Exhibit 10.1

HEALTH CARE PROPERTY INVESTORS, INC.
CHANGE IN CONTROL SEVERANCE PLAN

1.             Establishment and Purpose.  Health Care Property Investors, Inc.
(the “Corporation”) considers it essential to the best interests of its
shareholders to foster the continuous employment of key management personnel. 
In connection with this, the Corporation’s Board of Directors (the “Board”)
recognizes that, as is the case with many publicly held corporations, the
possibility of a change in control of the Corporation may exist and that the
uncertainty and questions that it may raise among management could result in the
departure or distraction of management personnel to the detriment of the
Corporation and its shareholders.  The Board has decided to reinforce and
encourage the continued attention and dedication of selected members of the
Corporation’s management to their assigned duties without the distraction
arising from the possibility of a change in control of the Corporation.  In
order to induce such members of management to remain in its employ, the
Corporation hereby agrees that on and after the Effective Date (as defined in
Section 2), subject to the terms and conditions of this Plan, Participants (as
defined in Section 3) shall be eligible to receive the severance benefits set
forth in Section 6 of this Plan in the event that the Participants’ employment
with the Corporation is terminated under the circumstances described in Section
5 of this Plan subsequent to a Change in Control (as defined in Section 4). 
Upon the Effective Date, any prior severance agreement or letter between each
participant and the Corporation shall terminate and be of no further effect.

2.             Term of Plan.  This Plan shall commence on the date of its
approval by the Compensation Committee of the Board (the “Effective Date”) and
shall continue in effect through December 31, 2008 (the “Term”); provided,
however, commencing on January 1, 2008 and on each January 1 thereafter, the
Term shall automatically be extended for one additional year as to each
Participant then in the Plan unless, not later than November 30 of the preceding
year, the Corporation shall have given notice to the Participant that it does
not wish to extend the Term, and if such notice is timely given, the Plan will
terminate at the end of the Term then in effect as to each Participant who is
timely given such notice (with no extension or further notice, as the case may
be); provided, further, that if a Change in Control, occurs during the Term (or
the extended Term, as the case may be), the Term shall continue in effect as to
each Participant in the Plan at the time of the Change in Control for a period
of not less than twenty-four (24) months beyond the month in which such Change
in Control occurred.  For purposes of clarity, the Corporation may give notice
of termination of the Term to all or only certain Participants. If such notice
is given to only certain Participants, the Term shall continue as set forth
above as to all other Participants (subject to the Corporation’s rights to
similarly terminate the Term in accordance with the foregoing on some future
date(s) as to any such Participants).  A Participant shall cease to be eligible
for benefits under this Plan (and shall cease to be a Participant) at midnight
Pacific Time on the last day of the Term applicable to that Participant.  The
termination or expiration of the Term as to a Participant shall not affect the
Participant’s obligations under Section 10 or affect the Participant’s right to
benefits (if any) pursuant to Section 6 as to any termination of employment that
occurred during such Term.

  

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3.             Participation.

(a)           Participation.  The Compensation Committee of the Board (the
“Committee”) shall from time to time designate in writing those employees of the
Corporation (each, an “Eligible Person”) who are, subject to Section 3(b),
eligible to participate in the Plan (each, a “Participant”).  Notwithstanding
anything else contained herein to the contrary, the Committee shall limit the
class of persons selected to participate in this Plan to a select group of
management or highly compensated employees, as set forth in Sections 201, 301
and 401 of ERISA.

(b)           Participation Agreement.  To the extent the Committee has
designated an Eligible Person as being eligible to participate in this Plan, the
Eligible Person shall become a Participant only by promptly completing, fully
executing, and returning to the Corporation a participation agreement in
substantially the form attached hereto as Exhibit A (or such other form as the
Committee may require and provide for at the time it designates the Eligible
Person as being eligible to participate in this Plan).  The Participation
Agreement shall set forth the Participant’s applicable “Severance Multiplier”
for the purposes of calculating the Participant’s benefits under Section 6.

(c)           Termination of Employment.  Notwithstanding anything else
contained in the Plan to the contrary, a Participant shall not be deemed to have
terminated employment with the Corporation if his or her employment by the
Corporation terminates but he or she otherwise continues, immediately after such
termination of employment, as an employee of a subsidiary of the Corporation (a
“Subsidiary”); provided that whether the Participant has Good Reason to
terminate employment shall be determined by comparing the Participant’s
authority, duties, responsibilities and other terms of employment after giving
effect to such change to the Participant’s authority, duties, responsibilities
and other terms of employment before giving effect to such change (in each case
relative to the Corporation and its Subsidiaries on a consolidated basis, not
simply with reference to the Participant’s employer).

(d)           Benefit Offset.  Notwithstanding anything else contained in the
Plan to the contrary, any severance benefits otherwise payable under the Plan to
a Participant shall be offset or reduced by the amount of severance benefits
payable or deliverable to the Participant under any other plan, program, or
agreement of or with the Corporation or any of its Subsidiaries.

4.             Change in Control.  No benefits shall be payable under Section 6
of this Plan unless there has been a Change in Control.  For purposes of this
Plan, a Change in Control shall be deemed to occur if any of the following take
place on or after the Effective Date:

(a)           The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934
(the “Exchange Act”) (a “Person”)) of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of 25% or more of either (1)
the then-outstanding shares of common stock of the Corporation (the “Outstanding
Company Common Stock”) or (2) the combined voting power of the then-outstanding
voting securities of the Corporation entitled to vote generally in the election
of directors (the “Outstanding Company Voting Securities”); provided, however,
that, for purposes of this clause (a), the following acquisitions shall not
constitute a Change in Control:

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(A) any acquisition directly from the Corporation, (B) any acquisition by the
Corporation, (C) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Corporation or any affiliate of the Corporation
or a successor, (D) any acquisition by any entity pursuant to a transaction that
complies with clauses (c)(1), (2) and (3) below, and (E) any acquisition by a
Person who owned at least 25% of either the Outstanding Company Common Stock or
the Outstanding Company Voting Securities as of the Effective Date or an
affiliate of any such Person;

(b)           A change in the Board or its members such that individuals who, as
of the later of the Effective Date or the date that is two years prior to such
change (the later of such two dates is referred to as the “Measurement Date”),
constitute the Board (the “Incumbent Board”) cease for any reason to constitute
at least a majority of the Board; provided, however, that any individual
becoming a director subsequent to the Measurement Date whose election, or
nomination for election by the Corporation’s stockholders, was approved by a
vote of at least two-thirds of the directors then comprising the Incumbent Board
(including for these purposes, the new members whose election or nomination was
so approved, without counting the member and his predecessor twice) shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board;

(c)           Consummation of a reorganization, merger, statutory share exchange
or consolidation or similar corporate transaction involving the Corporation or
any of its Subsidiaries, a sale or other disposition of all or substantially all
of the assets of the Corporation, or the acquisition of assets or stock of
another entity by the Corporation or any of its Subsidiaries (each, a “Business
Combination”), in each case unless, following such Business Combination, (1) all
or substantially all of the individuals and entities that were the beneficial
owners of the Outstanding Company Common Stock and the Outstanding Company
Voting Securities immediately prior to such Business Combination beneficially
own, directly or indirectly, more than 66-2/3% of the then-outstanding shares of
common stock and the combined voting power of the then-outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the entity resulting from such Business Combination (including,
without limitation, an entity that, as a result of such transaction, owns the
Corporation or all or substantially all of the Corporation’s assets directly or
through one or more subsidiaries (a “Parent”)) in substantially the same
proportions as their ownership immediately prior to such Business Combination of
the Outstanding Company Common Stock and the Outstanding Company Voting
Securities, as the case may be, (2) no Person (excluding any entity resulting
from such Business Combination or a Parent or any employee benefit plan (or
related trust) of the Corporation or such entity resulting from such Business
Combination or Parent) beneficially owns, directly or indirectly, more than 25%
of, respectively, the then-outstanding shares of common stock of the entity
resulting from such Business Combination or the combined voting power of the
then-outstanding voting securities of such entity, except to the extent that the
ownership in excess of 25% existed prior to the Business Combination, and (3) at
least a majority of the members of the board of directors or trustees of the
entity resulting from such Business Combination or a Parent were members of the
Incumbent Board (determined pursuant to clause (b) above using the date that is
the later of the Effective Date or the date that is two years prior to the
Business Combination as the Measurement Date) at the time of the execution of
the initial agreement or of the action of the Board providing for such Business
Combination; or

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(d)           Approval by the stockholders of the Corporation of a complete
liquidation or dissolution of the Corporation other than in the context of a
transaction that does not constitute a Change in Control under clause (c) above.

5.             Termination Following Change in Control.

(a)           General.  During the Term, if any of the events described in
Section 4 constituting a Change in Control shall have occurred, each Participant
shall be entitled to the benefits provided in Section 6(b) upon the subsequent
termination of his or her employment, provided that such termination occurs
during the Term and within the two (2) year period immediately following the
date of such Change in Control, unless such termination is (i) because of the
Participant’s death or Disability (as defined in Section 5(b)), (ii) by the
Corporation for Cause (as defined in Section 5(c)), or (iii) by the Participant
other than for Good Reason (including a voluntary retirement when the
Participant otherwise does not have Good Reason to terminate employment).  In
the event that the Participant is entitled to such benefits, such benefits shall
be paid notwithstanding the subsequent expiration of the Term.  For purposes of
clarity, no Participant shall be entitled to any benefits under this Plan if his
or her employment with the Corporation terminates for any reason before a Change
in Control occurs or more than two (2) years after a Change in Control occurs.

(b)           Disability.  As to any particular Participant, “Disability” means
the Participant’s inability, because of physical or mental illness or injury, to
perform the essential functions of his or her customary duties to the
Corporation, even with a reasonable accommodation, and the continuation of such
disabled condition for a period of one hundred eighty (180) continuous days, or
for not less than two hundred ten (210) days during any continuous twenty-four
(24) month period.

