L E A S E

                      HEALTH CARE PROPERTY INVESTORS, INC.,
                                     Lessor
                                       AND
                              EMERITUS CORPORATION
                                     Lessee
                          Dated as of September 5, 2001






<PAGE>


     v



     i
                                TABLE OF CONTENTS
ARTICLE  I.     1
1.1     Leased  Property;  Term     1
ARTICLE  II.     2
2.1     Definitions     2
ARTICLE  III.     11
3.1     Rent     11
3.2     [Intentionally  Omitted]     12
3.3     [Intentionally  Omitted]     12
3.4     Additional  Charges     12
3.5     Late  Payment  of  Rent     12
3.6     Net  Lease     13
ARTICLE  IV.     13
4.1     Impositions     13
4.2     Utilities     14
4.3     Insurance     14
4.4     Impound  Account     14
4.5     Tax  Service     14
ARTICLE  V.     14
5.1     No  Termination,  Abatement,  etc     14
ARTICLE  VI.     15
6.1     Ownership  of  the  Leased  Property     15
6.2     Personal  Property     15
6.3     Transfer  of  Personal  Property  and Capital Additions to Lessor     15
ARTICLE  VII.     16
7.1     Condition  of  the  Leased  Property     16
7.2     Use  of  the  Leased  Property     16
7.3     Lessor  to  Grant  Easements,  etc     17
7.4     Preservation  of  Gross  Revenues     17
ARTICLE  VIII.     18
8.1     Compliance  with  Legal  and  Insurance  Requirements,  Instruments, etc
18
ARTICLE  IX.     18
9.1     Maintenance  and  Repair     18
9.2     Encroachments,  Restrictions,  Mineral  Leases,  etc     19
ARTICLE  X.     20
10.1     Construction  of  Capital  Additions  to  the  Leased  Property     20
10.2     Funding  by  Lessor     22
10.3     Capital  Additions  Financed  by  Lessee     23
ARTICLE  XI.     23
11.1     Liens     23
ARTICLE  XII.     24
12.1     Permitted  Contests     24
ARTICLE  XIII.     24
13.1     General  Insurance  Requirements     25
13.2     Replacement  Cost     26
13.3     Additional  Insurance     26
13.4     Waiver  of  Subrogation     26
13.5     Policy  Requirements     26
13.6     Increase  in  Limits     27
13.7     Blanket  Policies  and  Policies  Covering  Multiple  Locations     27
13.8     No  Separate  Insurance     27
ARTICLE  XIV.     27
14.1     Insurance  Proceeds     27
14.2     Insured  Casualty     28
14.3     Uninsured  Casualty     29
14.4     No  Abatement  of  Rent     29
14.5     Waiver     29
14.6     Damage  Near  End  of  Term     29
ARTICLE  XV.     29
15.1     Total  Taking     29
15.2     Partial  Taking     29
15.3     Restoration     29
15.4     Award-Distribution     30
15.5     Temporary  Taking     30
ARTICLE  XVI.     30
16.1     Events  of  Default     30
16.2     Certain  Remedies     32
16.3     Damages     33
16.4     Receiver     34
16.5     Lessee's  Obligation  to  Purchase     34
16.6     Waiver     34
16.7     Application  of  Funds     34
16.8     Reserved     34
16.9     Reserved     34
16.10     Lessor's  Security  Interest     34
ARTICLE  XVII.     35
17.1     Lessor's  Right  to  Cure  Lessee's  Default     35
ARTICLE  XVIII.     35
18.1     Purchase  of  the  Leased  Property     36
ARTICLE  XIX.     36
19.1     Renewal  Term     36
ARTICLE  XX.     36
20.1     Holding  Over     37
ARTICLE  XXI.     37
21.1     Letters  of  Credit     37
21.2     Uses  of  Letters  of  Credit     37
ARTICLE  XXII.     37
22.1     Risk  of  Loss     37
ARTICLE  XXIII.     37
23.1     General  Indemnification     37
ARTICLE  XXIV.     38
24.1     Prohibition     38
24.2     Consent     39
24.3     Costs     40
24.4     No  Release  of  Lessee's  Obligations     41
24.5     Assignment  of  Lessee's  Rights  Against  Sublease     41
24.6     Reserved     41
24.7     REIT  Protection     41
24.8     Prepaid  Rent     42
ARTICLE  XXV.     42
25.1     Officer's  Certificate     42
25.2     Statements     42
25.3     Charges     44
ARTICLE  XXVI.     44
26.1     Lessor's  Right  to  Inspect  and  Show the Leased Property and Capital
Additions     44
ARTICLE  XXVII.     44
27.1     No  Waiver     44
ARTICLE  XXVIII.     44
28.1     Remedies  Cumulative     44
ARTICLE  XXIX.     44
29.1     Acceptance  of  Surrender     44
ARTICLE  XXX.     44
30.1     No  Merger     44
ARTICLE  XXXI.     45
31.1     Conveyance  by  Lessor     45
ARTICLE  XXXII.     45
32.1     Quiet  Enjoyment     45
ARTICLE  XXXIII.     45
33.1     Notices     45
ARTICLE  XXXIV.     46
34.1     Appraiser     46
ARTICLE  XXXV.  [Intentionally  Omitted]     46
ARTICLE  XXXVI.     46
36.1     Lessor  May  Grant  Liens     47
36.2     Attornment     47
ARTICLE  XXXVII.     47
37.1     Hazardous  Substances     47
37.2     Notices     48
37.3     Remediation     48
37.4     Indemnity     48
37.5     Environmental  Inspection     49
ARTICLE  XXXVIII.     49
38.1     Memorandum  of  Lease     49
ARTICLE  XXXIX.     50
39.1     Sale  of  Assets     50
ARTICLE  XL.     50
40.1     Subdivision     50
ARTICLE  XLI.     51
41.1     Authority     51
ARTICLE  XLII.     51
42.1     Attorneys'  Fees     51
ARTICLE  XLIII.     51
43.1     Brokers     51
ARTICLE  XLIV.     51
44.1     Miscellaneous     52


Addendum


<PAGE>
Exhibit  A-1     Legal  Description  of  the  Land  (Biloxi)
Exhibit  A-2     Legal  Description  of  the  Land  (Auburn)
Exhibit  B     List  of  Lessor's  Personal  Property
Exhibit  C     Form  of  Amendment
Exhibit  D     Number  of  Units  at  Each  Facility
Exhibit  E     List  of  Other  Leases


<PAGE>


     58




                                      LEASE
     THIS  LEASE ("Lease") is dated as of the 5th day of September, 2001, and is
                   -----
by  and  between  HEALTH  CARE  PROPERTY INVESTORS, INC., a Maryland corporation
("Lessor")  and  EMERITUS  CORPORATION,  a  Washington  corporation  ("Lessee").
    ----                                                               ------
1.
2.     Leased  Property;  Term
       -----------------------
     .  Upon  and  subject  to  the  terms and conditions hereinafter set forth,
Lessor leases to Lessee and Lessee leases from Lessor all of Lessor's rights and
interest  in  and  to  the  following  (collectively,  the  "Leased  Property"):
                                                             ----------------
3.     the  real  property  described  in  Exhibit  A-1 (Biloxi) and Exhibit A-2
                                           ------------              -----------
(Auburn)  attached  hereto  (collectively,  the  "Land");
                                                  ----
4.     all  buildings, structures, Fixtures and other improvements of every kind
now  or  hereafter  located  on  the  Land  including,  alleyways and connecting
tunnels,  sidewalks,  utility pipes, conduits and lines (on-site and off-site to
the  extent  Lessor  has  obtained  any interest in the same), parking areas and
roadways  appurtenant  to  such  buildings  and structures and Capital Additions
funded  by  Lessor  (collectively,  the  "Leased  Improvements");
                                          --------------------
5.     all  easements,  rights  and  appurtenances  relating to the Land and the
Leased  Improvements  (collectively,  the  "Related  Rights");
                                            ---------------
6.     all  equipment,  machinery,  fixtures,  and  other  items  of real and/or
personal  property,  including all components thereof, now and hereafter located
in,  on  or  used  in connection with and permanently affixed to or incorporated
into  the  Leased  Improvements,  including  all  furnaces,  boilers,  heaters,
electrical  equipment,  heating, plumbing, lighting, ventilating, refrigerating,
incineration,  air  and water pollution control, waste disposal, air-cooling and
air-conditioning  systems,  apparatus,  sprinkler  systems,  fire  and  theft
protection  equipment,  and built-in oxygen and vacuum systems, all of which, to
the  greatest  extent  permitted  by  law,  are hereby deemed to constitute real
estate, together with all replacements, modifications, alterations and additions
     thereto  (collectively,  the  "Fixtures");  and
                                    --------
7.     the machinery, equipment, furniture and other personal property described
     on  Exhibit  B  attached  hereto,  together  with  all  replacements  and
         ----------
substitutes  therefor  (collectively,  "Lessor's  Personal  Property").
        --                              ----------------------------
     SUBJECT, HOWEVER, to the easements, encumbrances, covenants, conditions and
restrictions  and  other matters which affect the Leased Property as of the date
hereof  or the Commencement Date or created thereafter as permitted hereunder to
have  and  to  hold  for  a  fixed  term  (the  "Fixed  Term") commencing on the
                                                 -----------
Commencement  Date,  as defined below, and ending at 11:59 p.m. Los Angeles time
on  the  expiration of the fifteenth (15th) Lease Year, and the one (1) Extended
Term  provided  for  in  Article  XIX unless this Lease is earlier terminated as
hereinafter  provided.  Promptly  after the Commencement Date, the parties shall
execute  an amendment to this Lease in substantially the form attached hereto as
Exhibit  C  to  confirm certain matters, including the Commencement Date and the
----------
Minimum  Rent  as  determined pursuant to Section 3.1 below.  Upon any change in
--
the  Minimum  Rent  in  accordance  with  the provisions of Section 3.1 below or
--
otherwise  pursuant  to  this  Lease,  the  parties  shall  similarly execute an
--
amendment to this Lease confirming such matters.  Notwithstanding the foregoing,
--
the  failure  of  Lessee  to so execute and deliver any such amendment shall not
affect  Lessor's  determination of the matters to be confirmed thereby.  No such
amendment to this Lease will be recorded in the public records without the prior
written  consent  of  Lessor  and  Lessee.
8.
9.     Definitions
       -----------
     .  (See also Addendum Section 46.3)  For all purposes of this Lease, except
         --- ---- -------- ------- ----
as  otherwise  expressly  provided or unless the context otherwise requires, (i)
the  terms  defined  in  this Article have the meanings assigned to them in this
Article  and  include  the  plural  as well as the singular; (ii) all accounting
terms  not  otherwise  defined  herein  have  the  meanings  assigned to them in
accordance  with  GAAP  as  at the time applicable; (iii) all references in this
Lease  to  designated  "Articles,"  "Sections" and other subdivisions are to the
designated  Articles,  Sections  and  other subdivisions of this Lease; (iv) the
word  "including"  shall have the same meaning as the phrase "including, without
limitation," and other similar phrases; and (v) the words "herein," "hereof" and
"hereunder"  and  other  similar words refer to this Lease as a whole and not to
any  particular  Article,  Section  or  other  subdivision:
Additional  Charges:  As  defined  in  Article  III.
-------------------
Affiliate:  Any  Person which, directly or indirectly, controls or is controlled
---------
by  or  is  under  common  control  with any other Person.  For purposes of this
definition,  "control"  (including  the  correlative  meanings  of  the  terms
"controlled  by"  and  "under common control with"), as used with respect to any
Person,  shall  mean  the  possession,  directly  or indirectly, of the power to
direct  or  cause  the  direction of the management and policies of such Person,
through  the  ownership  of  voting  securities,  partnership interests or other
equity  interests.  When  used  with  respect  to  any  corporation,  the  term
"Affiliate"  shall  also  include any Person which owns, directly or indirectly,
fifty  percent  (50%)  or more of any class of security of such corporation, but
shall  exclude any affiliates of Daniel R. Baty which but for their relationship
with  Daniel  R.  Baty  would  not  be  considered  affiliates  of  Lessee.
Appraiser:  As  defined  in  Article  XXXIV.
---------
Award:  All compensation, sums or anything of value awarded, paid or received on
-----
a  total  or  partial  Condemnation.
Base  Period:  The  period commencing on that date which is eighteen (18) months
------------
prior  to  the  date  any  appraisal  of  the  Facility  is made pursuant to the
provisions of Article XXXIV and ending on the date which is six (6) months prior
to  the  date  any  such  appraisal  of  the  Facility  is  made.
BLS:  Bureau  of  Labor  Statistics,  U.S.  Department  of  Labor.
---
Business Day:  Each Monday, Tuesday, Wednesday, Thursday and Friday which is not
------------
a  day on which national banks in the City of New York, New York are authorized,
or  obligated,  by  law  or  executive  order,  to  close.
Capital  Additions:  One  or  more  new  buildings,  or  one  or more additional
------------------
structures  annexed  to  any  portion  of any of the Leased Improvements, or the
-------
material expansion of existing improvements, which are constructed on any parcel
----
or portion of the Land, during the Term, including construction of a new wing or
new  story, or the renovation of existing improvements on the Leased Property in
order  to  provide  a  functionally  new facility needed to provide services not
previously  offered.
Capital  Additional Costs:  The costs of any Capital Addition made to the Leased
-------------------------
Property whether paid for by Lessee or Lessor, including (i) all permit fees and
other costs imposed by any governmental authority, the cost of site preparation,
the  cost of construction including materials and labor, the cost of supervision
and  related  design,  engineering  and  architectural services, the cost of any
fixtures,  and if and to the extent approved by Lessor, the cost of construction
financing;  (ii)  fees paid to obtain necessary licenses and certificates; (iii)
the cost of any land contiguous to the Leased Property which is to become a part
of  the Leased Property purchased for the purpose of placing thereon the Capital
Addition  or  any  portion  thereof or for providing means of access thereto, or
parking  facilities therefor, including the cost of surveying the same, but only
to  the extent approved by Lessor in writing and in advance if Lessor is funding
such  Capital Addition; (iv) the cost of insurance, real estate taxes, water and
sewage  charges  and  other  carrying  charges  for such Capital Addition during
construction; (v) the cost of title insurance; (vi) reasonable fees and expenses
of  legal  counsel;  (vii)  filing,  registration  and recording taxes and fees;
(viii)  documentary  stamp  and similar taxes; and (ix) all reasonable costs and
expenses  of  Lessor  and  any Person which has committed to finance the Capital
Addition,  including  (a)  the  reasonable fees and expenses of their respective
legal  counsel;  (b)  printing  expenses; (c) filing, registration and recording
taxes  and  fees;  (d)  documentary stamp and similar taxes; (e) title insurance
charges  and  appraisal  fees;  (f)  rating agency fees; and (g) commitment fees
charged  by  any  Person  advancing  or  offering  to advance any portion of the
financing  for  such  Capital  Addition.
