Exhibit 10.2

 

HCP, INC.

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into on January
26, 2012, by and between HCP, Inc. (the “Company”) and Timothy M. Schoen
(“Executive”).  Where the context permits, references to “the Company” shall
include the Company and any successor of the Company.

 

W I T N E S S E T H:

 

WHEREAS, the Company and Executive mutually desire to set forth herein the terms
and conditions pursuant to which Executive will continue to serve as the
Executive Vice President – Chief Financial Officer of the Company, effective as
of January 26, 2012 (the “Effective Date”).

 

NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements herein contained, together with other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto
do hereby agree as follows:

 

1.                                    SERVICES AND DUTIES.  Subject to Section 2
hereof, from and after the Effective Date, Executive shall, pursuant to the
terms of this Agreement, be employed by the Company as the Executive Vice
President – Chief Financial Officer of the Company.  The principal location of
Executive’s employment with the Company shall be at the Company’s headquarters
in Long Beach, California, although Executive understands and agrees that
Executive may be required to travel from time to time for business reasons. 
During the Term (as defined in Section 2), Executive shall be a full-time
employee of the Company, shall dedicate substantially all of Executive’s working
time to the Company, and shall have no other employment or other business
ventures which are undisclosed to the Company or which conflict with Executive’s
duties under this Agreement.  Executive shall have such authorities, duties and
responsibilities as the Company’s chief executive officer (or his delegate) may
from time to time assign to him and reasonably consistent with those customarily
performed by an officer holding the position set forth above with a company
having a similar size and nature of the Company. Notwithstanding the foregoing,
nothing herein shall prohibit Executive from participating in trade associations
or industry organizations which are related to the business of the Company or
engaging in charitable, civic or political activities, so long as such interests
do not materially interfere, individually or in the aggregate, with the
performance of Executive’s duties hereunder.  Executive agrees that he shall
comply with the corporate policies of the Company as they are in effect from
time to time throughout the Term (including, without limitation, the Company’s
business conduct and ethics policies, as they may change from time to time).

 

2.                                    TERM.  Executive’s employment under the
terms and conditions of this Agreement shall commence on the Effective Date. 
Such employment shall continue for an initial term of three (3) years following
the Effective Date (the “Initial Term”), which will be automatically extended on
the last day of the Initial Term for an additional one (1)-year term and on each
anniversary of the last day of the Initial Term thereafter, unless either
Executive or the Company has given written notice to the other no less than
sixty (60) days prior to the expiration of the Term then in effect that the Term
shall not be so extended.  As used herein, the “Term”

 

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shall refer to the Initial Term and any extension thereof pursuant to the
preceding sentence.  Provision of notice that the Term shall not be extended or
further extended, as the case may be, shall not constitute a breach of this
Agreement and shall not constitute “Good Reason” for purposes of this
Agreement.  Notwithstanding the above, the Term shall earlier expire immediately
upon the termination of Executive’s employment pursuant to Section 5 hereof.

 

3.                                    COMPENSATION.

 

a)                                    Base Compensation.  The Company shall pay
to Executive an initial base salary in the amount of $500,000 per annum in
accordance with the regular payroll practices of the Company (the base salary as
in effect from time to time, the “Base Compensation”).  Payment of the Base
Compensation is subject to customary employee contributions to any benefit
programs in which Executive is enrolled.  The Base Compensation may be increased
from time to time at the Company’s sole discretion, but in no event shall the
Base Compensation be reduced without Executive’s approval.

 

b)                                   Annual Cash Bonus.  For each calendar year
during the Term, Executive shall be eligible to receive an annual cash incentive
award (an “Annual Bonus”), the actual amount of such bonus will be determined
based on the achievement of performance criteria relating to both Executive and
the Company, as determined each year in good faith by the Compensation Committee
(the “Compensation Committee”) of the Board of Directors (the “Board”) of the
Company (or any successor thereto).  The Annual Bonus, if any, shall be paid to
Executive by no later than March 15 of the year following the year to which such
Annual Bonus relates, so long as Executive is actively employed by the Company
and has not provided a notice of resignation to the Company or received a notice
of termination from the Company as of the date of payment.

 

c)                                    Tax Withholding.  All taxable compensation
payable to Executive pursuant to this Agreement shall be subject to any
applicable withholding taxes and such other taxes as are required under Federal
law or the law of any state or governmental body to be collected with respect to
compensation paid by the Company to Executive.

 

4.                                    BENEFITS AND PERQUISITES.

 

a)                                    Retirement and Welfare Benefits.  During
the Term, Executive shall be eligible to participate in all fringe benefits,
perquisites, and such other benefit plans and arrangements as are made available
generally to the Company’s senior executives.  The benefits described herein
shall be subject to the applicable terms of the applicable plans and shall be
governed in all respects in accordance with the terms of such plans as from time
to time in effect.  Nothing in this Section 4, however, shall require the
Company to maintain any benefit plan or provide any type or level of benefits to
its current or former employees, including Executive.