(c)           Cause.  Termination by the Corporation of a Participant’s
employment for “Cause” shall mean termination (i) upon the Participant’s willful
and continued failure to perform his or her duties with the Corporation (other
than any such failure resulting from his or her incapacity due to physical or
mental illness or any such actual or anticipated failure after the Participant’s
issuance of a Notice of Termination (as defined in Section 5(f)) for Good
Reason, after a written demand for performance is delivered to the Participant
by the Committee, which demand specifically identifies the manner in which the
Committee believes that the Participant has not performed his or her duties,
(ii) upon the Participant’s willful and continued failure to follow and comply
with the specific and lawful directives of the Committee, as reasonably
determined by the Committee (other than any such failure resulting from the
Participant’s incapacity due to physical or mental illness or any such actual or
anticipated failure after the Participant’s issuance of a Notice of Termination
for Good Reason), after a written demand for performance is delivered to the
Participant by the Committee, which demand specifically identifies the manner in
which the Committee believes that the Participant has not performed his or her
duties, (iii) upon the Participant’s willful and continued failure to follow and
comply with the policies of the Corporation as in effect from time to time
(other than any such failure

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resulting from the Participant’s incapacity due to physical or mental illness or
any such actual or anticipated failure after the Participant’s issuance of a
Notice of Termination (as defined in Section 5(f)) for Good Reason, after a
written demand for performance is delivered to the Participant by the Committee,
which demand specifically identifies the manner in which the Committee believes
that the Participant has not followed or complied with such Corporation
policies; (iv) upon the Participant’s willful commission of an act of fraud or
dishonesty resulting in material economic or financial injury to the
Corporation; (v) upon the Participant’s willful engagement in illegal conduct or
gross misconduct, in each case which is materially and demonstrably injurious to
the Corporation; or (vi) upon the Participant’s indictment for, conviction of,
or a plea of guilty or nolo contendere to any felony.

(d)           Good Reason.  A Participant shall be entitled to terminate his or
her employment for Good Reason. For purposes of this Plan, “Good Reason” shall
mean, without the Participant’s express written consent, the occurrence after a
Change in Control and during the Term of any of the following:

(i)            the assignment to the Participant of any duties inconsistent with
the position in the Corporation that the Participant held immediately prior to
the Change in Control, a significant adverse alteration in the nature or status
of the Participant’s responsibilities or the conditions of the Participant’s
employment from those in effect immediately prior to such Change in Control, or
any other action by the Corporation that results in a material diminution in the
Participant’s position, authority, duties or responsibilities;

(ii)           the Corporation’s reduction of the Participant’s annual base
salary as in effect on the Effective Date or as the same may be increased from
time to time;

(iii)          the relocation of the Corporation’s offices at which the
Participant is principally employed immediately prior to the date of the Change
in Control (the Participant’s “Principal Location”) to a location more than
thirty (30) miles from such location, or the Corporation’s requiring the
Participant, without the Participant’s written consent, to be based anywhere
other than his or her Principal Location, provided that such relocation results
in a longer commute (measured by actual mileage) for the Participant from the
Participant’s primary residence to such new location and except for required
travel on the Corporation’s business to an extent substantially consistent with
the Participant’s current business travel obligations;

(iv)          the Corporation’s failure to pay to the Participant any portion of
his or her current compensation or to pay to the Participant any portion of an
installment of deferred compensation under any deferred compensation program of
the Corporation reasonably promptly after the date such compensation is due;

(v)           the Corporation’s failure to continue in effect any material
compensation or benefit plan in which the Participant participates immediately
prior to the Change in Control, unless an equitable arrangement (embodied in an
ongoing substitute or alternative plan) has been made with respect to such plan,
or the Corporation’s failure to continue the Participant’s participation therein
(or in such substitute or alternative plan) on a basis not materially less
favorable, both in terms of the amount of benefits provided and the level of the
Participant’s participation relative to other participants, as existed at the
time of the Change in Control;

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(vi)          the Corporation’s failure to obtain a satisfactory agreement from
any successor to assume and agree to perform this Plan, as contemplated in
Section 8 hereof; or

(vii)         any purported termination of the Participant’s employment that is
not effected pursuant to a Notice of Termination satisfying the requirements of
Section 5(f) hereof (and, if applicable, the requirements of Section 5(c)
hereof), which purported termination shall not be effective for purposes of this
Agreement.

Notwithstanding the foregoing, no such condition shall constitute “Good Reason”
unless the Participant provides written notice of such condition to the
Corporation and the Corporation fails to remedy the condition claimed to
constitute Good Reason within thirty (30) days of receiving written notice
thereof; and provided, further, that in all events the termination of the
Participant’s employment with the Corporation shall not be treated as a
termination for “Good Reason” unless such termination occurs not more than six
(6) months following the initial existence of the condition claimed to
constitute Good Reason.  A Participant’s right to terminate his or her
employment pursuant to this Section 5(d) shall not be affected by his or her
incapacity due to physical or mental illness.  A Participant’s continued
employment shall not constitute consent to, or a waiver of rights with respect
to, any circumstance constituting Good Reason hereunder.

(e)           Termination Generally.  For purposes of clarity, a Participant or
the Corporation shall be entitled to terminate the Participant’s employment for
any reason or no reason at any time after a Change in Control effective as of
the applicable date set forth in Section 5(a).

(f)            Notice of Termination.  Any purported termination of a
Participant’s employment by the Corporation or by the Participant (other than
termination due to death which shall terminate the Participant’s employment
automatically) shall be communicated by written Notice of Termination to the
Participant or the Corporation, respectively, other party hereto in accordance
with Section 14. “Notice of Termination” shall mean a notice that shall indicate
the specific termination provision in this Plan relied upon and shall set forth
in reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Participant’s employment under the provision so indicated.

(g)           Date of Termination, Etc.  “Date of Termination” shall mean (a) if
a Participant’s employment is terminated due to the Participant’s death, the
date of the Participant’s death; (b) if a Participant’s employment is terminated
for Disability, thirty (30) days after Notice of Termination is given (provided
that the Participant shall not have returned to the full-time performance of his
or her duties during such thirty (30)-day period), and (c) if a Participant’s
employment is terminated for any other reason, the date specified in the Notice
of Termination.

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6.             Compensation Upon Termination Following A Change in Control.  If
a Participant’s employment is terminated following a Change in Control during
the Term and during the two (2) year period immediately following the date of
the Change in Control, the Participant shall be entitled to the benefits
described below, subject to the other terms and conditions of this Plan:

(a)           If the Participant’s employment is terminated in such
circumstances by the Corporation for Cause or Disability or by the Participant
other than for Good Reason or due to the Participant’s death, the Corporation
shall pay the Participant (i) the Participant’s accrued and unpaid base salary
and vacation (if any) through the Date of Termination, and (ii) all other
amounts to which the Participant is entitled under any compensation plan of the
Corporation at the time such payments are due, and the Corporation shall have no
further obligations to the Participant under this Agreement.

(b)           If the Participant’s employment by the Corporation shall be
terminated by the Participant for Good Reason or by the Corporation other than
for Cause or Disability and in all cases other than due to the Participant’s
death, then, subject to the provisions of Section 7, the Participant shall be
entitled to the benefits provided below.  For purposes of this Section 6(b), a
Participant’s “Annual Bonus Amount” shall mean the greater of (i) one-third
(1/3) of the Participant’s annual base salary as in effect as of the Date of
Termination or (ii) the average annual bonus received by the Participant in the
three (3) years immediately prior to the Change in Control for each full year of
employment with the Corporation, which shall be determined without regard to the
payment of any special bonuses (e.g. transaction bonuses).  For purposes of this
Section 6(b), a Participant’s “Annual Base Salary” shall mean the greater of (x)
the Participant’s annual base salary as in effect as of the Date of Termination
or (y) the Participant’s annual base salary as in effect immediately prior to
the Change in Control.

(i)            The Corporation shall pay to the Participant (1) the
Participant’s accrued and unpaid base salary and vacation (if any) through the
Date of Termination, (2) the unpaid portion, if any, of any annual bonus, plus
an amount equal to the Participant’s applicable Annual Bonus Amount multiplied
by a fraction, the numerator of which is the number of calendar days that the
Participant was employed by the Corporation during the year of termination and
the denominator of which is 365, and (3) all other amounts to which the
Participant is entitled under any compensation plan of the Corporation at the
time such payments are due;

(ii)           A lump sum severance payment equal to the sum of: (A) the
Participant’s Severance Multiplier times the Participant’s Annual Base Salary;
plus (B) the Participant’s Severance Multiplier times the Participant’s Annual
Bonus Amount;

(iii)          A cash payment equal to the expected aggregate cost of the
premiums that would be charged to the Participant to continue medical coverage
pursuant to the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), at the
same or reasonably equivalent medical coverage for the Participant (and, if
applicable, the Participant’s eligible dependents) as in effect immediately
prior to the Participant’s Date of Termination, for a period of months after the
Participant’s Date of Termination equal to twelve (12) multiplied by the
Participant’s Severance Multiplier.

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(iv)          (A) Any stock options or equity or equity-related compensation or
grants that vest based on the passage of time and continued performance of
services (to the extent outstanding and not otherwise vested as of the Date of
Termination, and exclusive of any grants that include performance-based vesting
criteria) shall become fully vested immediately prior to such termination; (B)
any stock options or equity or equity-related compensation or grants that vest
based on the satisfaction of performance-based criteria (to the extent
outstanding and not otherwise vested as of the Severance Date) shall continue to
be governed by the provisions of the applicable award agreement in the
circumstances; provided, however, that to the extent that any such
then-outstanding equity-based awards are subject to forfeiture and/or vesting
requirements based on the passage of time, such awards shall be fully
accelerated with respect to such time-based forfeiture and/or vesting
provisions; and (C) the Participant shall have until the date that is twelve
(12) months after his or her Date of Termination to exercise any stock option to
the extent that it has become vested on the Date of Termination, subject to
earlier termination of the stock option upon the stock option’s original
expiration date or the occurrence of a change in control event or certain
similar reorganization event under the terms of the applicable award agreement. 
Except as provided in this Section 6(b)(iv), the effect of a termination of
employment on a Participant’s equity-based awards shall be determined under the
terms of the applicable award agreement.