Cash  Flow:  The  net  income from the Facility, determined on the basis of GAAP
----------
applied on a consistent basis, plus the sum of (i) depreciation and amortization
--
expense;  (ii)  Rent  and  other expenses payable hereunder, excluding, however,
Impositions;  plus  (iii)  management fees; less the sum of (y) a management fee
allowance  of  five  percent (5%) of Gross Revenues for the corresponding period
plus (z) an annual Two Hundred Dollar ($200) per unit reserve, pro-rated for the
corresponding  period.
Cash  Flow  Coverage:  For  any  period,  calculated  as  of the last day of the
--------------------
period, the ratio of Cash Flow attributable to such period to total Rent payable
------
for  such  period  under  the  Lease.
Closing  Date:  As  defined  in  the  Contract  of  Acquisition.
-------------
Code:  The  Internal  Revenue  Code  of  1986,  as  amended.
----
Commencement  Date:  The  Closing  Date.
------------------
Condemnation:  The  exercise  of  any  governmental  power,  whether  by  legal
------------
proceedings  or  otherwise,  by  a  Condemnor or a voluntary sale or transfer by
--------
Lessor  to  any  Condemnor,  either  under threat of condemnation or while legal
----
proceedings  for  condemnation  are  pending.
----
Condemnor:  Any  public  or  quasi-public  authority,  or private corporation or
---------
individual,  having  the  power  of  Condemnation.
----
Consolidated  Financials:  For  any  fiscal  year or other accounting period for
------------------------
Lessee  and  its  consolidated Subsidiaries, statements of earnings and retained
---
earnings and of changes in financial position for such period and for the period
--
from  the  beginning of the respective fiscal year to the end of such period and
the  related balance sheet as at the end of such period, together with the notes
thereto,  all  in  reasonable  detail  and setting forth in comparative form the
corresponding figures for the corresponding period in the preceding fiscal year,
and  prepared  in  accordance  with  GAAP.
Consolidated  Net  Worth:  At  any time, the sum of the following for Lessee and
------------------------
its  consolidated Subsidiaries, on a consolidated basis determined in accordance
--
with  GAAP:
10.     the amount of capital or stated capital (after deducting the cost of any
     shares  held  in  its  treasury),  plus
11.     the  amount of capital surplus and retained earnings (or, in the case of
a  capital  surplus  or  retained  earnings  deficit,  minus  the amount of such
deficit),  minus
12.     the  sum  of the following (without duplication of deductions in respect
of  items  already  deducted  in arriving at surplus and retained earnings): (a)
unamortized  debt  discount  and  expense; and (b) any write-up in book value of
assets  resulting  from  a  revaluation  thereof  subsequent  to the most recent
Consolidated  Financials  prior  to the date hereof, excluding, however, any (i)
net write-up in value of foreign currency in accordance with GAAP, (ii) write-up
     resulting  from  a reversal of a reserve for bad debts or depreciation, and
(iii)  write-up  resulting from a change in methods of accounting for inventory.
     Contract  of  Acquisition:  The  agreement  of  even  date  herewith by and
     -------------------------
between  Lessor  and  Lessee relative to the acquisition by Lessor of the Leased
     -
Property.
Cost  of  Living  Index:  The Consumer Price Index for All Urban Consumers, U.S.
-----------------------
City  Average  (1982-1984  =100),  published  by  the BLS, or such other renamed
--
index.  If the BLS changes the publication frequency of the Cost of Living Index
--
so  that  a  Cost  of  Living  Index  is  not available to make a cost-of-living
adjustment  as specified herein, the cost-of-living adjustment shall be based on
the  percentage  difference  between  the  Cost  of Living Index for the closest
preceding  month  for  which a Cost of Living Index is available and the Cost of
Living  Index  for  the  comparison month as required by this Lease.  If the BLS
changes  the  base  reference  period  for the Cost of Living Index from 1982-84
=100,  the  cost-of-living  adjustment  shall be determined with the use of such
conversion  formula  or  table  as  may  be  published  by  the BLS.  If the BLS
otherwise  substantially  revises,  or  ceases publication of the Cost of Living
Index,  then  a  substitute  index  for  determining cost-of-living adjustments,
issued  by  the  BLS  or  by  a  reliable  governmental  or  other  nonpartisan
publication,  shall  be  reasonably  selected  by  Lessor  and  Lessee.
CPI  Rent:  An amount equal to the sum of (i) the product of (y) a fraction, the
---------
numerator  of which is the Cost of Living Index for the first month of the Lease
Year  for  which CPI Rent is being calculated minus the Cost of Living Index for
the  first month of the immediately preceding Lease Year, and the denominator of
which  is  the  Cost  of  Living  Index  for  the first month of the immediately
preceding Lease Year multiplied by (z) the sum of the prior Lease Year's Minimum
Rent  plus  (ii)  the prior Lease Year's CPI Rent; provided, however, that in no
                                                   --------  -------
event  will  the  increase  in  CPI  Rent from one Lease Year to the next be (A)
greater  than  three  and fifty one hundredths percent (3.50%) of the sum of the
prior  Lease  Year's  Minimum  Rent  and  CPI  Rent  or  (B)  less  than  zero,
notwithstanding the actual percentage change in the Cost of Living Index for the
applicable  period.
Date  of  Taking:  The  date  the  Condemnor  has the right to possession of the
----------------
property  being  condemned.
-----
Environmental  Costs:  As  defined  in  Article  XXXVI.
--------------------
Emeritus:  Emeritus  Corporation,  a  Washington  corporation.
--------
Emeritus'  Reimbursable  Expenses:  As  defined  in the Contract of Acquisition.
---------------------------------
Environmental  Laws:  Environmental  Laws shall mean any and all federal, state,
-------------------
municipal  and  local laws, statutes, ordinances, rules, regulations, guidances,
policies,  orders,  decrees,  judgments,  whether  statutory  or  common law, as
amended  from  time  to  time,  now  or  hereafter  in  effect,  or promulgated,
pertaining  to the environment, public health and safety and industrial hygiene,
including  the  use,  generation,  manufacture,  production,  storage,  release,
discharge,  disposal,  handling,  treatment,  removal, decontamination, cleanup,
transportation  or  regulation  of  any  Hazardous  Substance,  including  the
Industrial  Site Recovery Act, the Clean Air Act, the Clean Water Act, the Toxic
Substances  Control  Act,  the Comprehensive Environmental Response Compensation
and  Liability  Act,  the  Resource  Conservation  and Recovery Act, the Federal
Insecticide,  Fungicide,  Rodenticide  Act,  the Safe Drinking Water Act and the
Occupational  Safety  and  Health  Act.
Event  of  Default:  As  defined  in  Article  XVI.
------------------
Extended  Term:  As  defined  in  Article  XIX.
--------------
Facility:  The  assisted  living  facility  being  operated  or  proposed  to be
--------
operated  on  the  Leased  Property.  (See  also  Addendum  Section  46.3)
-------                                ---  ----  --------  -------  ----
Facility  Mortgage:  As  defined  in  Article  XIII.
------------------
Facility  Mortgagee:  As  defined  in  Article  XIII.
-------------------
Fair  Market Added Value:  The Fair Market Value (as hereinafter defined) of the
------------------------
Leased  Property (including all Capital Additions) less the Fair Market Value of
the Leased Property determined as if no Capital Additions financed by Lessee had
been  constructed.
Fair  Market  Rental:  The  fair  market rental value of the Leased Property, or
--------------------
applicable  portion  thereof,  based  upon  the Fair Market Value, including any
---
periodic  increases  therein,  determined  in  accordance  with  the  appraisal
---
procedures  set  forth  in  Articles  XXXIV.
---
Fair  Market  Value:  The  fair  market  value  of  the Leased Property, and all
-------------------
Capital  Additions,  determined  in accordance with the appraisal procedures set
------
forth  in  Article  XXXIV.  Fair  Market  Value  shall  be the value obtained by
--
assuming  that  the  Leased  Property  is encumbered by this Lease.  Further, in
--
determining  Fair  Market  Value the positive or negative effect on the value of
--
the  Leased  Property  attributable to the interest rate, amortization schedule,
--
maturity  date,  prepayment  penalty  and  other  terms  and  conditions  of any
--
encumbrance  which  will not be removed at or prior to the date as of which such
--
Fair  Market Value determination is being made shall be taken into account.  The
Leased  Property  shall  be  valued  at  its highest and best use which shall be
presumed  to  be  as  a fully-permitted Facility operated in accordance with the
provisions  of  this  Lease.  Fair market value of the Leased Property shall not
include  "going  concern" or "business enterprise" value attributable to factors
other  than  the  highest and best use of the Leased Property.  In addition, the
following  specific  matters  shall  be  factored  in or out, as appropriate, in
determining  Fair  Market  Value:
(i)     The  negative  value  of  (a) any deferred maintenance or other items of
repair  or  replacement  of  the  Leased Property, (b) any then current or prior
licensure  or certification violations and/or admissions holds and (c) any other
breach  or  failure  of  Lessee  to perform or observe its obligations hereunder
shall  not  be  taken  into account; rather, the Leased Property, and every part
thereof,  shall  be  deemed to be in the condition required by this Lease (i.e.,
good  order and repair) and Lessee shall at all times be deemed to have operated
the  Facility  in  compliance  with and to have performed all obligations of the
Lessee  under  this  Lease.
13.     The  occupancy  level  of the Facility shall be deemed to be the average
occupancy  during  the  Base  Period.
14.     If  the  Facility's  Primary Intended Use includes a mixed use, then the
average  of  such  mix  during  the  Base  Period  shall  be taken into account.
     Fixed  Term:  As  defined  in  Article  I.
     -----------
Fixtures:  As  defined  in  Article  I.  (See  also  Addendum  Section  46.3)
--------                                  ---  ----  --------  -------  ----
GAAP:  Generally  accepted  accounting  principles.
----
Gross  Revenues:  All  revenues  received or receivable from or by reason of the
---------------
operation  of  the  Facility  or  any other use of the Leased Property, Lessee's
--
Personal  Property  and all Capital Additions including all revenues received or
--
receivable  for  the  use of or otherwise attributable to units, rooms, beds and
other facilities provided, meals served, services performed (including ancillary
services),  space  or  facilities  subleased or goods sold on or from the Leased
Property and all Capital Additions, including, and except as provided below, any
consideration  received under any commercial (as opposed to resident or patient)
subletting,  licensing  or  other arrangements with third parties (a "Commercial
                                                                      ----------
Sublessee")  relating  to  the  possession  or  use of any portion of the Leased
  -------
Property and all Capital Additions; provided, however, that Gross Revenues shall
  ---                               --------  -------
not  include:
(ii)     non-operating  revenues such as interest income or income from the sale
of  assets  not  sold  in  the  ordinary  course  of  business;
15.     federal,  state or local excise taxes and any tax based upon or measured
by  such  revenues  which is added to or made a part of the amount billed to the
patient  or  other  recipient of such services or goods, whether included in the
billing  or  stated  separately;
16.     contractual  allowances  (relating  to any period during the Term of the
Lease)  for  billings  not paid by or received from the appropriate governmental
agencies  or  third  party  providers;  and
17.     all  proper  patient  billing  credits  and  adjustments  according  to
generally  accepted  accounting  principles  relating to health care accounting.
     Gross Revenues for each Lease Year shall reflect all cost report settlement
adjustments,  whether  positive  or negative, received in or payable during such
Lease  Year  in  accordance  with  GAAP  relating  to  health  care  accounting,
regardless of the year that such settlement amounts are applicable to; provided,
                                                                       --------
however,  that  to  the  extent  settlement  amounts are applicable to years, or
-------
portions  thereof, prior to the Commencement Date, such settlement amounts shall
-----
not  be  reflected in Gross Revenues for the Lease Year in which such settlement
amounts  are  received or paid.  Gross Revenues shall include the Gross Revenues
of any Commercial Sublessee with respect to any applicable portion of the Leased
Property  and/or  any Capital Additions, i.e., the Gross Revenues generated from
the  operations  conducted on or from such portion shall be included directly in
the  Gross  Revenues  and  the  rent  received or receivable by Lessee from such
Commercial  Sublessee  shall  be  excluded from Gross Revenues for such purpose.
Guarantor:  Any  guarantor of Lessee's or an Affiliate of Lessee's obligation to
---------
Lessor or an Affiliate of Lessor, in every case, whether such Guaranty is now or
hereafter  existing.
Handling:  As  defined  in  Article  XXXVII.
--------
Hazardous  Substances:  Collectively,  any  petroleum,  petroleum  product  or
---------------------
byproduct  or  any  substance, material or waste regulated or listed pursuant to
-------
any  Environmental  Law.
--
HCPI:  Health  Care  Property  Investors,  Inc.,  a  Maryland  corporation.
----
HCPI's  Transaction  Costs:  As  defined  in  the  Contract  of  Acquisition.
--------------------------
Impositions:  Collectively,  all  taxes,  including capital stock, franchise and
-----------
other  state  taxes of Lessor (or, if Lessor is not HCPI, of HCPI as a result of
--
its  investment  in  Lessor),  ad  valorem,  sales,  use, single business, gross
receipts,  transaction  privilege,  rent or similar taxes; assessments including
assessments  for  public  improvements  or benefits, whether or not commenced or
completed prior to the date hereof and whether or not to be completed within the
Term;  ground  rents;  water, sewer and other utility levies and charges; excise
tax  levies;  fees  including  license,  permit,  inspection,  authorization and
similar  fees;  and all other governmental charges, in each case whether general
or  special,  ordinary  or  extraordinary,  or  foreseen or unforeseen, of every
character in respect of the Leased Property and/or the Rent and all interest and
penalties  thereon attributable to any failure in payment by Lessee which at any
time  prior  to,  during  or  in  respect  of the Term hereof may be assessed or
imposed on or in respect of or be a lien upon (i) Lessor or Lessor's interest in
the  Leased  Property,  (ii) the Leased Property or any part thereof or any rent
therefrom  or  any  estate,  right,  title  or  interest  therein,  or (iii) any
occupancy,  operation, use or possession of, or sales from or activity conducted
on or in connection with the Leased Property or the leasing or use of the Leased
Property  or any part thereof; provided, however, that nothing contained in this
                               --------  -------
Lease  shall  be  construed  to  require  Lessee to pay (a) any tax based on net
income  (whether  denominated  as  a  franchise  or  capital stock or other tax)
imposed  on  Lessor or any other Person, (b) any transfer, or net revenue tax of
Lessor or any other Person except Lessee and its successors, (c) any tax imposed
with  respect to the sale, exchange or other disposition by Lessor of any Leased
Property  or  the  proceeds  thereof,  or  (d)  any principal or interest on any
indebtedness  on  the  Leased  Property  owed  to a Facility Mortgagee for which
Lessor  is  the obligor, except to the extent that any tax, assessment, tax levy
or  charge,  which  is  otherwise  included  in  this  definition,  and  a  tax,
assessment,  tax  levy  or  charge  set  forth  in  clause (a) or (b) is levied,
assessed  or  imposed  in  lieu  thereof  or  as  a  substitute  therefor.