 

b)                                   Paid Time Off.  During the Term, Executive
shall be entitled to accrue vacation in accordance with the Company’s vacation
policies applicable to its executives generally as such policies are in effect
from time to time.

 

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c)                                    Reimbursement of Expenses.  The Company
shall reimburse Executive for any and all expenses reasonably incurred by
Executive during the Term in performing Executive’s duties hereunder, including
travel, meals and accommodations, upon submission by Executive of vouchers or
receipts and in compliance with such rules and policies relating thereto as the
Company may from time to time adopt.  Executive agrees to promptly submit and
document any reimbursable expenses in accordance with the Company’s expense
reimbursement policies to facilitate the timely reimbursement of such expenses.

 

5.                                    TERMINATION.  The Term and Executive’s
employment hereunder may be terminated (1) by the Company for “Cause” (as
defined and determined below), effective on the date on which a written notice
to such effect (a “Cause Termination Notice”) is delivered to Executive; (2) by
the Company at any time without Cause (which includes pursuant to an election by
the Company not to renew the Term, the written notice (pursuant to Section 2) of
which shall be deemed a notice of termination of Executive’s employment
hereunder), effective sixty (60) days following the date on which a written
notice to such effect is delivered to Executive; (3) by Executive for “Good
Reason” (as defined and determined below), in accordance with the notice, cure
and termination periods set forth in the definition of such term below; or (4)
by Executive at any time other than for Good Reason, effective sixty (60) days
following the date on which a written notice to such effect is delivered to the
Company (or its successors).  In the event that the Company provides Executive
notice of termination without Cause pursuant to clause (2) or Executive provides
the Company notice of termination pursuant to clause (3) or clause (4), the
Company will have the option to place the Executive on paid administrative leave
during the notice period.  Upon any termination of Executive’s employment
hereunder, Executive shall be entitled to receive the following:  (i) any
accrued but unpaid Base Compensation (to be paid as provided in Section 3(a));
(ii) reimbursement for expenses incurred by Executive prior to the date of
termination in accordance with Section 4(c) hereof; (iii) vested benefits, if
any, to which Executive may be entitled under the Company’s employee benefit
plans as of the date of termination; and (iv) any additional amounts or benefits
due under any applicable plan, program, agreement or arrangement of the Company
or its Affiliates (the amounts and benefits described in clauses (i) through
(iv) above, collectively, the “Accrued Benefits”).  Accrued Benefits under this
Section 5 shall in all events be paid in accordance with the Company’s payroll
procedures, expense reimbursement procedures or plan terms, as applicable, or in
accordance with applicable law.

 

a)                                    Termination by the Company for Cause or by
Executive without Good Reason.  If Executive’s employment hereunder is
terminated during the Term by the Company for Cause or by Executive without Good
Reason, Executive shall not be entitled to any further compensation or benefits
other than the Accrued Benefits.

 

b)                                   Termination by the Company without Cause or
by Executive With Good Reason.  Subject to Section 5(e) below, if Executive’s
employment hereunder is terminated during the Term (I) by the Company other than
for Cause (and other than due to Executive’s death or “Disability” (as defined
below) or a decision by the Company not to extend the Term as provided in
Section 2), or (II) by Executive with Good Reason, then Executive shall be
entitled to (1) the Accrued Benefits and (2) subject to Executive’s execution of
a general release of claims in the form attached hereto as Exhibit A (with such
changes as may be reasonably required to such form to help ensure its
enforceability in light of any changes in applicable law) (the “Release”) within
twenty-one (21) days following such termination of employment, and the
expiration of any revocation period with respect to such Release provided by
applicable law, and

 

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provided that Executive does not materially breach the restrictive covenants set
forth in Section 6 hereof or in any other agreement between Executive and the
Company or to which Executive is a party (collectively, “Restrictive Covenants”)
or any other ongoing obligation to which Executive is subject as of the date of
termination:

 

(i)                                   an amount equal to one (1) times the sum
of (x) Executive’s Base Compensation, at the rate in effect on the date of
Executive’s termination of employment and (y) the greater of (I) Executive’s
annual incentive bonus paid or payable for the last fiscal year of the Company
for which the Compensation Committee has determined bonuses for the Company’s
executives generally prior to the date of such termination or (II) the average
of the Executive’s annual incentive bonuses for the three consecutive fiscal
years of the Company ending with the last fiscal year of the Company for which
the Compensation Committee has determined bonuses for the Company’s executives
generally prior to the date of such termination (or, if less, the average of
Executive’s annual incentive bonuses for the entire period of his employment
with the Company), such amount to be paid in a lump sum in the month following
the month in which Executive’s Separation from Service (as defined below)
occurs; and

 

