, the consideration shall be allocated among the Assigned
Assets as set forth in Schedule 2.6, such allocation to be made as provided in
Section 1060 of the Code. Assignors and Assignee shall each file Form 8594
(Asset Acquisition Statement Under Section 1060) on a timely basis reporting the
allocation of the consideration consistent with the allocation in Schedule 2.6.
Schedule 2.6 also reflects the aggregate fair market values for the Assigned
Assets, as such terms are defined in regulations promulgated pursuant to Section
1060 of the Code. Assignors and Assignee shall file on a timely basis any
amendments required to such Form 8594 as a result of a subsequent adjustment of
the consideration. Assignors and Assignee shall not take any position on their
respective federal income or other applicable tax returns that is inconsistent
with the allocation of the consideration as agreed to in Schedule 2.6 or as
adjusted as a result of a subsequent increase or decrease in the consideration.
The Assignors and Assignee shall each indemnify, defend and hold harmless the
other from and against any and all claims, losses, liabilities, damages, cost
and expenses that may be incurred as a result of the failure to file Form 8594,
the failure to file such Form 8594 on a timely basis or the failure to file its
tax returns in the manner required by this Section 2.6.

         2.7 Damages. The consideration exchanged by the parties pursuant to
this Agreement, and the allocation of consideration described herein, reflects a
mutual compromise and may not be indicative of the damages or losses that will
result from the breach of this Agreement or any of the Transaction Documents.

         2.8 Intentionally Deleted.

         2.9 Filings. Immediately after the execution and delivery of this
Agreement, the Company shall file a Current Report on 8-K with the Securities
and Exchange Commission and Lone Star shall file an amendment to its Schedule
13D with the Securities and Exchange Commission relating to the transactions
contemplated herein, the contents of which shall be subject to the reasonable
approval of both Company and Lone Star, but shall comply in all respect with all
applicable law, rules, and regulations, including, without limitation, all
regulations of the Securities and Exchange Commission.

         2.10 Pre-Closing Escrow.

                  (a) Upon the execution hereof, the Company shall pay Two
         Million Dollars ($2,000,000) (the "Pre-Closing Escrow Amount") to
         American Escrow (the "Pre-Closing Escrow Agent"), and the Pre-Closing
         Escrow Agent shall hold the Pre-Closing Escrow Amount under the terms
         of an escrow agreement in the form of Exhibit E hereto (the
         "Pre-Closing Escrow Agreement").

                  (b) Upon the consummation of the sale of the assisted living
         facility and community known as Crowne Point, the Company shall pay an
         additional Two Million Dollars ($2,000,000) (the "Crowne Point
         Proceeds") to the Pre-Closing Escrow Agent, and the Pre-Closing Escrow
         Agent shall hold the Crowne Point Proceeds in a separate escrow account

<PAGE>
                                                                  Page 50 of 123


         (the "Crowne Point Escrow") pursuant to an escrow agreement between the
         Company and the Pre-Closing Escrow Agent. Such escrow agreement shall
         provide that the Pre-Closing Escrow Agent shall provide Lone Star with
         evidence satisfactory to Lone Star that the Crowne Point Proceeds have
         been deposited into the Crowne Point Escrow and will immediately notify
         Lone Star of any distributions from the Crown Point Escrow Account.

                                   ARTICLE III

                         REPRESENTATIONS AND WARRANTIES

         3.1 Representations and Warranties of the Assignors. Each of the
Greenbriar Parties represents and warrants, for and on behalf of itself and with
respect to each Assignor and the Assigned Assets purported to be owned by each
such Assignor, to the Lone Star Parties as follows:

                  (a) Organization. Each of the Greenbriar Parties is a
         corporation duly organized, validly existing and in good standing under
         the laws of the jurisdiction of its formation and has the requisite
         power and authority to own, lease or otherwise hold the assets owned,
         leased or otherwise held by it and to carry on its business as
         presently conducted by it. Each of the Greenbriar Parties is in good
         standing and duly qualified to conduct business as a foreign entity in
         every jurisdiction in which its ownership or lease of property or
         conduct of the business makes such qualification necessary. All of the
         jurisdictions in which the Greenbriar Parties are in good standing and
         duly qualified to conduct business as a foreign entity are listed on
         Schedule 3.1(a).

                  (b) Authorization and Effect of Agreement. Each of the
         Greenbriar Parties has the requisite corporate power and authority to
         execute, deliver and perform its obligations under each of the
         Transaction Documents executed or to be executed by such Greenbriar
         Party. The execution, delivery and performance by each Greenbriar Party
         of each of the Transaction Documents executed or to be executed by such
         Greenbriar Party has been duly authorized by all requisite corporate
         action as applicable. This Agreement has been duly executed and
         delivered by each of the Greenbriar Parties. This Agreement
         constitutes, and each of the other Transaction Documents to be executed
         by a party hereto will constitute, the valid and binding obligation of
         such Greenbriar Party, enforceable against such Greenbriar Party in
         accordance with its terms, subject to applicable bankruptcy,
         insolvency, fraudulent conveyance, reorganization, moratorium and
         similar laws affecting creditors' rights and remedies generally and
         subject, as to enforceability, to general principles of equity,
         including principles of commercial reasonableness, good faith and fair
         dealing (regardless of whether enforcement is sought in a proceeding at
         law or in equity).


<PAGE>
                                                                  Page 51 of 123


                  (c) Conflicts. Neither the execution, delivery, nor
         performance of any Transaction Document executed or to be executed by
         any Greenbriar Party will (i) violate any material Law applicable to
         such Greenbriar Party, (ii) violate, conflict with, permit the
         cancellation or acceleration of, or give rise to a loss of any benefit
         under, any material agreement or commitment to which such Greenbriar
         Party is a party or by which any of its properties are bound, or (iii)
         violate or conflict with any provision of such Greenbriar Party's
         Organizational Documents. Neither the Company nor any the Assignors
         have entered into, or is aware of, any agreement pursuant to which any
         person or entity has obtained the right to acquire any assets of the
         Company any of its Subsidiaries.

                  (d) Consents. Except as set forth on Schedule 3.1(d), no
         material actions, consents, or approvals of, or filings with, any
         governmental authorities or any third parties are required in
         connection with the execution, delivery or performance by any of the
         Greenbriar Parties of the Transaction Documents.

                  (e) Stockholder Matters. The Consent Agreement has been signed
         by those officers, directors and holders of the Company's Capital Stock
         (including the Intervenors) signatory thereto, and no action has been
         taken by an such party to amend, modify of rescind the Consent
         Agreement.

                  (f) Absence of Certain Changes and Events. Except as
         contemplated or expressly permitted by this Agreement and except as set
         forth on Schedule 3.1(f) or disclosed in any filing with the Securities
         Exchange and Commission prior to the date hereof, since March 31, 2001,
         there has not been (i) any material damage, destruction or loss of any
         kind with respect to any of the Assigned Assets, nor has there been any
         event or circumstance which has had or reasonably could be expected to
         have a material adverse effect on the financial condition or business
         operations of such Assignor; (ii) any declaration, setting aside or
         payment of any dividend or other distribution (whether in cash, stock
         or property) with respect to any of the Assignors' outstanding capital
         stock; (iii) any cancellation or compromise of any debt or claim, or
         waiver or release of any right, except in the ordinary course of
         business consistent with past practices; (iv) any sale, assignment,
         lease or disposition of assets of any of the Assignors (or a commitment
         to do any of the foregoing), except in the case of obsolete equipment
         or in connection with the acquisition of replacement property that has
         substantially the same value and utility; (v) any Lien created or
         assumed upon the Assigned Assets (other than Permitted Liens); (vi) any
         capital expenditures, or commitments to make such capital expenditures,
         in excess of $100,000 (in the aggregate); (vii) the execution of any
         agreement with any director, officer, employee or independent
         contractor of any of the Assignors providing for his/her employment, or
         any increase in compensation or severance or termination of benefits
         payable or to become payable by an Assignor to such director, officer,
         employee, or independent contractor, or any increase in benefits under
         any collective bargaining agreement or other Employee Benefit Plan of
         any of the Assignors, except in the ordinary course of business

<PAGE>
                                                                  Page 52 of 123


         consistent with past practices; (viii) any distributions to its
         stockholders in respect of its Capital Stock or loans to any Person; or
         (ix) any transaction with any Affiliate required to be disclosed under
         Item 404 of Regulation S-K promulgated under the Securities Act of
         1933, as amended. Since March 31. 2001 such Assignor has not conducted
         the Business other than in the ordinary course, consistent with such
         Assignor's past practice. Since March 31, 2001, there has not been any
         material adverse change in the Business or the financial condition or
         results of operations of the Business. Since December 31, 2000, there
         has not been any change by any of the Company or any of its
         Subsidiaries in their financial or tax accounting principles or
         methods, except insofar as required by GAAP, applicable law or
         circumstances which did not exist as of the date of the December 31,
         2000 audited financial statements.

                  (g) Subsidiaries. The Company has previously provided to Lone
         Star copies of all Organizational Documents of the Company and each
         Assignor, and such copies are true and correct in all respects.

                  (h) Litigation; Decrees. Except as disclosed on Schedule
         3.1(h)(1) and the Lawsuit, there are no lawsuits, claims or
         administrative or other proceedings or investigations pending or, to
         the knowledge of the Company or any of its Subsidiaries, threatened by,
         against or affecting (i) any of the Company or its Subsidiaries,
         including without limitation, the Assignors, relating to the
         Businesses, where the uninsured amount exceeds $200,000, individually
         or in the aggregate, or (ii) this Agreement, the other Transaction
         Documents or the transactions contemplated hereby or thereby. Except as
         disclosed on Schedule 3.1(h)(1), neither the Company nor any of its
         Subsidiaries, including the Assignors, is a party to or subject to the
         provisions of any judgment, order, writ, injunction, decree or award of
         any court, arbitrator or governmental or regulatory official, body or
         authority relating to the Businesses, this Agreement, the other
         Transaction Documents or the transactions contemplated hereby or
         thereby. Except as disclosed on Schedule 3.1(h)(2), none of the
         litigation described on Schedule 3.1(h)(1), affects or could affect the
         Assigned Assets or such Assignor's Business.

                  (i) Deposits. Schedule 3.1(i) sets forth a true and complete
         list all resident deposits being held by the Company or any of its
         Subsidiaries and all cash of the Company or any of its Subsidiaries
         which are related to the Assignors' Businesses.

                  (j) Real Property.

                           (i) Schedule 3.1(j) sets forth a true and complete
                  list of all real property owned by each Assignor (the "Real
                  Property"). Such Assignor has, and Assignee will be
                  transferred, good and indefeasible title to the Real Property,
                  free and clear of any Liens (other than Permitted Liens). Such

<PAGE>
                                                                  Page 53 of 123


                  Assignor does not lease, as lessee, any real property. Such
                  Assignor has provided to Assignee correct and complete copies
                  of all title insurance policies issued to such Assignor or in
                  such Assignor's possession relating to the Real Property.

                           (ii) The Real Property of such Assignor constitutes
                  all real property used in connection with such Assignor's
                  Business. Neither the Company nor such Assignor has knowledge
                  that the Real Property, any improvements thereon, or the use
                  by such Assignor thereof, fails to conform to (i) all
                  applicable Laws, including but not limited to zoning
                  requirements and the Americans With Disabilities Act, and (ii)
                  all restrictive covenants, if any. There are no eminent domain
                  proceedings pending, or to such Assignor's knowledge,
                  threatened against the Real Property. The Real Property has
                  adequate ingress or egress to public streets and highways.

                           (iii) The Real Property is connected to and is served
                  by water, solid waste and sewage disposal, drainage,
                  telephone, gas, electricity and other utility equipment
                  facilities and services necessary and sufficient for the
                  operation or use of the Real Property. To such Assignor's
                  knowledge, such facilities and services are adequate for the
                  present use and operation of the Real Property on a fully
                  occupied basis, and are installed and connected pursuant to
                  valid permits and are in material compliance with all
                  governmental regulations. To such Assignor's knowledge, no
                  fact or condition exists which would result in the termination
                  or impairment in the furnishing of utility services to the
                  Real Property. With respect to the prior three sentences, such
                  Assignor has not received any written notice to the contrary.

                           (iv) Other than as set forth on Schedule 3.1(j), the
                  Real Property has not been damaged by fire or other casualty
                  except for such damage which has been fully repaired and
                  restored prior to the date of this Agreement.

                           (v) Schedule 3.1(j) sets forth a true and complete
                  list of all real property leased by such Assignor, as lessor,
                  and a true and correct copy of the rent roll relating to each
                  of the Assignor's Facilities (the "Facility Leases").

                           (vi) There has not been (i) any threatened
                  cancellation of any Facility Leases not in the ordinary course
                  of such Assignor's Business, (ii) any outstanding disputes, of
                  a material nature, under any Facility Leases or (iii) to such
                  Assignor's knowledge, any bases for any claim of breach or
                  default thereunder. Such Assignor has no reason to believe
                  that any of the Facility Leases that are renewable will not be

<PAGE>
                                                                  Page 54 of 123


                  renewed by the other party on reasonable terms other than in
                  the ordinary course of such Assignor's Business.

                           (k) Physical Assets and Properties. Each Assignor
                  owns or leases all physical assets and personal properties
                  necessary in the operation of their respective Businesses. To
                  the extent such Assignor owns such physical assets and
                  personal property, each Assignor has, and Assignee will be
                  transferred and have, good title to all tangible assets and
                  properties, whether personal or mixed, purported to be owned
                  by such Assignor and included in the Assigned Assets (the
                  "Owned Tangible Property"), free and clear of all Liens, other
                  than Permitted Liens. Schedule 3.1(m) sets forth a true and
                  complete list of each lease or other agreement under which
                  such Assignor leases, licenses, holds, or operates any item of
                  physical property, other than the Owned Tangible Property,
                  that is included in the Assigned Assets (such leased tangible
                  property being referred to herein as the "Leased Tangible
                  Property"). Such Assignor has valid and enforceable leasehold
                  interests in the Leased Tangible Property, free and clear of
                  all Liens, other than Permitted Liens. All Owned Tangible
                  Property and Leased Tangible Property is located on the Real
                  Property.