Insurance  Requirements:  The  terms  of  any  insurance policy required by this
-----------------------
Lease and all requirements of the issuer of any such policy and of any insurance
----
board, association, organization or company necessary for the maintenance of any
such  policy.
Intangible Property:  All accounts, proceeds of accounts, rents, profits, income
-------------------
or  revenues  derived  from  the  use  of rooms or other space within the Leased
Property or the providing of services in or from the Leased Property; documents,
chattel  paper,  instruments,  contract  rights,  deposit  accounts,  general
intangibles,  causes  of  action,  now  owned  or  hereafter  acquired by Lessee
(including  any  right  to  any  refund  of  any Impositions) arising from or in
connection  with  Lessee's operation or use of the Leased Property; all licenses
and  permits now owned or hereinafter acquired by Lessee, which are necessary or
desirable  for Lessee's use of the Leased Property for its Primary Intended Use,
including,  if  applicable,  any certificate of need or similar certificate; the
right  to use any trade name or other name associated with the Facility; and any
and  all  third-party  provider  agreements  (including  Medicare and Medicaid).
     Land:  As  defined  in  Article  I.  (See  also  Addendum  Section  46.3)
     ----                                  ---  ----  --------  -------  ----
     Lease:  As  defined  in  the  preamble.
     -----
Lease  Rate:  Eleven  percent  (11%).
-----------
Lease  Year:  Each period of twelve (12) full calendar months from and after the
-----------
Commencement  Date,  unless  the Commencement Date is a day other than the first
(1st) day of a calendar month, in which case the first (1st) Lease Year shall be
the  period  of  twelve (12) full calendar months from and after the first (1st)
day  of  the  first  (1st)  calendar  month  following  the  month  in which the
Commencement  Date occurs, and each subsequent Lease Year shall be the period of
twelve (12) full calendar months from and after the first (1st) day of the first
(1st) calendar month following the expiration of the prior Lease Year; provided,
                                                                       --------
however,  that  the last Lease Year during the Term may be a period of less than
-------
twelve  (12)  full  calendar  months  and shall end on the last day of the Term.
Leased  Improvements:  As defined in Article I. (See also Addendum Section 46.3)
--------------------                             --- ---- -------- ------- ----
Leased  Property:  As  defined  in  Article  I. (See also Addendum Section 46.3)
----------------                                 --- ---- -------- ------- ----
Legal  Requirements:  All  federal,  state,  county,  municipal  and  other
-------------------
governmental  statutes,  laws  (including  common  law  and Environmental Laws),
-----------
rules,  policies,  guidance,  codes,  orders,  regulations, ordinances, permits,
-----
licenses,  covenants,  conditions,  restrictions,  judgments,  decrees  and
----
injunctions affecting either the Leased Property, Lessee's Personal Property and
----
all  Capital  Additions  or the construction, use or alteration thereof, whether
now  or  hereafter  enacted  and  in  force, including any which may (i) require
repairs,  modifications  or  alterations  in or to the Leased Property, Lessee's
Personal  Property  and  all Capital Additions, (ii) in any way adversely affect
the  use  and enjoyment thereof, or (iii) regulate the transport, handling, use,
storage  or  disposal or require the cleanup or other treatment of any Hazardous
Substance.
Lessee:  As  defined  in  the  preamble.
------
Lessee's  Personal Property:  The Personal Property other than Lessor's Personal
---------------------------
Property.  (See  also  Addendum  Section  46.3)
            ---  ----  --------  -------  ----
Lessor:  As  defined  in  the  preamble.
------
Lessor's  Initial  Investment.  At  any  given  time,  the  sum  of (i) Lessor's
-----------------------------
Purchase  Price,  plus  (ii)  all of HCPI's Transaction Costs, plus (iii) all of
-------
Emeritus'  Reimbursable Expenses paid, funded, reimbursed or credited by Lessor,
---
as  HCPI,  to  Lessee,  as  Emeritus,  pursuant  to  the Contact of Acquisition.
Lessor's Personal Property:  As defined in Article I. (See also Addendum Section
--------------------------                             --- ---- -------- -------
46.3)
----
Lessor's Purchase Price:  The total Purchase Price paid by Lessor for all of the
-----------------------
Leased  Property,  as  set  forth  in  the  Contract  of  Acquisition  (i.e.,
$15,100,000).
Letters  of  Credit:  As  defined  in  Section  21.1.
-------------------
Minimum  Rent:  As  defined  in  Section  3.1.1.
-------------
Minimum  Repurchase  Price:  As  defined  in  Addendum  Section  46.3.
--------------------------
Officer's  Certificate:  A certificate of Lessee signed by an officer authorized
----------------------
to  so  sign  by  its  board  of  directors  or  by-laws.
Other  Leases:  As  defined  in  Section  21.1.
-------------
Overdue  Rate:  On  any date, a rate equal to 2% above the Prime Rate, but in no
-------------
event  greater  than  the  maximum  rate  then  permitted  under applicable law.
Payment Date:  Any due date for the payment of the installments of Minimum Rent,
------------
CPI  Rent  or  any  other  sums  payable  under  this  Lease.
Person:  Any  individual,  corporation, partnership, joint venture, association,
------
joint  stock  company,  trust,  unincorporated  organization,  government or any
agency  or  political  subdivision  thereof  or  any  other  form  of  entity.
Personal  Property:  All  machinery,  furniture  and  equipment, including phone
------------------
systems  and  computers,  trade fixtures, inventory, supplies and other tangible
----
personal  property  used  or  useful  in  the use of the Leased Property for its
--
Primary  Intended  Use,  other  than  Fixtures.
--
Primary  Intended  Use:  As  defined  in  Addendum  Section  46.3.
----------------------
Prime Rate:  On any date, a rate equal to the annual rate on such date announced
----------
by  the  Bank  of  New  York  to be its prime, base or reference rate for 90-day
unsecured loans to its corporate borrowers of the highest credit standing but in
no  event greater than the maximum rate then permitted under applicable law.  If
the  Bank of New York discontinues its use of such prime, base or reference rate
or  ceases to exist, Lessor shall designate the prime, base or reference rate of
another  state  or federally chartered bank based in New York to be used for the
purpose  of  calculating  the  Prime  Rate  hereunder.
Priority  Encumbrances:  As  defined  in  Article  XXXVI.
----------------------
Purchase  Price.  As  defined  in  the  Contract  of  Acquisition.
---------------
Quarter:  During  each  Lease  Year,  the  first three (3) calendar month period
-------
commencing  on  the first (1st) day of such Lease Year and each subsequent three
----
(3)  calendar  month  period within such Lease Year; provided, however, that the
last  Quarter  during  the  Term may be a period of less than three (3) calendar
months  and  shall  end  on  the  last  day  of  the  Term.
Related  Rights.  As  defined  in  Article  I.  (See also Addendum Section 46.3)
---------------                                  --- ---- -------- ------- ----
Rent:  Collectively,  the  Minimum  Rent,  CPI  Rent  and  Additional  Charges.
----
SEC:  The  Securities  and  Exchange  Commission.
---
State:  The  State  or  Commonwealth  in  which  the Leased Property is located.
-----
Subsidiaries:  Corporations,  limited  liability  companies  or partnerships, in
------------
which  Lessee  owns,  directly or indirectly, more than 50% of the voting stock,
---
membership  interests  or  partnership  interest,  respectively.
--
Term:  Collectively,  the  Fixed  Term and the Extended Term, as the context may
----
require,  unless  earlier  terminated.
--
Test  Rate:  The minimum interest rate necessary to avoid imputation of original
----------
issue  discount  income  under  Sections  483 or 1272 of the Code or any similar
provisions.
Transfer  Consideration:  As  defined  in  Article  XXIV.
-----------------------
Unavoidable  Delays:  Delays  due  to  strike,  lockout,  inability  to  procure
-------------------
materials,  power  failure,  act of God, governmental restriction, enemy action,
-------
civil commotion, fire, unavoidable casualty or other cause beyond the control of
--
the party responsible for performing an obligation hereunder; provided, however,
                                                              --------  -------
that  a  lack  of funds shall not be deemed a cause beyond the control of either
party  hereto.
Unsuitable  for  Its Primary Intended Use:  A state or condition of the Facility
-----------------------------------------
such  that by reason of damage or destruction or Condemnation, in the good faith
judgment of Lessor and Lessee, the Facility cannot be operated on a commercially
practicable  basis for its Primary Intended Use taking into account, among other
relevant factors, the number of units and usable beds affected by such damage or
destruction  or  Condemnation.
18.
19.     Rent
        ----
     .  Lessee  will  pay  to  Lessor  in  lawful  money of the United States of
America which shall be legal tender for the payment of public and private debts,
without  offset  or deduction, the amounts set forth hereinafter as Minimum Rent
and  CPI  Rent  during the Term.  Payments of Minimum Rent and CPI Rent shall be
made  by wire transfer initiated by Lessee to Lessor's account or to the account
of such other Person as Lessor from time to time may designate in writing on the
first  day  of  each  calendar  month.
20.     Minimum  Rent.
        -------------
21.     Fixed  Term.
        -----------
22.     Subject  to  increases  provided in subsection (b) below, for the period
from  the  Commencement  Date  through  the expiration of the Fixed Term, Lessee
shall  pay  to  Lessor "Minimum Rent" monthly, in advance on or before the first
                        ------------
day  of  each  calendar  month,  in an amount equal to one-twelfth (1/12) of the
product of (i) the Lease Rate, times (ii) the total Minimum Repurchase Price for
                               -----
     the  Facilities  as of the Commencement Date.  The first monthly payment of
Minimum  Rent  shall  be  payable  on  the Commencement Date (prorated as to any
partial  calendar  month  at  the  beginning  of  the  Term).
23.     The  monthly  Minimum  Rent  determined pursuant to subsection (i) above
shall  be  increased  from  time  to  time  on the date of any payment, funding,
accrual,  reimbursement  or  crediting  of  any  of  HCPI's Transaction Costs or
Emeritus'  Reimbursable  Expenses  by  Lessor,  as  HCPI,  under the Contract of
Acquisition  following  the  Commencement Date by an amount equal to one-twelfth
(1/12)  of the product of (A) the amount of such post-Commencement Date payment,
funding,  accrual,  reimbursement  or  crediting  by  Lessor  of any such HCPI's
Transaction  Costs  or  of  Emeritus' Reimbursable Expenses, times (B) the Lease
                                                             -----
Rate.
24.     Extended Term.  During the Extended Term, if at all, Lessee shall pay to
        -------------
     Lessor  "Minimum  Rent"  monthly, in advance, on or before the first day of
              -------------
each  calendar month, in an amount equal to one-twelfth (1/12) of the product of
(i) the total Minimum Rent and CPI Rent payable for the last Lease Year of Fixed
Term,  times  (ii)  103.5%.
       -----
25.     CPI  Rent.  In  addition  to  the Minimum Rent, Lessee shall, commencing
        ---------
with  the  first  calendar month of the second Lease Year and continuing through
the expiration of the Fixed Term and commencing with the first calendar month of
     the  second  Lease  Year  of  the  Extended Term and continuing through the
expiration of the Term, pay to Lessor each month one twelfth (1/12th) of the CPI
Rent.
26.     [Intentionally  Omitted]
        ------------------------
27.     [Intentionally  Omitted]
28.     Additional  Charges
     .  In  addition to the Minimum Rent and CPI Rent, (i) Lessee shall also pay
and  discharge  as  and  when  due  and  payable all other amounts, liabilities,
obligations  and  Impositions  which  Lessee assumes or agrees to pay under this
Lease;  and (ii) in the event of any failure on the part of Lessee to pay any of
those  items referred to in clause (i) above, Lessee shall also promptly pay and
discharge  every  fine,  penalty,  interest  and  cost  which  may  be added for
non-payment  or late payment of such items (the items referred to in clauses (i)
and  (ii)  above  being  referred  to  herein  collectively  as  the "Additional
                                                                      ----------
Charges").
29.     Late  Payment  of  Rent
        -----------------------
     .  Lessee hereby acknowledges that late payment by Lessee to Lessor of Rent
will cause Lessor to incur costs not contemplated hereunder, the exact amount of
which  is  presently  anticipated  to be extremely difficult to ascertain.  Such
costs  may  include processing and accounting charges and late charges which may
be  imposed on Lessor by the terms of any loan agreement and other expenses of a
similar  or  dissimilar  nature.  Accordingly,  if any installment of Rent other
than  Additional Charges payable to a Person other than Lessor shall not be paid
within  three  (3)  Business  Days after its due date, Lessee will pay Lessor on
demand  a late charge equal to the lesser of (i) five percent (5%) of the amount
of  such  installment  or (ii) the maximum amount permitted by law.  The parties
agree  that  this  late  charge represents a fair and reasonable estimate of the
costs  that  Lessor will incur by reason of late payment by Lessee.  The parties
further agree that such late charge is Rent and not interest and such assessment
does  not  constitute  a lender or borrower/creditor relationship between Lessor
and  Lessee.  In  addition, the amount unpaid, including any late charges, shall
bear  interest  at the Overdue Rate compounded monthly from the due date of such
installment  to  the date of payment thereof, and Lessee shall pay such interest
to Lessor on demand.  The payment of such late charge or such interest shall not
constitute  waiver  of,  nor  excuse  or cure, any default under this Lease, nor
prevent  Lessor  from  exercising  any  other  rights  and remedies available to
Lessor.