(ii)                                each equity-based award granted by the
Company to Executive that is outstanding on the date of termination will
immediately vest as to any portion of the award that is scheduled to vest with
two (2) years following the termination date; provided, however, that as to any
such award that is subject to performance-based vesting requirements for which
the applicable performance period is in progress on the termination date, such
award shall remain open until the end of such performance period and, upon a
determination thereafter by the Compensation Committee as to the relevant level
of performance achieved and the portion of the award eligible to vest based on
such determination, Executive will be credited with two (2) years of continued
service, as measured from the date of Executive’s termination of employment, for
purposes of applying any time-based vesting requirements applicable to the
award.  Any portion of any equity-based award granted by the Company to
Executive that is not vested after giving effect to the foregoing acceleration
provisions shall terminate as of Executive’s date of termination (or, in the
case of a performance-based award, as of the date of the Compensation
Committee’s determination of the relevant level of performance achieved).

 

c)                                    Termination Due to Death or Disability. 
The Term and Executive’s employment hereunder shall automatically terminate upon
Executive’s death or Disability.  If Executive’s employment hereunder terminates
due to death or Disability, then Executive shall not be entitled to any further
compensation or benefits other than the Accrued Benefits.

 

d)                                   Welfare Benefit Continuation.  Subject to
Section 5(e) below, in the event that Executive’s employment hereunder is
terminated other than (i) by the Company for Cause or (ii) by Executive without
Good Reason, the Company shall reimburse Executive for the full amount of the
COBRA premiums incurred by Executive during the 12 month period following the
date of such termination, provided that (A) such reimbursement does not result
in adverse tax consequences to the Company under Section 105(h) of the Code or
otherwise and (B) such reimbursement shall immediately cease in the event that
Executive becomes eligible to participate in the health insurance plan of a
subsequent employer or other service recipient (or at such time as the Company
ceases to offer group medical coverage to its active executive employees or the
Company is otherwise under no obligation to offer COBRA continuation coverage to
Executive).

 

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e)                                    Change in Control Plan.  Notwithstanding
the foregoing provisions, in the event that Executive would be entitled to
severance benefits under the Company’s Change in Control Severance Plan, or any
successor plan thereto (the “CIC Plan”), in connection with a termination of his
employment described in Section 5(b) or Section 5(d) above, Executive will be
entitled to receive the benefits provided under the CIC Plan.  In no event will
Executive be entitled to receive severance benefits under both the CIC Plan and
this Agreement.

 

f)                                       Definitions.  For purposes of this
Agreement:

 

“Affiliate” means an affiliate of the Company (or other referenced entity, as
the case may be) as defined in Rule 12b-2 promulgated under Section 12 of the
Securities Exchange Act of 1934, as amended.

 

“Cause” means the occurrence of any of the following: (i) Executive’s willful
and continued failure to perform his duties with the Corporation (other than any
such failure resulting from his or her incapacity due to physical or mental
illness) after a written demand for performance is delivered to Executive by the
Company, which demand specifically identifies the manner in which the Company
believes that Executive has not performed his duties; (ii) Executive’s willful
and continued failure to follow and comply with the policies of the Company as
in effect from time to time (other than any such failure resulting from
Executive’s incapacity due to physical or mental illness) after a written demand
for performance is delivered to Executive by the Company, which demand
specifically identifies the manner in which the Company believes that Executive
has not followed or complied with such Company policies; (iii) Executive’s
willful commission of an act of fraud or dishonesty resulting in material
economic or financial injury to the Company; (iv) Executive’s willful engagement
in illegal conduct or gross misconduct, in each case which is materially and
demonstrably injurious to the Company; (v) Executive’s breach of any provision
of Section 6 of this Agreement; or (vi) Executive’s indictment for, conviction
of, or a plea of guilty or nolo contendere to any felony.

 

For purposes of clarification, if the definition of “Cause” set forth above, and
the process associated with it, differs from the definition of cause (or similar
term) in any stock incentive plan or agreement of the Company or any of its
Affiliates, including the Company’s incentive stock award plan or any other such
plan or agreement under which a grant of restricted stock shall be made, the
definition set forth above shall control.

 

“Disability” means that Executive (i) is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, or (ii) is, by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, receiving income replacement benefits for a period of not less
than 3 months under an accident and health plan, or disability plan, covering
employees of the company or an Affiliate of the Company.