(v)           The Participant shall be fully vested in his or her accrued
benefits under any nonqualified pension, profit sharing, deferred compensation
or supplemental plans maintained by the Corporation and the Corporation shall
pay the Participant a cash lump sum amount equal to the portion of the
Participant’s account under the Corporation’s 401(k) plan (including, without
limitation, any 401(k) matching contributions), if any, that has not become
vested under the terms of such plan as of the Date of Termination.

(vi)          The Corporation shall furnish the Participant for six (6) years
following the Date of Termination (without reference to whether the Term
continues in effect) with directors’ and officers’ liability insurance insuring
the Participant against insurable events which occur or have occurred while the
Participant was a director or officer of the Corporation, such insurance to have
policy limits aggregating not less than the amount in effect immediately prior
to the Change in Control, and otherwise to be in substantially the same form and
to contain substantially the same terms, conditions and exceptions as the
liability issuance policies provided for officers and directors of the
Corporation in force from time to time, provided, however, that such terms,
conditions and exceptions shall not be, in the aggregate, materially less
favorable to the Participant than those in effect on the Effective Date;
provided, further, that if the aggregate annual premiums for such insurance at
any time during such period exceed one hundred and fifty percent (150%) of the
per annum rate of premium currently paid by the Corporation for such insurance,
then the Corporation shall provide the maximum coverage that will then be
available at an annual premium equal to one hundred and fifty percent (150%) of
such rate; and

(vii)         In any situation where under applicable law the Corporation has
the power to indemnify (or advance expenses to) the Participant in respect of
any judgments, fines, settlements, loss, cost or expense (including attorneys’
fees) of any nature related to or arising out of the Participant’s activities as
an agent, employee, officer or director of the

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Corporation or in any other capacity on behalf of or at the request of the
Corporation, the Corporation shall promptly on written request, indemnify (and
advance expenses to) the Participant to the fullest extent permitted by
applicable law, including but not limited to making such findings and
determinations and taking any and all such actions as the Corporation may, under
applicable law, be permitted to have the discretion to take so as to effectuate
such indemnification or advancement.  Such agreement by the Corporation shall
not be deemed to impair any other obligation of the Corporation respecting the
Participant’s indemnification otherwise arising out of this or any other
agreement or promise of the Corporation or under any statute.

(c)           Subject to Section 7 and Section 22, the payments described in
Sections 6(a)(i), 6(b)(i)(1), 6(b)(i)(2), 6(b)(ii), 6(b)(iii) and 6(b)(iv), as
applicable, shall be paid in cash to the Participant in a single lump sum as
soon as practicable following the Date of Termination, but in no event beyond
seventy four (74) days from such date (or, if earlier, the (10) business days
after the Participant’s release contemplated by Section 7(a) becomes irrevocable
by the Participant in accordance with applicable law.

(d)           The foregoing provisions of this Section 6 shall not affect: (i) a
Participant’s receipt of benefits otherwise due terminated employees under group
insurance coverage consistent with the terms of the applicable Corporation
welfare benefit plan; (ii) a Participant’s rights under COBRA to continue
participation in medical, dental, hospitalization and life insurance coverage;
or (iii) a Participant’s receipt of benefits otherwise due in accordance with
the terms of the Corporation’s 401(k) plan (if any).

7.             Release; Exclusive Remedy.

(a)           This Section 7 shall apply notwithstanding anything else contained
in this Plan or any other stock option, restricted stock or other equity-based
award agreement to the contrary.  Notwithstanding anything to the contrary
contained in this Plan, the Corporation’s obligation to make any payment of
benefits with respect to a Participant pursuant to Section 6(b) of this Plan (if
the Participant is otherwise entitles to such benefits) is subject to the
condition precedent that (i) the Participant has fully executed a valid and
effective release (in the form attached hereto as Exhibit B or such other form
as the Committee may reasonably require in the circumstances, which other form
shall be substantially similar to that attached hereto as Exhibit B but with
such changes as the Committee may determine to be required or reasonably
advisable in order to make the release enforceable and otherwise compliant with
applicable laws), (ii) such executed release is delivered by the Participant to
the Corporation so that it is received by the Corporation in the time period
specified below, and (iii) such release is not revoked by the Participant
(pursuant to any revocation rights afforded by applicable law).  In order to
satisfy the requirements of this Section 7(a), a Participant’s release referred
to in the preceding sentence must be delivered by the Participant to the
Corporation so that it is received by the Corporation no later than twenty five
(25) calendar days after the Participant’s Date of Termination (or such later
date as may be required for an enforceable release of the Participant’s claims
under the United States Age Discrimination in Employment Act of 1967, as amended
(“ADEA”), to the extent the ADEA is applicable in the circumstances, in which
case the Participant will be provided with either twenty one (21) or forty five
(45) days, depending on the circumstances of the termination, to consider the
release).  In addition, the Corporation may require that the Participant’s
release be executed no earlier than the date that the Participant’s employment
with the Corporation terminates.

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(b)           Each Participant agrees that the general release agreement
described in Section 7(a) will require that the Participant acknowledge, as a
condition to the payment of any benefits under Section 6(b), that the payments
contemplated by Section 6(b) shall constitute the exclusive and sole remedy for
any termination of the Participant’s employment, and each Participant will be
required to covenant, as a condition to receiving any such payment, not to
assert or pursue any other remedies, at law or in equity, with respect to any
termination of employment.  No Participant shall be required to mitigate the
amount of any payment provided for in Section 6 by seeking other employment or
otherwise nor shall the amount of any payment or benefit provided for in Section
6 be reduced by any compensation earned by the Participant as the result of
employment by another employer or self-employment, by retirement benefits, by
offset against any amount claimed to be owed by the Participant to the
Corporation, or otherwise.

8.             Section 280G.  Each Participant shall be covered by the
provisions set forth in Exhibit C hereto, incorporated herein by this reference.

9.             Successors; Assigns

(a)           The Corporation shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Corporation to expressly
assume and agree to perform the obligations under this Plan in the same manner
and to the same extent that the Corporation would be required to perform it if
no such succession had taken place.  Failure of the Corporation to obtain such
assumption and agreement prior to the effectiveness of any such succession shall
be deemed a material breach of this Plan by the Corporation and shall entitle
each Participant to terminate his or her employment and receive compensation
from the Corporation in the same amount and on the same terms to which the
Participant would be entitled hereunder if the Participant terminates his or her
employment for Good Reason following a Change in Control, except that for
purposes of implementing the foregoing, the date on which any such succession
becomes effective shall be deemed the Date of Termination.  Unless expressly
provided otherwise, “Corporation” as used herein shall mean the Corporation as
defined in this Plan and any successor to its business and/or assets as
aforesaid.

(b)           None of the benefits, payments, proceeds or claims of any Eligible
Person or Participant shall be subject to any claim of any creditor and, in
particular, the same shall not be subject to attachment or garnishment or other
legal process by any creditor, nor shall any such Eligible Person or Participant
have any right to alienate, anticipate, commute, pledge, encumber or assign any
of the benefits or payments or proceeds which he or she may expect to receive,
contingently or otherwise, under the Plan.  Notwithstanding the foregoing,
benefits which are in pay status may be subject to a court-ordered garnishment
or wage assignment, or similar order, or a tax levy.  The Plan shall inure to
the benefit of and be enforceable by each Participant’s personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees, and legatees.  If a Participant dies while any amount would still be
payable to him or her hereunder had he or she continued to live, all such
amounts, unless otherwise provided herein, shall be paid to the Participant’s
estate in accordance with the terms of the Plan.

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10.           Confidentiality, Noncompetition and Non-Solicitation Covenants. 
Each Participant by accepting participation in the Plan expressly agrees to each
of the foregoing provisions of this Section 10:

(a)           Confidentiality.  Each Participant shall not at any time (whether
during or after the Participant’s employment with the Corporation and whether or
not the Participant subsequently ceases to participate in this Plan or is ever
entitled to the benefits provided in Section 6) directly or indirectly, other
than in the course of the Participant’s duties hereunder, disclose or make
available to any person, firm, corporation, association or other entity for any
reason or purpose whatsoever, any Confidential Information (as defined below);
provided, however, that this Section 10(a) shall not apply when (i) disclosure
is required by law or by any court, arbitrator, mediator or administrative or
legislative body (including any committee thereof) with apparent jurisdiction to
order the Participant to disclose or make available such information (provided,
however, that the Participant shall promptly notify the Corporation in writing
upon receiving a request for such information), or (ii) with respect to any
other litigation, arbitration or mediation involving this Plan, including but
not limited to enforcement of this Plan.  Upon termination of a Participant’s
employment with the Corporation, all Confidential Information in the
Participant’s possession that is in written, digital or other tangible form
(together with all copies or duplicates thereof, including computer files) shall
be returned to the Corporation and shall not be retained by the Participant or
furnished to any third party, in any form except as provided herein; provided,
however, that the Participant shall not be obligated to treat as confidential,
or return to the Corporation copies of any Confidential Information that (x) was
publicly known at the time it was disclosed to the Participant, (y) becomes
publicly known or available thereafter other than by any means in violation of
this Plan or any other duty owed to the Corporation by any person or entity, or
(z) is lawfully disclosed to the Participant by a third party.  As used in this
Plan, the term “Confidential Information” means: information disclosed to a
Participant or known by a Participant as a consequence of or through the
Participant’s relationship with the Corporation, about the suppliers, customers,
employees, business methods, public relations methods, organization, procedures
or finances, including, without limitation, information of or relating to
supplier lists or customer lists, of the Corporation and its affiliates
(collectively, the “Company Group”).