30.     Net  Lease
        ----------
     .  This  Lease  is  and is intended to be what is commonly referred to as a
"net, net, net" or "triple net" lease.  The Rent shall be paid absolutely net to
Lessor,  so  that  this  Lease  shall  yield  to  Lessor  the full amount of the
installments  of  Minimum  Rent,  CPI Rent and Additional Charges throughout the
Term,  all  as  more  fully  set  forth  in  Article IV and subject to any other
provisions  of this Lease which expressly provide for adjustment or abatement of
Rent  or  other  charges.
31.
32.     Impositions
        -----------
     .
33.     Subject to Article XII relating to permitted contests, Lessee shall pay,
     or  cause to be paid, all Impositions before any fine, penalty, interest or
cost  may be added for non-payment.  Lessee shall make such payments directly to
the  taxing authorities where feasible, and promptly furnish to Lessor copies of
official  receipts  or  other  satisfactory  proof  evidencing  such  payments.
Lessee's  obligation  to pay Impositions shall be absolutely fixed upon the date
such Impositions become a lien upon the Leased Property or any part thereof.  If
any  Imposition  may,  at  the  option  of  the  taxpayer,  lawfully  be paid in
installments, whether or not interest shall accrue on the unpaid balance of such
Imposition,  Lessee  may  pay  the  same, and any accrued interest on the unpaid
balance  of such Imposition, in installments as the same respectively become due
and  before  any  fine,  penalty, premium, further interest or cost may be added
thereto.
34.     Lessor  shall  prepare  and  file  all tax returns and reports as may be
required  by  Legal  Requirements  with  respect  to  Lessor's net income, gross
receipts,  franchise  taxes  and  taxes  on  its capital stock, and Lessee shall
prepare  and  file all other tax returns and reports as may be required by Legal
Requirements.
35.     Any  refund  due  from any taxing authority in respect of any Imposition
paid  by  Lessee  shall  be  paid  over  to or retained by Lessee if no Event of
Default shall have occurred hereunder and be continuing.  Any other refund shall
     be  paid  over  to  or  retained  by  Lessor.
36.     Lessor and Lessee shall, upon request of the other, provide such data as
     is  maintained by the party to whom the request is made with respect to the
Leased Property as may be necessary to prepare any required returns and reports.
If any property covered by this Lease is classified as personal property for tax
purposes,  Lessee  shall  file  all  personal  property  tax  returns  in  such
jurisdictions where it must legally so file.  Lessor, to the extent it possesses
the  same,  and  Lessee,  to the extent it possesses the same, shall provide the
other  party,  upon  request,  with  cost and depreciation records necessary for
filing  returns  for  any  property  so  classified as personal property.  Where
Lessor  is  legally  required  to  file personal property tax returns and to the
extent  practicable,  Lessee shall be provided with copies of assessment notices
indicating a value in excess of the reported value in sufficient time for Lessee
to  file  a  protest.
37.     Lessee  may,  upon  notice to Lessor, at Lessee's option and at Lessee's
sole  cost  and expense, protest, appeal, or institute such other proceedings as
Lessee  may  deem  appropriate  to effect a reduction of real estate or personal
property  assessments  and  Lessor,  at  Lessee's  expense  as  aforesaid, shall
reasonably cooperate with Lessee in such protest, appeal, or other action but at
     no  cost  or  expense  to  Lessor.  Billings for reimbursement by Lessee to
Lessor  of  personal  property  or  real  property taxes shall be accompanied by
copies  of  a  bill  therefor  and  payments thereof which identify the personal
property  or  real  property  with  respect  to  which  such  payments are made.
38.     Lessor  shall give prompt notice to Lessee of all Impositions payable by
Lessee hereunder of which Lessor has knowledge, but Lessor's failure to give any
     such  notice shall in no way diminish Lessee's obligations hereunder to pay
such  Impositions.
39.     Impositions imposed in respect of the tax-fiscal period during which the
     Term  terminates  shall be adjusted and prorated between Lessor and Lessee,
whether  or  not  such  Imposition  is imposed before or after such termination.
40.     Utilities
        ---------
     .  Lessee shall pay or cause to be paid all charges for electricity, power,
gas,  oil, water and other utilities used in the Leased Property and all Capital
Additions  thereto.  Lessee shall also pay or reimburse Lessor for all costs and
expenses  of  any  kind  whatsoever  which  at any time with respect to the Term
hereof  may  be  imposed  against  Lessor  by  reason  of  any of the covenants,
conditions  and/or  restrictions  affecting  the  Leased Property or any portion
thereof,  or with respect to easements, licenses or other rights over, across or
with  respect  to  any  adjacent  or  other  property  which benefits the Leased
Property,  including any and all costs and expenses associated with any utility,
drainage  and  parking  easements.
41.     Insurance
        ---------
     .  Lessee  shall  pay  or  cause  to be paid all premiums for the insurance
coverage  required  to  be  maintained  by  Lessee  hereunder.
42.     Impound  Account
        ----------------
     .  Lessor  may,  at its option to be exercised by thirty (30) days' written
notice  to  Lessee,  require  Lessee  to  deposit, at the time of any payment of
Minimum  Rent,  an  amount  equal  to one-twelfth (1/12th) of Lessee's estimated
annual  taxes,  of every kind and nature, required pursuant to Section 4.1 plus,
if  Lessee  fails to pay any insurance premium in a timely manner as required by
this Lease, one-twelfth (1/12th) of Lessee's estimated annual insurance premiums
required  pursuant to Section 4.3 into an impound account as directed by Lessor.
Such  amounts  shall  be applied to the payment of the obligations in respect of
which  said  amounts  were  deposited  in such order of priority as Lessor shall
determine,  on  or  before the respective dates on which the same or any of them
would  become  delinquent.  The cost of administering such impound account shall
be  paid  by  Lessee.  Nothing in this Section 4.4 shall be deemed to affect any
right  or  remedy  of  Lessor  hereunder.
43.     Tax  Service
        ------------
     .  If  requested  by  Lessor,  Lessee  shall, at its sole cost and expense,
cause  to  be  furnished  to Lessor a tax reporting service, to be designated by
Lessor,  covering  the  Leased  Property  and  all  Capital  Additions.
44.
45.     No  Termination,  Abatement,  etc
        ---------------------------------
     .  Except  as  otherwise  specifically provided in this Lease, Lessee shall
remain bound by this Lease in accordance with its terms and shall not seek or be
entitled to any abatement, deduction, deferment or reduction of Rent, or set-off
against  the Rent.  The respective obligations of Lessor and Lessee shall not be
affected by reason of (i) any damage to or destruction of the Leased Property or
any  portion  thereof  from  whatever  cause  or  any Condemnation of the Leased
Property or any portion thereof; (ii) other than as a result of Lessor's willful
misconduct  or  gross  negligence,  the  lawful  or  unlawful prohibition of, or
restriction  upon,  Lessee's use of the Leased Property, or any portion thereof,
the  interference  with  such  use  by  any  Person  or by reason of eviction by
paramount title; (iii) any claim that Lessee has or might have against Lessor by
reason of any default or breach of any warranty by Lessor hereunder or under any
other  agreement  between  Lessor  and  Lessee or to which Lessor and Lessee are
parties;  (iv)  any  bankruptcy,  insolvency,  reorganization,  composition,
readjustment,  liquidation,  dissolution,  winding  up  or  other  proceedings
affecting  Lessor  or any assignee or transferee of Lessor; or (v) for any other
cause,  whether  similar  or  dissimilar  to  any of the foregoing, other than a
discharge of Lessee from any such obligations as a matter of law.  Lessee hereby
specifically  waives all rights arising from any occurrence whatsoever which may
now  or  hereafter  be  conferred  upon  it  by  law (a) to modify, surrender or
terminate  this  Lease  or  quit or surrender the Leased Property or any portion
thereof; or (b) which may entitle Lessee to any abatement, reduction, suspension
or  deferment  of  the Rent or other sums payable by Lessee hereunder, except as
otherwise  specifically provided in this Lease.  However, nothing shall preclude
Lessee  from  bringing  a separate action and Lessee is not waiving other rights
and  remedies not expressly waived herein.  The obligations of Lessor and Lessee
hereunder  shall  be  separate  and independent covenants and agreements and the
Rent and all other sums payable by Lessee hereunder shall continue to be payable
in  all  events  unless  the  obligations  to  pay  the same shall be terminated
pursuant to the express provisions of this Lease or by termination of this Lease
other  than  by  reason  of  an  Event  of  Default.
46.
47.     Ownership  of  the  Leased  Property
        ------------------------------------
     .  Lessee  acknowledges  that the Leased Property is the property of Lessor
and  that  Lessee  has only the right to the exclusive possession and use of the
Leased  Property  upon the terms and conditions of this Lease.  Lessee shall, at
its  expense,  restore  the Leased Property to the condition required by Section
9.1.4.
48.     Personal  Property
        ------------------
     .  During  the  Term, Lessee may, as necessary and at its expense, install,
affix  or  assemble  or place on any parcels of the Land or in any of the Leased
Improvements,  any  items of Lessee's Personal Property and replacements thereof
which  shall  be  the  property  of  and owned by Lessee.  Except as provided in
Sections  6.3  and  16.10,  Lessor  shall  have  no  rights to Lessee's Personal
Property.  Lessee shall provide and maintain during the entire Term all Personal
Property  necessary  in  order  to  operate  the Facility in compliance with all
licensure  and  certification  requirements,  all  Legal  Requirements  and  all
Insurance  Requirements  and  for  the  Primary Intended Use and as required, in
Lessee's  prudent  business  judgment,  to  meet  the  needs of residents of the
Facility.
49.     Transfer  of  Personal  Property  and  Capital  Additions  to  Lessor
        ---------------------------------------------------------------------
     .  Upon  the  expiration  or  earlier  termination  of this Lease, Lessee's
Personal Property which does not provide a new function with respect to Lessor's
Personal  Property  shall become the property of Lessor, free of any encumbrance
and Lessee shall execute all documents and take any actions reasonably necessary
to  evidence  such ownership and discharge any encumbrance.  Notwithstanding the
foregoing,  Lessee  shall  not  be  required to transfer any of the following of
Lessee's Personal Property to Lessor in accordance with this Section 6.3, to the
extent  such  Personal  Property  is  being  leased by Lessee from a third-party
lessor:  (a)  motor  vehicles;  (b) copy machines; (c) fax machines; (d) postage
meters;  and  (e)  dish  machines  (i.e.,  dishwashers).
50.
51.     Condition  of  the  Leased  Property
        ------------------------------------
     .  Lessee  acknowledges  receipt  and  delivery of possession of the Leased
Property  and  that  Lessee  has  examined  and  otherwise  has knowledge of the
condition  of  the  Leased  Property prior to the execution and delivery of this
Lease and has found the same to be in good order and repair, free from Hazardous
Substances  not  in  compliance  with Legal Requirements (except as set forth in
Addendum  Section  46.12)  and  satisfactory  for  its  purposes  hereunder.
   -----  -------  -----
Regardless, however, of any examination or inspection made by Lessee and whether
   ----- -
or  not  any  patent  or  latent  defect or condition was revealed or discovered
thereby, Lessee is leasing the Leased Property "as is" in its present condition.
Lessee  waives any claim or action against Lessor in respect of the condition of
the  Leased  Property including any defects or adverse conditions not discovered
or otherwise known by Lessee as of the date hereof.  LESSOR MAKES NO WARRANTY OR
REPRESENTATION,  EXPRESS  OR  IMPLIED,  IN RESPECT OF THE LEASED PROPERTY OR ANY
PART  THEREOF,  EITHER  AS  TO  ITS FITNESS FOR USE, DESIGN OR CONDITION FOR ANY
PARTICULAR  USE  OR  PURPOSE OR OTHERWISE, OR AS TO THE NATURE OR QUALITY OF THE
MATERIAL OR WORKMANSHIP THEREIN, OR THE EXISTENCE OF ANY HAZARDOUS SUBSTANCE, IT
BEING  AGREED  THAT  ALL SUCH RISKS, LATENT OR PATENT, ARE TO BE BORNE SOLELY BY
LESSEE  INCLUDING  ALL  RESPONSIBILITY  AND  LIABILITY  FOR  ANY  ENVIRONMENTAL
REMEDIATION  AND  COMPLIANCE  WITH  ALL  ENVIRONMENTAL  LAWS.
52.     Use  of  the  Leased  Property
        ------------------------------
     .
53.     Lessee  covenants that it will obtain and maintain all authorization and
approvals needed to use and operate the Leased Property and the Facility for the
     Primary  Intended Use and any other use conducted on the Leased Property as
may  be  permitted  from  time  to  time  hereunder  in  accordance  with  Legal
Requirements  including  applicable licenses, provider agreements, permits, and,
if  appropriate,  Medicare  and/or  Medicaid  certification.
54.     Lessee  shall  use  or  cause  to  be  used  the Leased Property and the
improvements  thereon  for their Primary Intended Use.  Lessee shall not use the
Leased  Property or any portion thereof or, any Capital Addition thereto for any
other  use without the prior written consent of Lessor, which consent Lessor may
withhold  in  its  sole  discretion.
55.     Lessee  shall  operate  continuously the Leased Property and all Capital
Additions  thereto  in  accordance  with its Primary Intended Use.  Lessee shall
devote  the  entire  Facility  and  all Capital Additions thereto to the Primary
Intended  Use,  except for areas reasonably required for office or storage space
uses  incidental  to  the  Primary  Intended  Use.  Lessee  shall not modify the
services  offered or take any other action (e.g., removing patients or residents
from the Facility or directing patients or residents, or prospective patients or
     residents,  to  another  Facility)  which  would  materially  reduce  Gross
Revenues.  Lessee  shall at all times maintain an adequate staff for the service
of  its  residents  and/or  patients.  Lessee  shall  employ  its best judgment,
efforts and abilities to operate the Facility in such a manner so as to maximize
Gross Revenues and to enhance the reputation and attractiveness of the Facility.
56.     Lessee  shall  conduct  its  business at the Facility in conformity with
prudent  standards  of  patient  or  resident  care  practice.
57.     Lessee  shall  not  commit  or  suffer  to be committed any waste on the
Leased  Property or any Capital Addition thereto or cause or permit any nuisance
thereon.
58.     Lessee  shall  neither  suffer  nor  permit  the  Leased Property or any
portion thereof or any Capital Addition thereto financed by Lessor to be used in
     such a manner as (i) might reasonably tend to impair Lessor's title thereto
or  to  any  portion thereof or (ii) may make possible a claim of adverse use or
possession,  or  an  implied  dedication  of  the Leased Property or any portion
thereof  or  any  Capital  Addition  thereto  financed  by  Lessor.