                           (l) Intangible Assets and Properties. Set forth on
                  Schedule 3.1(l) is a true and complete listing of all
                  intangible assets and properties, including, without
                  limitation, all patents, copyrights, trademarks and service
                  marks, owned by such Assignor as of the date hereof (the
                  "Owned Intangible Properties"). Set forth on Schedule 3.1(l)
                  is a true and complete listing of all intangible assets and
                  properties, including, without limitation, all patents,
                  copyrights, trademarks and service marks, which such Assignor
                  licenses from third parties (the "Licensed Intangible
                  Properties"). The Owned Intangible Properties and the Licensed
                  Intangible Properties constitute all intangible assets and
                  properties used in connection with the operation of such
                  Assignor's Business. Such Assignor has, and Assignee will be
                  transferred and will have, good and marketable title to the
                  Owned Intangible Properties, free and clear of all Liens. Such
                  Assignor has, and except as set forth on Schedule 3.1(i) and
                  as provided in Section 8.1, Assignee will be transferred and
                  will have, the valid and enforceable right to use the Licensed
                  Intangible Properties in the manner the Licensed Intangible
                  Properties are used in connection with such Assignor's
                  Business as currently conducted, without the requirement for
                  any payment therefor and free and clear of all Liens. The
                  operations of such Assignor's Business do not, in any material
                  respect, infringe on the intellectual property rights of any
                  other person or entity other than the litigation with respect
                  to the name "Greenbriar" disclosed on Page D-7 of Schedule
                  3.1(h).

                           (m) Contracts. Each Assignor has provided to Lone
                  Star or has given Lone Star access to accurate and complete
                  copies of all of the following agreements or documents to
                  which such Assignor is subject and each of which is listed on
                  Schedule 3.1(m): (i) any lease (whether of real or personal
                  property); (ii) any agreement for the purchase of materials,
                  supplies, goods, services, equipment, or other assets (A)

<PAGE>
                                                                  Page 55 of 123


                  providing for annual payments by such Assignor of $10,000 or
                  more, (B) providing for aggregate payments by such Assignor of
                  $25,000 or more, or (C) not terminable on thirty (30) days or
                  less notice without penalty; (iii) any partnership, joint
                  venture, or other similar agreement or arrangement; (iv) any
                  instruments or documents evidencing the issuance of any equity
                  securities, warrants, rights or options to purchase equity
                  securities of such Assignor; (v) any management agreements;
                  (vi) any instruments or documents evidencing or relating to
                  Indebtedness, or guarantees of Indebtedness by such Assignor,
                  and any security interest granted by such Assignor with
                  respect thereto; (vii) any option, license, franchise, or
                  similar agreement; (viii) any agency, dealer, sales
                  representative, marketing, or other similar agreement; (ix)
                  any agreement that limits the freedom of any Assignor to
                  compete in any line of business or with any Person or in any
                  area that would limit the freedom of Assignee or any Affiliate
                  of Assignee after the Closing Date; (x) any agreement with a
                  holder of any Assignor's capital stock; (xi) any agreement
                  with any director or officer of any Greenbriar Party; or (xii)
                  any other agreement, commitment, arrangement, or plan not made
                  in the ordinary course of business. All such agreements,
                  arrangements, commitments, guarantees and other instruments
                  are legal, valid and binding obligations of such Assignor, and
                  to such Assignor's knowledge, of the other parties thereto,
                  enforceable in accordance with their terms; all payments
                  required to be made thereunder have been made by the parties
                  required to do so, except to the extent that any payments are
                  being contested in good faith and are listed as such on
                  Schedule 3.1(m); and no defenses, offsets or counterclaims
                  thereto have been asserted in writing, or, to such Assignor's
                  knowledge, may be made by any party thereto other than such
                  Assignor, nor has such Assignor waived any substantial rights
                  thereunder.

                           (n) Contract Defaults. Except as disclosed on
                  Schedule 3.1(n), such Assignor has not received written notice
                  of any default, and such Assignor is not in default, under any
                  material agreement, arrangement, commitment, guarantee or
                  other instrument relating to, binding, or affecting such
                  Assignor, such Assignor's Business or any of the Assigned
                  Assets, and there has not occurred any event which, with the
                  lapse of time or giving of notice, or both, would constitute a
                  default under any such material agreement. Except as set forth
                  on Schedule 3.1(n), there has not been (i) any threatened
                  cancellation of any contract set forth on Schedule 3.1(m),
                  (ii) any outstanding dispute under such contracts listed on
                  Schedule 3.1(m) or (iii) to the knowledge of such Assignor,
                  any bases for any claim of breach or default thereunder. The
                  execution, delivery and performance of this Agreement will not
                  entitle any other party to a contract specified on Schedule
                  3.1(m) to cancel, suspend or terminate such contract or cause
                  a diminution of such Assignor's rights thereunder. Except as
                  set forth on Schedule 3.1(m), in the case of any such
                  contracts (specified on Schedule 3.1(m)) which such Assignor
                  was not an original party, such entities rights thereunder
                  have been duly assigned to such Assignor by written
                  instrument, and where required, such assignment has been
                  consented to in writing by the other party or parties thereto,

<PAGE>
                                                                  Page 56 of 123


                  and such Assignor has furnished Assignee with true and
                  complete copies of all such assignments and consents. Such
                  Assignor has no reason to believe that any of the contracts
                  specified on Schedule 3.1(m) that are renewable will not be
                  renewed by the other party on reasonable terms.

                           (o) Compliance With Laws. Such Assignor is not in
                  material violation of, nor has such Assignor (or any
                  predecessor of such Assignor), received any written notice of
                  any alleged material violation of, any Law in (i) the conduct
                  of its Business, or (ii) its execution, delivery or
                  performance of the Transaction Documents. Such Assignor is not
                  in default of or in violation in any material respect of any
                  judgment, order, injunction or decree of any court,
                  administrative agency or other governmental authority.

                           (p) Environmental Matters. Except as set forth in
                  Schedule 3.1(p), (i) to the knowledge of such Assignor, the
                  Real Property is and has been in compliance in all material
                  respects with all applicable federal, state, or local
                  statutes, codes, rules, regulations, licenses or permits
                  relating to the environment, natural resources or public or
                  employee health or safety ("Environmental Laws") and Assignor
                  is not aware of any facts, circumstances or conditions
                  relating to the Real Property or the facilities or operations
                  thereon that could reasonably be expected to result in the
                  owner or operator of the Real Property incurring any material
                  liability or loss under any Environmental Law; and (ii)
                  Assignor has provided Assignee with copies of all
                  environmental health and safety reports relating to the Real
                  Property that are in Assignor's possession, custody or
                  control. There are no, and to the knowledge of the Assignor,
                  there never have been any underground storage tanks on the
                  Real Property.

                           (q) Insurance. The assets, properties and operations
                  of such Assignor are insured under various policies of general
                  liability and other forms of insurance listed on Schedule
                  3.1(q), which policies are, in full force and effect on the
                  date hereof, valid and enforceable in accordance with their
                  terms.

                           (r) Employee Matters.

                                    (i) Schedule 3.1(r) sets forth each
                           "employee benefit plan," as defined in Section 3(3)
                           of the ERISA, and all other employee compensation and
                           benefit arrangements or payroll practices, including,
                           without limitation, all severance pay, sick leave,
                           vacation pay, salary continuation for disability,
                           consulting or other compensation agreements,
                           retirement, deferred compensation, bonus, long-term
                           incentive, stock option, stock purchase,
                           hospitalization, medical insurance, life insurance,
                           and scholarship plans or programs maintained by such
                           Assignor or any trade or business (whether or not
                           incorporated) which is under common control, or which
                           is treated as a single employer, with such Assignor
                           under Section 414(b), (c), (m) or (o) of the Code
                           ("ERISA Affiliate") or to which such Assignor, any of
                           its Subsidiaries, or an ERISA Affiliate has

<PAGE>
                                                                  Page 57 of 123


                           contributed or is obligated to contribute (all such
                           plans or arrangements being hereinafter referred to
                           as the "Employee Benefit Plans") on account of any
                           person presently employed by such Assignor (an
                           "Employee") or formerly so employed by such Assignor
                           (a "Former Employee"), or under which any Employee or
                           Former Employee participates or has accrued any
                           rights. The terms Employee and Former Employee will
                           include, where applicable, the beneficiaries and
                           dependents of an Employee or Former Employee. Except
                           as disclosed on Schedule 3.1(r), no such Assignor or
                           any ERISA Affiliate has ever contributed to any plan
                           subject to Section 413 of the Code or to any multiple
                           employer welfare arrangement, as defined in Section
                           3(40) of ERISA. Such Assignor has no commitment or
                           obligation to establish or adopt any new or
                           additional Employee Benefit Plans or to materially
                           increase the benefits under any existing Employee
                           Benefit Plan.

                                    (ii) No Employee or Former Employee of such
                           Assignor will be entitled to any additional benefit
                           or any acceleration of the time of payment or vesting
                           of any benefit under any of the Employee Benefit
                           Plans set forth on Schedule 3.1(r) as a result of the
                           transactions contemplated by this Agreement or the
                           other Transaction Documents.

                           (s) Labor Matters. Except as listed and described on
                  Schedule 3.1(h), Schedule 3.1(r) and Schedule 3.1(s), with
                  respect to Employees and Former Employees, (i) such Assignor
                  has no written personnel policy applicable to such Employees,
                  (ii) such Assignor is and has been in compliance in all
                  material respects with all applicable Laws regarding
                  employment and employment practices, terms and conditions of
                  employment, wages and hours, occupational safety and health
                  and workers' compensation and is not engaged in any unfair
                  labor practices, (iii) such Assignor has no material
                  grievances pending or, to the knowledge of such Assignor,
                  threatened against it and (iv) such Assignor has no material
                  charges or complaints pending or, to such entity's knowledge,
                  threatened against it before the National Labor Relations
                  Board, the Equal Employment Opportunity Commission or any
                  other federal, state or local agency responsible for the
                  prevention of unlawful employment practices. There is no labor
                  strike, slowdown, work stoppage or lockout actually pending
                  or, to the knowledge of such Assignor, threatened against or
                  affecting such Assignor's Business. Such Assignor is not a
                  party to any collective bargaining agreement, no such
                  agreement determines the terms and conditions of any Employee
                  or Former Employee, and no collective bargaining agent has
                  been certified as a representative of any of the Employees or
                  Former Employees. To such Assignor's knowledge, no union
                  organizational campaign is currently pending with respect to
                  any of the Employees or Former Employees.

                           (t) Solvency. After giving effect to the transactions
                  contemplated by the Transaction Documents and the payment and
                  accrual of all transaction costs in connection with the

<PAGE>
                                                                  Page 58 of 123


                  foregoing, the Company and its Subsidiaries, taken as a whole,
                  are Solvent.

                           (u) Warranty and Product Liability Claims. Except as
                  set forth on Schedule 3.1(u), such Assignor has not made any
                  express warranties or guarantees with respect to any services
                  rendered in the operation of such Assignor's Business.

                           (v) Licenses, Permits, Etc. Schedule 3.1(v) sets
                  forth all governmental licenses, franchises, permits and other
                  authorizations held by such Assignor. Such government
                  licenses, franchises, permits and other authorizations
                  transferred to Assignee by such Assignor constitute all
                  government licenses, franchises, permits and other
                  authorizations necessary in the conduct of such Assignor's
                  Business.

                           (w) Employees and Consultants. Schedule 3.1(w) hereto
                  contains a complete list of the employees of each Assignor
                  (the "Subject Employees"), and the total current compensation
                  and benefits of each such employee. Such Assignor has
                  furnished the Assignee with true and complete copies of any
                  contracts with such Subject Employees, provided, however,
                  Assignee shall have no obligation to assume any such contract.
                  Schedule 3.1(w) also sets forth a true and complete list of
                  all consulting, service or commission agreements to which such
                  Assignor (or the Company (or any of its Subsidiaries) on
                  behalf of such Assignor) is a party or otherwise relating to
                  such Assignor's Business.

                           (x) Disclosure. No representation or warranty by the
                  Greenbriar Parties contained in this Agreement or in any
                  Transaction Document and no statement contained in any
                  document furnished or to be furnished by or on behalf of any
                  Greenbriar Party, or any Affiliate thereof to any Lone Star
                  Party or any of Lone Star Party's representatives in
                  connection with the transactions contemplated hereby, contains
                  or will contain any untrue statement of a material fact, or
                  omits or will omit to state any material fact necessary, in
                  light of the circumstances under which it was or will be made,
                  in order to make the statements herein or therein not
                  misleading.

                           (y) Taxes and Fees. Other than those Taxes that will
                  be prorated on the Closing Date as set forth in Section 2.5,
                  each Assignor has paid and discharged, or has caused to be
                  paid and discharged, all Taxes for which it is obligated and
                  will pay and discharge all such Taxes which will have become
                  due and payable prior to or as of the Closing Date. Each
                  Assignor has duly filed or will file, or has caused or will
                  cause to be duly filed, with the appropriate federal, state
                  and local governmental agencies all returns and reports
                  required to be filed by such Assignor as of the Closing Date
                  and with respect to any taxable period prior to or which
                  includes the Closing Date (each of which fairly present or
                  will present the information purported to be shown and reflect
                  or will reflect, all Tax liability of such entity for the
                  periods in question) and such Assignor has paid or will pay in

<PAGE>
                                                                  Page 59 of 123


                  full all Taxes in respect of the periods for which such
                  returns and reports were filed. All necessary payments
                  required to be withheld for the employees (including, without
                  limitation, for unemployment insurance) have been properly
                  withheld and paid.

                           (z) Finders. None of the Company, any of the
                  Assignors, or any Affiliate of such entity has made any
                  agreement with any Person or taken any action which would
                  cause any Person to become entitled to an agent's, broker's,
                  or finder's fee or commission in connection with the
                  transactions contemplated hereby.