 

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“Good Reason” means the occurrence, without the express prior written consent of
Executive, of any of the following events: (i) the failure by the Company to pay
the Executive any portion of Executive’s Base Compensation within ten (10) days
of the date such compensation is due, (ii) the relocation of Executive’s
principal location of employment, to a location outside a fifty (50) mile radius
from Long Beach, California, (iii) any material diminution of Executive’s
duties, responsibilities or authorities hereunder, (iv) any material breach by
the Company of any of its material obligations to Executive, or (v) any failure
of the Company to obtain the assumption in writing of its obligations under this
Agreement by any successor to all or substantially all of its business or assets
within 30 days after any reconstruction, amalgamation, combination, merger,
consolidation, sale, liquidation, dissolution or similar transaction, unless
such assumption occurs by operation of law.  Notwithstanding the foregoing,
“Good Reason” to terminate Executive’s employment shall not exist unless (a) a
written notice has first been delivered to the Board by Executive (the “Good
Reason Notice”), which Good Reason Notice (1) specifically identifies the
event(s) Executive believes constitutes Good Reason and (2) provides 30 days
from the date of such Good Reason Notice for the Company to cure such
circumstances (the “Good Reason Period”) and (b) the Company has failed to
timely cure such circumstances.  If the Company fails to timely cure such
circumstances in accordance with the foregoing, Executive may send a notice to
the Board that he is terminating his employment for Good Reason (“Good Reason
Termination Notice”), in which case his employment hereunder shall thereupon be
terminated for Good Reason.  If any Good Reason Notice to the Board shall not
have been delivered by Executive within ninety (90) days following the date
Executive becomes aware of the purported existence of a Good Reason event, or
any Good Reason Termination Notice to the Board shall not have been delivered by
Executive within thirty (30) days following the end of the Good Reason Period,
then any purported termination of Executive’s employment relating to the
applicable event shall not be a termination for Good Reason under this
Agreement.

 

As used herein, a “Separation from Service” occurs when Executive dies, retires,
or otherwise has a termination of employment with the Company that constitutes a
“separation from service” within the meaning of Treasury Regulation Section
1.409A-1(h)(1), without regard to the optional alternative definitions available
thereunder.

 

g)                                    Resignation as Officer or Director.  Upon
a termination of Executive’s employment hereunder, unless requested otherwise by
the Company, Executive shall resign each position (if any) that Executive then
holds as an officer of the Company or as an officer or director of any of their
Affiliates.

 

h)                                    Section 409A.  The intent of the parties
is that payments and benefits under this Agreement shall not result in the
imputation of any tax, penalty or interest pursuant to Section 409A of the Code,
and accordingly, to the maximum extent permitted, this Agreement shall be
construed and interpreted consistent with that intent.  Notwithstanding anything
contained herein to the contrary, Executive shall not be considered to have
terminated employment with the Company for purposes of any payments under this
Agreement which are subject to Section 409A of the Code until the Executive has
incurred a “separation from service” from the Company within the meaning of
Section 409A of the Code.  Each amount to be paid or benefit to be provided
under this Agreement shall be construed as a separate identified payment for
purposes of Section 409A of the Code.  Without limiting the foregoing and
notwithstanding

 

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anything contained herein to the contrary, to the extent required in order to
avoid the imputation of any tax, penalty or interest pursuant to Section 409A of
the Code, amounts that would otherwise be payable and benefits that would
otherwise be provided pursuant to this Agreement during the six-month period
immediately following an Executive’s separation from service shall instead be
paid on the first business day after the date that is six months following the
Executive’s separation from service (or, if earlier, the Executive’s date of
death).  To the extent required in order to avoid the imputation of any tax,
penalty or interest pursuant to Section 409A of the Code, amounts reimbursable
to Executive under this Agreement shall be paid to Executive on or before the
last day of the year following the year in which the expense was incurred and
the amount of expenses eligible for reimbursement (and in kind benefits provided
to Executive) during one year may not affect amounts reimbursable or provided in
any subsequent year.  The Company makes no representation that any or all of the
payments described in this Agreement will be exempt from or comply with Section
409A of the Code and makes no undertaking to preclude Section 409A of the Code
from applying to any such payment.

 

6.                                    COVENANTS.  Executive acknowledges that
during the period of his employment with the Company or any Affiliate, he shall
have access to the Company’s “Confidential Information” (as defined below) and
will meet and develop relationships with the Company’s potential and existing
suppliers, financing sources, clients, customers and employees. Accordingly,
Executive agrees to the following provisions of this Section 6 (in addition to
Executive’s confidentiality obligations to the Company and its subsidiaries
pursuant to the Company’s policies as in effect from time to time).

 

a)                                    Noncompetition.

 

(i)                                   Executive agrees that during the period of
his employment with the Company, Executive shall not:  (A) directly or
indirectly, engage in, manage, operate, control, supervise, or participate in
the management, operation, control or supervision of any business or entity
which competes with (any such action individually and in the aggregate, to
compete with) the Company or any of its subsidiaries (collectively, the “Company
Group”) or serve as an employee, consultant or in any other capacity for such
business or entity; (B) have any ownership or financial interest, directly, or
indirectly, in any competitor including, without limitation, as an individual,
partner, shareholder (other than as a shareholder of a publicly-owned
corporation in which the Executive owns less than five percent (5%) of the
outstanding shares of such corporation), officer, director, employee, principal,
agent or consultant, or (C) serve as a representative of any business
organization; any or all of which, without first obtaining written approval of
the chief executive officer of the Company.  Executive also agrees that as long
as he is employed by the Company, he will not undertake the planning or
organization of any business activity competitive with the Company Group.