59.     Lessor  to  Grant  Easements,  etc
        ----------------------------------
     .  Lessor  shall,  from  time  to  time  so long as no Event of Default has
occurred  and  is  continuing, at the request of Lessee and at Lessee's cost and
expense,  but  subject  to  the  approval of Lessor, which approval shall not be
unreasonably  withheld  or  delayed  (i) grant easements and other rights in the
nature  of  easements;  (ii)  release  existing easements or other rights in the
nature  of  easements  which  are  for the benefit of the Leased Property; (iii)
dedicate  or  transfer  unimproved  portions  of  the  Leased Property for road,
highway  or  other  public  purposes;  (iv) execute petitions to have the Leased
Property  annexed  to any municipal corporation or utility district; (v) execute
amendments  to  any  covenants, conditions and restrictions affecting the Leased
Property;  and (vi) execute and deliver to any Person any instrument appropriate
to  confirm  or  effect  such grants, releases, dedications and transfers to the
extent  of its interest in the Leased Property, but only upon delivery to Lessor
of  an  Officer's  Certificate  stating  that  such  grant  release, dedication,
transfer,  petition or amendment is not detrimental to the proper conduct of the
business  of  Lessee  on  the Leased Property and does not materially reduce the
value  of  the  Leased  Property.
60.     Preservation  of  Gross  Revenues
        ---------------------------------
     .  Lessee  acknowledges  that  a fair return to Lessor on its investment in
the  Leased  Property  is dependent, in part, on the concentration on the Leased
Property  during  the  Term  of  the  assisted living business of Lessee and its
Affiliates  in  the  geographical  area  of the Leased Property.  Lessee further
acknowledges  that  diversion  of residents and/or patients, as applicable, from
the  Facility  to  other  facilities or institutions owned, operated or managed,
whether directly or indirectly, by Lessee or its Affiliates will have a material
adverse  impact  on  the value and utility of the Leased Property.  Accordingly,
Lessor  and  Lessee  agree  as  follows:
61.     During  the  Term, neither Lessee nor any of its Affiliates, directly or
indirectly,  shall  operate,  own,  manage  or have any interest in or otherwise
participate  in  or  receive  revenues  from  any  other facility or institution
providing  services  or  similar  goods to those provided in connection with the
Facility and the Primary Intended Use (which Lessee did not operate, own, manage
     or  have  any interest in on the Commencement Date), within a ten (10) mile
radius  outward from the outside boundary of the Leased Property.  All distances
shall  be  measured  on a straight line rather than on a driving distance basis.
In  the  event that any portion of such other facility or institution is located
within  such  restricted area the entire facility or institution shall be deemed
located  within  such  restricted  area.
62.
63.     Compliance  with  Legal  and  Insurance  Requirements,  Instruments, etc
        ------------------------------------------------------------------------
     .  Subject  to  Article  XII  regarding  permitted contests, Lessee, at its
expense,  shall  promptly  (i)  comply with all Legal Requirements and Insurance
Requirements  regarding  the use, operation, maintenance, repair and restoration
of  the  Leased  Property,  Lessee's Personal Property and all Capital Additions
whether or not compliance therewith may require structural changes in any of the
Leased  Improvements  or Capital Additions thereto or interfere with the use and
enjoyment  of the Leased Property and (ii) procure, maintain and comply with all
licenses,  certificates  of  need,  provider  agreements (but only to the extent
Lessee, in its prudent business judgment, elects to participate in the Medicare,
Medicaid  or other third party payor programs) and other authorizations required
for  the  use of the Leased Property, Lessee's Personal Property and all Capital
Additions for the Primary Intended Use and any other use of the Leased Property,
Lessee's  Personal  Property  and all Capital Additions then being made, and for
the  proper  erection,  installation,  operation  and  maintenance of the Leased
Property, Lessee's Personal Property and all Capital Additions.  In an emergency
or  in the event of a breach by Lessee of its obligations hereunder which is not
cured  within any applicable cure period, Lessor may, but shall not be obligated
to,  enter  upon  the Leased Property and all Capital Additions thereto and take
such  actions  and incur such costs and expenses to effect such compliance as it
deems  advisable  to  protect  its  interest  in the Leased Property and Capital
Additions  thereto, and Lessee shall reimburse Lessor for all costs and expenses
incurred by Lessor in connection with such actions.  Lessee covenants and agrees
that  the  Leased Property, Lessee's Personal Property and all Capital Additions
shall  not  be  used  for  any  unlawful  purpose.
64.
65.     Maintenance  and  Repair
        ------------------------
     .
66.     Lessee,  at  its  expense, shall maintain the Leased Property, and every
portion  thereof,  Lessee's Personal Property and all Capital Additions, and all
private  roadways,  sidewalks  and curbs appurtenant to the Leased Property, and
which  are  under  Lessee's  control in good order and repair whether or not the
need  for  such  repairs  occurs as a result of Lessee's use, any prior use, the
elements  or  the age of the Leased Property, Lessee's Personal Property and all
Capital  Additions,  and,  with  reasonable  promptness,  make all necessary and
appropriate  repairs  thereto  of  every  kind  and  nature,  including, without
limitation,  those  necessary  to comply with changes in any Legal Requirements,
whether  interior  or  exterior,  structural  or  non-structural,  ordinary  or
extraordinary,  foreseen  or  unforeseen  or  arising  by  reason of a condition
existing  prior  to  the  Commencement  Date.  All  repairs  shall  be  at least
equivalent  in  quality  to  the original work.  Lessee will not take or omit to
take  any  action  the  taking  or omission of which might materially impair the
value  or  the  usefulness  of  the  Leased Property or any part thereof or, any
Capital  Addition  thereto  for  its  Primary  Intended  Use.
67.     Lessor  shall  not  under  any circumstances be required to (i) build or
rebuild  any  improvements  on  the  Leased  Property;  (ii)  make  any repairs,
replacements,  alterations, restorations or renewals of any nature to the Leased
Property,  whether  ordinary  or  extraordinary,  structural  or non-structural,
foreseen  or  unforeseen,  or  to  make  any expenditure whatsoever with respect
thereto;  or  (iii)  maintain  the  Leased  Property  in any way.  Lessee hereby
waives, to the extent permitted by law, the right to make repairs at the expense
     of  Lessor  pursuant  to  any law in effect at the time of the execution of
this  Lease  or  hereafter  enacted.
68.     Nothing  contained  in  this  Lease  and no action or inaction by Lessor
shall  be  construed  as  (i)  constituting  the  consent  or request of Lessor,
expressed  or implied, to any contractor, subcontractor, laborer, materialman or
vendor  to  or for the performance of any labor or services or the furnishing of
any  materials  or  other  property  for the construction, alteration, addition,
repair  or  demolition  of  or to the Leased Property or any part thereof or any
Capital  Addition  thereto; or (ii) giving Lessee any right, power or permission
to  contract  for  or  permit  the  performance  of any labor or services or the
furnishing  of  any  materials or other property in such fashion as would permit
the  making  of  any  claim  against  Lessor  in  respect thereof or to make any
agreement  that  may  create,  or in any way be the basis for, any right, title,
interest,  lien,  claim  or  other  encumbrance upon the estate of Lessor in the
Leased  Property  or  portion  thereof  or  any  Capital  Addition  thereto.
69.     Unless Lessor shall convey any of the Leased Property to Lessee pursuant
     to  the  provisions  of  the  Lease,  Lessee  shall, upon the expiration or
earlier  termination  of  the  Term,  vacate  and surrender the Leased Property,
Lessor's Personal Property, and all Capital Additions to Lessor in the condition
in  which  the  Leased  Property  and Lessor's Personal Property were originally
received  from  Lessor and Lessee's Personal Property and Capital Additions were
originally  introduced  to  the Facility, except as repaired, rebuilt, restored,
altered or added to as permitted or required by the provisions of this Lease and
except  for  ordinary  wear  and  tear.
70.     Encroachments,  Restrictions,  Mineral  Leases,  etc
        ----------------------------------------------------
     .  If  any  of  the  Leased Improvements or Capital Additions shall, at any
time,  encroach  upon any property, street or right-of-way, or shall violate any
restrictive  covenant  or  other agreement affecting the Leased Property, or any
part  thereof  or  any  Capital  Addition thereto, or shall impair the rights of
others  under  any  easement  or  right-of-way  to  which the Leased Property is
subject,  or  the  use of the Leased Property or any Capital Addition thereto is
impaired,  limited  or interfered with by reason of the exercise of the right of
surface  entry or any other provision of a lease or reservation of any oil, gas,
water  or other minerals, then promptly upon the request of Lessor or any Person
affected  by any such encroachment, violation or impairment, Lessee, at its sole
cost  and expense, but subject to its right to contest the existence of any such
encroachment,  violation  or impairment, shall protect, indemnify, save harmless
and defend Lessor from and against all losses, liabilities, obligations, claims,
damages,  penalties,  causes of action, costs and expenses (including reasonable
attorneys',  consultants' and experts' fees and expenses) based on or arising by
reason  of  any  such encroachment, violation or impairment.  In the event of an
adverse  final determination with respect to any such encroachment, violation or
impairment,  Lessee  shall  either  (i)  obtain  valid  and effective waivers or
settlements  of  all  claims,  liabilities  and damages resulting from each such
encroachment,  violation  or impairment, whether the same shall affect Lessor or
Lessee;  or  (ii)  make  such changes in the Leased Improvements and any Capital
Addition  thereto,  and  take  such  other  actions, as Lessee in the good faith
exercise  of  its  judgment  deems  reasonably  practicable,  to  remove  such
encroachment  or  to  end such violation or impairment, including, if necessary,
the  alteration  of  any  of  the  Leased  Improvements  or any Capital Addition
thereto,  and in any event take all such actions as may be necessary in order to
be  able  to  continue  the operation of the Leased Improvements and any Capital
Addition thereto for the Primary Intended Use substantially in the manner and to
the  extent the Leased Improvements and Capital Additions were operated prior to
the  assertion  of  such  encroachment,  violation  or  impairment.  Lessee's
obligations  under  this Section 9.2 shall be in addition to and shall in no way
discharge or diminish any obligation of any insurer under any policy of title or
other  insurance  and,  to  the  extent the recovery thereof is not necessary to
compensate  Lessor  for any damages incurred by any such encroachment, violation
or  impairment,  Lessee  shall be entitled to a credit for any sums recovered by
Lessor  under  any  such  policy  of  title  or other insurance and Lessor, upon
request  by  Lessee,  shall assign Lessor's rights under such policies to Lessee
provided  such  assignment  does  not adversely affect Lessor's rights under any
such  policy  and  provided further that Lessee shall indemnify, defend, protect
and  save Lessor harmless from and against any liability, cost or expense of any
kind  that  may  be  imposed upon Lessor in connection with any such assignment.
71.
72.     Construction  of  Capital  Additions  to  the  Leased  Property
        ---------------------------------------------------------------
     .
                        (See also Addendum Section 46.4)
                         --- ---- -------- ------- ----
73.     Requests.  No  Capital  Addition  shall  be  made  which would tie in or
        --------
connect  any  Leased  Improvements with any improvements on property adjacent to
the  Land  without Lessor's approval, which may be withheld in Lessor's sole and
absolute  discretion.  Except  as  provided  above,  Lessee  shall,  without the
consent  of  Lessor,  have  the  right to make a Capital Addition if the Capital
Addition  Cost  for such Capital Addition project does not exceed $100,000.  All
other  Capital  Additions shall be subject to Lessor's review and approval which
approval  shall  not  be  unreasonably withheld.  For any Capital Addition which
does  not  require  the  approval  of  Lessor, Lessee shall, prior to commencing
construction  of  such Capital Addition, provide to Lessor a written description
of  such  Capital  Addition  and  on an ongoing basis supply Lessor with related
documentation  and  information  as  Lessor  may  reasonably request.  If Lessee
desires  to  make  a  Capital  Addition for which Lessor's approval is required,
Lessee  shall submit to Lessor in reasonable detail a general description of the
proposal,  the projected cost of construction and such plans and specifications,
permits,  licenses,  contracts  and other information concerning the proposal as
Lessor  may reasonably request.  Such description shall indicate the use or uses
to  which  such  Capital Addition will be put and the impact, if any, on current
and  forecasted  gross  revenues  and operating income attributable thereto.  It
shall be reasonable for Lessor to condition its approval of any Capital Addition
     upon  any  or  all  of  the  following  terms  and  conditions:
74.     Such  construction  shall  be  effected  pursuant  to detailed plans and
specifications  approved  by  Lessor;
75.     Such construction shall be conducted under the supervision of a licensed
     architect  or  engineer  selected  by  Lessee  and  approved  by  Lessor;
76.     Lessee  shall  have  procured or caused to be procured a performance and
payment bond for the full value of such construction, which such bond shall name
     Lessor  as an additional obligee and otherwise be in form and substance and
issued  by  a  Person  reasonably  satisfactory  to  Lessor;  and
77.     Such  construction shall not be undertaken unless Lessee demonstrates to
the  reasonable  satisfaction  of  Lessor  the financial ability to complete the
construction  without  adversely  affecting  its cash flow position or financial
viability.
78.     Construction  Requirements  for  all  Capital Additions.  Whether or not
        -------------------------------------------------------
Lessor's  review  and  approval  is  required,  for  all  Capital  Additions:
79.     Such  construction  shall  not  be  commenced  until  Lessee  shall have
procured  and  paid  for  all  municipal  and  other  governmental  permits  and
authorizations  required  therefor, and Lessor shall join in the application for
such  permits  or  authorizations  whenever  such action is necessary; provided,
                                                                       --------
however, that (i) any such joinder shall be at no cost or expense to Lessor; and
    ---
     (h)  any plans required to be filed in connection with any such application
which  require the approval of Lessor as hereinabove provided shall have been so
approved  by  Lessor;
80.     Such construction shall not, and Lessee's licensed architect or engineer
     shall  certify  to  Lessor  that  such  construction  shall not, impair the
structural  strength  of  any  component  of  the  Facility  or  overburden  the
electrical,  water,  plumbing,  HVAC  or  other  building  systems  of  any such
component;
81.     Lessee's licensed architect or engineer shall certify to Lessor that the
     detailed plans and specifications conform to and comply with all applicable
building, subdivision and zoning codes, laws, ordinances and regulations imposed
by  all  governmental  authorities having jurisdiction over the Leased Property;
82.     Such  construction  shall, when completed, be of such a character as not
to  decrease  the value of the Leased Property as it was immediately before such
Capital  Addition;
83.     During  and following completion of such construction, the parking which
is  located  in  the  Facility  or  on  the  Land  shall remain adequate for the
operation  of  the  Facility  for its Primary Intended Use and in no event shall
such  parking  be  less  than  that which was or is required by law or which was
located  in  the  Facility  or on the Land prior to such construction; provided,
                                                                       --------
however, with Lessor's prior consent and at no additional expense to Lessor, (i)
   ----
     to  the  extent  additional  parking  is  not  already  a part of a Capital
Addition,  Lessee  may  construct additional parking on the Land; or (ii) Lessee
may acquire off-site parking to serve the Facility as long as such parking shall
be  dedicated  to,  or  otherwise  made  available  to  serve,  the  Facility;
84.     All  work  done  in  connection  with  such  construction  shall be done
promptly and in a good and workmanlike manner using first-class materials and in
     conformity  with  all  Legal  Requirements;  and
85.     Promptly  following  the  completion  of such construction, Lessee shall
deliver to Lessor "as built" drawings of such addition, certified as accurate by
     the  licensed  architect  or  engineer selected by Lessee to supervise such
work,  and  copies  of  any  new  or  revised  Certificates  of  Occupancy.