(b)           Noncompetition.  Each Participant acknowledges that the nature of
the Company Group’s business and the Participant’s position with the Corporation
is such that if the Participant were to become employed by, or substantially
involved in, the business of a competitor of the Company Group during the twelve
(12) months following the termination of the Participant’s employment with the
Corporation, it would be very difficult for the Participant not to rely on or
use the Company Group’s trade secrets and Confidential Information.  Thus, to
avoid the inevitable disclosure of the Company Group’s trade secrets and
Confidential Information, and to protect such trade secrets and Confidential
Information and the Company Group’s relationships and goodwill with customers,
during the Participant’s employment with the Corporation and for a period of
twelve (12) months after the Date of Termination for any reason (the “Restricted
Period”), the Participant will not directly or indirectly engage in (whether as
an employee, consultant, agent, proprietor, principal, partner, stockholder,
corporate officer, director or otherwise), nor have any ownership interest in,
or participate in the financing, operation, management or control of, any
person, firm, corporation or business anywhere in the United States and Mexico
(the “Restricted Area”) that competes with any member of the

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Company Group in the healthcare real estate acquisition, development,
management, investment or financing industry (a “Competing Business”); provided,
that the Participant may purchase and hold only for investment purposes less
than 2% of the shares of any corporation in competition with the Company Group
whose shares are regularly traded on a national securities exchange. 
Notwithstanding the preceding sentence, in the event a Participant accepts
employment with or provides services to a business (the “Service Recipient”)
that is affiliated with another business that engages in a Competing Business or
which derives a de minimis portion of its gross revenues from Competing
Businesses, the Participant’s employment by or service to the Service Recipient
shall not, in and of itself, constitute a breach by that Participant of his or
her obligations pursuant to this Section 10(b) so long as each of the following
conditions is satisfied at all times during the Restricted Period and while the
Participant is employed by or providing service to the Service Recipient: (i) no
more than 10% of the gross revenues of the Service Recipient are derived from
Competing Businesses; (ii) no more than 10% of the gross revenues of the Service
Recipient and those entities that (directly or through one or more
intermediaries) are controlled by, control, or are under common control with
such Service Recipient, together on a consolidated basis, are derived from
Competing Businesses; and (iii) in the course of the Participant’s services for
the Service Recipient, a material portion of the Participant’s services are not
directly involved in or responsible for any Competing Business.  The foregoing
covenants in this Section 10(b) shall continue in effect through the entire
Restricted Period regardless of whether the Participant is then entitled to
receive any severance payments from the Corporation.

(c)           Non-Solicitation of Employees. During the Restricted Period, each
Participant shall not to directly or indirectly solicit, induce, attempt to
hire, recruit, encourage, take away, or hire any employee or independent
contractor of the Company Group whose annual rate of compensation is then
$50,000 or more or cause any such Company Group employee or contractor to leave
his or her employment or engagement with the Company Group either for employment
with the Participant or for any other entity or person.  The foregoing covenants
in this Section 10(c) shall continue in effect through the entire Restricted
Period regardless of whether the Participant is then entitled to receive any
severance payments from the Corporation.

(d)           Non-Solicitation of Customers.  During the Restricted Period, each
Participant shall not to directly or indirectly influence or attempt to
influence customers, vendors, suppliers, licensors, lessors, joint venturers,
associates, consultants, agents, or partners of the Company Group to divert
their business away from the Company Group to any Competing Business, and each
Participant agrees not to otherwise interfere with, disrupt or attempt to
disrupt the business relationships, contractual or otherwise, between any member
of the Company Group and any of its customers, suppliers, vendors, lessors,
licensors, joint venturers, associates, officers, employees, consultants,
managers, partners, members or investors.  The foregoing covenants in this
Section 10(d) shall continue in effect through the entire Restricted Period
regardless of whether the Participant is then entitled to receive any severance
payments from the Corporation.

(e)           Understanding of Covenants. Each Participant, by accepting
participation in this Plan represents as follows: the Participant (i) is
familiar with the foregoing covenants set forth in this Section 10, (ii) is
fully aware of the Participant’s obligations hereunder, (iii) agrees to the
reasonableness of the length of time, scope and geographic coverage of the
foregoing

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covenants set forth in this Section 10, (iv) agrees that the Company Group
currently conducts business throughout the Restricted Area, (v) agrees that such
covenants are necessary to protect the Company Group’s confidential and
proprietary information, good will, stable workforce, and customer relations,
(vi) agrees that the Participant’s coverage by this Plan for the Term applicable
to the Participant is good, valid and sufficient consideration for (among other
things) the Participant’s agreement to such covenants, and (vii) agrees that
such covenants shall continue in effect as to the Participant even if the
Participant ceases at any time in the future to participate in the Plan (i.e.,
the Participant ceases to be a “Participant”) and even if the Participant is
never entitled to the benefits set forth in Section 6 (and accordingly, the term
“Participant” includes a former “Participant” to the extent necessary to effect
such covenants).

(f)            Right to Injunctive and Equitable Relief.  Each Participant’s
obligations not to disclose or use Confidential Information and to refrain from
the solicitations described in this Section 10 are of a special and unique
character, which gives them a peculiar value.  The Corporation cannot be
reasonably or adequately compensated in damages in an action at law in the event
a Participant breaches such obligations, and the breach of such obligations
would cause irreparable harm to the Corporation.  Therefore, the Corporation
shall be entitled to injunctive and other equitable relief without bond or other
security in the event of such breach in addition to any other rights or remedies
which the Corporation may possess.  Furthermore, each Participant’s obligations
and the rights and remedies of the Corporation under this Section 10 are
cumulative and in addition to, and not in lieu of, any obligations, rights, or
remedies created by applicable law relating to misappropriation or theft of
trade secrets or confidential information.

(g)           Cooperation.  During each Participant’s employment with the
Corporation and thereafter, the Participant shall respond to all reasonable
inquiries of the Corporation about any matters concerning the Corporation or its
affairs that occurred or arose during the Participant’s employment by the
Corporation, and each Participant shall reasonably cooperate with the
Corporation in investigating, prosecuting and defending any charges, claims,
demands, liabilities, causes of action, lawsuits or other proceedings by,
against or involving the Corporation relating to the period during which the
Participant was employed by the Corporation or relating to matters of which the
Participant had or should have had knowledge or information.  Further, except as
required by law, each Participant will at no time voluntarily serve as a witness
or offer written or oral testimony against the Corporation in conjunction with
any complaints, charges or lawsuits brought against the Corporation by or on
behalf of any current or former employees, or any governmental or administrative
agencies related to the Participant’s period of employment and will provide the
Corporation with notice of any subpoena or other request for such information or
testimony.

11.           Claims Procedures.

(a)           Presentation of Claim.  Any Participant (such Participant being
referred to below as a “Claimant”) may deliver to the Committee a written claim
for a determination with respect to the benefits payable to such Claimant
pursuant to this Plan.  If such a claim relates to the contents of a notice
received by the Claimant, the claim must be made within sixty (60) days after
such notice was received by the Claimant.  All other claims must be made within
one hundred eighty (180) days of the date on which the event that caused the
claim to arise occurred.  The claim must state with particularity the
determination desired by the Claimant.

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(b)           Notification of Decision.  The Committee shall consider a
Claimant’s claim within a reasonable time, but no later than ninety (90) days
after receiving the claim.  If the Committee determines that special
circumstances require an extension of time for processing the claim, written
notice of the extension shall be furnished to the Claimant prior to the
termination of the initial ninety (90) day period.  In no event shall such
extension exceed a period of ninety (90) days from the end of the initial ninety
(90) day period.  The extension notice shall indicate the special circumstances
requiring an extension of time and the date by which the Committee expects to
render the benefit determination.  The Committee shall notify the Claimant in
writing:

(i)            that the Claimant’s requested determination has been made, and
that the claim has been allowed in full; or

(ii)           that the Committee has reached a conclusion contrary, in whole or
in part, to the Claimant’s requested determination, and such notice must set
forth in a manner calculated to be understood by the Claimant:

(1)           the specific reason(s) for the denial of the claim, or any part of
it;

(2)           specific reference(s) to pertinent provisions of the Plan upon
which such denial was based;

(3)           a description of any additional material or information necessary
for the Claimant to perfect the claim, and an explanation of why such material
or information is necessary;

(4)           an explanation of the claim review procedure and the time limits
applicable to such procedures set forth in Section 11(c); and

(5)           a statement of the Claimant’s right to bring a civil action under
ERISA Section 502(a) following an adverse determination on review.

(c)           Review of a Denied Claim.  On or before sixty (60) days after
receiving a notice from the Committee that a claim has been denied, in whole or
in part, a Claimant (or the Claimant’s duly authorized representative) may file
with the Committee a written request for a review of the denial of the claim. 
The Claimant (or the Claimant’s duly authorized representative):

(i)            may, upon request and free of charge, have reasonable access to,
and copies of, all documents, records and other information relevant to the
claim for benefits;

(ii)           may submit written comments or other documents; and/or

(iii)          may request a hearing, which the Committee, in its sole
discretion, may grant.

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(d)           Decision on Review.  The Committee shall render its decision on
review promptly, and no later than sixty (60) days after the Committee receives
the Claimant’s written request for a review of the denial of the claim.  If the
Committee determines that special circumstances require an extension of time for
processing the claim, written notice of the extension shall be furnished to the
Claimant prior to the termination of the initial sixty (60) day period.  In no
event shall such extension exceed a period of sixty (60) days from the end of
the initial sixty (60) day period.  The extension notice shall indicate the
special circumstances requiring an extension of time and the date by which the
Committee expects to render the benefit determination.  In rendering its
decision, the Committee shall take into account all comments, documents, records
and other information submitted by the Claimant relating to the claim, without
regard to whether such information was submitted or considered in the initial
benefit determination.  The decision must be written in a manner calculated to
be understood by the Claimant, and it must contain:

(i)            specific reasons for the decision;

(ii)           specific reference(s) to the pertinent Plan provisions upon which
the decision was based;

(iii)          a statement that the Claimant is entitled to receive, upon
request and free of charge, reasonable access to and copies of, all documents,
records and other information relevant (as defined in applicable ERISA
regulations) to the Claimant’s claim for benefits; and

(iv)          a description of the Claimant’s right to bring a civil action
under Section 502(a) of ERISA following an adverse benefit determination on
review.

12.           Arbitration; Dispute Resolution, Etc.

(a)           Notwithstanding anything to the contrary contained in the Plan,
the Participant, in his or her sole discretion, may elect to have any claim or
controversy arising out of or in connection with the Plan and/or a Participation
Agreement submitted to binding arbitration and adjudicated in accordance with
this Section 12 without first having to exhaust the claims procedures set forth
in Article 11.