 

b)                                   Solicitation of Employees, Etc.  Executive
agrees that during the period of his employment with the Company and for twelve
(12) months thereafter, Executive shall not, directly or indirectly, other than
in connection with carrying out his duties during the period of his employment
with the Company, solicit or induce any of the employees or consultants of the
Company Group (or individuals who served as employees or consultants of the
Company Group at any time during the preceding nine (9) month period):  (i) to
terminate their employment or relationship with the Company Group, and/or (ii)
to work for the Executive or any competitor of the Company Group.

 

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c)                                    Solicitation of Clients, Etc.  Executive
agrees that during the period of his employment with the Company and for twelve
(12) months thereafter, he will not use Confidential Information (as defined
below) to, directly or indirectly, solicit, take away, divert or attempt to
divert, the business or patronage of any clients or customers of the Company for
the purpose of providing services that materially compete with the products
provided by the Company at the time of Executive’s termination.  For purposes of
this Agreement, “products provided by the Company” includes not only products
and services which the Company then provides and/or markets or sells, but also
those which it is in the process of researching and/or developing, at the time
of Executive’s termination, and/or as to which, at the time of Executive’s
termination, the Company has a strategic business plan in place to research,
develop and/or market at some time in the future.  The restrictions on
soliciting or providing services to customers of the Company apply to:  (i) any
customer or customer contact of the Company with whom Executive has had any
business relations during his employment (whether before or after the Effective
Date) with the Company; and (ii) any customer or customer contact who was a
customer or customer contact of the Company on the date of Executive’s
termination from the Company or during the twelve-month period prior to such
termination, or who was a prospective customer or customer contact of the
Company with whom the Company had actually met with, or had written or
telephonic communications with, during said period(s).

 

d)                                   Disparaging Comments.  Executive agrees not
to make critical, negative or disparaging remarks about the Company or any of
its Affiliates, including, but not limited to, comments about any of its assets,
services, management, business or employment practices, and not to voluntarily
aid or voluntarily assist any person in any way with respect to any third party
claims pursued against the Company Group.  Nothing in this Section 6(d) will
prevent Executive or the Company from responding fully and accurately to any
question, inquiry or request for information when required by applicable law or
legal process.

 

e)                                    Confidentiality.  The Company and the
Executive acknowledge that:

 

(i)                                   The Company’s business is highly
competitive;

 

(ii)                               The essence of that portion of the Company’s
business in which the Executive will be involved consists, in large degree, of
trade secrets, proprietary or confidential business or financial affairs
information, materials, know-how (whether or not in writing), technology,
product information, personnel information regarding its employees, and
intellectual property belonging to the Company and confidential and proprietary
business and client relationships (all of the foregoing will be referred to
collectively as “Trade Secrets”), which have been developed at great investment
of time and resources by the Company Group so as to engender substantial good
will of the Company, all of which are and will be the exclusive property of the
Company, protected and kept secret by the Company; and

 

(iii)                          Without limiting Executive’s obligations under
the foregoing, the Executive agrees that during the period of his employment
with the Company and at all times thereafter, Executive shall keep secret and
retain in strictest confidence and shall not use for his

 

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benefit or the benefit of others, except in connection with the business and
affairs of the Company, all confidential information of and confidential matters
(whether available in written, electronic form or orally) relating to (A) the
Company Group’s pricing and business (including, without limitation, the
strategies employed by and the actual investments of any member of the Company
Group and the contemplated business strategies and/or investments of any member
of the Company Group), (B) all corporations or other business organizations in
which the Company Group has or has had an investment and (C) third parties
learned by Executive heretofore or hereafter directly or indirectly in
connection with Executive’s employment with the Company or from the Company
Group (the “Confidential Information”).  In consideration of, and as a condition
to, continued access to Confidential Information and without prejudice to or
limitation on any other confidentiality obligation imposed by agreement or law,
Executive hereby agrees to undertake to use and protect Confidential Information
in accordance with restriction placed on its use or disclosure.  Without
limiting the foregoing, Executive shall not disclose such Confidential
Information to any director, officer, partner, employee or agent of the Company
Group unless in Executive’s reasonable good faith judgment, such person has a
need to know such Confidential Information in furtherance of the Company Group’s
business, and (except in connection with the business and affairs of the
Company) Executive shall not disclose Confidential Information to anyone outside
of the Company Group except with the Company’s express written consent.

 

(iv)                           Executive acknowledges that the Company’s rights
in its Trade Secrets and Confidential Information would be misappropriated
should the Executive use or disclose to others the Trade Secrets and/or
Confidential Information outside the scope of his employment pursuant to this
Agreement.

 

(v)                               Executive agrees that during the period of his
employment with the Company, Executive shall not directly or indirectly, use,
disseminate, or disclose, in whole or in part, any of the Company Group’s Trade
Secrets to any person, firm, corporation, association, or other entity for any
reason or purpose whatsoever, other than (A) in the regular and proper scope and
course of Executive’s employment with Company, or (B) as required by law,
provided, however, that Executive will give Company reasonable advance notice of
any such disclosure or use that is required by law.