86.     Funding  by  Lessor
        -------------------
     .
87.     Lessee  may  request  that Lessor fund a Capital Addition, in which case
Lessee shall provide to Lessor any information about such Capital Addition which
     Lessor  may  reasonably  request.  Lessor  may,  but  shall  be  under  no
obligation  to,  provide the funds necessary to meet the request.  Within thirty
(30)  days  of  receipt of a request to fund a proposed Capital Addition, Lessor
shall  notify  Lessee  as  to whether it will fund the proposed Capital Addition
and,  if  so,  the terms and conditions upon which it would do so, including the
terms of any amendment to this Lease.  Lessee shall have ten (10) days to accept
or  reject  Lessor's  funding  proposal.  In  no  event shall the portion of the
projected  Capital  Addition  Cost  comprised  of land, if any, materials, labor
charges  and  fixtures  be less than ninety percent (90%) of the total amount of
the  projected  cost  of  such  Capital  Addition.
88.     If  Lessor agrees to fund a proposed Capital Addition and Lessee accepts
the  terms  thereof, Lessee shall provide Lessor with the following prior to any
advance  of  funds:
89.     any  information, certificates, licenses, permits or documents requested
by Lessor which are necessary and obtainable to confirm that Lessee will be able
     to  use the Capital Addition upon completion thereof in accordance with the
Primary  Intended Use, including all required federal, state or local government
licenses  and  approvals;
90.     an  Officer's Certificate and, if requested, a certificate from Lessee's
architect,  setting  forth  in reasonable detail the projected or actual Capital
Addition  Costs;
91.     an  amendment to this Lease, in a form prepared by Lessor and reasonably
agreed  to by Lessee, providing for an increase in the Rent in amounts as agreed
upon  by  the  parties  hereto  and  other  provisions  as  may  be necessary or
appropriate;
92.     a deed conveying title to Lessor to any land acquired for the purpose of
     constructing  the  Capital  Addition  free  and  clear  of  any  liens  or
encumbrances  except those approved by Lessor, and accompanied by an ALTA survey
thereof  satisfactory  to  Lessor;
93.     for  each  advance,  endorsements  to  any  outstanding  policy of title
insurance  covering  the Leased Property or commitments therefor satisfactory in
form  and  substance  to  Lessor  (i)  updating  the same without any additional
exception  except  as may be approved by Lessor and (ii) increasing the coverage
thereof  by  an  amount  equal to the Fair Market Value of the Capital Addition,
except  to  the extent covered by the owner's policy of title insurance referred
to  in  subparagraph  (f),  below;
94.     if appropriate, an owner's policy of title insurance insuring fee simple
     title  to  any  land  conveyed  to  Lessor  free and clear of all liens and
encumbrances  except  those that do not materially affect the value of such land
and  do  not  interfere  with  the use of the Leased Property or are approved by
Lessor;
95.     if  requested  by  Lessor,  a  M.A.I.  appraisal  of the Leased Property
indicating  that the Fair Market Value of the Leased Property upon completion of
the  Capital  Addition  will exceed the Fair Market Value of the Leased Property
immediately  prior  thereto by an amount not less than ninety-five percent (95%)
of  the  cost  of  the  Capital  Addition;  and
96.     such  other  billing  statements,  invoices, certificates, endorsements,
opinions,  site  assessments, surveys, resolutions, ratifications, lien releases
and waivers and other instruments and information reasonably required by Lessor.
97.     Capital  Additions  Financed  by  Lessee
        ----------------------------------------
     .  If  Lessee  provides  or  arranges  such  financing, the following shall
apply:
98.     There  shall  be no adjustment in the Minimum Rent or CPI Rent by reason
of  any  such  Capital  Addition.
99.     Upon  the  expiration  or  earlier  termination of this Lease, except by
reason  of  an  Event  of  Default  by Lessee hereunder, Lessor shall compensate
Lessee  for  all  Capital  Additions  financed  by  Lessee:
100.     By purchasing such Capital Additions from Lessee for cash in the amount
     of  the  then  Fair  Market  Added  Value  of  such  Capital  Additions; or
101.     By  such  other  arrangement  regarding  such  compensation as shall be
mutually  and  reasonably  acceptable  to  Lessor  and  Lessee.
102.
103.     Liens
         -----
     .  Subject to the provisions of Article XII relating to permitted contests,
Lessee  will  not  directly  or  indirectly  create  or allow to remain and will
promptly  discharge  at  its  expense  any  lien, encumbrance, attachment, title
retention  agreement  or  claim upon the Leased Property or any Capital Addition
thereto  or  any  attachment, levy, claim or encumbrance in respect of the Rent,
excluding,  however,  (i)  this  Lease;  (ii) the matters that existed as of the
Commencement  Date;  (iii)  restrictions, liens and other encumbrances which are
consented  to  in  writing  by  Lessor, or any easements granted pursuant to the
provisions  of  Section  7.3;  (iv)  liens  for  Impositions which Lessee is not
required  to  pay hereunder; (v) subleases permitted by Article XXIV; (vi) liens
for  Impositions  not  yet  delinquent;  (vii)  liens  of  mechanics,  laborers,
materialmen,  suppliers  or  vendors  for  sums  either disputed or not yet due;
provided  that  (1)  the  payment  of such sums shall not be postponed under any
     ---
related  contract  for  more  than  sixty  (60) days after the completion of the
action giving rise to such lien and such reserve or other appropriate provisions
as  shall  be  required  by law or GAAP shall have been made therefor or (2) any
such  liens  are  in the process of being contested as permitted by Article XII;
(viii)  any  liens  which  are  the  responsibility  of  Lessor  pursuant to the
provisions  of  Article  XXXVI;  and  (ix) liens related to equipment leases for
equipment  which  is used or useful in Lessee's business on the Leased Property;
provided  that  the  payment  of  any sums due under such equipment leases shall
 -------
either  (A) be paid as and when due in accordance with the terms thereof, or (B)
 ---
be  in  the  process  of  being  contested  as  permitted  by  Article  XII.
104.
105.     Permitted  Contests
         -------------------
     .  Lessee,  upon  prior written notice to Lessor, on its own or in Lessor's
name,  at  Lessee's  expense,  may  contest,  by  appropriate  legal proceedings
conducted  in  good  faith  and  with  due  diligence,  the  amount, validity or
application,  in  whole  or in part, of any licensure or certification decision,
Imposition,  Legal  Requirement,  Insurance Requirement, lien, attachment, levy,
encumbrance,  charge  or  claim;  provided,  however, that (i) in the case of an
                                  --------   -------
unpaid  Imposition,  lien,  attachment,  levy, encumbrance, charge or claim, the
commencement  and  continuation of such proceedings shall suspend the collection
thereof  from  Lessor  and  from  the  Leased  Property  or any Capital Addition
thereto;  (ii)  neither the Leased Property or any Capital Addition thereto, the
Rent therefrom nor any part or interest in either thereof would be in any danger
of  being  sold,  forfeited,  attached  or  lost  pending  the  outcome  of such
proceedings; (iii) in the case of a Legal Requirement, neither Lessor nor Lessee
would  be  in  any  danger  of civil or criminal liability for failure to comply
therewith  pending  the  outcome  of  such proceedings; (iv) if any such contest
shall  involve  a  sum  of  money  or potential loss in excess of Fifty Thousand
Dollars  ($50,000), Lessee shall deliver to Lessor and its counsel an opinion of
legal counsel reasonably acceptable to Lessor to the effect set forth in clauses
(i),  (ii) and (iii) above, to the extent applicable; (v) in the case of a Legal
Requirement,  Imposition,  lien,  encumbrance  or charge, Lessee shall give such
reasonable  security  as may be required by Lessor to insure ultimate payment of
the  same  and  to  prevent any sale or forfeiture of the Leased Property or any
Capital  Addition  thereto  or  the  Rent  by  reason  of  such  non-payment  or
noncompliance;  (vi)  in  the  case  of  an  Insurance Requirement, the coverage
required  by  Article  XIII  shall  be  maintained; and (vii) if such contest be
finally  resolved against Lessor or Lessee, Lessee shall promptly pay the amount
required  to  be paid, together with all interest and penalties accrued thereon,
or  comply  with  the  applicable  Legal  Requirement  or Insurance Requirement.
Lessor,  at  Lessee's  expense,  shall  execute  and  deliver  to  Lessee  such
authorizations  and  other  documents  as may reasonably be required in any such
contest,  and, if reasonably requested by Lessee or if Lessor so desires, Lessor
shall  join as a party therein.  The provisions of this Article XII shall not be
construed  to  permit  Lessee to contest the payment of Rent or any other amount
(other than Impositions or Additional Charges which Lessee may from time to time
be  required  to  impound  with  Lessor)  payable by Lessee to Lessor hereunder.
Lessee  shall  indemnify,  defend,  protect  and  save  Lessor harmless from and
against  any  liability,  cost  or  expense of any kind that may be imposed upon
Lessor  in  connection  with  any such contest and any loss resulting therefrom.
106.
                        (See also Addendum Section 46.5)
                         --- ---- -------- ------- ----
107.     General  Insurance  Requirements
         --------------------------------
     .  During the Term, Lessee shall at all times keep the Leased Property, and
all  property located in or on the Leased Property, including Capital Additions,
the  Fixtures  and  the Personal Property, insured with the kinds and amounts of
insurance  described  below.  This  insurance  shall  be  written  by  companies
authorized to do insurance business in the State in which the Leased Property is
located.  All  liability  type  policies  must  name  Lessor  as  an "additional
                                                                      ----------
insured." All property policies shall name Lessor as "loss payee."  All business
                                                      ----------
interruption  policies  shall  name  Lessor as "loss payee" with respect to Rent
                                                ----------
only.  Losses  shall  be  payable to Lessor and/or Lessee as provided in Article
XIV.  In  addition,  the  policies, as appropriate, shall name as an "additional
                                                                      ----------
insured"  or  "loss  payee"  the  holder of any mortgage, deed of trust or other
  -----        -----------
security agreement ("Facility Mortgagee") securing any indebtedness or any other
  --                 ------------------
Encumbrance  placed  on the Leased Property in accordance with the provisions of
Article  XXXVI  ("Facility  Mortgage")  by way of a standard form of mortgagee's
                  ------------------
loss payable endorsement.  Any loss adjustment shall require the written consent
of  Lessor, Lessee, and each Facility Mortgagee unless the amount of the loss is
less  than  $10,000  in  which  event no consent shall be required.  Evidence of
insurance  shall  be  deposited with Lessor and, if requested, with any Facility
Mortgagee(s).  If  any  provision  of any Facility Mortgage requires deposits of
insurance  to  be  made with such Facility Mortgagee, Lessee shall either pay to
Lessor  monthly  the  amounts required and Lessor shall transfer such amounts to
each  Facility  Mortgagee,  or,  pursuant to written direction by Lessor, Lessee
shall  make  such  deposits directly with such Facility Mortgagee.  The policies
shall  insure  against  the  following  risks:
108.     Loss  or  damage  by  fire,  vandalism and malicious mischief, extended
coverage  perils  commonly  known  as special form perils, earthquake (including
earth  movement) and windstorm in an amount not less than the insurable value on
a  replacement  cost  basis  (as  defined below in Section 13.2) and including a
building  ordinance  coverage  endorsement;
109.     Loss  or  damage  by  explosion  of  steam boilers, pressure vessels or
similar  apparatus,  now  or hereafter installed in the Facility, in such limits
with  respect  to any one accident as may be reasonably requested by Lessor from
time  to  time;
110.     Flood (when the Leased Property is located in whole or in part within a
     designated  100-year  flood  plain area) and such other hazards and in such
amounts  as  may  be  customary  for  comparable  properties  in  the  area;
111.     Loss  of  rental  value  in an amount not less than twelve (12) months'
Rent  payable  hereunder  or  business  interruption  in an amount not less than
twelve (12) months of income and normal operating expenses including payroll and
     Rent  payable  hereunder  with  an  endorsement  extending  the  period  of
indemnity by at least ninety (90) days (Building Ordinance - Increased Period of
Restoration  Endorsement)  necessitated  by the occurrence of any of the hazards
described  in  Sections  13.1.1,  13.1.2  or  13.1.3;
112.     Claims  for  bodily  injury  or  property  damage  under  a  policy  of
commercial  general  liability  insurance with amounts not less than One Million
and  No/100  Dollars  ($1,000,000.00)  combined  single  limit and Three Million
No/100  Dollars  ($3,000,000.00)  in  the  annual  aggregate;  and
113.     Medical  professional  liability with amounts not less than One Million
Dollars  ($1,000,000)  combined  single  limit  and  Three  Million  Dollars
($3,000,000)  in  the  annual  aggregate.
114.     Replacement  Cost
         -----------------
     .  The  term  "replacement  cost" shall mean the actual replacement cost of
the  insured  property  from  time to time with new materials and workmanship of
like  kind  and quality.  If either party believes that the replacement cost has
increased  or  decreased at any time during the Term, it shall have the right to
have  such  replacement  cost  redetermined  by  an impartial national insurance
company  reasonably acceptable to both parties (the "impartial appraiser").  The
                                                     -------------------
party  desiring to have the replacement cost so redetermined shall forthwith, on
receipt  of  such  determination by the impartial appraiser, give written notice
thereof to the other party hereto.  The determination of the impartial appraiser
shall  be  final  and  binding on the parties hereto, and Lessee shall forthwith
increase  or  decrease  the  amount  of  the  insurance carried pursuant to this
Article  to  the  amount  so  determined by the impartial appraiser.  Each party
shall  pay  one-half  (1/2)  of the fee, if any, of the impartial appraiser.  If
Lessee  has  made  improvements  to  the Leased Property, Lessor may at Lessee's
expense  have  the  replacement  cost  redetermined  at  any  time  after  such
improvements  are  made,  regardless  of  when  the  replacement  cost  was last
determined.