(b)             The Corporation and, by accepting participation in this Plan,
each Participant hereby consent to the resolution by mandatory and binding
arbitration of all claims or controversies arising out of or in connection with
the Plan and/or the Participant’s Participation Agreement that the Corporation
may have against the Participant, or that the Participant may have against the
Corporation or against any of its officers, directors, employees or agents
acting in their capacity as such, and which are not resolved under the terms of
Article 11 (or which are not required to be resolved under the terms of Article
11, as the case may be).  Each party’s promise to resolve all such claims or
controversies by arbitration in accordance with the Plan rather than through the
courts is consideration for the other party’s like promise.  It is further
agreed that the decision of an arbitrator on any issue, dispute, claim or
controversy submitted for arbitration, shall be final and binding upon the
Corporation and the Participant and that judgment may be entered on the award of
the arbitrator in any court having proper jurisdiction.

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(c)           Except as otherwise provided in this procedure or by mutual
agreement of the parties, any arbitration shall be before a sole arbitrator (the
“Arbitrator”) selected from Judicial Arbitration & Mediation Services, Inc., Los
Angeles, California, or its successor (“JAMS”), or if JAMS is no longer able to
supply the arbitrator, such arbitrator shall be selected from the American
Arbitration Association, and shall be conducted in accordance with the
provisions of California Civil Procedure Code Sections 1280 et. seq. as the
exclusive remedy of such dispute.

(d)           The Arbitrator shall interpret the Plan, any applicable
Corporation policy or rules and regulations, any applicable substantive law (and
the law of remedies, if applicable) of the state in which the claim arose, or
applicable federal law.  If arbitration is brought after the claim or
controversy has been submitted for review by the Committee in accordance with
Article 11, the Arbitrator shall limit his or her review to whether or not the
Committee has abused its discretion in its interpretation of the Plan and such
policies, rules, and regulations; provided, however, that the Arbitrator shall
apply a de novo standard of review with respect to any claim for benefits
hereunder in connection with a Change in Control.  In reaching his or her
decision, the Arbitrator shall have no authority to change or modify any lawful
Corporation policy, rule or regulation, or the Plan.  Except as provided in
Section 12(e), the Arbitrator, and not any federal, state or local court or
agency, shall have exclusive and broad authority to resolve any dispute relating
to the interpretation, applicability, enforceability or formation of the Plan,
including but not limited to, any claim that all or any part of the Plan is
voidable.  The Arbitrator shall have the authority to decide dispositive
motions.  Following completion of the arbitration, the arbitrator shall issue a
written decision disclosing the essential findings and conclusions upon which
the award is based.

(e)           Notwithstanding the foregoing, provisional injunctive relief may,
but need not, be sought by the Participant or the Corporation in a court of law
while arbitration proceedings are pending, and any provisional injunctive relief
granted by such court shall remain effective until the matter is finally
resolved by the Arbitrator in accordance with the foregoing.  Final resolution
of any dispute through arbitration may include any remedy or relief which would
otherwise be available at law and which the Arbitrator deems just and
equitable.  The Arbitrator shall have the authority to award full damages as
provided by law.  Any award or relief granted by the Arbitrator hereunder shall
be final and binding on the parties hereto and may be enforced by any court of
competent jurisdiction.

(f)            The Corporation shall pay the reasonable fees and expenses of the
Arbitrator and of a stenographic reporter, if employed.  Each party shall pay
its own legal fees and other expenses and costs incurred with respect to the
arbitration.

13.           Administration of the Plan.

(a)           Administration - General.  The Corporation shall be the plan
administrator (within the meaning of Section 3(16)(A) of ERISA).  The
Corporation delegates its duties under the Plan to the Committee.  The Committee
delegates the day-to-day ministerial duties with respect to the Plan to the
Corporation’s management.  The Committee and its delegates shall be named
fiduciaries of the Plan to the extent required by ERISA

16

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(b)           Powers and Duties of the Committee.  The Committee shall enforce
the Plan in accordance with its terms, shall be charged with the general
administration of the Plan, and shall have all powers necessary to accomplish
its purposes, including, but not by way of limitation, the power and authority
to do the following:

(i)            To determine eligibility for and participation in the Plan;

(ii)           To construe and interpret the terms and provisions of the Plan;

(iii)          To compute and certify to the amount and kind of benefits payable
to Participants and their beneficiaries, and to determine the amount of
withholding taxes to be deducted pursuant to Section 16;

(iv)          To maintain all records that may be necessary for the
administration of the Plan;

(v)           To provide for the disclosure of all information and the filing or
provision of all reports and statements to Participants, beneficiaries or
governmental agencies as shall be required by law;

(vi)          To make and publish such rules for the regulation of the Plan and
procedures for the administration of the Plan as are not inconsistent with the
terms hereof; and

(vii)         To appoint a plan manager or any other agent, and to delegate to
them such powers and duties in connection with the administration of the Plan as
the Committee may from time to time prescribe.

(c)           Committee Action.  Subject to Section 11, the Committee shall act
with respect to the Plan at meetings by affirmative vote of a majority of the
members of the Committee.  Any action permitted to be taken at a meeting with
respect to the Plan may be taken without a meeting if, prior to such action, a
written consent to the action is signed by all members of the Committee and such
written consent is filed with the minutes of the proceedings of the Committee. 
A member of the Committee shall not vote or act upon any matter which relates
solely to himself or herself as a Participant.  The Chairman or any other member
or members of the Committee designated by the Chairman may execute any
certificate or other written direction on behalf of the Committee.

(d)           Construction and Interpretation. As to any event prior to a Change
in Control, the Committee shall have full discretion to construe and interpret
the terms and provisions of the Plan and any and all Participation Agreements,
which interpretation or construction shall be final and binding on all parties,
including but not limited to the Corporation and any Participant, beneficiary or
other person.

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14.           Notice.  All notices under or with respect to this Plan or any
Participation Agreement shall be in writing and shall be either personally
delivered or mailed postage prepaid, by certified mail, return receipt
requested:

(a)           if to the Corporation:

Health Care Property Investors, Inc.

Attention: Compensation Committee

3760 Kilroy Airport Way, Suite 300
                                  Long Beach, California 90806

with a copy to:

Health Care Property Investors, Inc.

Attention: Secretary of the Corporation

3760 Kilroy Airport Way, Suite 300
Long Beach, California 90806

 (b)                              if to a Participant, to the Participant’s
address most recently on file in the payroll records of the Corporation.

Notice shall be effective when personally delivered, or five (5) business days
after being so mailed.  Any party may change its address for purposes of giving
future notices pursuant to the Plan and any Participation Agreement by notifying
the other party in writing of such change in address, such notice to be
delivered or mailed in accordance with the foregoing.

15.           Governing Law.  The Plan and any Participation Agreement hereunder
will be governed by and construed in accordance with ERISA and, to the extent
not preempted thereby, the laws of the State of California (unless otherwise
expressly provided in the Participant’s Participation Agreement, in which case
the law of the state specified in the Participant’s Participation Agreement
shall apply instead of the law of the State of California as to that
Participant), without giving effect to any choice of law or conflicting
provision or rule (whether of the State of California or any other jurisdiction)
that would cause the laws of any jurisdiction other than United States federal
law and the law of the State of California (or other state, as applicable) to be
applied.  In furtherance of the foregoing, applicable federal law and, to the
extent not preempted by applicable federal law, the internal law of the State of
California (or other state, as applicable), will control the interpretation and
construction of the Plan and any Participation Agreement hereunder, even if
under such jurisdiction’s choice of law or conflict of law analysis, the
substantive law of some other jurisdiction would ordinarily apply.  Any
statutory reference in the Plan or any Participation Agreement shall also be
deemed to refer to all applicable final rules and final regulations promulgated
under or with respect to the referenced statutory provision.

16.           Miscellaneous.  The Committee may from time to time amend the Plan
or any Participation Agreement in any way it deems to be advisable; provided
that no such amendment shall materially and adversely affect the rights of any
Participant (or former Participant) under the Plan or Participation Agreement,
as applicable, without that Participant’s (or former Participant’s, as the case
may be) consent.  Neither the failure nor any delay on the part of a party to
exercise any right, remedy, power or privilege under the Plan or any
Participation Agreement shall operate as a waiver thereof, nor shall any single
or partial exercise of any right, remedy, power or privilege preclude any other
or further exercise of the same or of any right,

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remedy, power or privilege, nor shall any waiver of any right, remedy, power or
privilege with respect to any occurrence be construed as a waiver of such right,
remedy, power or privilege with respect to any other occurrence.  No waiver
shall be effective unless it is in writing and is signed by the party asserted
to have granted such waiver.  No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have
been made by the Corporation which are not expressly set forth in this Plan. All
references to sections of the Exchange Act or the Code shall be deemed also to
refer to any successor provisions to such sections.  The Corporation may
withhold (or cause there to be withheld, as the case may be) from any amounts
otherwise due or payable under or pursuant to this Plan such federal, state and
local income, employment, or other taxes as may be required to be withheld
pursuant to any applicable law or regulation.  Any obligations of the
Corporation under Sections 4 and 6 shall survive the expiration of the term of
this Agreement. The section headings contained in this Agreement are for
convenience only, and shall not affect the interpretation of this Agreement.

17.           Unsecured General Creditor.  Participants and their heirs,
successors, and assigns shall have no legal or equitable rights, claims, or
interest in any specific property or assets of the Corporation or any
Subsidiary.  No assets of the Corporation shall be held under any trust, or held
in any way as collateral security, for the fulfilling of the obligations of the
Corporation under this Plan.  Any and all of the Corporation’s assets shall be,
and remain, the general unpledged, unrestricted assets of the Corporation
(unless pledged or restricted with respect to the Corporation’s obligations
other than the Plan).  The Corporation’s obligation under the Plan shall be
merely that of an unfunded and unsecured promise of the Corporation to pay money
and benefits in the future, and the rights of the Participants and their heirs
or successors as to benefits under the Plan shall be no greater than those of
unsecured general creditors of the Corporation.

18.           Other Benefit Plans.  All payments, benefits and amounts provided
under the Plan shall be in addition to and not in substitution for any pension
rights under the any tax-qualified pension or retirement plan in which the
Participant participates, and any disability, workers’ compensation or other
Corporation benefit plan distribution that a Participant is entitled to (other
than severance benefits), under the terms of any such plan, at the time the
Participant ceases to be employed by the Corporation.  Notwithstanding the
foregoing, the Plan shall not create an inference that any duplicate payments
shall be required.  Payments received by a person under the Plan shall not be
deemed a part of the person’s compensation for purposes of the determination of
benefits under any other employee pension, welfare or other benefit plans or
arrangements, if any, provided by the Corporation, except where explicitly
provided under the terms of such plans or arrangements.