 

(vi)                            As used in this Agreement, each of the terms
“Trade Secrets” and “Confidential Information” will not include any information
that becomes generally known to the public or within the relevant trade or
industry unless it becomes known due to Executive’s violation of this Agreement.

 

f)                                       Cooperation.  Executive agrees that at
all times following the termination of his employment, Executive will cooperate
in all reasonable respects with the Company and its Affiliates in connection
with (i) any and all existing or future litigation, actions or proceedings
(whether civil, criminal, administrative, regulatory or otherwise) brought by or
against the Company or any of its Affiliates, or (ii) any audit of the financial
statements of the Company or any Affiliate with respect to the period of time
when Executive was employed by the Company or any Affiliate, in each case to the
extent the Company reasonably deems Executive’s cooperation necessary. 
Executive shall be reimbursed for all reasonable out-of-pocket expenses incurred
by Executive as a result of such cooperation.  With respect to any and all
existing or future litigation, actions or proceedings (whether civil, criminal,
administrative, regulatory or otherwise) brought against Executive in connection
with his employment by the Company, the Company will honor, and proceed in
accordance with, its bylaws as in effect from time to time.

 

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g)                                    No Limitation.  Nothing contained in this
Section 6 shall limit any common law or statutory obligation that Executive may
have to the Company or any of its Affiliates.  For purposes of all provisions of
this Section 6, the “Company” refers to the Company and any incorporated or
unincorporated Affiliates of the Company, including any entity which becomes
Executive’s employer as a result of any reorganization or restructuring of the
Company for any reason.

 

h)                                    Acknowledgement.  Executive agrees and
acknowledges that each restrictive covenant in this Section 6 is reasonable as
to duration, terms and geographical area and that the same protects the
legitimate interests of the Company and its Affiliates, imposes no undue
hardship on Executive, is not injurious to the public, and that, notwithstanding
any provision in this Agreement to the contrary, any violation of this
restrictive covenant shall be specifically enforceable in any court of competent
jurisdiction.  Executive agrees and acknowledges that a portion of the
compensation paid to Executive under this Agreement will be paid in
consideration of the covenants contained in this Section 6, the sufficiency of
which consideration is hereby acknowledged.  If any provision of this Section 6
as applied to Executive or to any circumstance is adjudged by a court with
jurisdiction upon short notice to be invalid or unenforceable, the same shall in
no way affect any other circumstance or the validity or enforceability of any
other provisions of this Section 6.  If the scope of any such provision, or any
part thereof, is too broad to permit enforcement of such provision to its full
extent, Executive agrees that the court making such determination shall have the
power to reduce the duration and/or area of such provision, and/or to delete
specific words or phrases, and in its reduced form, such provision shall then be
enforceable and shall be enforced.  Executive agrees and acknowledges that the
breach of this Section 6 will cause irreparable injury to the Company and upon
breach of any provision of this Section 6, the Company shall be entitled to seek
injunctive relief, specific performance or other equitable relief by any court
with jurisdiction upon short notice; provided, however, that this shall in no
way limit any other remedies which the Company may have (including, without
limitation, the right to seek monetary damages).  Each of the covenants in this
Section 6 shall be construed as an agreement independent of any other provisions
in this Agreement.

 

i)                                        Permitted Statements.  Nothing in this
Agreement shall restrict either party from making truthful statements (i) when
required by law, subpoena, court order or the like; (ii) when requested by a
governmental, regulatory, or similar body or entity; or (iii) in confidence to a
professional advisor for the purpose of securing professional advice.

 

7.                                    ASSIGNMENT.  This Agreement, and all of
the terms and conditions hereof, shall bind the Company and its successors and
assigns and shall bind Executive and Executive’s heirs, executors and
administrators.  Neither this Agreement, nor any of the Company’s rights or
obligations hereunder, may be assigned or otherwise subject to hypothecation by
Executive, and any such attempted assignment or hypothecation shall be null and
void.  The Company may assign the rights and obligations of the Company
hereunder, in whole or in part, to any of the Company’s Affiliates or parent
corporations, or to any other successor or assign in connection with the sale of
all or substantially all of the Company’s assets or stock or in connection with
any merger, acquisition and/or reorganization, provided the assignee assumes the
obligations of the Company hereunder.

 

10

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8.                                    GENERAL.

 

a)                                    Notices.  Any notices provided hereunder
must be in writing and shall be deemed effective upon the earlier of one (1)
business day following personal delivery (including personal delivery by
telecopy or telex), or the third (3rd) business day after mailing by first class
mail to the recipient at the address indicated below:

 

To the Company:

 

Chief Executive Officer

HCP, Inc.