115.     Additional  Insurance
         ---------------------
     .  In addition to the insurance described above, Lessee shall maintain such
additional  insurance upon notice from Lessor as may be reasonably required from
time  to  time by any Facility Mortgagee and shall further at all times maintain
adequate workers' compensation coverage and any other coverage required by Legal
Requirements  for  all Persons employed by Lessee on the Leased Property and any
Capital  Addition  thereto  in  accordance  with  Legal  Requirements.
116.     Waiver  of  Subrogation
         -----------------------
     .  All  insurance  policies  carried  by  either  party covering the Leased
Property  and  any  Capital  Addition  thereto  and  Lessee's  Personal Property
including contents, fire and casualty insurance, shall expressly waive any right
of  subrogation on the part of the insurer against the other party.  The parties
hereto  agree that their policies will include such waiver clause or endorsement
so  long as the same are obtainable without extra cost, and in the event of such
an  extra  charge  the other party, at its election, may pay the same, but shall
not  be  obligated  to  do  so.  Each party waives any claims it has against the
other  party  to  the  extent  such  claim  is  covered  by  insurance.
117.     Policy  Requirements
         --------------------
     .  All  of  the  policies of insurance referred to in this Article shall be
written  in  form  satisfactory  to  Lessor  and  by  insurance companies with a
policyholder  rating  of  "A"  and  a financial rating of "X" in the most recent
version  of  Best's  Key  Rating  Guide.  Lessee  shall  pay all of the premiums
therefor,  and  deliver such policies or certificates thereof to Lessor prior to
their  effective date (and with respect to any renewal policy, at least ten (10)
days  prior  to  the expiration of the existing policy), and in the event of the
failure of Lessee either to effect such insurance in the names herein called for
or  to  pay  the  premiums therefor, or to deliver such policies or certificates
thereof  to  Lessor,  at the times required, Lessor shall be entitled, but shall
have  no  obligation, to effect such insurance and pay the premiums therefor, in
which  event  the  cost  thereof,  together with interest thereon at the Overdue
Rate,  shall  be  repayable  to Lessor upon demand therefor.  Each insurer shall
agree,  by endorsement on the policy or policies issued by it, or by independent
instrument  furnished  to  Lessor,  that  it  will give to Lessor ten (10) days'
written  notice  before  the  policy  or  policies in question shall be altered,
allowed to expire or cancelled.  Each property policy shall have a deductible or
deductibles,  if  any,  which  are no greater than those normally maintained for
similar facilities in the State.  Each earthquake policy shall have a deductible
of  ten percent (10%) of real property, personal property and rental value limit
at  the  subject  location,  unless  such  requirement is specifically waived by
Lessor.
118.     Increase  in  Limits
         --------------------
     .  If  either  party  shall at any time believe the limits of the insurance
required  hereunder  to  be  either excessive or insufficient, the parties shall
endeavor  to  agree  in  writing  on  the  proper and reasonable limits for such
insurance  to be carried and such insurance shall thereafter be carried with the
limits  thus  agreed  on until further change pursuant to the provisions of this
Section.  If  the  parties  shall  be  unable  to  agree thereon, the proper and
reasonable  limits  for  such  insurance to be carried shall be determined by an
impartial  third party reasonably selected by the parties.  Nothing herein shall
permit  the  amount  of  insurance  to  be  reduced  below the amount or amounts
required  by  any  Facility  Mortgagee.
119.     Blanket  Policies  and  Policies  Covering  Multiple  Locations
         ---------------------------------------------------------------
..  Notwithstanding  anything to the contrary contained in this Article, Lessee's
obligations to carry the insurance provided for herein may be brought within the
coverage  of a blanket policy or policies of insurance carried and maintained by
Lessee; provided, however, that the coverage afforded Lessor will not be reduced
        --------  -------
or  diminished  or  otherwise  be  different from that which would exist under a
separate  policy  meeting  all other requirements of this Lease by reason of the
use  of  such  blanket  policy  of  insurance,  and  provided  further  that the
requirements  of  this  Article XIII are otherwise satisfied.  For any liability
policies  covering  facilities  in  addition  to the Leased Property, Lessor may
require  excess  limits  as  Lessor  reasonably  determines.
120.     No  Separate  Insurance
         -----------------------
     .  Lessee  shall not, on Lessee's own initiative or pursuant to the request
or requirement of any third party, (i) take out separate insurance concurrent in
form  or contributing in the event of loss with that required in this Article to
be  furnished by, or which may reasonably be required to be furnished by, Lessee
or  (ii)  increase  the  amounts  of  any then existing insurance by securing an
additional policy or additional policies, unless all parties having an insurable
interest  in  the subject matter of the insurance, including in all cases Lessor
and all Facility Mortgagees, are included therein as additional insureds and the
loss  is  payable  under such insurance in the same manner as losses are payable
under  this  Lease.  Lessee shall immediately notify Lessor of the taking out of
any  such  separate  insurance or of the increasing of any of the amounts of the
then existing insurance by securing an additional policy or additional policies.
121.
                        (See also Addendum Section 46.6)
                         --- ---- -------- ------- ----
122.     Insurance  Proceeds
         -------------------
     .  All  proceeds  payable  by  reason  of  any loss or damage to the Leased
Property,  or  any portion thereof, under any policy of insurance required to be
carried hereunder shall be paid to Lessor and made available by Lessor to Lessee
from  time  to time for the reasonable costs of reconstruction or repair, as the
case  may  be,  of  any  damage to or destruction of the Leased Property, or any
portion thereof; provided, however, that if the total amount of proceeds payable
                 --------  -------
is $10,000 or less, the proceeds shall be paid to Lessee and used for the repair
of  any  damage  to  the  Leased  Property.  Any  excess  proceeds  of insurance
remaining  after  the  completion  of  the  restoration or reconstruction of the
Leased  Property  to  substantially  the  same  condition as existed immediately
before the damage or destruction and with materials and workmanship of like kind
and  quality and to Lessor's reasonable satisfaction shall be remitted by Lessor
to  Lessee  free  and  clear  upon completion of any such repair and restoration
except  as  otherwise  specifically  provided below in this Article XIV.  In the
event  neither Lessor nor Lessee is required or elects to repair and restore the
Leased  Property,  all  such insurance proceeds shall be retained by Lessor free
and  clear  except as otherwise specifically provided below in this Article XIV.
All salvage resulting from any risk covered by insurance shall belong to Lessor.
123.     Insured  Casualty
         -----------------
     .
124.     If  the  Leased Property is damaged or destroyed from a risk covered by
insurance  carried  by  Lessee  such  that  the  Facility  thereby  is  rendered
Unsuitable  for  its  Primary  Intended Use, Lessee shall either (i) restore the
Leased  Property  to  substantially  the  same  condition as existed immediately
before  such damage or destruction, or (ii) offer to acquire the Leased Property
from  Lessor  for  a  purchase  price  equal  to  the greater of (y) the Minimum
Repurchase  Price  or (z) the Fair Market Value immediately prior to such damage
or  destruction.  If  Lessor  does  not accept Lessee's offer to so purchase the
Leased  Property,  Lessee  may either withdraw such offer and proceed to restore
the  Leased  Property to substantially the same condition as existed immediately
before  such  damage or destruction or terminate the Lease in which event Lessor
shall  be  entitled  to  retain  the  insurance  proceeds.
125.     If  the  Leased  Property  is  damaged from a risk covered by insurance
carried  by  Lessee, but the Facility is not thereby rendered Unsuitable for its
Primary  Intended Use, Lessee shall restore the Leased Property to substantially
the same condition as existed immediately before such damage.  Such damage shall
     not terminate this Lease; provided, however, that if Lessee cannot within a
                               --------
reasonable time after diligent efforts obtain the necessary government approvals
needed  to restore and operate the Facility for its Primary Intended Use, Lessee
may  offer  to  purchase  the  Leased Property for a purchase price equal to the
greater  of  the  Minimum  Repurchase Price or the Fair Market Value immediately
prior  to  such  damage.  If  Lessee  shall  make such offer and Lessor does not
accept  the  same,  Lessee may either withdraw such offer and proceed to restore
the  Leased  Property to substantially the same condition as existed immediately
before such damage or destruction, or terminate the Lease, in which event Lessor
shall  be  entitled  to  retain  the  insurance  proceeds.
126.     If the cost of the repair or restoration exceeds the amount of proceeds
     received  by  Lessor  from  the insurance required to be carried hereunder,
Lessee shall contribute any excess amounts needed to restore the Facility.  Such
difference  shall  be paid by Lessee to Lessor together with any other insurance
proceeds,  for  application  to  the  cost  of  repair  and  restoration.
127.     If  Lessor accepts Lessee's offer to purchase the Leased Property, this
Lease  shall  terminate  as  to the Leased Property upon payment of the purchase
price  and Lessor shall remit to Lessee all insurance proceeds pertaining to the
Leased  Property,  including  insurance proceeds pertaining to Capital Additions
and  Lessee's  Personal  Property,  then  held  by  Lessor.
128.     Uninsured  Casualty
         -------------------
     .  If  the  Leased Property is damaged or destroyed from a risk not covered
by  insurance  carried  by  Lessee,  whether  or  not such damage or destruction
renders  the  Leased Property Unsuitable for its Primary Intended Use, Lessee at
its  expense  shall  restore  the  Leased  Property  to  substantially  the same
condition  it  was  in  immediately  before  such damage or destruction and such
damage or destruction shall not terminate this Lease; provided, however, that if
                                                      --------  -------
Lessee  cannot  within  a  reasonable  time  after  diligent  efforts obtain the
necessary  government  approvals  needed to restore and operate the Facility for
its  Primary  Intended  Use,  Lessee  shall  purchase  the Leased Property for a
purchase  price equal to the greater of the Minimum Repurchase Price or the Fair
Market  Value  immediately  prior  to  such  damage.
129.     No  Abatement  of  Rent
         -----------------------
     .  This Lease shall remain in full force and effect and Lessee's obligation
to  pay  the  Rent  and  all  other  charges required by this Lease shall remain
unabated  during  the  period required for adjusting insurance, satisfying Legal
Requirements,  repair  and  restoration.
130.     Waiver
         ------
     .  Lessee  waives  any  statutory  rights of termination which may arise by
reason  of  any  damage  or  destruction  of  the  Leased  Property.
131.     Damage  Near  End  of  Term
         ---------------------------
     .  If  the  damage  or destruction contemplated hereunder occurs during the
last  year of the Fixed Term or the Extended Term, as applicable, Lessee may, in
lieu  of  repairing and restoring the Leased Property as contemplated hereunder,
terminate  this  Lease  effective  as  of  the  date of payment to Lessor of the
greater of (a) the insurance proceeds attributable to such damage or destruction
and (b) the cost to repair such damage or destruction as reasonably estimated by
Lessor.
132.
                        (See also Addendum Section 46.7)
                         --- ---- -------- ------- ----
     15.     Condemnation
             ------------
     .
133.     Total  Taking
         -------------
     .  If the Leased Property is totally and permanently taken by Condemnation,
this  Lease  shall  terminate  as  of  the  day  before  the  Date  of  Taking.
134.     Partial  Taking
         ---------------
     .  If a portion of the Leased Property is taken by Condemnation, this Lease
shall  remain  in  effect if the Facility is not thereby rendered Unsuitable for
Its Primary Intended Use, but if the Facility is thereby rendered Unsuitable for
Its  Primary  Intended  Use, this Lease shall terminate as of the day before the
Date  of  Taking.
135.     Restoration
         -----------
     .  If  there  is  a  partial  taking  of the Leased Property and this Lease
remains  in  full  force  and effect pursuant to Section 15.2, Lessor shall make
available  to  Lessee  the  portion  of  the  Award  necessary  and specifically
identified  for  restoration  of the Leased Property and Lessee shall accomplish
all  necessary  restoration  whether or not the amount provided by the condemnor
for  restoration  is  sufficient.
136.     Award-Distribution
         ------------------
     .  The  entire  Award  shall  belong to and be paid to Lessor, except that,
subject  to  the  rights of the Facility Mortgagees, Lessee shall be entitled to
receive  from  the  Award, if and to the extent such Award specifically includes
such  item,  lost profits value and moving expenses, provided, that in any event
Lessor  shall  receive  from  the  Award,  subject to the rights of the Facility
Mortgagees,  no  less  than  the  greater  of the Fair Market Value prior to the
institution  of  the  Condemnation  or  the  Minimum  Repurchase  Price.
137.     Temporary  Taking
         -----------------
     .  The taking of the Leased Property, or any part thereof, shall constitute
a taking by Condemnation only when the use and occupancy by the taking authority
has  continued for longer than 180 consecutive days.  During any shorter period,
which shall be a temporary taking, all the provisions of this Lease shall remain
in  full  force  and effect and the Award allocable to the Term shall be paid to
Lessee.
138.