19.           Severability.  In the event any provision of the Plan or any
Participation Agreement shall be adjudicated by a court of competent
jurisdiction to be invalid, prohibited or unenforceable under any present or
future law, such provision, as to such jurisdiction, shall be ineffective,
without invalidating the remaining provisions of the Plan or Participation
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction.  Furthermore, in lieu of such invalid or unenforceable
provision there will be added automatically as a part of the Plan or
Participation Agreement, as applicable, a legal, valid and enforceable provision
as similar in terms to such invalid or unenforceable provision as may be
possible.  Notwithstanding the foregoing, if such provision could be more
narrowly drawn so as not to be invalid, prohibited or unenforceable in such
jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without
invalidating the remaining provisions of the Plan or Participation Agreement or
affecting the validity or enforceability of such provision in any other
jurisdiction.

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20.           Employment Status.  Except as may be provided under any other
written agreement between a Participant and the Corporation (other than the Plan
and the Participation Agreement entered into with respect to this Plan), the
employment of each Participant by the Corporation is “at will,” and may be
terminated by either the Participant or the Corporation at any time.

21.           Payments on Behalf of Persons Under Incapacity.  In the event that
any amount becomes payable under this Plan to a person who, in the sole judgment
of the Committee, is considered by reason of physical or mental condition to be
unable to give a valid receipt therefor the Committee may direct that such
payment be made to any person found by the Committee, in its sole judgment, to
have assumed the care of such person.  Any payment made pursuant to such
determination shall constitute a full release and discharge of the Committee and
the Corporation.

22.           Code Section 409A.  The provisions of this section shall only
apply if, and to the extent, required to avoid the imputation of any tax,
penalty or interest pursuant to Section 409A of the Code (“Code Section 409A”). 
Notwithstanding any provision of the Plan to the contrary, if a Participant is a
“specified employee” as defined for purposes of Code Section 409A, the
Participant shall not be entitled to any payments pursuant to the Plan upon a
termination of his or her employment until the earlier of (a) the date which is
six (6) months after the Participant’s separation from service (as defined for
purposes of Code Section 409A) with the Corporation, or (b) the date of the
Participant’s death.  In such event, any amounts otherwise payable to the
Participant following a termination of the Participant’s employment that are not
so paid by reason of this paragraph shall be paid as soon as practicable after
the date that is six (6) months after the Participant’s separation from service
(as defined for purposes of Code Section 409A) with the Corporation (or, if
earlier, the date of the Participant’s death).  To the extent that the Plan is
subject to Code Section 409A, the Plan shall be construed and interpreted to the
maximum extent reasonably possible to avoid the imputation of any tax, penalty
or interest pursuant to Code Section 409A.

 

20

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EXHIBIT A

FORM OF PARTICIPATION AGREEMENT

[Date]

Dear                              :

You have been selected to participate in the Health Care Property Investors,
Inc. Change in Control Severance Plan (the “Plan”), subject to your execution
and return of this letter agreement (this “Participation  Agreement”) to Health
Care Property Investors, Inc. (the “Corporation”).

For purposes of calculating any severance benefits you may become entitled to
under Section 6 of the Plan, the following multiplier will apply:

Severance Multiplier:

[       ]

                Note that the agreements you make by executing this
Participation Agreement will be enforceable against you, regardless of whether
or not your employment terminates in circumstances that entitle you to severance
benefits under the Plan.   Nevertheless, you agree that your participation in
the Plan (even if you never become entitled to severance benefits pursuant to
the Plan), as well as your continued employment by the Corporation, each in and
of itself and without the other constitutes good and adequate consideration for
the agreements you make in this Participation Agreement.

By signing this Participation Agreement you specifically agree that you have
received and read the Plan and agree to be bound by its terms.  The Plan is
incorporated into (made a part of) this Participation Agreement by this
reference.  You acknowledge and agree that the Corporation has not made any
promises or representations to you concerning the Plan other than as set forth
in the Plan and this Participation Agreement.

As to your participation in the Plan, the Plan and this Participation Agreement
will be governed by and construed in accordance with ERISA and, to the extent
not preempted thereby, the laws of the State of [                           ],
without giving effect to any choice of law or conflicting provision or rule
(whether of the State of [                          ] or any other jurisdiction)
that would cause the laws of any jurisdiction other than United States federal
law and the law of the State of [                          ] to be applied.  In
furtherance of the foregoing, applicable federal law and, to the extent not
preempted by applicable federal law, the internal law of the State of
[                          ], will control the interpretation and construction
of the Plan and this Participation Agreement, even if under such jurisdiction’s
choice of law or conflict of law analysis, the substantive law of some other
jurisdiction would ordinarily apply.

A-1

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Please note that you are not required to participate in the Plan, and may
decline participation in the Plan by not returning this Participation
Agreement.  If you want to accept participation in the Plan, you must execute
this Participation Agreement and see that it is returned in person or via
facsimile to the Corporation’s [                          ] at (       )
       -         so that it is received no later than
[                          ].  This Participation Agreement may be executed in
separate counterparts, each of which is deemed to be an original and all of
which taken together constitute one and the same agreement.

 

HEALTH CARE PROPERTY INVESTORS, INC.,

 

 

a Maryland corporation

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

 

Title:

 

 

 

ACCEPTED AND AGREED:

 

 

 

 

 

 

 

Print Name:

 

 

 

A-2

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EXHIBIT B

FORM OF RELEASE AGREEMENT(1)

This Release Agreement (this “Release Agreement”) is entered into this        
day of                      20        , by and between
                                   , an individual (“Executive”), and Health
Care Property Investors, Inc., a Maryland corporation (the “Company”).

WHEREAS, Executive has been employed by the Company; and

WHEREAS, Executive’s employment by the Company has terminated and, in connection
with the Company’s Change in Control Severance Plan (the “Plan”), the Company
and Executive desire to enter into this Release Agreement upon the terms set
forth herein;

NOW, THEREFORE, in consideration of the covenants undertaken and the releases
contained in this Release Agreement, and in consideration of the obligations of
the Company (or one of its subsidiaries) to pay severance benefits (conditioned
upon this Release Agreement) under and pursuant to the Plan, Executive and the
Company agree as follows:

1.             Release.  Executive, on behalf of himself or herself, his or her
descendants, dependents, heirs, executors, administrators, assigns, and
successors, and each of them, hereby acknowledges full and complete satisfaction
of and covenants not to sue and fully releases and discharges the Company and
each of its parents, subsidiaries and affiliates, past and present, as well as
its and their trustees, directors, officers, members, managers, partners,
agents, attorneys, insurers, employees, stockholders, representatives, assigns,
and successors, past and present, and each of them, hereinafter together and
collectively referred to as the “Releasees,” with respect to and from any and
all claims, wages, demands, rights, liens, agreements or contracts (written or
oral), covenants, actions, suits, causes of action, obligations, debts, costs,
expenses, attorneys’ fees, damages, judgments, orders and liabilities of
whatever kind or nature in law, equity or otherwise, whether now known or
unknown, suspected or unsuspected, and whether or not concealed or hidden (each,
a “Claim”), which he or she now owns or holds or he or she has at any time
heretofore owned or held or may in the future hold as against any of said
Releasees (including, without limitation, any Claim arising out of or in any way
connected with Executive’s service as an officer, director, employee, member or
manager of any Releasee, Executive’s separation from his or her position as an
officer, director, employee, manager and/or member, as applicable, of any
Releasee, or any other transactions, occurrences, acts or omissions or any loss,
damage or injury whatever), whether known or unknown, suspected or unsuspected,
resulting from any act or omission by or on the part of said Releasees, or any
of them, committed or omitted prior to the date of this Release Agreement
including, without limiting the generality of the foregoing, any Claim under
Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment
Act of 1967, the Americans with Disabilities Act, the Family and Medical Leave
Act of 1993, the California Fair Employment and Housing Act, the California
Family Rights Act, or any other federal, state or local law, regulation, or
ordinance, or any Claim for severance pay, bonus, sick leave, holiday pay,
vacation pay, life insurance, health or medical insurance or any other fringe
benefit, workers’ compensation or disability; provided however,

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(1) The Company reserves the right to modify this form as to any Participant
employed outside of California.

B-1

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that the foregoing release shall not apply to any obligation of the Company to
Executive pursuant to any of the forgoing:  (1) any obligation created by or
arising out of the Plan for which receipt or satisfaction has not been
acknowledged, (2) any equity-based awards previously granted by the Company to
Executive, to the extent that such awards continue after the termination of
Executive’s employment with the Company in accordance with the applicable terms
of such awards; (3) any right to indemnification that Executive may have
pursuant to the Fourth Amended and Restated Bylaws of the Company, its corporate
charter or under any written indemnification agreement with the Company (or any
corresponding provision of any subsidiary or affiliate of the Company) with
respect to any loss, damages or expenses (including but not limited to
attorneys’ fees to the extent otherwise provided) that Executive may in the
future incur with respect to his service as an employee, officer or director of
the Company or any of its subsidiaries or affiliates; (4) with respect to any
rights that Executive may have to insurance coverage for such losses, damages or
expenses under any Company (or subsidiary or affiliate) directors and officers
liability insurance policy; (5) any rights to continued medical or dental
coverage that Executive may have under COBRA; (6) any rights to payment of
benefits that Executive may have under a retirement plan sponsored or maintained
by the Company that is intended to qualify under Section 401(a) of the Internal
Revenue Code of 1986, as amended, or (7) any deferred compensation or
supplemental retirement benefits that Executive may be entitled to under a
nonqualified deferred compensation or supplemental retirement plan of the
Company.  In addition, this release does not cover any Claim that cannot be so
released as a matter of applicable law.  Executive acknowledges and agrees that
he or she has received any and all leave and other benefits that he or she has
been and is entitled to pursuant to the Family and Medical Leave Act of 1993.