                           (aa) Books of Account. None of the Assignors have
                  engaged in any transaction, maintained any bank account or
                  used any of the funds of such Assignor except for
                  transactions, bank accounts and funds which have been and are
                  reflected in the normally maintained books and records of the
                  Business.

                           (bb) Sufficiency of Assets. The Assigned Assets
                  constitute all properties and assets used by such Assignor in
                  the conduct of such Assignor's Business as currently
                  conducted.

                           (cc) Cash Position. The cash balances shown on the
                  Corporate Cash Report dated as of July 26, 2001 certified by
                  James Gilley and Gene Bertcher represents the approximate
                  total cash and cash equivalents for the Company and its
                  Subsidiaries. The uses of cash shown on the Corporate Cash
                  Requirements Report dated as of July 26, 2001 certified by
                  James Gilley and Gene Bertcher represents the approximate cash
                  uses for the Company and its Subsidiaries.

                           (dd) Bankruptcy. Neither the Company nor any of the
                  Assignors has (i) filed a petition seeking relief under Title
                  11 of the United States Code, as now constituted or hereafter
                  amended, or any other applicable federal, state or foreign
                  bankruptcy, debtor relief or other similar law, (ii) consented
                  to the institution of proceedings thereunder or to the filing
                  of any such petition or to the appointment of or taking
                  possession by a custodian, receiver, liquidator, assignee,
                  trustee or sequestrator (or similar official) of such
                  Greenbriar Party or of any substantial part of any such
                  Person's assets, (iii) made a general assignment for the
                  benefit of creditors, (iv) taken any corporate action to
                  authorize any of the foregoing or (v) admitted in writing its
                  inability to, or shall be generally unable to, pay its debts
                  as such debts become due.

         3.2 Representations and Warranties of Assignee. Lone Star represents
and warrants to the Greenbriar Parties as follows:

                  (a) Corporate Organization. Lone Star is a limited partnership
         duly formed, validly existing and in good standing under the laws of
         the State of Delaware.


<PAGE>
                                                                  Page 60 of 123


                  (b) Authorization and Effect of Agreement. Lone Star has the
         requisite limited partnership power and authority to execute, deliver
         and perform its obligations under each of the Transaction Documents
         executed or to be executed by Lone Star. The execution, delivery and
         performance by Lone Star of each of the Transaction Documents executed
         or to be executed by Lone Star has been duly authorized by all
         requisite limited partnership action. This Agreement has been duly
         executed and delivered by Lone Star. This Agreement constitutes, and
         each of the other Transaction Documents to be executed by Lone Star
         will constitute, the valid and binding obligation of Lone Star,
         enforceable against Lone Star in accordance with its terms, subject to
         applicable bankruptcy, insolvency, fraudulent conveyance,
         reorganization, moratorium and similar laws affecting creditors' rights
         and remedies generally and subject, as to enforceability, to general
         principles of equity, including principles of commercial
         reasonableness, good faith and fair dealing (regardless of whether
         enforcement is sought in a proceeding at law or in equity).

                  (c) Conflicts. Neither the execution, delivery, nor
         performance of any Transaction Document executed or to be executed by
         Lone Star will (i) violate any material Law applicable to Lone Star,
         (ii) violate, conflict with, permit the cancellation or acceleration
         of, or give rise to a loss of any benefit under, any material agreement
         or commitment to which Lone Star is a party or by which any of its
         properties are bound, or (iii) violate or conflict with any provision
         of Lone Star's Organizational Documents.

                  (d) Consents. No actions, consents, or approvals of, or
         filings with, any governmental authorities or any third parties are
         required in connection with the execution, delivery or performance by
         Lone Star of the Transaction Documents executed or to be executed by
         Lone Star.

                  (e) Finders. Neither Lone Star nor an Affiliate of Lone Star
         has made any agreement with any person or taken any action which would
         cause any person to become entitled to an agent's, broker's or finder's
         fee or commission in connection with the transactions contemplated
         hereby.

                                   ARTICLE IV

                                   AGREEMENTS
                                   ----------

         4.1 Conduct of Business. From the date hereof through the Closing, the
Company and each of the Assignors will not to take any action inconsistent with
this Agreement. Without limiting the generality of the foregoing, unless
consented to by Assignee in writing, the Company and each of the Assignors, will
not, except as contemplated by this Agreement:

                  (a) with respect to the Company, change or amend its
         Organizational Documents, except as otherwise required by law in a
         manner that would adversely affect its ability to consummate the

<PAGE>
                                                                  Page 61 of 123


         transaction contemplated hereby, and with respect to any Assignor,
         change or amend its Organizational Documents, except as otherwise
         required by law;

                  (b) enter into, extend, materially modify, terminate or renew
         any contract of a type required to be listed on Schedule 3.1(m), except
         in the ordinary course of business;

                  (c) sell, assign, transfer, convey, lease or otherwise dispose
         of any material assets or properties used or useful in any of the
         Businesses;

                  (d) except as otherwise required by law or consistent with
         past practices, no Assignor shall take any action with respect to the
         grant of any severance or termination pay which will become due and
         payable from such Assignor on or after the Closing Date; make any
         change in the management structure of such Assignor, including, without
         limitation, the hiring of additional officers or the terminations of
         existing officers, other than in the ordinary course of business;

                  (e) with respect to any Assignor, acquire by merger or
         consolidation with, or merge or consolidate with, or purchase
         substantially all of the assets of, or otherwise acquire any material
         assets or business of any corporation, partnership, association or
         other business organization or division thereof, except as contemplated
         by Section 9.11; and

                  (f) with respect to any Assignor, incur any Indebtedness.

         4.2 Inspection. From time to time prior to Closing, the Company and the
Assignors shall afford to Assignee and its accountants, counsel and other
representatives reasonable access, during normal business hours, to the
properties, books, contracts, commitments, tax returns, records and appropriate
officers and employees of the Company and its Subsidiaries, including the
Assignors, and shall furnish such representatives with all financial and
operating data and other information concerning the affairs of the Company and
its Subsidiaries as they may reasonably request.

         4.3 Litigation Standstill. The parties hereto agree not to seek a
hearing date, or, if applicable, agree to postpone any hearing date, on any
motions or pleadings in connection with the Lawsuit, including, without
limitation, Lone Star's Motion for Summary Judgment, until the earlier to occur
of the termination of this Agreement pursuant to Article 9 or September 15,
2001. Lone Star's obligations under this Section 4.3 are subject to no further
motions or pleadings being made in connection with the Lawsuit by the parties
hereto or the subject matter of the Lawsuit by any parties hereto attempting to
intervene in the Lawsuit.


<PAGE>
                                                                  Page 62 of 123


         4.4 Employees.

                  (a) Assignor Obligations. Each Assignor acknowledges that
         notwithstanding any benefits which Assignee may offer or provide to any
         Employee to whom Assignee has extended an offer of employment, such
         Assignor has certain obligations with respect to such Assignor's
         Employees under Section 4980B of the Code and Section 601 et seq. of
         the Employment Retirement Income Security Act of 1974, as amended
         ("ERISA") and agree to comply with those obligations. Each Assignor
         shall be responsible for and shall cause to be discharged and satisfied
         in full all amounts owed to any Employee or Former Employee, including
         wages, salaries, accrued vacation, any employment, incentive,
         compensation or bonus agreements or other benefits or payments on
         account of termination of employment by such Assignor, and shall
         indemnify the Lone Star Parties and hold the Lone Star Parties harmless
         from any losses thereunder. Each Assignor shall be responsible for
         compliance with the COBRA notice and continuation coverage requirements
         under Part 6 of Title I of the ERISA, with respect to all employees
         (and their beneficiaries) experiencing a qualifying event (as defined
         in Section 603 of ERISA) on account of the transactions contemplated by
         this Agreement or occurring prior to the Closing.

                  (b) Employment by Assignor. Assignee may, but is not obligated
         to, extend offers of employment effective as of the Closing Date to any
         or none of the Subject Employees on terms and conditions to be
         determined by Assignee in its sole discretion. Assignee will notify the
         appropriate Assignor within ten (10) days prior to the anticipated
         Closing Date of which Subject Employees, if any, the Assignee intends
         to make offers of employment. Assignor will have no liability for any
         claims made by any Subject Employee subsequently employed or continued
         in employment by Assignee and for which the initial event giving rise
         to such claim occurred after the Closing Date and not as a result of
         the transactions contemplated hereby. To the extent that Assignee does
         extend offers of employment to any of the Subject Employees, each
         Assignor agrees to terminate or release any such Subject Employee from
         such Subject Employee's employment with Assignor.

         4.5 Agreement to Forward Orders, Inquiries and Leads. The Company and
each Assignor hereby agrees that for a period of three (3) months they will
forward promptly to the Assignee any and all inquiries and sales leads relating
to the Businesses and the Facilities transferred in connection therewith.

         4.6 Third Party Solicitations. From the date hereof until Closing, the
Company, its Affiliates, officers, directors, employees or representatives will
not initiate any transaction which could adversely affect their obligations
under this Agreement, and the Company shall give Lone Star prompt written notice
if the Company or any of its Affiliates is approached by any Person or group of
Persons about any such transaction and a reasonable opportunity to participate
in discussions regarding the same; provided, however, nothing contained herein
shall prohibit the Company from entering into discussions or negotiations with

<PAGE>
                                                                  Page 63 of 123


any Person or group of Persons concerning any merger, sale of assets, sale of
shares of Capital Stock or similar transaction if such transaction could not
adversely affect the Greenbriar Parties' obligations under this Agreement.

         4.7 Employee Solicitation.

                  (a) From the date hereof and for a period of one (1) year from
         the Closing Date, without the prior written consent of Lone Star,
         neither the Company nor any of its Subsidiaries shall, or shall
         knowingly permit its Affiliates, officers, directors, representatives
         and agents to, (i) prior to Closing, directly or indirectly offer,
         participate or initiate negotiations with any Person employed at the
         Facilities with respect to a transfer of such Person's employment to
         another facility owned or operated by the Company, its Subsidiaries, or
         their respective Affiliates, or (ii) directly or indirectly, hire,
         offer, participate in, or initiate negotiations concerning, employment,
         with any officer or employee of the Assignee or any Person that was
         employed at any Facility within the year prior to Closing and was
         subsequently employed by Assignee after Closing.

                  (b) From the date hereof and for a period of one (1) year from
         the Closing Date, without the prior written consent of the Company,
         Lone Star shall not, and shall not knowingly permit its Affiliates,
         officers, directors, representatives and agents to, directly or
         indirectly, hire, offer, participate in, or initiate negotiations
         concerning employment with any officer or employee of the Company or
         any Assignor (or their Affiliates) other than the Subject Employees or
         as otherwise contemplated herein.

                  (c) Notwithstanding the foregoing, this Agreement shall not
         prohibit any advertisement or general solicitation (or hiring as a
         result thereof) that is not specifically targeted at such persons.

         4.8 Non-Competition. For a period beginning on the Closing Date and
ending one (1) year after the date of Closing, neither the Company nor any of
its Subsidiaries or their respective Affiliates shall, without the prior written
consent of Lone Star, directly or indirectly, engage, participate, make any
financial investment in, manage or render advisory other services to or for any
Person engaged in the business of owning, operating or managing assisted living
facilities or communities located within a twenty-mile radius of any of the
Businesses, other than the assisted living facilities and communities known as
The Greenbriar at Sherman located in Sherman, Texas, Villa de Rey located in
Roswell, New Mexico and Camelot Retirement located in Harlingen, Texas. The
Company and each of the Assignors acknowledges, in its own behalf and on behalf
of their respective Subsidiaries, that the scope of prohibited activities, the
geographic boundaries and the duration of the obligations set forth herein are
(i) reasonable and no broader than necessary to protect the legitimate business
interest of the Lone Star Parties and (ii) do not and will not impose an
unreasonable burden upon such parties.


<PAGE>
                                                                  Page 64 of 123


         4.9 Confidentiality. Except for any governmental filings required in
order to complete the transactions contemplated herein and as the Company and
the Lone Star Parities may otherwise agree or consent in writing, all
information received by the Lone Star Parties and the Greenbriar Parties and
their respective representatives in contemplation, or pursuant to the terms, of
this Agreement shall be kept in confidence by the receiving party and its
representatives; provided, however, that any party hereto may disclose such
information to its legal and financial advisors, lenders, financing sources and
their respective legal advisors and representatives so long as such Persons
agree to maintain the confidentiality of such information in accordance with
this Section 4.9. If the transactions contemplated hereby shall fail to be
consummated, all copies of documents or extracts thereof containing information
and data as to one of the other parties, including all information prepared by
the receiving party's representatives may be destroyed at the option of the
receiving party, with notice of such destruction (or return) to be confirmed in
writing to the disclosing party. Any information not so destroyed (or returned)
will remain subject to these confidentiality provisions (notwithstanding any
termination of this Agreement) until the second (2nd) anniversary of the date of
this Agreement. The foregoing confidentiality provisions shall not apply to such
portions of the information received which (i) are or become generally available
to the public through no action by the receiving party or by such party's
representatives, (ii) are or become available to the receiving party on a
non-confidential basis from a source, other than the disclosing party or its
representatives, not known by the receiving party to be prohibited from
disclosing such portions to it by a contractual legal or fiduciary obligation,
or (iii) are required by law to be disclosed. In addition, the foregoing
confidentiality provisions shall not apply to any disclosure by the Lone Star
Parties after the Closing of any information disclosed to them by the Greenbriar
Parties.

         Cooperation. The Company and each of the Assignors agrees to use its
reasonable best efforts to cooperate with the Lone Star Parties in obtaining any
third-party consents necessary to effectuate the transactions contemplated
hereby.