3760 Kilroy Airport Way, Suite 300

Long Beach, CA 90806

 

To Executive:

 

At the address shown in the Company’s personnel records

 

or to such other address or to the attention of such other person as the
recipient party will have specified by prior written notice to the sending
party.

 

b)                                   Severability.  Any provision of this
Agreement which is deemed by a court of competent jurisdiction to be invalid,
illegal or unenforceable in any jurisdiction shall, as to that jurisdiction and
subject to this paragraph be ineffective to the extent of such invalidity,
illegality or unenforceability, without affecting in any way the remaining
provisions hereof in such jurisdiction or rendering that or any other provisions
of this Agreement invalid, illegal, or unenforceable in any other jurisdiction. 
If any covenant should be deemed invalid, illegal or unenforceable by a court of
competent jurisdiction because its scope is considered excessive, such covenant
shall be modified so that the scope of the covenant is reduced only to the
minimum extent necessary to render the modified covenant valid, legal and
enforceable.

 

c)                                    Entire Agreement.  This document, together
with the CIC Plan and the other documents referred to herein and all restrictive
covenants in any and all agreements between Executive and the Company or to
which Executive is a party (the “Integrated Document”), constitutes the final,
complete, and exclusive embodiment of the entire agreement and understanding
between the parties related to the subject matter hereof and except as otherwise
explicitly set forth in the Integrated Document, supersedes and preempts any
prior or contemporaneous understandings, agreements, or representations by or
between the parties, written or oral.

 

d)                                   Counterparts.  This Agreement may be
executed on separate counterparts, any one (1) of which need not contain
signatures of more than one (1) party, but all of which taken together will
constitute one and the same agreement.  Signatures delivered by facsimile or
“pdf” shall be effective for all purposes.

 

11

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e)                                    Amendments.  No amendments or other
modifications to this Agreement may be made except by a writing signed by all
parties.  No amendment or waiver of this Agreement requires the consent of any
individual, partnership, corporation or other entity not a party to this
Agreement.  Nothing in this Agreement, express or implied, is intended to confer
upon any third person any rights or remedies under or by reason of this
Agreement.

 

f)                                       Choice of Law.  All questions
concerning the construction, validity and interpretation of this Agreement shall
be governed by the laws of the State of California without giving effect to
principles of conflicts of law of such state.

 

g)                                    Survivorship.  The provisions of this
Agreement necessary to carry out the intention of the parties as expressed
herein shall survive the termination or expiration of this Agreement.

 

h)                                    Waiver.  The waiver by either party of the
other party’s prompt and complete performance, or breach or violation, of any
provision of this Agreement shall not operate nor be construed as a waiver of
any subsequent breach or violation, and the failure by any party hereto to
exercise any right or remedy which it may possess hereunder shall not operate
nor be construed as a bar to the exercise of such right or remedy by such party
upon the occurrence of any subsequent breach or violation.  No waiver shall be
deemed to have occurred unless set forth in a writing executed by or on behalf
of the waiving party.  No such written waiver shall be deemed a continuing
waiver unless specifically stated therein, and each such waiver shall operate
only as to the specific term or condition waived and shall not constitute a
waiver of such term or condition for the future or as to any act other than that
specifically waived.

 

i)                                        Headings.  The subject heading of this
Agreement are for convenience and reference only and in no way define, describe,
extend or limit the scope or intent of this Agreement or the intent of any
provision hereof.

 

j)                                       Construction.  The parties acknowledge
that this Agreement is the result of arm’s-length negotiations between
sophisticated parties, each afforded representation by legal counsel.  Each and
every provision of this Agreement shall be construed as though both parties
participated equally in the drafting of the same, and any rule of construction
that a document shall be construed against the drafting party shall not be
applicable to this Agreement.

 

9.                                    ARBITRATION.

 

a)                                    If any legally actionable dispute arises
which cannot be resolved by mutual discussion between the parties, each of
Executive and the Company agree to resolve that dispute by arbitration before an
arbitrator experienced in employment law.  Said arbitration will be conducted
pursuant to the JAMS Employment Arbitration Rules and Procedures and applicable
California law.  The parties agree that this arbitration agreement includes any
such disputes that the Company and its related entities may have against
Executive, or Executive may have against the Company and/or its related entities
and/or employees, arising out of or relating to Executive’s employment or its
termination including any claims of discrimination or harassment in violation of
applicable law and any other aspect of Executive’s compensation, training,
employment, or its termination.

 

12

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b)                                   The parties further agree that this
arbitration provision is the exclusive and binding remedy for any such dispute
and will be used instead of any court action, which is hereby expressly waived,
except for any request by either party for temporary or preliminary injunctive
relief pending arbitration in accordance with applicable law or an
administrative claim with an administrative agency.  THE PARTIES HEREBY WAIVE
ANY RIGHTS THEY MAY HAVE TO TRIAL BY JUDGE OR JURY.

 

c)                                    The parties agree that the arbitration
shall be conducted in Los Angeles County, California, unless otherwise mutually
agreed.