2.             Acknowledgment of Payment of Wages.  Except for accrued vacation
(which the parties agree totals approximately [         ] days of pay) and
salary for the current pay period, Executive acknowledges that he/she has
received all amounts owed for his or her regular and usual salary (including,
but not limited to, any bonus, severance, or other wages), and usual benefits
through the date of this Agreement.

3.             1542 Waiver.  It is the intention of Executive in executing this
Release Agreement that the same shall be effective as a bar to each and every
Claim hereinabove specified.  In furtherance of this intention, Executive hereby
expressly waives any and all rights and benefits conferred upon him or her by
the provisions of SECTION 1542 OF THE CALIFORNIA CIVIL CODE and expressly
consents that this Release Agreement shall be given full force and effect
according to each and all of its express terms and provisions, including those
related to unknown and unsuspected Claims, if any, as well as those relating to
any other Claims hereinabove specified. SECTION 1542 provides:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.”

B-2

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Executive acknowledges that he may hereafter discover Claims or facts in
addition to or different from those which Executive now knows or believes to
exist with respect to the subject matter of this Release Agreement and which, if
known or suspected at the time of executing this Release Agreement, may have
materially affected this settlement.  Nevertheless, Executive hereby waives any
right, Claim or cause of action that might arise as a result of such different
or additional Claims or facts.  Executive acknowledges that he or she
understands the significance and consequences of such release and such specific
waiver of SECTION 1542.

4.             [ADEA Waiver.  Executive expressly acknowledges and agrees that
by entering into this Release Agreement, Executive is waiving any and all rights
or Claims that he or she may have arising under the Age Discrimination in
Employment Act of 1967, as amended (the “ADEA”), which have arisen on or before
the date of execution of this Release Agreement.  Executive further expressly
acknowledges and agrees that:

A.            In return for this Release Agreement, the Executive will receive
consideration beyond that which the Executive was already entitled to receive
before entering into this Release Agreement;

B.            Executive is hereby advised in writing by this Release Agreement
to consult with an attorney before signing this Release Agreement;

C.            Executive has voluntarily chosen to enter into this Release
Agreement and has not been forced or pressured in any way to sign it;

D.            Executive was given a copy of this Release Agreement on
[                               , 20       ] and informed that he or she had
[twenty one (21)/forty five (45)] days within which to consider this Release
Agreement and that if he or she wished to execute this Release Agreement prior
to expiration of such [21-day/45-day] period, he or she should execute the
Endorsement attached hereto;

E.             Executive was informed that he or she had seven (7) days
following the date of execution of this Release Agreement in which to revoke
this Release Agreement, and this Release Agreement will become null and void if
Executive elects revocation during that time.  Any revocation must be in writing
and must be received by the Company during the seven-day revocation period.  In
the event that Executive exercises his or her right of revocation, neither the
Company nor Executive will have any obligations under this Release Agreement;

F.             Nothing in this Release Agreement prevents or precludes Executive
from challenging or seeking a determination in good faith of the validity of
this waiver under the ADEA, nor does it impose any condition precedent,
penalties or costs from doing so, unless specifically authorized by federal
law.](2)

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(2) Except as noted below, Section 3 will be included if the Executive is age 40
or older as of the date that the Executive’s employment by the Company
terminates or in such other circumstances (if any) as the Executive may have
claims under the ADEA.  In the event Section 3 is included, whether the
Executive has 21 days, 45 days, or some other period in which to consider the
Release Agreement will be determined with reference to the requirements of the
ADEA in order for such waiver to be valid in the circumstances.  The
determinations referred to in the preceding two sentences shall be made by the
Company in its sole discretion.  In any event (regardless of the applicability
of the ADEA in the circumstances) the Release Agreement will include the
Executive’s acknowledgements and agreements set forth in clauses 3.A, 3.B, and
3.C.

B-3

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5.             No Transferred Claims.  Executive warrants and represents that
the Executive has not heretofore assigned or transferred to any person not a
party to this Release Agreement any released matter or any part or portion
thereof and he or she shall defend, indemnify and hold the Company and each of
its affiliates harmless from and against any claim (including the payment of
attorneys’ fees and costs actually incurred whether or not litigation is
commenced) based on or in connection with or arising out of any such assignment
or transfer made, purported or claimed.

6.             Compliance With Participation Agreement.  Executive warrants and
represents that Executive has complied fully with his or her obligations
pursuant to that certain Participation Agreement entered into by Executive in
connection with the Plan.  Executive covenants that he or she will continue to
abide by the applicable provisions of such Participation Agreement.

7.             Severability.  It is the desire and intent of the parties hereto
that the provisions of this Release Agreement be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in
which enforcement is sought.  Accordingly, if any particular provision of this
Release Agreement shall be adjudicated by a court of competent jurisdiction to
be invalid, prohibited or unenforceable under any present or future law, such
provision, as to such jurisdiction, shall be ineffective, without invalidating
the remaining provisions of this Release Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction; furthermore, in lieu
of such invalid or unenforceable provision there will be added automatically as
a part of this Release Agreement, a legal, valid and enforceable provision as
similar in terms to such invalid or unenforceable provision as may be possible. 
Notwithstanding the foregoing, if such provision could be more narrowly drawn so
as not to be invalid, prohibited or unenforceable in such jurisdiction, it
shall, as to such jurisdiction, be so narrowly drawn, without invalidating the
remaining provisions of this Release Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.

8.             Counterparts.  This Release Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.

9.             Governing Law.  THIS RELEASE AGREEMENT WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH UNITED STATES FEDERAL LAW AND, TO THE EXTENT NOT
PREEMPTED BY UNITED STATES FEDERAL LAW, THE LAWS OF THE STATE OF CALIFORNIA,
WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICTING PROVISION OR RULE
(WHETHER OF THE STATE OF CALIFORNIA OR ANY OTHER JURISDICTION) THAT WOULD CAUSE
THE LAWS OF ANY JURISDICTION OTHER THAN UNITED STATES FEDERAL LAW AND THE LAW OF
THE STATE OF CALIFORNIA TO BE APPLIED.  IN FURTHERANCE OF THE FOREGOING,
APPLICABLE FEDERAL LAW AND, TO THE EXTENT NOT PREEMPTED BY APPLICABLE FEDERAL
LAW, THE INTERNAL LAW OF THE STATE OF CALIFORNIA, WILL CONTROL THE
INTERPRETATION AND CONSTRUCTION OF THIS RELEASE AGREEMENT, EVEN IF UNDER SUCH
JURISDICTION’S CHOICE OF LAW OR CONFLICT OF LAW ANALYSIS, THE SUBSTANTIVE LAW OF
SOME OTHER JURISDICTION WOULD ORDINARILY APPLY.

B-4

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10.           Amendment and Waiver.  The provisions of this Release Agreement
may be amended and waived only with the prior written consent of the Company and
Executive, and no course of conduct or failure or delay in enforcing the
provisions of this Release Agreement shall be construed as a waiver of such
provisions or affect the validity, binding effect or enforceability of this
Release Agreement or any provision hereof.

11.           Descriptive Headings.  The descriptive headings of this Release
Agreement are inserted for convenience only and do not constitute a part of this
Release Agreement.

12.           Construction.  Where specific language is used to clarify by
example a general statement contained herein, such specific language shall not
be deemed to modify, limit or restrict in any manner the construction of the
general statement to which it relates.  The language used in this Release
Agreement shall be deemed to be the language chosen by the parties to express
their mutual intent, and no rule of strict construction shall be applied against
any party.

13.           Arbitration.  Any claim or controversy arising out of or relating
to this Agreement shall be submitted to arbitration in accordance with the
arbitration provision set forth in the Plan.

14.           Nouns and Pronouns.  Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural and vice-versa.

15.           Legal Counsel.  Each party recognizes that this is a legally
binding contract and acknowledges and agrees that they have had the opportunity
to consult with legal counsel of their choice.  Executive acknowledges and
agrees that he has read and understands this Agreement completely, is entering
into it freely and voluntarily, and has been advised to seek counsel prior to
entering into this Agreement and he has had ample opportunity to do so.

B-5

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The undersigned have read and understand the consequences of this Release
Agreement and voluntarily sign it.  The undersigned declare under penalty of
perjury under the laws of the State of California that the foregoing is true and
correct.

EXECUTED this                    day of                      20     , at
                       , California.

 

“Executive”

 

 

 

 

 

 

 

Print Name:

 

 

 

 

 

 

HEALTH CARE PROPERTY INVESTORS, INC.,

 

a Maryland corporation,

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

B-6

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ENDORSEMENT

I,                                       , hereby acknowledge that I was given
[21/45] days to consider the foregoing Release Agreement and voluntarily chose
to sign the Release Agreement prior to the expiration of the [21-day/45-day]
period.

I declare under penalty of perjury under the laws of the United States and the
State of California that the foregoing is true and correct.

EXECUTED this  [            ] day of [                      200        ], at
                             , California.

 

 

 

Print Name:

 

 

 

B-7

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EXHIBIT C

SECTION 280G PROVISIONS

The provisions of this Exhibit C shall apply to each Participant in the Health
Care Property Investors, Inc. Change in Control Severance Plan (the “Plan”). 
Capitalized terms used herein and not otherwise defined herein shall have the
meanings ascribed to such terms in the Plan.

1.             Gross-Up Payment.

(a)           Subject to Section 1(b), in the event it is determined (pursuant
to Section 2 below) or finally determined (as defined in Section 3(c) below)
that any payment, distribution, transfer, benefit or other event with respect to
the Corporation or a successor, direct or indirect subsidiary or affiliate of
the Corporation (or any successor or affiliate of any of them, and including any
benefit plan of any of them), and arising in connection with an event described
in Section 280G(b)(2)(A)(i) of the Code, occurring after the Effective Date, to
or for the benefit of a Participant or a Participant’s dependents, heirs or
beneficiaries (whether such payment, distribution, transfer, benefit or other
event occurs pursuant to the terms of this Plan or otherwise, but determined
without regard to any additional payments required under this Section 1) (each a
“Payment” and collectively the “Payments”) is or was subject to the excise tax
imposed by Section 4999 of the Code, and any successor provision or any
comparable provision of state or local income tax law (collectively, “Section
4999”), or any interest, penalty or addition to tax is or was incurred by the
Participant with respect to such excise tax (such excise tax, together with any
such interest, penalty, addition to tax, and costs (including professional fees)
hereinafter collectively referred to as the “Excise Tax”), then, within 10 days
after such determination or final determination, as the case may be, the
Corporation shall pay to the Participant (or to the applicable taxing authority
on the Participant’s behalf) an additional cash payment (hereinafter referred to
as the “Gross-Up Payment”) equal to an amount such that after payment by the
Participant of all taxes, interest, penalties, additions to tax and costs
imposed or incurred with respect to the Gross-Up Payment (including, without
limitation, any income and excise taxes imposed upon the Gross-Up Payment), the
Participant retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon such Payment or Payments.  The Gross-Up Payment, if triggered
pursuant to this Section 1(a), is intended to put the Participant in the same
position as the Participant would have been had no Excise Tax been imposed upon
or incurred as a result of any Payment.