                                    ARTICLE V

                              CONDITIONS TO CLOSING
                              ---------------------

         5.1 Conditions to Obligations of Assignee and Assignor. The obligations
of the Lone Star Parties and the Greenbriar Parties to consummate, or cause to
be consummated, the transactions contemplated hereby are subject to the
condition that there not be in force any order or decree, statute, rule or
regulation nor shall there be on file any complaint by a governmental agency
seeking an order or decree, restraining, enjoining or prohibiting the
consummation of the transactions contemplated hereby, and neither the Lone Star
Parties nor the Greenbriar Parties shall have received notice from any
governmental authority that it has determined to institute any suit or
proceeding to restrain or enjoin the consummation of the transactions
contemplated hereby or to nullify or render ineffective this Agreement if
consummated, or to take any other action which would result in the prohibition
or a material change in the terms of the transactions contemplated hereby.


<PAGE>
                                                                  Page 65 of 123


         5.2 Conditions to Obligations of Assignee. The obligations of the Lone
Star Parties to consummate, or cause to be consummated, the transactions
contemplated by this Agreement are subject to the satisfaction of the following
additional conditions, any one or more of which may be waived in writing by the
Lone Star Parties:

                  (a) Each of the representations and warranties of the
         Greenbriar Parties contained in this Agreement all of the other
         Transaction Documents shall be true and correct in all material
         respects (other than the representation set forth in Section 3.1(cc),
         which shall be true and correct in all respects), both on the date
         hereof and as of the Closing, as if made anew at and as of that time,
         and each of the covenants and agreements of the Greenbriar Parties to
         be performed as of or prior to the Closing shall have been duly
         performed and complied with in all material respects, except in each
         case for changes after the date hereof which are contemplated or
         expressly permitted by this Agreement.

                  (b) Each Greenbriar Party shall have delivered to the Lone
         Star Parties a certificate signed by an officer of such Greenbriar
         Party, dated as of the date of Closing, certifying that, to the best of
         the knowledge and belief of such officer, the conditions specified in
         Section 5.1, as they relate to such Greenbriar Party, and Section
         5.2(a) have been fulfilled.

                  (c) Any consent required for the consummation of the
         transactions contemplated shall have been obtained.

                  (d) The Lone Star Parties shall have received the following,
         and in form and substance satisfactory to Lone Star Parties:

                           (i) a Warranty Deed executed by each of the Assignors
                  conveying all of the Real Property;

                           (ii) Title Insurance Policies covering all of the
                  Real Property;

                           (iii) Surveys, certified to Assignee and the
                  applicable title company, of the Real Property reasonably
                  acceptable to Lone Star and otherwise satisfactory for the
                  applicable title company to delete the survey exception from
                  the title insurance policy to be issued by such title company,
                  provided, Lone Star shall pay any costs charged by the title
                  company solely related to the deletion of the survey exception
                  from the title policy;

                           (iv) a Bill of Sale duly executed by each of the
                  Assignors; and

                           (v) the Assumption Agreement duly executed by each of
                  the Assignors.


<PAGE>
                                                                  Page 66 of 123


                  (e) Lone Star Parties shall have received the following
         opinions, all dated the Closing Date and all in form and substance
         satisfactory to the Lone Star Parties:

                           (i) a written opinion of (A) Glast, Phillips &
                  Murray, in form and substance satisfactory to Lone Star, and
                  (B) with respect to matters of local law, local counsel to the
                  Company and its Subsidiaries (such counsel to be reasonably
                  satisfactory to Lone Star), each such opinion as to such
                  matters as shall be required by Lone Star or its counsel,
                  including the corporate good standing of the Greenbriar
                  Parties, the proper adoption of any corporate resolution
                  required hereby, the authority of the Person signing for the
                  Greenbriar Parties, the validity, binding nature and
                  enforceability of this Agreement and the other Transaction
                  Documents;

                           (ii) a written opinion of Nevada counsel to the
                  Company and its Subsidiaries (such counsel to be reasonably
                  satisfactory to Lone Star) (i) stating that this Agreement,
                  the other Transaction Documents, and the consummation of the
                  transactions contemplated hereby and thereby do not require
                  the approval of the holders of the Company's Capital Stock
                  under Nevada law or the Company's Organizational Documents,
                  and (ii) as to such other matters as shall be required by Lone
                  Star or its counsel; and

                           (iii) unless waived by Lone Star, the Company having
                  obtained a solvency opinion from Business Valuation Services,
                  Inc. or another valuation firm reasonably acceptable to Lone
                  Star, on which the Lone Star Parties may rely and which is
                  reasonably satisfactory to Lone Star, to the effect that after
                  giving effect to the transactions contemplated by the
                  Transaction Documents and the payment and accrual of all
                  transaction costs in connection with the foregoing, the
                  Company and its Subsidiaries, taken as a whole, are Solvent.

                  (f) The Lone Star Parties shall have received lien searches
         from all jurisdictions reasonably determined by the Lone Star Parties
         to be appropriate, as of one (1) day prior to the Closing Date, with
         respect to the Company and each of its Assignors reflecting no Liens
         (other than Permitted Liens) or evidence satisfactory to Assignee of
         the payment or release of any and all Lien.

                  (g) Each Greenbriar Party shall have (A) delivered to Assignee
         (x) copies certified by the appropriate governmental official of the
         jurisdiction of its incorporation as of a date not more than five (5)
         days prior to the Closing Date, of each Greenbriar Party's certificate
         of incorporation and all amendments thereto and (y) copies, certified
         by the Secretary or an Assistant Secretary of each Greenbriar Party, of
         each Greenbriar Party's Bylaws; (B) deliver to Assignee a certificate
         of good standing issued with respect to each Greenbriar Party by the
         appropriate governmental official of the jurisdiction of its
         incorporation as of a date not more than one (1) day prior to the
         Closing Date; and (C) executed and delivered a secretary's certificate

<PAGE>
                                                                  Page 67 of 123


         relating to incumbency, corporate proceedings and the certificate of
         incorporation and bylaws.

                  (h) As of the Closing Date and prior to giving effect to the
         transactions contemplated by the Transaction Documents, there shall not
         have occurred any material adverse change in the business, results of
         operations, financial condition of the Company or the Assignors between
         the date hereof and the Closing Date.

                  (i) The Consent Agreement is in full force and effect and no
         action has been taken to amend, modify or rescind such Agreement
         without the consent of Lone Star.

                  (j) The Lone Star Parties shall have entered into employment
         contracts with the executive director of each Facility on terms no less
         favorable than such Persons' existing employment contracts.

                  (k) No Assignor shall have any Indebtedness outstanding
         (including, without limitation, any trade payables for which such
         Assignor has received an invoice prior to Closing, provided after
         Closing such Assignor shall promptly pay any trade payables upon
         receipt of the invoice thereof), other than the Assumed Liabilities,
         and no Assignor shall have any creditors, other than those creditors
         whose claims arise directly from the Assumed Liabilities, other than
         creditors whose claims are the subject of a bona fide dispute.

                  (l) The bankruptcy case commenced by American Care
         Communities, Inc. shall have been dismissed, or the Bankruptcy Court
         with jurisdiction over such proceedings shall have issued an order
         permitting the transfer of the assisted living facilities and
         communities known as Berne Village and Rose Tara Plantation.

                  (m) All repairs necessitated by the existing damage to the
         assisted living facility and community known as the Greenbriar at
         Dennison (including roof and siding repairs) shall have been completed
         to the reasonable satisfaction of Lone Star; provided, however, if such
         repairs have not been completed prior to the Closing, the repairs will
         be completed by the Company and/or its contractors at the Company's
         sole cost and expense within thirty (30) days of the Closing Date.

         5.3 Conditions to the Obligations of Assignor. The obligation of the
Greenbriar Parties to consummate the transactions contemplated by this Agreement
is subject to the satisfaction of the following additional conditions, any one
or more of which may be waived in writing by the Greenbriar Parties:

                  (a) Each of the representations and warranties of Lone Star
         contained in this Agreement shall be true and correct in all material
         respects both on the date hereof and as of the Closing, as if made anew
         at and as of that time, and each of the covenants and agreements of

<PAGE>
                                                                  Page 68 of 123


         Lone Star to be performed as of or prior to the Closing shall have been
         duly performed in all material respects, except in each case for
         changes after the date hereof which are contemplated or expressly
         permitted by this Agreement.

                  (b) Lone Star shall have delivered to the Assignors a
         certificate signed by an officer of Lone Star, dated the Closing,
         certifying that, to the best of the knowledge and belief of such
         officer, the conditions specified in Section 5.1, as they relate to
         Lone Star, and Section 5.3(a) have been fulfilled.

                  (c) Lone Star shall have delivered the Mutual Release and any
         Stock Certificates.

                  (d) The Lone Star Parties shall have delivered the Assumption
         Agreement.

                                   ARTICLE VI

                                   TERMINATION
                                   -----------

         6.1 Termination. This Agreement may be terminated and the transactions
contemplated hereby abandoned:

                  (a) By mutual written consent of the parties at any time prior
         to the Closing.

                  (b) After August 15, 2001 and prior to the Closing, by written
         notice to the Company from Assignee, if (i) there is any material
         breach of any representation, warranty, covenant or agreement on the
         part of any Greenbriar Party set forth in this Agreement, or (ii) if a
         representation or warranty of the Greenbriar Parties shall be untrue in
         any material respect, in either case, such that the condition specified
         in Section 5.2(a) hereof would not be satisfied at the Closing (a
         "Terminating Assignor's Breach") and, in each such case, such breach
         has not been cured within seven (7) days after notice thereof by the
         Assignee to the Company.

                  (c) After August 15, 2001 and prior to the Closing, by written
         notice to Lone Star from the Company, if (i) there is any material
         breach of any representation, warranty, covenant or agreement on the
         part of Lone Star set forth in this Agreement, (ii) or if a
         representation or warranty of Lone Star shall be untrue in any material
         respect, in either case, such that the condition specified in Section
         5.3 hereof would not be satisfied at the Closing (a "Terminating
         Assignee's Breach") and, in each such case, such breach has not been
         cured within seven (7) days after notice thereof by the Company to Lone
         Star.

                  (d) By either the Company or Lone Star, after September 15,
         2001, if the Closing has not occurred prior to such date, provided that
         such terminating party is not in breach of any of its representations,

<PAGE>
                                                                  Page 69 of 123


         warranties, covenants or agreements hereunder, and all of such
         terminating party's conditions to Closing have been satisfied prior to
         such date.

                  (e) By either the Company or Lone Star on or before August 8,
         2001, if the sale of the assisted living facility and community known
         as Crowne Point has not been consummated.

                  (f) By either the Company or Lone Star on or before August 14,
         2001, because Heller Financial has not consented to the transfer of the
         assisted living facilities and communities known as Berne Village and
         Rose Tara Plantation on terms satisfactory to each of the Company and
         Lone Star.

                  (g) By Lone Star, after August 14, 2001, because any of the
         first mortgage holders have not consented to the transfer of the
         assisted living facilities and communities known as Greenbriar at
         Denison, Rose Garden Estates, Windsor House West, The Terrace, Villa
         del Sol, La Villa, Summer Hill, Meadowbrook or Camelot Assisted Living.

                  (h) By Lone Star, if the Company shall fail to put or at any
         time maintain $2,000,000 from the Crowne Point closing, i.e. the Crowne
         Point Proceeds, in the Crowne Point Escrow Account in accordance with
         Section 2.10(b).

                  (i) By Lone Star, if a case or proceeding commences against
         any Greenbriar Party (i) seeking a decree or order in respect of any
         Greenbriar Party under Title 11 of the United States Code, as now
         constituted or hereafter amended or any other applicable federal, state
         or foreign bankruptcy, debtor relief or other similar law, (ii) seeking
         the appointment of a custodian, receiver, liquidator, assignee, trustee
         or sequestrator (or similar official) for any Greenbriar Party or of
         any substantial part of any such Person's assets or (iii) seeking the
         winding-up or liquidation of the affairs of any Greenbriar Party.

                  (j) By Lone Star, if any Greenbriar Party, subsequent hereto
         (i) files a petition seeking relief under Title 11 of the United States
         Code, as now constituted or hereafter amended, or any other applicable
         federal, state or foreign bankruptcy, debtor relief or other similar
         law, (ii) consents to the institution of proceedings thereunder or to
         the filing of any such petition or to the appointment of or taking
         possession by a custodian, receiver, liquidator, assignee, trustee or
         sequestrator (or similar official) of any Greenbriar Party or of any
         substantial part of any such Person's assets, (iii) makes a general
         assignment for the benefit of creditors, (iv) takes any corporate
         action to authorize any of the foregoing or (v) admits in writing its
         inability to, or shall be generally unable to, pay its debts as such
         debts become due.

         6.2 Post-Termination Activity. In the event of the termination of the
Agreement pursuant to Section 6.1(and including any notice of termination or

<PAGE>
                                                                  Page 70 of 123


acts in furtherance of a declared purpose to terminate regardless of whether
such termination is effective) or for any other reason, either party agrees that
it shall not, directly or indirectly:

                  (a) contact the escrow agent or any other person to stop,
         inderdict or delay the immediate release and return of the Escrow
         Amounts to the appropriate party;

                  (b) file or sponsor any garnishment, attachment or other legal
         effort to obtain control over all or any portion of the escrowed fund
         if it is not the party entitled to such Escrow Amounts

         for a period which shall end seven (7) days after all of the Escrowed
         Amounts shall have been returned to the appropriate party free and
         clear of any claims by, through, or under the other party for the
         possession or use of such funds.

         6.3 Effect of Termination. In the event of termination of this
Agreement pursuant to Section 6.1, this Agreement shall forthwith become void
and have no effect, without any liability on the part of any party hereto or
their respective Affiliates, officers, directors or stockholders, other than
liability of the Greenbriar Parties or Lone Star as the case may be, for
breaches of this Agreement occurring prior to such termination. The provisions
of Sections 4.9, 9.7 and 9.8 hereof shall survive any termination of this
Agreement.

                                   ARTICLE VII

                          SURVIVAL AND INDEMNIFICATION
                          ----------------------------

         7.1 Survival of Representations, Warranties and Covenants. The
representations, warranties, agreement and covenants contained in this Agreement
shall survive the execution of this Agreement and remain for two (2) years
following the Closing Date; provided, however, the representations and
warranties set forth in each of (i) Sections 3.1(b), 3.1(e), 3.1(j)(i), 3.1(k),
3.1(l) shall survive indefinitely and (ii) Sections 3.1(p), 3.1(r) and 3.1(y)
shall survive until the applicable statute of limitations has expired.