 

d)                                   The provisions of Section 1281.8 of the
California Code of Civil Procedure with respect to provisional remedies will
apply to any such arbitration.  In any such arbitration proceeding, any hearing
must be transcribed by a certified court reporter and the arbitrator’s decision
must be set forth in writing, consistent with the law of California and
supported by essential findings of fact and conclusion of law.  The arbitrator
may issue any remedy or award available under applicable law but may not add to,
modify, change or disregard any lawful terms of this Agreement or issue an award
or remedy that is contrary to the law of California.  The parties further agree
that each party shall pay its own costs and attorneys’ fees, if any; provided,
however, the Company shall pay any costs and expenses that Employee would not
otherwise have incurred if the dispute had been adjudicated in a court of law,
rather than through arbitration, including the arbitrator’s fee, any
administrative fee, and any filing fee in excess of the maximum court filing fee
in the jurisdiction in which the arbitration is commenced.  If either party
prevails on a statutory claim that affords the prevailing party an award of
attorneys’ fees, then the arbitrator may award reasonable attorneys’ fees to the
prevailing party, consistent with applicable law.

 

10.                            REPRESENTATIONS.  Each party represents and
warrants that (a) such party is not subject to any contract, arrangement,
agreement, policy or understanding, or to any statute, governmental rule or
regulation, that in any way limits such party’s ability to enter into and fully
perform such party’s obligations under this Agreement; (b) such party is not
otherwise unable to enter into and fully perform such party’s obligations under
this Agreement; and (c) upon the execution and delivery of this Agreement by
both parties, this Agreement shall be such party’s valid and binding obligation,
enforceable against such party in accordance with its terms, except to the
extent that enforceability may be limited by applicable bankruptcy, insolvency
or similar laws affecting the enforcement of creditors’ rights generally.

 

11.                            INCONSISTENCIES.  In the event of any
inconsistency between any provision of this Agreement and any provision of any
other Company arrangement, the provisions of this Agreement shall control to the
extent more favorable to Executive unless Executive otherwise agrees in a
writing that expressly refers to the provision of this Agreement whose control
he is waiving.

 

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12.                            BENEFICIARIES/REFERENCES.  Executive shall be
entitled, to the extent permitted under applicable law, to select and change a
beneficiary or beneficiaries to receive any compensation or benefit hereunder
following Executive’s death by giving written notice thereof.  In the event of
Executive’s death or a judicial determination of his incompetence, references in
this Agreement to Executive shall be deemed, where appropriate, to refer to his
beneficiary, estate or other legal representative.

 

 

[Remainder of page is left blank intentionally]

 

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IN WITNESS WHEREOF AND INTENDING TO BE LEGALLY BOUND THEREBY, the parties hereto
have executed and delivered this Agreement as of the year and date first above
written.

 

THIS AGREEMENT CONTAINS AN ARBITRATION PROVISION WHEREBY EACH PARTY AGREED TO
SUBMIT DISPUTES TO BINDING ARBITRATION.

 

 

HCP, INC.

 

 

 

 

 

   /s/ James F. Flaherty III

 

 

By:

JAMES F. FLAHERTY III

 

 

Chief Executive Officer

 

 

 

 

 

EXECUTIVE

 

 

 

 

 

   /s/ Timothy M. Schoen

 

 

Timothy M. Schoen

 

15

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Exhibit A

 

FORM OF RELEASE AGREEMENT1

 

This Release Agreement (this “Release Agreement”) is entered into this ___ day
of _________ 20__, by and between Timothy M. Schoen, an individual
(“Executive”), and HCP, 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 Employment Agreement between the Company and Executive dated  January
26, 2012 (the “Employment Agreement”), 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 Employment Agreement,
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

 

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1 The Company may modify this form as to any individual employed outside of
California.

 

A-1

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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, 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 Section 5 of the Employment
Agreement 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.”

 

A-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 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 determination referred to in the preceding sentence shall be
made by the Company in its sole

 

A-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 Employment Agreement. 
Executive warrants and represents that Executive has complied fully with his or
her obligations pursuant to the Employment Agreement.  Executive covenants that
he or she will continue to abide by the applicable provisions of such Employment
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.

 

 

discretion.  In any event, the Release Agreement will include the Executive’s
acknowledgements and agreements set forth in clauses 4.A, 4.B, and 4.C.

 

A-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 Employment Agreement.

 

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 Release Agreement
completely, is entering into it freely and voluntarily, and has been advised to
seek counsel prior to entering into this Release Agreement and he has had ample
opportunity to do so.

 

A-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”

 

 

 

 

 

 

 

Timothy M. Schoen

 

 

 

 

 

HCP, INC.,

 

a Maryland corporation,

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

A-6

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ENDORSEMENT

 

 

I, Timothy M. Schoen, 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 [_____________ 20____], at _____________,
California.

 

 

 

 

 

Timothy M. Schoen

 

A-7

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