(b)           Notwithstanding anything contained in Section 1(a) or any other
provision of the Plan to the contrary, if a reduction in the amount of the
Payments by an amount up to but not in excess of twenty five thousand dollars
($25,000) would avoid the imputation of any Excise Tax on the remaining Payments
(after such reduction), then the Payments shall be reduced (but not below zero)
so that the maximum amount of the Payments (after reduction) shall be one dollar
($1.00) less than the amount which would cause the Payments to be subject to the
Excise Tax.  Unless the Participant shall have given prior written notice to the
Corporation to effectuate a reduction in the Payments if such a reduction is
required, the Corporation shall reduce or eliminate the Payments by first
reducing or eliminating any cash severance benefits, then by reducing or
eliminating any accelerated vesting of stock options, then by reducing or
eliminating any accelerated vesting of other equity-based awards, then by
reducing or eliminating any other remaining Payments.

C-1

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(c)           The preceding provisions of this Section 1 shall take precedence
over the provisions of any other plan, arrangement or agreement governing the
Participant’s rights and entitlements to any benefits or compensation.

2.             Determination of Gross-Up.

(a)           Except as provided in Section 3, the determination that a Payment
is subject to an Excise Tax, and in such event, whether a Gross-Up Payment or a
reduction in Payments is required pursuant to Section 1(a) and Section 1(b),
shall be made in writing by a nationally recognized accounting firm or executive
compensation consulting firm selected by the Corporation (the “Accounting
Firm”).  Such determination shall include the amount of the Gross-Up Payment or
reduction in Payments, as applicable, and detailed computations thereof,
including any assumptions used in such computations.  Any determination by the
Accounting Firm will be binding on the Participant and the Corporation.

(b)           For purposes of determining whether a Gross-Up Payment is
required, and if so, the amount of any such Gross-Up Payment, the Participant
shall be deemed to pay Federal income taxes at the highest marginal rate of
Federal individual income taxation in the calendar year in which the Payment is
to be made.  Such highest marginal rate shall take into account the loss of
itemized deductions by the Participant and shall also include the Participant’s
share of the hospital insurance portion of FICA and state and local income taxes
at the highest marginal rate of individual income taxation in the state and
locality of the Participant’s residence on the date that the Payment is made,
net of the maximum reduction in Federal income taxes that could be obtained from
the deduction of such state and local taxes.

3.             Notification.

(a)           The Participant shall notify the Corporation in writing of any
claim by the Internal Revenue Service (or any successor thereof) or any state or
local taxing authority (individually or collectively, the “Taxing Authority”)
that, if successful, would require the payment by the Corporation of a Gross-Up
Payment.  Such notification shall be given as soon as practicable but no later
than 30 days after the Participant receives written notice of such claim and
shall apprise the Corporation of the nature of such claim and the date on which
such claim is requested to be paid; provided, however, that if the Participant
fails to give such notice within such 30-day period it shall not result in a
waiver or forfeiture of any of the Participant’s rights under this Exhibit C
except to the extent of actual damages suffered by the Corporation as a result
of such failure.  the Participant shall not pay such claim prior to the
expiration of the 15-day period following the date on which the Participant
gives such notice to the Corporation (or such shorter period ending on the date
that any payment of taxes, interest, penalties or additions to tax with respect
to such claim is due).  If the Corporation notifies the Participant in writing
prior to the expiration of such 15-day period (regardless of whether such claim
was earlier paid as contemplated by the preceding parenthetical) that it desires
to contest such claim, the Participant shall:

C-2

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(i)            give the Corporation any information reasonably requested by the
Corporation relating to such claim;

(ii)           take such action in connection with contesting such claim as the
Corporation shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim by
an attorney selected by the Corporation;

(iii)          cooperate with the Corporation in good faith in order effectively
to contest such claim; and

(iv)          permit the Corporation to participate in any proceedings relating
to such claim;

provided, however, that the Corporation shall bear and pay directly all
attorneys fees, costs and expenses (including additional interest, penalties and
additions to tax) incurred in connection with such contest and shall indemnify
and hold the Participant harmless, on an after-tax basis, for all taxes
(including, without limitation, income and excise taxes), interest, penalties
and additions to tax imposed in relation to such claim and in relation to the
payment of such costs and expenses or indemnification.

(b)           Without limitation on the foregoing provisions of this Section 3,
and to the extent its actions do not unreasonably interfere with or prejudice
the Participant’s disputes with the Taxing Authority as to other issues, the
Corporation shall control all proceedings taken in connection with such contest
and, in its reasonable discretion, may pursue or forego any and all
administrative appeals, proceedings, hearings and conferences with the Taxing
Authority in respect of such claim and may, at its or in their sole option,
either direct the Participant to pay the tax, interest or penalties claimed and
sue for a refund or contest the claim in any permissible manner, and the
Participant agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Corporation shall determine; provided, however, that if
the Corporation directs the Participant to pay such claim and sue for a refund,
the Corporation shall advance an amount equal to such payment to the
Participant, on an interest-free basis, and shall indemnify and hold the
Participant harmless, on an after-tax basis, from all taxes (including, without
limitation, income and excise taxes), interest, penalties and additions to tax
imposed with respect to such advance or with respect to any imputed income with
respect to such advance, as any such amounts are incurred; and, further,
provided, that any extension of the statute of limitations relating to payment
of taxes, interest, penalties or additions to tax for the Participant’s taxable
year with respect to which such contested amount is claimed to be due is limited
solely to such contested amount; and, provided, further, that any settlement of
any claim shall be reasonably acceptable to the Participant, and the
Corporation’s control of the contest shall be limited to issues with respect to
which a Gross-Up Payment would be payable hereunder, and the Participant shall
be entitled to settle or contest, as the case may be, any other issue.

C-3

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(d)           If, after the Participant receives an amount advanced by the
Corporation pursuant to Section 3(a), the Participant receives any refund with
respect to such claim, the Participant shall (subject to the Corporation’s
compliance with the requirements of this Exhibit C) promptly pay to the
Corporation an amount equal to such refund (together with any interest paid or
credited thereof after taxes applicable thereto), net of any taxes (including,
without limitation, any income or excise taxes), interest, penalties or
additions to tax and any other costs incurred by the Participant in connection
with such advance, after giving effect to such repayment.  If, after the
Participant receives an amount advanced by the Corporation pursuant to Section
3(a), it is finally determined that the Participant is not entitled to any
refund with respect to such claim, then such advance shall be forgiven and shall
not be required to be repaid and the amount of such advance shall be treated as
a Gross-Up Payment and shall offset, to the extent thereof, the amount of any
Gross-Up Payment otherwise required to be paid.

(e)           For purposes of this Exhibit C, whether the Excise Tax is
applicable to a Payment shall be deemed to be “finally determined” upon the
earliest of: (1) the expiration of the 15-day period referred to in Section 3(a)
if the Corporation or the Participant’s Employer has not notified the
Participant that it intends to contest the underlying claim, (2) the expiration
of any period following which no right of appeal exists, (3) the date upon which
a closing agreement or similar agreement with respect to the claim is executed
by the Participant and the Taxing Authority (which agreement may be executed
only in compliance with this section), or (4) the Participant receives notice
from the Corporation that it no longer seeks to pursue a contest (which shall be
deemed received if the Corporation does not, within 15 days following receipt of
a written inquiry from the Participant, affirmatively indicate in writing to the
Participant that the Corporation intends to continue to pursue such contest).

4.             Underpayment and Overpayment.  It is possible that no Gross-Up
Payment will initially be made but that a Gross-Up Payment should have been
made, or that a Gross-Up Payment will initially be made in an amount that is
less than what should have been made, or that a reduction in Payments was made
that should not have been made (any of such events is referred to as an
“Underpayment”).  It is also possible that a Gross-Up Payment will initially be
made in an amount that is greater than what should have been made or that
Payments were reduced by an amount less than that required by Section 1(b) (an
“Overpayment”).  The determination of any Underpayment or Overpayment shall be
made by the Accounting Firm in accordance with Section 2.  In the event of an
Underpayment, the Corporation shall pay the Participant the amount of any such
Underpayment (plus any interest or penalties payable with respect to such
excess).  In the event of an Overpayment, the Participant shall promptly pay to
the Corporation the amount of such Overpayment together with interest on such
amount at the applicable Federal rate provided for in Section 1274(d) of the
Code for the period commencing on the date of the Overpayment to the date of
such payment by the Participant to the Corporation.  The Participant shall make
such payment to the Corporation as soon as administratively practicable after
the Corporation notifies the Participant of (a) the Accounting Firm’s
determination that an Overpayment was made and (b) the amount to be repaid.

5.             Compliance with Law.  Nothing in this Exhibit C is intended to
violate the Sarbanes-Oxley Act of 2002, and to the extent that any advance or
repayment obligation hereunder would constitute such a violation, such
obligation shall be modified so as to make the advance a nonrefundable payment
to the Participant and the repayment obligation null and void to the extent
required by such Act.

C-4

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6.             Section 409A.  Notwithstanding anything to the contrary provided
herein, the payment by the Corporation to the Participant of any Gross-Up
Payment required hereunder shall be paid to the Participant no later than the
last day of the calendar year that follows the calendar year in which the
applicable Excise Taxes on the Payments are remitted to the applicable Taxing
Authority.

C-5

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