         7.2 Indemnification by Assignor. The Company and each of the Assignors
shall, jointly and severally, indemnify and hold harmless each Assignee Party
(hereinafter defined) in respect of any and all Indemnifiable Losses resulting
from or relating to:

                  (a) any and all liabilities and obligations of the Greenbriar
         Parties of any nature whatsoever, except for the Assumed Liabilities;

                  (b) any and all actions, suits, claims, or legal,
         administrative, arbitration, governmental or other proceedings or
         investigations against any Assignee Party that relate to the Greenbriar
         Parties, the Businesses, the Assigned Assets or any affiliate of the
         Greenbriar Parties in which the initial event giving rise thereto

<PAGE>
                                                                  Page 71 of 123


         occurred prior to the Closing or which results from or arise out of any
         action or inaction prior to the Closing of the Greenbriar Parties, or
         any director, officer, employee, agent, representative or subcontractor
         of any Greenbriar Party, including without limitation, the litigation
         described on Schedule 3.1(h)(2);

                  (c) nonperformance or breach of any representation or warranty
         on the part of any Greenbriar Party under this Agreement or any other
         Transaction Document, or any misrepresentation in or omission from any
         certificate furnished to the Lone Star Parties pursuant hereto;

                  (d) nonfulfillment of any covenant or agreement on the part of
         any Greenbriar Party under this Agreement or any other Transaction
         Document;

                  (e) any failure of the Company, any Assignor or Assignee to
         comply with any bulk sales or transfer law (including the bulk sales
         provisions of the Uniform Commercial Code in any jurisdiction) of any
         jurisdiction applicable to the sale and transfer of the Assigned Assets
         contemplated hereby;

                  (f) all sales or transfer taxes in respect of real or personal
         property which may be due as a result of the sale taking place pursuant
         to this Agreement;

                  (g) all actions, suits, proceedings, demands, assessments,
         judgments, reasonable attorney's fees, court costs and expenses
         incident to any of the foregoing; or

                  (h) any and all actions, suits, claims, or legal,
         administrative, arbitration, governmental or other proceedings or
         investigations against any Assignee Party that relate to this Agreement
         or any of the other Transaction Documents or the transactions
         contemplated hereby and thereby.

         "Assignee Party" shall mean the Lone Star Parties, any Affiliate of the
Lone Star Parties, including, without limitation, the owners of Assignee or Lone
Star, and any officer, director, or employee of Assignee or the Lone Star
Parties or of any Affiliate thereof, including, without limitation, the owners
of the Lone Star Parties.

         Indemnification by Lone Star Parties. The Lone Star Parties shall
indemnify and hold harmless each Assignor Party (hereinafter defined) in respect
of any and all Indemnifiable Losses resulting from or relating to:

                  (i) any and all Assumed Liabilities;

                  (j) nonperformance or breach of any representation or warranty
         on the part of Lone Star under this Agreement or any other Transaction
         Document, or any misrepresentation in or omission from any certificate
         furnished to Assignor pursuant hereto;


<PAGE>
                                                                  Page 72 of 123


                  (k) nonfulfillment of any covenant or agreement on the part of
         Lone Star under this Agreement or any other Transaction Document;

                  (l) any and all actions, suits, claims, or legal,
         administrative, arbitration, governmental or other proceedings or
         investigations against any Assignor Party that relate to the Lone Star
         Parties, the Business, the Assigned Assets or any Affiliate of the Lone
         Star Parties in which the initial event giving use rise thereto
         occurred after the Closing or which results from or arise out of any
         action or inaction after the Closing of the Lone Star Parties or any
         director, officer, employee, agent, representative or subcontractor of
         the Lone Star Parties; or

                  (m) all actions, suits, proceedings, demands, assessments,
         judgments, reasonable attorney's fees, costs and expenses incident to
         any of the foregoing.

         "Assignor Party" shall mean the Company, the Assignors, any Affiliate
of Assignors, including, without limitation, the owners of Assignors, or any
officer, director, or employee of Assignors or of any Affiliate of Assignors,
including, without limitation, the owners of Assignors.

         7.3 Defense of Claims.

                  (a) If any Indemnitee receives notice of assertion or
         commencement of any Third Party Claim against such Indemnitee with
         respect to which an Indemnifying Party is obligated to provide
         indemnification under this Agreement, the Indemnitee will give such
         Indemnifying Party reasonably prompt written notice thereof, but in any
         event not later than fifteen (15) calendar days after receipt of such
         notice of such Third Party Claim. Such notice will describe the Third
         Party Claim in reasonable detail, will include copies of all material
         written evidence thereof and will indicate the estimated amount, if
         reasonably practicable, of the Indemnifiable Loss that has been or may
         be sustained by the Indemnitee. The Indemnifying Party will have the
         right to participate in, or, by giving written notice to the
         Indemnitee, to assume, the defense of any Third Party Claim at such
         Indemnifying Party's own expense and by such Indemnifying Party's own
         counsel (reasonably satisfactory to the Indemnitee), and the Indemnitee
         will cooperate in good faith in such defense.

                  (b) If, within ten (10) calendar days after giving notice of a
         Third Party Claim to an Indemnifying Party pursuant to Section 7.4(a),
         an Indemnitee receives written notice from the Indemnifying Party that
         the Indemnifying Party has elected to assume the defense of such Third
         Party Claim as provided in the last sentence of Section 7.4(a), the
         Indemnifying Party will not be liable for any legal expenses
         subsequently incurred by the Indemnitee in connection with the defense
         thereof; provided, however, that if (i) the Indemnifying Party fails to
         take reasonable steps necessary to defend diligently such Third Party
         Claim within five (5) calendar days after receiving written notice from
         the Indemnitee that the Indemnitee believes the Indemnifying Party has
         failed to take such steps or if the Indemnifying Party has not

<PAGE>
                                                                  Page 73 of 123


         undertaken fully to indemnify the Indemnitee in respect of all
         Indemnifiable Losses relating to the matter, (ii) the Indemnitee
         believes that a conflict of interest exists between the Indemnitee and
         Indemnifying Party, (iii) the Indemnitee is requested to participate,
         at the request of the Indemnifying Party, or (iv) the Indemnifying
         Party's elects not to defend such claim, the Indemnitee will be free,
         without prejudice to any the Indemnitee's rights hereunder, to assume
         its own defense, and the Indemnifying Party will be liable for all
         reasonable costs or expenses paid or incurred in connection therewith.
         Without the prior written consent of the Indemnitee, the Indemnifying
         Party will not enter into any settlement of any Third Party Claim which
         would lead to liability or create any financial or other obligation on
         the part of the Indemnitee for which the Indemnitee is not entitled to
         indemnification hereunder.

                  (c) A failure to give timely notice or to include any
         specified information in any notice as provided in Section 7.4(a) or
         7.4(b) will not affect the rights or obligations of any party hereunder
         except and only to the extent that, as a result of such failure, any
         person which was entitled to receive such notice was deprived of its
         right to recover any payment under its applicable insurance coverage or
         was otherwise materially damaged as a result of such failure.

                  (d) The Indemnifying Party will have a period of ten (10)
         calendar days within which to respond in writing to any claim by an
         Indemnitee on account of an Indemnifiable Loss which does not result
         from a Third Party Claim (a "Direct Claim"). If the Indemnifying Party
         does not so respond within such ten (10) calendar day period, the
         Indemnifying Party will be deemed to have rejected such claim, in which
         event the Indemnitee will be free to pursue such remedies as may be
         available to the Indemnitee.

                                  ARTICLE VIII

                               TRANSITION SERVICES
                               -------------------

         8.1 Use of Name. On and after the Closing Date, the Assignors agree to
sign or file such consents or other documents as Assignee shall reasonably
request in order to permit Assignee to use any Owned Intangible Property or
Licensed Intangible Property, including without limitation, the names "Berne
Village", "Rose Garden Estates", "Rose Tara Plantation", "The Terrace", "Windsor
House West", "Villa del Sol", "Summer Hill", "La Villa", "Camelot Assisted
Living", and "Meadowbrook Place" and the Company and the Assignors shall
immediately cease using the same. The Assignee shall not use the name
"Greenbriar" or any of its related marks, and shall remove the name and mark of
"Greenbriar" from any of the Facilities' signage as soon as practicable after
Closing, but in no event later than 90 days after Closing.

         8.2 Permits. Form the date hereof and after the Closing Date, the
Assignors agree to join and fully cooperate with the Assignee in the filing of
any application with any necessary federal, state or local governmental
authorities, requesting such governmental authority's approval for the

<PAGE>
                                                                  Page 74 of 123


assignment or transfer to the Assignee (or any of its Affiliates) of any or all
permits issued to any Assignor (or its Subsidiaries) by such governmental
authority with respect to the Assignors' respective Businesses and the operation
thereof. Such cooperation shall include without limitation the furnishing of any
information that may be required in connection with such applications.

         8.3 Payment Received. Each Assignor agrees that it will hold and will
promptly transfer and deliver to the appropriate party, from time to time as and
when received by them, any cash, checks with appropriate endorsements (using
their best efforts not to convert such checks into cash), or other property that
they may receive which properly belongs to another party, including any
insurance proceeds, and will account to the appropriate party for all such
receipts. Assignee shall have the right and authority to endorse the name of
each Assignor (which endorsement of the name of such Assignor shall include the
words "without recourse") on any check or any other evidences of indebtedness
received by Assignee on account of the Businesses and the Assigned Assets
transferred to Assignee hereunder.

         8.4 Copies of Records.

                  (a) Each of the Assignors shall preserve all records possessed
         by it (and not otherwise transferred to Assignee) relating to the
         Assigned Assets, Assumed Liabilities or operations of the Business and
         shall provide Assignee with access, upon prior reasonable written
         request, during regular business hours, to such books of account and
         records. Assignee and its representatives shall have the right to make
         copies of such books and records. Such records may nevertheless be
         destroyed by Assignors if Assignors send Assignee written notice of
         their intent to destroy records, specifying with particularity the
         contents of the records to be destroyed. Such records may then be
         destroyed after the 90th day following delivery of such notice unless
         Assignee objects to the destruction, in which case Assignors shall
         either agree to retain such records or to deliver such records to
         Assignee.

                  (b) Assignee shall preserve all records of Assignors which
         were transferred to Assignee relating to the time periods prior to the
         Closing, and shall provide to each Assignor with access to such records
         (to the extent related to such Assignor), upon prior reasonable written
         request, during regular business hours. Assignors and their
         representatives shall have the right to make copies of such books and
         records. Such records may nevertheless be destroyed by Assignee if
         Assignee sends the applicable Assignor written notice of its intent to
         destroy such records, specifying with particularity the contents of the
         records to be destroyed. Such records may then be destroyed after the
         90th day following delivery of such notice unless the applicable
         Assignor objects to the destruction, in which case Assignee shall
         either agree to retain such records or to deliver such records to such
         Assignor.


<PAGE>
                                                                  Page 75 of 123


                                   ARTICLE IX

                                  MISCELLANEOUS
                                  -------------

         9.1 Notices. No notice or other communication shall be deemed given
unless sent in the manner, and to the persons, specified in this Section 9.1.
All notices and other communications hereunder shall be in writing and shall be
deemed given (a) upon receipt if delivered personally (unless subject to clause
(b)) or if mailed by registered or certified mail, (b) at noon on the date after
dispatch if sent by overnight courier or (c) upon the completion of transmission
(which is confirmed telephonically by the receiving party) if transmitted by
telecopy or other means of facsimile which provides immediate or near immediate
transmission to compatible equipment in the possession of the recipient, and in
any case to the parties at the following addresses or telecopy numbers (or at
such other address or telecopy number for a party as will be specified by like
notice):

                         if to any Greenbriar Party, to

                         Greenbriar Corporation
                         650 Centura Tower One
                         14185 Dallas Parkway
                         Dallas, Texas  75240
                         Attention: President
                         Telecopy: (972) 407-8420
                         with a copy (which shall not constitute notice) to

                        Henry W. Simon, Jr.
                        Simon, Warner & Doby, L.L.P.
                        1700 City Center Tower II
                        301 Commerce Street
                        Fort Worth, Texas  76102
                        Telecopy:  (817) 810-5255

                        If to Lone Star, to

                        LSOF Pooled Equity, L.P.
                        600 N. Pearl Street
                        Suite 1550, LB 161
                        Dallas, Texas 76140
                        Attention:  Len Allen
                        Telecopy:  (214) 754-8401


<PAGE>
                                                                  Page 76 of 123


                        with a copy (which shall not constitute notice) to

                        Weil, Gotshal & Manges LLP
                        100 Crescent Court, Suite 1300
                        Dallas, Texas 75201-6950
                        Attention: Michael A. Saslaw
                        Telecopy: (214) 746-7777

Each party named above may change its address and that of its representative for
notice by the giving of notice thereof in the manner hereinabove provided.

         Transfer Taxes. Assignors shall bear responsibility, jointly and
severally, for, and timely pay, all applicable Taxes, if any, due as a result of
the transfer of the Assigned Assets in accordance herewith.

         Non-Assignable Contracts. Nothing contained in this Agreement shall be
construed as an assignment or an attempted assignment of any contract which is
in law nonassignable without the consent of the other party or parties thereto,
unless such consent shall be given. To the extent that all consents for the
assignment of any contract shall not have been obtained by Assignors, the
applicable Assignor shall use commercially reasonable efforts to (i) provide to
Assignee the financial and business benefits of such nonassignable contract and
(ii) enforce, at the request of Assignee, for the account of Assignee, any
rights of Assignor arising from any such nonassignable contract (including the
right to elect to terminate in accordance with the terms thereof upon the
request of Assignee).

         9.2 Entire Agreement. This Agreement, the Transaction Documents and the
other agreements contemplated hereby set forth the entire agreement of the
parties with respect to the matters set forth herein or therein. This Agreement
shall not be modified except by written instrument executed together or in
counterparts by all of the parties hereto. All exhibits and schedules referred
to herein are intended to be and hereby are specifically made a part of this
Agreement.

         9.3 Non-Waiver. The failure of any party to insist upon strict
performance of any provision hereof shall not constitute a waiver of, or
estoppel against asserting, the right to require such performance in the future,
nor shall a waiver or estoppel with respect to a later breach of a similar
nature or otherwise.

         9.4 Curative Actions; Severability.

                  (a) If any of the covenants, terms or conditions of this
         Agreement are held illegal by any court or administrative body of
         competent jurisdiction, and any director or stockholder action,
         including, but not limited to, the execution of any documents or
         instruments, will make such covenants, terms or conditions valid and
         enforceable, each party hereby agrees that it shall take or cause to be

<PAGE>
                                                                  Page 77 of 123


         taken such action as may reasonably be required to make any such
         covenant, term or condition valid and enforceable.

                  (b) If any provision of this Agreement is held invalid, such
         invalidity shall not affect the other provisions hereof which can be
         given effect without the invalid provision, and to this end the
         provisions of this Agreement are intended to be and shall be deemed
         severable.

         9.5 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO THE PRINCIPLES
OF CONFLICTS OF LAWS. THE PARTIES HERETO HEREBY CONSENT TO THE JURISDICTION OF
ANY STATE OR FEDERAL COURT LOCATED WITHIN DALLAS COUNTY, TEXAS AND IRREVOCABLY
AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS
AGREEMENT SHALL BE LITIGATED IN SUCH COURTS. THE PARTIES ACCEPT FOR ITSELF AND
IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE
NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND WAIVE ANY DEFENSE OF FORUM
NON CONVENIENS, AND IRREVOCABLY AGREE TO BE BOUND BY ANY JUDGMENT RENDERED
THEREBY IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENTS.

         9.6 WAIVER OF JURY TRAIL. EACH PARTY HERETO WAIVES ANY RIGHT TO TRAIL
BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (i) ARISING UNDER THIS
AGREEMENT OR ANY OF THE OTHER TRANSACTION DOCUMENTS OR (ii) IN ANY WAY CONNECTED
WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO IN RESPECT
OF THIS AGREEMENT OR ANY OF THE OTHER TRANSACTION DOCUMENTS OR THE TRANSACTIONS
RELATED HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. EACH PARTY HEREBY
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL
BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT SUCH PARTY MAY FILE AN
ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO
TRIAL BY JURY.

         9.7 Construction. The headings in this Agreement are inserted for
convenience and identification only and are not intended to describe, interpret,
define or limit the scope, extent, or intent of this Agreement or any provision
hereof. Whenever the context requires, the gender of all words used in this
Agreement shall include the masculine, feminine, and neuter, and the number of
all words shall include the singular and the plural. No provision of this
Agreement will be interpreted in favor of, or against, any of the parties hereto
by reason of the extent to which any such party or its counsel participated in

<PAGE>
                                                                  Page 78 of 123


the drafting thereof or by reason of the extent to which any such provision is
inconsistent with any prior draft hereof or thereof.

         9.8 Counterparts. This Agreement may be executed in any number of
counterparts with the same effect as if each of the parties had signed the same
document. All counterparts shall be construed together and shall constitute one
and the same instrument.

         9.9 Successors and Assigns. Except as provided to the contrary in this
Agreement, this Agreement shall apply to, and shall be binding upon each of the
parties, their respective successors and permitted assigns. Neither this
Agreement nor any rights, interests or obligations hereunder may be assigned
without the prior written consent of Lone Star and the Company; provided,
however, that Lone Star may assign its rights and obligations hereunder to any
designee or designees subject to compliance by Lone Star of its obligations to
execute and deliver the Mutual Release; provided, further, that Windsor may
assign its rights and obligations hereunder to Windsor House Greenville LLC.

         9.10 Cumulative Rights. The rights and remedies provided by this
Agreement are cumulative, and the use of any right or remedy by either party
shall not preclude or waive its right to use any or all other remedies.

         9.11 Costs; Expenses. The Company will pay all of the costs and
expenses incurred by itself and the Lone Star Parties incidental to this
Agreement and the Transaction Documents and in preparing to consummate and
consummating the transactions provided for herein and therein; provided,
however, such costs and expenses shall be limited to $150,000.

         9.12 No Third Party Beneficiaries. Nothing in this Agreement is
intended to confer upon any Person that is not a party hereto any rights or
remedies hereunder or otherwise.

         9.13 Press Releases/Filings. The Greenbriar Parties, on the one hand,
and the Lone Star Parties, on the other hand, hereby acknowledge and agree that
the portion of any proposed press release or filing with the Securities and
Exchange Commission or any other governmental authority by such party pertaining
to the transactions contemplated hereby which references either such
transactions or other parties hereto by name shall be coordinated with, and
agreed upon, prior to the release or publication of such press release or filing
with the Securities and Exchange Commission by the Lone Star Parties, on the one
hand, and the Company, on the other hand. With respect to filing with the
Securities and Exchange Commission, the contents of such filing shall be subject
to the reasonable approval of both the Company and Lone Star, but shall comply
in all respects with all applicable law, rules, and regulations, including,
without limitation, all regulations of the Securities and Exchange Commission.

         9.14 Time of the Essence. Time is of the essence to each and every
provision of this Agreement.


<PAGE>
                                                                  Page 79 of 123


         9.15 Acknowledgments. The parties hereto hereby acknowledge that: (a)
each such party has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Transaction Documents; and (b) no joint
venture is created hereby or by the other Transaction Documents or otherwise
exists by virtue of the transactions contemplated hereby among the Greenbriar
Parties and the Lone Star Parties.

         9.16 Assignment of Stock. The Greenbriar Parties hereby agree that
should Lone Star determine that it is advisable to accept an assignment of the
Capital Stock of any Assignor rather than the assignment of such Assignor's
assets, the Greenbriar Parties shall agree to enter into an amendment (and cause
the appropriate Subsidiary of Greenbriar to enter into an amendment) of this
Agreement to effectuate such change provided such transaction shall not affect
the economic terms as set forth herein.


            [The Remainder of this Page Is Intentionally Left Blank]






<PAGE>
                                                                  Page 80 of 123


         IN WITNESS WHEREOF, the parties have hereunto executed this Agreement
as of August 1, 2001.

                     THE COMPANY
                     -----------

                     GREENBRIAR CORPORATION


                     By:/s/ Gene S. Bertcher
                        --------------------------------------------------
                        Gene S. Bertcher, Executive Vice President and
                        Chief Financial Officer




<PAGE>
                                                                  Page 81 of 123


                     THE ASSIGNORS
                     -------------

                     WINDSOR HOUSE WEST, INCORPORATED


                     By:/s/ Gene S. Bertcher
                        --------------------------------------------
                        Gene S. Bertcher, President, Chief Executive
                        Officer and Treasurer





<PAGE>
                                                                  Page 82 of 123


                     BERNE VILLAGE, INC.


                     By:/s/ Gene S. Bertcher
                        --------------------------------------------------
                        Gene S. Bertcher, President, Chief Executive
                        Officer and Treasurer





<PAGE>
                                 Page 83 of 123


                         ROSE TARA PLANTATION, INC.


                         By:/s/ Gene S. Bertcher
                            --------------------------------------------------
                            Gene S. Bertcher, President, Chief Executive
                            Officer and Treasurer






<PAGE>
                                                                  Page 84 of 123


                         THE DENISON - GREENBRIAR, INC.


                         By:/s/ Gene S. Bertcher
                            --------------------------------------------------
                            Gene S. Bertcher, President, Chief Executive
                            Officer and Treasurer





<PAGE>
                                                                  Page 85 of 123


                         ROSE GARDEN ESTATES, INC.


                         By:/s/ Gene S. Bertcher
                            --------------------------------------------------
                            Gene S. Bertcher, President, Chief Executive
                            Officer and Treasurer





<PAGE>
                                                                  Page 86 of 123


                         THE TERRACE RETIREMENT, INC.


                         By:/s/ Gene S. Bertcher
                            --------------------------------------------------
                            Gene S. Bertcher, President, Chief Executive
                            Officer and Treasurer





<PAGE>
                                                                  Page 87 of 123


                         TRANSFERCO, INC.


                         By:/s/ Gene S. Bertcher
                            --------------------------------------------------
                            Gene S. Bertcher, President, Chief Executive
                            Officer and Treasurer





<PAGE>
                                                                  Page 88 of 123


              WEDGWOOD PARTNERS LTD., LIMITED PARTNERSHIP

              By: GRB, LLC, a Nevada limited liability company, General
                  Partner

                  By: Greenbriar Acquisition Corporation, a Nevada
                      corporation, Manager



                      By:/s/ Gene S. Bertcher
                         --------------------------------------------
                         Gene S. Bertcher, President, Chief Executive
                         Officer and Treasurer





<PAGE>
                                                                  Page 89 of 123


                         WEDGWOOD RETIREMENT INNS, INC.


                         By:/s/ Gene S. Bertcher
                            --------------------------------------------------
                            Gene S. Bertcher, President, Chief Executive
                            Officer and Treasurer




<PAGE>
                                                                  Page 90 of 123


                           LSOF POOLED EQUITY, L.P.

                           By:  LSOF GenPar, Inc., its General Partner


                           By: /s/ J.D. Dell
                              --------------------------------------------------
                           Name: J. D. Dell
                                ------------------------------------------------
                           Title: Vice President
                                 -----------------------------------------------






</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>5
<FILENAME>a8-2ex99_23.txt
<DESCRIPTION>EXHIBIT 99.23
<TEXT>
                                                                  Page 91 of 123


Exhibit 99.23

                                CONSENT AGREEMENT

         This Consent Agreement dated as of August 1, 2001 (this "Agreement"),
is made by and among LSOF Pooled Equity, L.P., a Delaware limited partnership
("Lone Star"), Greenbriar Corporation, a Nevada corporation (the "Company") and
each of the undersigned holders of shares of capital stock (each, a
"Stockholder" and collectively, the "Stockholders") of the Company.

                             PRELIMINARY STATEMENTS

         The Company and Lone Star have entered into a Master Settlement
Agreement (as the same may be amended from time to time, the "Settlement
Agreement"; terms used herein but not defined herein have the meanings set forth
in the Settlement Agreement), which provides that in consideration of the
release of any Claims that Lone Star may have against the Company with respect
to Lone Star's Preferred Stock investment in the Company and the assumption by
Lone Star of the Assumed Liabilities, (i) the Assignors are transferring to
Assignee all of their respective right, title and interest, in and to the
Assigned Assets (the "Assignment"), (ii) the Company will pay to Lone Star
$4,000,000 in immediately available funds, and (iii) for the same consideration,
the Company is also redeeming all of Lone Star's Preferred Stock, any and all of
the Company's common stock into which Lone Star's Preferred Stock was
purportedly converted, together with all of Lone Star's right, title and
interest to any and all claims and rights with respect to its interest as a
stockholder, equity interest holder or otherwise (collectively, the
"Transactions").

         The Transactions do not require the approval of the holders of the
majority of shares of the Company's capital stock under applicable law or the
Company's Organizational Documents.

         The Stockholders own the shares of the Company common stock, $.01 par
value per share (the "Common Stock"), set forth opposite their respective names
on Exhibit A hereto. As used herein, the term "Shares" includes all shares of
such Common Stock as to which each Stockholder (at any time prior to the
termination of this Agreement) is the beneficial or record owner or is otherwise
able to direct the voting thereof and all securities issued or exchanged with
respect to any such Shares upon any reclassification, recapitalization,
reorganization, merger, consolidation, spin-off, stock split, combination, stock
or other dividend or any other change in the Company's capital structure.

         To induce Lone Star to enter into the Settlement Agreement and to
consummate the transactions contemplated thereby, including without limitation,
executing the Mutual Release, the Company has agreed, upon the terms and subject
to the conditions set forth herein, to cause holders of not less than a majority
of the outstanding shares of Common Stock to execute this Agreement.

         NOW, THEREFORE, for good and valuable consideration, the receipt,
sufficiency and adequacy of which are hereby acknowledged, the parties to this
Agreement agree as follows:


<PAGE>
                                                                  Page 92 of 123


         7. Consent. Notwithstanding the fact that consent to the Transactions
is not required under applicable law or the Company's Organizational Document,
each Stockholder hereby consents to and approves the terms and conditions of the
Settlement Agreement and the other Transaction Documents, and the consummation
of the transactions contemplated thereby, including without limitation, the
Transactions.

         8. Public Filings. In the event that it is subsequently determined that
the Transactions require a vote of the stockholders of any class under
applicable law, the Company agrees to promptly prepare and file an Information
Statement with the Securities and Exchange Commission (the "SEC") and the
Company shall respond as promptly as practicable to any comments of the SEC with
respect thereto. The Company shall give Lone Star a reasonable opportunity to
review, comment on and make reasonable changes to the Information Statement. The
Company shall use its reasonable efforts to cause the Information Statement to
be mailed to the Company's stockholders as promptly as practicable after the
Information Statement is cleared by the SEC. The parties shall notify each other
promptly of the receipt of any comments from the SEC or its staff and of any
request by the SEC or its staff for amendments or supplements to the Information
Statement and shall supply each other with copies of all correspondence between
such party or any of its representatives, on the one hand, and the SEC or any of
its staff, on the other hand, with respect to the Information Statement.

         9. Stockholders' Representations and Warranties. Each Stockholder, as
to itself only, represents and warrants to Lone Star that such Stockholder is
the beneficial and record owner of the Shares set forth on Exhibit A, (ii) such
Stockholder has the sole right to vote such Shares, (iii) such Stockholder has
the full and unrestricted legal power, authority and right to enter into,
execute and deliver this Agreement without the consent or approval of any other
person, (iv) this Agreement is the valid and binding agreement of such
Stockholder, (v) the execution and delivery of this Agreement do not, and the
consummation of the transactions contemplated hereby and compliance with the
terms hereof will not, conflict with, or result in any violation of, or default
(with or without notice or lapse of time or both) under any provision of, the
certificate of incorporation or bylaws of any Stockholder, to the extent
applicable, any trust agreement, loan or credit agreement, note, bond, mortgage,
indenture, lease or other agreement, instrument, permit, concession, franchise,
license, judgment, order, notice, decree, statute, law, ordinance, rule or
regulation applicable to such Stockholder or to such Stockholder's property or
assets and (vi) such stockholder is not an Affiliate of Vestin Mortgage.

         10. The Company's Representations and Warranties. The Company hereby
represents and warrants to Lone Star as of the date here that the Company has
all requisite corporate power and authority to enter into this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement by the Company, and the consummation of the transactions
contemplated hereby, have been duly authorized by all necessary corporate action
on the part of the Company. This Agreement has been duly executed and delivered
by the Company and constitutes a valid and binding obligation of the Company

<PAGE>
                                                                  Page 93 of 123


enforceable in accordance with its terms. The execution and delivery of this
Agreement do not, and the consummation of the transactions contemplated hereby
and compliance with the terms hereof will not, conflict with, or result in any
violation of, or default (with or without notice or lapse of time or both) under
any provision of, the certificate of incorporation or bylaws of the Company, any
trust agreement, loan or credit agreement, note, bond, mortgage, indenture,
lease or other agreement, instrument, permit, concession, franchise, license,
judgment, order, notice, decree, statute, law, ordinance, rule or regulation
applicable to the Company or to the Company's property or assets. The Company
hereby represents and warrants that the Shares set forth on Exhibit A constitute
the majority of all issued and outstanding shares of Common Stock. Set forth on
Exhibit B is a true and correct list of (i) the authorized capital stock of the
Company, and (ii) as of the date hereof, the number of shares of each class of
capital stock that is issued and outstanding. Except as set forth on Exhibit B,
no other shares of capital stock are issued and outstanding. All of the issued
and outstanding shares of capital stock of the Company are duly authorized,
validly issued, dully paid and nonassessable, and were issued in compliance with
applicable federal and state securities laws. Except as set forth on Exhibit B,
there are no outstanding shares of capital stock or outstanding rights of first
refusal, preemptive rights or other rights, options, warrants, conversion rights
or other agreements either directly or indirectly for the purchase or
acquisition from the Company of any shares of its capital stock.

         11. Lone Star's Representations and Warranties. Lone Star hereby
represents and warrants to the Stockholders as of the date here that Lone Star
has all requisite corporate power and authority to enter into this Agreement and
to consummate the transactions contemplated hereby. The execution and delivery
of this Agreement by Lone Star, and the consummation of the transactions
contemplated hereby, have been duly authorized by all necessary corporate action
on the part of Lone Star. This Agreement has been duly executed and delivered by
Lone Star and constitutes a valid and binding obligation of Lone Star
enforceable in accordance with its terms. The execution and delivery of this
Agreement do not, and the consummation of the transactions contemplated hereby
and compliance with the terms hereof will not, conflict with, or result in any
violation of, or default (with or without notice or lapse of time or both) under
any provision of, the certificate of formation or limited partnership agreement
of Lone Star, any trust agreement, loan or credit agreement, note, bond,
mortgage, indenture, lease or other agreement, instrument, permit, concession,
franchise, license, judgment, order, notice, decree, statute, law, ordinance,
rule or regulation applicable to Lone Star or to Lone Star's property or assets.

         12. No Voting Trusts. Each Stockholder hereby revokes any and all
proxies and voting instructions with respect to the Shares previously given by
such Stockholder and such Stockholder agrees that it will not grant or give any
other proxies or voting instructions with respect to the voting of the Shares,
enter into any voting trust or other arrangement or agreement with respect to
the voting of the Shares (and if given or executed, such proxies, voting
instructions, voting trust or other arrangement or agreement shall not be

<PAGE>
                                                                  Page 94 of 123


effective), or agree, in any manner, to vote the Shares for or against any
proposal submitted to the Stockholders of the Company except in furtherance of
the proposals set forth in paragraph 7 hereof.

         13. Agreements with Respect to the Shares.

         (a) Should a vote of the stockholders be required under applicable law,
each Stockholder agrees to vote the Shares, to the extent entitled to vote, (x)
in favor of the approval of the Settlement Agreement, the Transactions and any
other transactions contemplated by the Transaction Documents, at every meeting
of the Stockholders of the Company at which any of such matters are considered
and at every adjournment thereof or in any other circumstances upon which a
vote, consent or other approval (including by written consent) with respect to
any of the Transactions and the Settlement Agreement is sought, and (y) with
respect to all other proposals submitted to the Stockholders of the Company
which, directly or indirectly, would reasonably be expected to prevent or
materially delay the consummation of Transactions, in such manner as Lone Star
may direct; and

         (b) Unless otherwise instructed in writing by Lone Star, during the
term of this Agreement, each Stockholder will vote the Shares against any
Competing Transaction.

         (c) For purposes of this Agreement, a "Competing Transaction" shall
mean a transaction of any kind proposed by any person(s) in lieu of or in
opposition to the Settlement Agreement and the Transactions.

         14. Proxies. In furtherance of the foregoing, each Stockholder is
granting to John P. Grayken and J.D. Dell, or to their respective designee(s),
irrevocable proxies and powers of attorney (which may be in the form annexed
hereto or such other form consistent with the terms hereof and thereof as Lone
Star may specify) to vote the Shares, to the extent such Shares are entitled to
vote, and hereby specifically agrees not to revoke such proxies granted under
any circumstances:

         (a) at any and all meetings of Stockholders of the Company, notice of
which meetings are given prior to the due and proper termination of this
Agreement, with respect to matters presented to the Company's Stockholders for
vote which relates to or affects (i) the Transaction or the Settlement Agreement
or the approval of either thereof; and (ii) any Competing Transaction; or

         (b) with respect to actions to be taken by written consent of the
Stockholders of the Company which relates to or affects any of the foregoing,
and which consent is solicited prior to the due and proper termination of this
Agreement.

         15. Limitation on Sales. During the term of this Agreement, each
Stockholder agrees not to sell, assign, transfer, or otherwise dispose of, or
issue an option or call with respect to, any of the Shares, or impair such

<PAGE>
                                                                  Page 95 of 123


Stockholder's Shares; provided, that any Stockholder may sell or otherwise
dispose of any of his or her Shares in a bona fide open market transaction or in
any other transaction if the transferee of such Shares agrees to be bound by and
subject to the terms and conditions of this Agreement as if such transferee had
executed this Agreement on the date hereof as a Stockholder.

         16. Specific Performance. Each Stockholder acknowledges that it will be
impossible to measure in money the damage to Lone Star if the Stockholder fails
to comply with the obligations imposed by this Agreement, and that, in the event
of any such failure, Lone Star will not have an adequate remedy at law or in
damages. Accordingly, each Stockholder agrees that injunctive relief or any
other equitable remedy, in addition to any remedies at law or damages, is the
appropriate remedy for any such failure and will not oppose the granting of any
such remedy on the basis that Lone Star has an adequate remedy at law. Each
Stockholder agrees not to seek, and agrees to waive any requirement for, the
securing or posting of a bond in connection with Lone Star seeking or obtaining
such equitable relief.

         17. Reasonable Efforts. Each Stockholder will use all reasonable
efforts to cause to be satisfied the conditions to the obligations of the
Company in such Stockholder's control to effect the Closing under the Settlement
Agreement.

         18. Publicity. Each Stockholder agrees that, from the date hereof, such
Stockholder shall not issue any public release or announcement concerning the
transactions contemplated by this Agreement and the Settlement Agreement without
the prior consent of Lone Star, except as such release or announcement may, in
the opinion of such Stockholder's counsel, be required by applicable law, in
which case such Stockholder shall allow Lone Star reasonable time to comment on
such release or announcement in advance of such issuance.

         19. Term of Agreement; Termination.

         (a) The term of this Agreement shall commence on the date hereof and
shall terminate upon the earliest to occur of (i) after the consummation of the
Transactions, (ii) the due and proper termination of the Settlement Agreement in
accordance with its terms or (iii) six (6) months from the date hereof. Upon
such termination, no party shall have any further obligations or liabilities
hereunder.

         (b) The obligations of the Stockholders set forth in this Agreement
shall not be effective or binding upon any Stockholder until after such time as
the Settlement Agreement is executed and delivered by Lone Star, the Company,
each Assignor and each Intervenor.


<PAGE>
                                                                  Page 96 of 123


         20. Miscellaneous.

         (a) Entire Agreement. This Agreement constitutes the entire agreement
among the parties with respect to the subject matter of this Agreement and
supersedes all prior written and oral and all contemporaneous oral agreements
and understandings with respect to the subject matter of this Agreement.

         (b) Notices. No notice or other communication shall be deemed given
unless sent in the manner, and to the persons, specified in this paragraph 14.
All notices and other communications hereunder shall be in writing and shall be
deemed given (a) upon receipt if delivered personally (unless subject to clause
(b)) or if mailed by registered or certified mail, (b) at noon on the date after
dispatch if sent by overnight courier or (c) upon the completion of transmission
(which is confirmed telephonically by the receiving party) if transmitted by
telecopy or other means of facsimile which provides immediate or near immediate
transmission to compatible equipment in the possession of the recipient, and in
any case to the parties at the following addresses or telecopy numbers (or at
such other address or telecopy number for a party as will be specified by like
notice):

                         if to any Greenbriar Party, to

                         Greenbriar Corporation
                         650 Centura Tower One
                         14185 Dallas Parkway
                         Dallas, Texas  75240
                         Attention: President
                         Telecopy: (972) 407-8420

                         with a copy (which shall not constitute notice) to:

                         Henry W. Simon, Jr.
                         Simon, Warner & Doby, L.L.P.
                         1700 City Center Tower II
                         301 Commerce Street
                         Fort Worth, Texas  76102
                         Telecopy:  (817) 810-5255


<PAGE>
                                                                  Page 97 of 123


                           If to Lone Star, to

                           LSOF Pooled Equity, L.P.
                           600 N. Pearl Street
                           Suite 1550, LB 161
                           Dallas, Texas 76140
                           Attention:  Len Allen
                           Telecopy:  (214) 754-8401

                           with a copy (which shall not constitute notice) to:

                           Weil, Gotshal & Manges LLP
                           100 Crescent Court, Suite 1300
                           Dallas, Texas 75201-6950
                           Attention: Michael A. Saslaw
                           Telecopy: (214) 746-7777

                           If to a Stockholder, to the address set forth below
                           such Stockholder's name on Exhibit A hereto, with a
                           copy (which shall not constitute notice) to:

                           Henry W. Simon, Jr.
                           Simon, Warner & Doby, L.L.P.
                           1700 City Center Tower II
                           301 Commerce Street
                           Fort Worth, Texas  76102
                           Telecopy:  (817) 810-5255

         (c) Waiver. The failure of any party to insist upon strict performance
of any provision hereof shall not constitute a waiver of, or estoppel against
asserting, the right to require such performance in the future, nor shall a
waiver or estoppel with respect to a later breach of a similar nature or
otherwise.

         (d) Curative Actions; Severability.

                  (i) If any of the covenants, terms or conditions of this
Agreement are held illegal by any court or administrative body of competent
jurisdiction, and any director or stockholder action, including, but not limited
to, the execution of any documents or instruments, will make such covenants,
terms or conditions valid and enforceable, each party hereby agrees that it
shall take or cause to be taken such action as may reasonably be required to
make any such covenant, term or condition valid and enforceable.

                  (ii) If any provision of this Agreement is held invalid, such
invalidity shall not affect the other provisions hereof which can be given

<PAGE>
                                                                  Page 98 of 123


effect without the invalid provision, and to this end the provisions of this
Agreement are intended to be and shall be deemed severable.

         (e) Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO THE PRINCIPLES
OF CONFLICTS OF LAWS. THE PARTIES HERETO HEREBY CONSENT TO THE JURISDICTION OF
ANY STATE OR FEDERAL COURT LOCATED WITHIN DALLAS COUNTY, TEXAS AND IRREVOCABLY
AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS
AGREEMENT SHALL BE LITIGATED IN SUCH COURTS. THE PARTIES ACCEPT FOR ITSELF AND
IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE
NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND WAIVE ANY DEFENSE OF FORUM
NON CONVENIENS, AND IRREVOCABLY AGREE TO BE BOUND BY ANY JUDGMENT RENDERED
THEREBY IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENTS.

         (f) WAIVER OF JURY TRAIL. EACH PARTY HERETO WAIVES ANY RIGHT TO TRAIL
BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (i) ARISING UNDER THIS
AGREEMENT OR ANY OF THE OTHER TRANSACTION DOCUMENTS OR (ii) IN ANY WAY CONNECTED
WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO IN RESPECT
OF THIS AGREEMENT OR ANY OF THE OTHER TRANSACTION DOCUMENTS OR THE TRANSACTIONS
RELATED HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. EACH PARTY HEREBY
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL
BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT SUCH PARTY MAY FILE AN
ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO
TRIAL BY JURY.

         (g) Construction. The headings in this Agreement are inserted for
convenience and identification only and are not intended to describe, interpret,
define or limit the scope, extent, or intent of this Agreement or any provision
hereof. Whenever the context requires, the gender of all words used in this
Agreement shall include the masculine, feminine, and neuter, and the number of
all words shall include the singular and the plural. No provision of this
Agreement will be interpreted in favor of, or against, any of the parties hereto
by reason of the extent to which any such party or its counsel participated in
the drafting thereof or by reason of the extent to which any such provision is
inconsistent with any prior draft hereof or thereof. Capitalized terms used
herein but not otherwise defined herein shall have the meaning given to them in
the Settlement Agreement.


<PAGE>
                                                                  Page 99 of 123


         (h) Counterparts. This Agreement may be executed in any number of
counterparts with the same effect as if each of the parties had signed the same
document. All counterparts shall be construed together and shall constitute one
and the same instrument.

         (i) Successors and Assigns. Except as provided to the contrary in this
Agreement, this Agreement shall apply to, and shall be binding upon each of the
parties, their respective successors and permitted assigns. Lone Star may freely
assign its rights and obligations hereunder to any designee subject to
compliance by Lone Star of its obligations to execute and deliver the Mutual
Release pursuant to the terms and conditions of the Settlement Agreement.

         (j) Cumulative Rights. The rights and remedies provided by this
Agreement are cumulative, and the use of any right or remedy by either party
shall not preclude or waive its right to use any or all other remedies.

         (k) No Third Party Beneficiaries. Nothing in this Agreement is intended
to confer upon any Person that is not a party hereto any rights or remedies
hereunder or otherwise.

         (l) Time of the Essence. Time is of the essence to each and every
provision of this Agreement.

         (m) Acknowledgments. The parties hereto hereby acknowledge that: (a)
each such party has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Transaction Documents; and (b) no joint
venture is created hereby or by the other Transaction Documents or otherwise
exists by virtue of the transactions contemplated hereby among the parties
hereto and Lone Star.

           [The remainder of this page is intentionally left blank.]



<PAGE>
                                                                 Page 100 of 123


         IN WITNESS WHEREOF, the parties hereto, intending to be legally bound
hereby, have duly executed this Consent Agreement as of the date first above
written.

                      LSOF POOLED EQUITY, L.P.

                      By:  LSOF GenPar, Inc., its General Partner

                      By: /s/ J.D. Dell
                          ----------------------
                          Name: J.D. Dell
                          Title: Vice President

                      GREENBRIAR CORPORATION

                      By: /s/ James R. Gilley
                          ----------------------
                          Name:  James R. Gilley
                          Title: Chairman of the Board
                                 and Chief Executive
                                 Officer



<PAGE>
                                                                 Page 101 of 123


                    THE APRIL TRUST, A GRANTOR TRUST
                    FOR THE BENEFIT OF JAMES R.
                    GILLEY AND SYLVIA M. GILLEY



                    By:  /s/ James R. Gilley
                         ------------------------------------------------
                    Name: James R. Gilley
                         ------------------------------------------------
                    Title: Trustee
                          -----------------------------------------------




<PAGE>
                                                                 Page 102 of 123


                    JRG INVESTMENTS CO., INC.



                    By:  /s/ James R. Gilley
                         ------------------------------------------------
                    Name: James R. Gilley
                         ------------------------------------------------
                    Title: President
                          -----------------------------------------------




<PAGE>
                                                                 Page 103 of 123


                                /s/ Sylvia M. Gilley
                                -----------------------------------
                                Sylvia M. Gilley




<PAGE>
                                                                 Page 104 of 123


                                /s/ Victor L. Lund
                                -----------------------------------
                                Victor L. Lund




<PAGE>
                                                                 Page 105 of 123


                                /s/ Gene S. Bertcher
                                -----------------------------------
                                Gene S. Bertcher



<PAGE>

                                                                 Page 106 of 123




                                /s/ Robert L. Griffis
                                -----------------------------------
                                Robert L. Griffis




<PAGE>
                                                                 Page 107 of 123


                                /s/ Don C. Benton
                                -----------------------------------
                                Don C. Benton




<PAGE>
                                                                 Page 108 of 123


                     AMERICAN REALTY TRUST, INC.



                     By: /s/ Robert Waldman
                        --------------------------------------------------
                     Name:  Robert Waldman
                          ------------------------------------------------
                     Title: Secretary
                           -----------------------------------------------




<PAGE>
                                                                 Page 109 of 123


                     BASIC CAPITAL MANAGEMENT, INC.



                     By: /s/ Robert Waldman
                        --------------------------------------------------
                     Name:  Robert Waldman
                          ------------------------------------------------
                     Title: Secretary
                           -----------------------------------------------




<PAGE>
                                                                 Page 110 of 123


                          NEVADA SEA INVESTMENTS, INC.



                     By: /s/ Robert Waldman
                        --------------------------------------------------
                     Name:  Robert Waldman
                          ------------------------------------------------
                     Title: Secretary
                           -----------------------------------------------




<PAGE>
                                                                 Page 111 of 123


                        INTERNATIONAL HEALTH PRODUCTS, INC.



                        By: /s/ Ronald E. Kimbrough
                           --------------------------------------------------
                        Name:  Ronald E. Kimbrough
                             ------------------------------------------------
                        Title: Secretary
                              -----------------------------------------------




<PAGE>
                                                                 Page 112 of 123


                           ONE REALCO CORPORATION (fka Davister Corporation)



                           By: /s/ Ronald Akin
                              --------------------------------------------------
                           Name:  Ronald Akin
                                ------------------------------------------------
                           Title: President
                                 -----------------------------------------------




<PAGE>
                                                                 Page 113 of 123


                        TACCO FINANCIAL, INC.



                        By: /s/ J.T. Tackett
                           --------------------------------------------------
                        Name:  J.T. Tackett
                             ------------------------------------------------
                        Title: Vice President
                              -----------------------------------------------






<PAGE>
- --------------------------------------------------------------------------------
CUSIP No. 393648-10-0                13D                  Page 114 of 123 Pages
- --------------------------------------------------------------------------------

<TABLE>
<S>                                                     <C>

                                    EXHIBIT A
                                    ---------

Name of Stockholder:                                    The April Trust, a Grantor Trust for the benefit of
                                                        James R. Gilley and Sylvia M. Gilley

Address:                                                650 Centura Tower One
                                                        14185 Dallas Parkway
                                                        Dallas, TX 75240

Telephone No.:                                          972-407-8400

Facsimile No.:                                          214-273-0620

Number of Shares of Common Stock:                       2,340,851

Name of Stockholder:                                    JRG Investments Co., Inc.

Address:                                                650 Centura Tower One
                                                        14185 Dallas Parkway
                                                        Dallas, TX 75240

Telephone No.:                                          972-407-8400

Facsimile No.:                                          214-273-0620

Number of Shares of Common Stock:                       897,851

Name of Stockholder:                                    Sylvia M. Gilley

Address:                                                650 Centura Tower One
                                                        14185 Dallas Parkway
                                                        Dallas, TX 75240

Telephone No.:                                          972-407-8400

Facsimile No.:                                          972-991-8582

Number of Shares of Common Stock:                       536,000

Name of Stockholder:                                    Victor L. Lund

Address:                                                816 NE 87th Avenue
                                                        Vancouver, Washington  98664

Telephone No.:                                          360-892-9090

Facsimile No.:                                          360-892-2146

<PAGE>
                                                                 Page 115 of 123


Number of Shares of Common Stock:                       1,234,961


Name of Stockholder:                                        Gene S. Bertcher

Address:                                                    650 Centura Tower One
                                                            14185 Dallas Parkway
                                                            Dallas, TX 75240

Telephone No.:                                              972-407-8400

Facsimile No.:                                              214-273-0624

Number of Shares of Common Stock:                           66,000

Name of Stockholder:                                        Robert L. Griffis

Address:                                                    650 Centura Tower One
                                                            14185 Dallas Parkway
                                                            Dallas, TX 75240

Telephone No.:                                              972-407-8400

Facsimile No.:                                              214-273-0625

Number of Shares of Common Stock:                           30,000

Name of Stockholder:                                        Don C. Benton

Address:                                                    Arrowhead Ranch
                                                            Route 1
                                                            Clarksville, Texas  75246

Telephone No.:                                              903-966-2347

Facsimile No.:                                              903-427-5773

Number of Shares of Common Stock:                           10,000

Name of Stockholder:                                        American Realty Trust, Inc.


<PAGE>
                                                                 Page 116 of 123


Address:                                                    1800 Valley View Lane, Suite 300
                                                            Dallas, Texas  75234

Telephone No.:                                              469-522-4277

Facsimile No.:                                              469-522-4388

Number of Shares of Common Stock:                           97,500




<PAGE>
                                                                 Page 117 of 123


Name of Stockholder:                                        Basic Capital Management, Inc.

Address:                                                    1800 Valley View Lane, Suite 300
                                                            Dallas, Texas  75234

Telephone No.:                                              469-522-4277

Facsimile No.:                                              469-522-4388

Number of Shares of Common Stock:                           141,260

Name of Stockholder:                                        Nevada Sea Investments, Inc.

Address:                                                    1800 Valley View Lane, Suite 300
                                                            Dallas, Texas  75234

Telephone No.:                                              469-522-4277

Facsimile No.:                                              469-522-4388

Number of Shares of Common Stock:                           72,800

Name of Stockholder:                                        International Health Products, Inc.

Address:                                                    1800 Valley View Lane, Suite 300
                                                            Dallas, Texas  75234

Telephone No.:                                              469-522-4277

Facsimile No.:                                              469-522-4388

Number of Shares of Common Stock:                           229,085



<PAGE>
                                                                 Page 118 of 123


Name of Stockholder:                                    One Realco Corporation (fka Davister Corporation)

Address:                                                1800 Valley View Lane, Suite 300
                                                        Dallas, Texas  75234

Telephone No.:                                          469-522-4277

Facsimile No.:                                          469-522-4388

Number of Shares of Common Stock:                       264,200

Name of Stockholder:                                    TacCo Financial, Inc.

Address:                                                1800 Valley View Lane, Suite 300
                                                        Dallas, Texas  75234

Telephone No.:                                          469-522-4277

Facsimile No.:                                          469-522-4388

Number of Shares of Common Stock:                       242,500

</TABLE>


<PAGE>
                                                                 Page 119 of 123


                                    EXHIBIT B
                                    ---------

                                 CAPITALIZATION
                                 --------------





The total number of shares of stock which the Company has authority to issue is
110,000,000 shares of capital stock, classified as (i) 100,000,000 shares of
common stock, $0.01 par value and (ii) 10,000,000 shares of preferred stock,
$0.10 par value. As of the date of this Agreement, 9,714,608 shares of common
stock are issued and outstanding and 6,000,000 shares of Series H Preferred
Stock, $0.10 par value, are issued and outstanding.





<PAGE>
                                                                 Page 120 of 123


                     IRREVOCABLE PROXY AND POWER OF ATTORNEY


         The undersigned hereby appoints John P. Grayken and J.D. Dell, as the
undersigned's attorney-in-fact and proxy, with full power of substitution, for
and in the undersigned's name, to vote, express consent or disapproval, or
otherwise act (including pursuant to written consent, but excluding the right to
assert, perfect and prosecute dissenters' rights of appraisal) in accordance
with Paragraphs 7(a) and 4(b) of the Consent Agreement with respect to all of
the shares of Common Stock, $.01 par value per share, of Greenbriar Corporation,
a Nevada corporation (the "Company"), owned of record by the undersigned.

         The proxy granted hereby shall be irrevocable and may be exercised at
any meeting of Stockholders, notice of which is given, or in respect of any
written consent which is solicited prior to the due and proper termination of,
and subject to and in accordance with the terms and conditions of, the Consent
Agreement, dated of even date herewith, among the undersigned, LSOF Pooled
Equity, L.P., a Delaware limited partnership, the Company and the Stockholders
of the Company signatory thereto. This proxy is coupled with an interest
sufficient in law to support such proxy.

Dated:   August 1, 2001
                                     -------------------------------------
                                     Name:


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>6
<FILENAME>a8-2ex99_24.txt
<DESCRIPTION>EXHIBIT 99.24
<TEXT>
                                                                 Page 121 of 123


Exhibit 99.24


                             JOINT FILING AGREEMENT

         The undersigned hereby agree that any Statement on Schedule 13D to be
filed with the Securities and Exchange Commission by any of the undersigned,
including any amendment thereto, with respect to the securities of Greenbriar
Corporation may be filed by any of the undersigned as a joint filing of all of
the undersigned. This Joint Filing Agreement shall be filed as an Exhibit to
such statement.




Date: August 2, 2001             LSOF POOLED EQUITY, L.P.

                                 By:    LSOF GenPar, Inc., its General Partner


                                 By:/s/ J.D. Dell
                                    ------------------------------------------
                                      J.D. Dell
                                      Vice President



Date: August 2, 2001             LSOF GENPAR, INC.


                                 By:/s/ J.D. Dell
                                    ------------------------------------------
                                      J.D. Dell
                                      Vice President



Date: August 2, 2001             LONE STAR OPPORTUNITY FUND, L.P.

                                 By:    Lone Star Partner, L.P.,
                                        its General Partner

                                        By:   Lone Star Management Co., Ltd.,
                                               its General Partner


                                              By:/s/ J.D. Dell
                                                 -----------------------------
                                                   J.D. Dell
                                                   Vice President

<PAGE>
                                                                 Page 122 of 123



Date: August 2, 2001             LONE STAR PARTNER, L.P.

                                 By:    Lone Star Management Co., Ltd.,
                                        its General Partner


                                        By:/s/ J.D. Dell
                                           -----------------------------------
                                              J.D. Dell
                                              Vice President




Date: August 2, 2001             LONE STAR MANAGEMENT CO., LTD.


                                 By:/s/ J.D. Dell
                                    ------------------------------------------
                                      J.D. Dell
                                      Vice President



Date: August 2, 2001             HUDSON ADVISORS, L.L.C.


                                 By:/s/ Steven R. Shearer
                                    ------------------------------------------
                                      Steven R. Shearer
                                      Vice President



Date: August 2, 2001             TERLINGUA ADVISORS, INC.


                                 By:/s/ Steven R. Shearer
                                    ------------------------------------------
                                      Steven R. Shearer
                                      Vice President



Date: August 2, 2001             ADVISORS GENPAR, INC.


                                 By:/s/ J.D. Dell
                                    ------------------------------------------
                                      J.D. Dell
                                      Vice President




<PAGE>
                                                                 Page 123 of 123


Date: August 2, 2001             HUDSON ADVISORS ASSOCIATES, L.P.

                                 By:    Advisors GenPar, Inc.
                                        its General Partner


                                        By:/s/ J.D. Dell
                                           -----------------------------------
                                           J.D. Dell
                                           Vice President





  Date: August 2, 2001           /s/ John P. Grayken
                                 ---------------------------------------------
                                 John P. Grayken


</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