                        (See also Addendum Section 46.8)
                         --- ---- -------- ------- ----
139.     Events  of  Default
         -------------------
     .  Any one or more of the following shall constitute an "Event of Default":
                                                              ----------------
140.     a  default  shall  occur  under  any  other lease or other agreement or
instrument,  including  the Contract of Acquisition or the Other Leases, between
Lessor  or  an  Affiliate of Lessor and Lessee or an Affiliate of Lessee, or any
letter  of  credit,  guaranty,  mortgage,  deed  of  trust,  or other instrument
executed  by Lessee or an Affiliate of Lessee in favor of Lessor or an Affiliate
of  Lessor,  in every case, whether now or hereafter existing, where the default
is  not  cured  within  any  applicable  grace  period  set  forth  therein;
141.     Lessee  shall fail to pay any installment of Rent when the same becomes
due  and payable and such failure is not cured by Lessee within a period of five
(5)  days  after notice thereof from Lessor; provided, however, that such notice
                                             --------  -------
shall  be in lieu of and not in addition to any notice required under applicable
law;
142.     [Intentionally  Omitted];
143.     if  Lessee shall fail to observe or perform any other term, covenant or
condition  of  this  Lease and such failure is not cured by Lessee within thirty
(30)  days after notice thereof from Lessor, unless such failure cannot with due
diligence  be  cured  within  a  period  of thirty (30) days, in which case such
failure  shall  not  be  deemed  to  be  an  Event of Default if Lessee proceeds
promptly and with due diligence to cure the failure and diligently completes the
     curing thereof; provided, however, that such notice shall be in lieu of and
                     --------  -------
not  in  addition  to  any  notice  required  under  applicable  law;
144.     Lessee  or  any  Guarantor  shall:
145.     admit  in  writing  its  inability  to  pay its debts generally as they
become  due,
146.     file  a  petition  in bankruptcy or a petition to take advantage of any
insolvency  act,
147.     make  an  assignment  for  the  benefit  of  its  creditors,
148.     consent  to  the appointment of a receiver of itself or of the whole or
any  substantial  part  of  its  Property,  or
149.     file  a  petition or answer seeking reorganization or arrangement under
the Federal bankruptcy laws or any other applicable law or statute of the United
     States  of  America  or  any  state  thereof;
150.     Lessee  or any Guarantor shall be adjudicated as bankrupt or a court of
competent  jurisdiction  shall  enter an order or decree appointing, without the
consent  of Lessee, a receiver of Lessee or of the whole or substantially all of
its property, or approving a petition filed against it seeking reorganization or
     arrangement  of  Lessee  under  the  Federal  bankruptcy  laws or any other
applicable  law or statute of the United States of America or any state thereof,
and  such  judgment, order or decree shall not be vacated or set aside or stayed
within  sixty  (60)  days  from  the  date  of  the  entry  thereof;
151.     Lessee  or  any  Guarantor  shall  be liquidated or dissolved, or shall
begin  proceedings  toward  such  liquidation  or  dissolution, or shall, in any
manner,  permit  the  sale  or  divestiture  of  substantially  all  its assets;
152.     the  estate  or  interest  of Lessee in the Leased Property or any part
thereof  shall  be  levied upon or attached in any proceeding and the same shall
not  be  vacated  or  discharged  within  the  later  of  ninety (90) days after
commencement  thereof  or  thirty  (30)  days  after receipt by Lessee of notice
thereof from Lessor; provided, however, that such notice shall be in lieu of and
                     --------  -------
     not  in  addition  to  any  notice  required  under  applicable  law;
153.     except  as  a  result  of  damage,  destruction or Condemnation, Lessee
voluntarily  ceases  operations on the Leased Property for a period in excess of
thirty  (30)  days;
154.     any of the representations or warranties made by Lessee in the Contract
     of  Acquisition  or otherwise proves to be untrue when made in any material
respect  which  materially  and  adversely  affects  Lessor;
155.     any Facility's applicable license or third-party provider reimbursement
     agreements  material  to  the Facility's operation for its Primary Intended
Use are at any time terminated or revoked or suspended for more than twenty (20)
days;
156.     any  local,  state  or  federal  agency  having  jurisdiction  over the
operation  of  the Facility removes ten percent (10%) or more of the patients or
residents  located  in  the  Facility;
157.     Lessee  voluntarily  transfers ten (10) or more patients located in the
Facility  to  any  other facility in which Lessee or any Affiliate of Lessee has
any  ownership  or other financial interest, including, without limitation, fees
earned  under  any  management agreement; provided that Lessee's transfer of any
                                          --------
patient  to  a  different  type  of  care facility as a result of such patient's
special needs that cannot be met at the Facility shall not be deemed a voluntary
     transfer;
158.     Lessee  fails  to  give  notice  to Lessor not later than ten (10) days
after  Lessee's  receipt thereof of any Class "A" or equivalent fine notice from
any  governmental  authority or officer acting on behalf thereof relating to the
Facility;
159.     Lessee  fails  to  notify  Lessor  within  twenty-four (24) hours after
receipt  of any notice from any governmental agency terminating or suspending or
threatening  termination or suspension, of any material license or certification
relating  to  the  Facility;
160.     Lessee  fails  to  give  notice  to Lessor not later than ten (10) days
after any notice, claim or demand from any governmental authority or any officer
     acting  on  behalf  thereof, of any violation of any law, order, ordinance,
rule  or  regulation  with  respect  to  the  operation  of  the  Facility;
161.     Lessee  fails  to  cure  or abate any Class "A" or equivalent violation
occurring  during the Term that is claimed by any governmental authority, or any
officer  acting  on  behalf  thereof,  of  any  law,  order,  ordinance, rule or
regulation  pertaining  to  the  operation  of the Facility, and within the time
permitted  by  such  authority  for  such  cure  or  abatement;
162.     any  proceedings  are  instituted  against  Lessee  by any governmental
authority  which  are  reasonably  likely to result in (i) the revocation of any
license granted to Lessee for the operation of the Facility, (ii) if applicable,
     the  decertification  of the Facility from participation in the Medicare or
Medicaid  reimbursement program, or (iii) the issuance of a stop placement order
with  respect  to  the  Facility;
163.     any  default  and  acceleration  of any recourse funded indebtedness of
Lessee  or  any  recourse  funded  indebtedness  of  any Affiliate of Lessee has
occurred,  and  such  funded  indebtedness  has  an  unpaid principal balance of
$1,000,000 or more or such default and acceleration could reasonably be expected
     to  have a material adverse impact on the financial condition or operations
of  Lessee  or  any  Guarantor;  and
164.     any  default which is not cured within any applicable cure period shall
occur  under any guaranty of Lessee's or an Affiliate of Lessee's obligations to
Lessor or an Affiliate of Lessor, in every case, whether such guaranty is now or
     hereafter  existing.
165.     Certain  Remedies
         -----------------
     .  If  an  Event  of Default shall have occurred, Lessor may terminate this
Lease  by  giving Lessee notice of such termination and the Term shall terminate
and  all  rights  of Lessee under this Lease shall cease.  Lessor shall have all
rights  at  law  and  in  equity available to Lessor as a result of any Event of
Default.  Lessee shall pay as Additional Charges all costs and expenses incurred
by or on behalf of Lessor, including reasonable attorneys' fees and expenses, as
a  result  of any Event of Default hereunder.  If an Event of Default shall have
occurred  and  be  continuing,  whether  or  not  this Lease has been terminated
pursuant  to  Section  16.1,  Lessee  shall,  to the extent permitted by law, if
required  by  Lessor so to do, immediately surrender to Lessor possession of the
Leased  Property  and any Capital Additions thereto and quit the same and Lessor
may  enter  upon  and  repossess  the  Leased  Property and any Capital Addition
thereto  by  reasonable force, summary proceedings, ejectment or otherwise, and,
to  the  extent permitted by law, may remove Lessee and all other Persons (other
than  the  residents of the Facility) and any of Lessee's Personal Property from
the  Leased  Property  and  any  Capital  Addition  thereto.
166.     Damages
         -------
     .  (i)  The  termination of this Lease; (ii) the repossession of the Leased
Property  and  any  Capital  Addition  thereto;  (iii)  the  failure  of Lessor,
notwithstanding  reasonable  good  faith  efforts, to relet the Leased Property;
(iv)  the  reletting  of  all  or any portion of the Leased Property; or (v) the
inability  of  Lessor  to  collect  or  receive  any  rentals  due upon any such
reletting,  shall  not  relieve  Lessee  of  its  liabilities  and  obligations
hereunder,  all  of  which  shall  survive any such termination, repossession or
reletting.  If any such termination occurs, Lessee shall forthwith pay to Lessor
all  Rent  due  and payable with respect to the Leased Property to and including
the date of such termination.  Thereafter, Lessee shall forthwith pay to Lessor,
at  Lessor's  option,  as  and  for  liquidated  and  agreed current damages for
Lessee's  Default,  either:
167.     the  sum  of:
168.     the worth at the time of award of the unpaid Rent which had been earned
     at  the  time  of  termination  to the extent not previously paid by Lessee
under  this  Section  16.3,
169.     the  worth  at the time of award of the amount by which the unpaid Rent
which  would  have been earned after termination until the time of award exceeds
the  amount  of  such  rental loss that Lessee proves could have been reasonably
avoided,
170.     the  worth  at the time of award of the amount by which the unpaid Rent
for  the  balance of the Term after the time of award exceeds the amount of such
rental  loss  that  Lessee  proves  could  be  reasonably  avoided,  plus
171.     any  other  amount necessary to compensate Lessor for all the detriment
proximately  caused  by  Lessee's  failure to perform its obligations under this
Lease  or  which  in  the  ordinary  course  of things would be likely to result
therefrom.
As used in clauses (i) and (ii) above, the "worth at the time of award" shall be
computed  by  allowing  interest  at  the Overdue Rate.  As used in clause (iii)
above,  the  "worth  at the time of award" shall be computed by discounting such
amount  at the discount rate of the Federal Reserve Bank of San Francisco at the
time  of  award  plus  one  percent  (1%).
     Alternatively,  if  Lessor  does  not  elect  to terminate this Lease, then
Lessee  shall  pay  to Lessor, at Lessor's option, as and for agreed damages for
such Event of Default without termination of Lessee's right to possession of the
Leased  Property, each installment of said Rent and other sums payable by Lessee
to  Lessor  under  the  Lease as the same becomes due and payable, together with
interest  at  the Overdue Rate from the date when due until paid, and Lessor may
enforce,  by  action  or  otherwise,  any  other term or covenant of this Lease.
172.     Receiver
         --------
     .  Upon  the  occurrence  of  an Event of Default, and upon commencement of
proceedings to enforce the rights of Lessor hereunder, Lessor shall be entitled,
as  a  matter of right, to the appointment of a receiver or receivers acceptable
to  Lessor  of  the  Leased Property and any Capital Addition thereto and of the
revenues, earnings, income, products and profits thereof, pending the outcome of
such  proceedings,  with  such powers as the court making such appointment shall
confer.
173.     Lessee's  Obligation  to  Purchase
         ----------------------------------
     .  If an Event of Default shall have occurred, Lessor may require Lessee to
purchase  the  Leased  Property on the first Minimum Rent Payment Date occurring
not  less than thirty (30) days after the date specified in a notice from Lessor
requiring  such  purchase  for  an  amount  equal to the greater of (i) the Fair
Market  Value,  or (ii) the Minimum Repurchase Price, plus, in either event, all
Rent  then due and payable (excluding the installment of Minimum Rent due on the
purchase  date).  If Lessor exercises such right, Lessor shall convey the Leased
Property  to Lessee on the date fixed therefor in accordance with the provisions
of  Article  XVIII  upon  receipt  of the purchase price therefor and this Lease
shall  thereupon  terminate.  Any  purchase  by  Lessee  of  the Leased Property
pursuant  to  this  Section shall be in lieu of the damages specified in Section
16.3.
174.     Waiver
         ------
     .  If  Lessor initiates judicial proceedings or if this Lease is terminated
by  Lessor  pursuant  to this Article, Lessee waives, to the extent permitted by
applicable  law, (i) any right of redemption, re-entry or repossession; and (ii)
the  benefit  of  any  laws  now  or  hereafter in force exempting property from
liability  for  rent  or  for  debt.
175.     Application  of  Funds
         ----------------------
     .  Any  payments  received  by  Lessor  under any of the provisions of this
Lease during the existence or continuance of any Event of Default which are made
to  Lessor  rather than Lessee due to the existence of an Event of Default shall
be  applied  to  Lessee's  obligations  in the order which Lessor may reasonably
determine  or  as  may  be  prescribed  by  the  laws  of  the  State.
176.     Reserved
         --------
     .
177.     Reserved
         --------
     .
178.     Lessor's  Security  Interest
         ----------------------------
     .  The  parties intend that if an Event of Default occurs under this Lease,
Lessor  will  control  Lessee's Personal Property and the Intangible Property so
that Lessor or its designee or nominee can operate or re-let the Leased Property
intact  for its Primary Intended Use.  Accordingly, to implement such intention,
and  for  the  purpose  of  securing  the payment and performance obligations of
Lessee  hereunder,  Lessor  and  Lessee  agree  as  follows:
179.     Lessee,  as  debtor,  hereby  grants  to  Lessor,  as  secured party, a
security  interest  and  an express contractual lien upon all of Lessee's right,
title  and  interest  in  and  to  Lessee's  Personal Property and in and to the
Intangible  Property  and  any  and  all  products,  proceeds, rents and profits
thereof  in  which  Lessee  now owns or hereafter acquires an interest or right,
including  any  leased  Lessee's  Personal  Property.  This  Lease constitutes a
security  agreement  covering  all  such  Lessee's  Personal  Property  and  the
Intangible  Property.  The  security  interest granted to Lessor with respect to
Lessee's  Personal  Property  in  this  Section  16.10 is intended by Lessor and
Lessee to be subordinate to any security interest granted in connection with the
     financing  or  leasing  of  all  or  any  portion  of the Lessee's Personal
Property  so  long  as  Lessee  uses  its best efforts to secure an agreement in
Lessor's  favor  that the lessor or financier of such Lessee's Personal Property
agrees to give Lessor written notice of any default by Lessee under the terms of
such  lease or financing arrangement, to give Lessor a reasonable time following
such notice to cure any such default and consents to Lessor's written assumption
of  such  lease  or  financing  arrangement  upon  Lessor's  curing  of any such
defaults.  This  security  agreement  and  the  security interest created herein
shall  survive  the termination, but not the expiration of this Lease until such
time  as  Lessor  has been fully compensated for all damages resulting from such
termination.
180.     If required by Lessor at any time during the Term, Lessee shall execute
     and  deliver  to  Lessor,  in  form  reasonably  satisfactory  to  Lessor,
additional  security  agreements, financing statements, fixture filings and such
other  documents  as  Lessor  may  reasonably require to perfect or continue the
perfection  of  Lessor's security interest in Lessee's Personal Property and the
Intangible  Property  and any and all products and proceeds thereof now owned or
hereinafter  acquired  by Lessee.  Additionally, Lessee hereby authorizes Lessor
to  file,  without Lessee's signature, any financing or continuation statements,
and  amendments  thereto  (or  similar  documents  required  by  any laws of any
applicable  jurisdiction)  reasonably  required  to  perfect  or  continue  the
perfection  of  Lessor's security interest in Lessee's Personal Property and the
Intangible  Property  and any and all products and proceeds thereof now owned or
hereinafter  acquired  by  Lessee.  In  the  event  Lessee  fails to execute any
financing  statement  or  other  documents for the perfection or continuation of
Lessor's security interest, Lessee hereby appoints Lessor as its true and lawful
attorney-in-fact  to  execute  any  such documents on its behalf, which power of
attorney  shall  be  irrevocable  and  is deemed to be coupled with an interest.
181.     Upon the occurrence of an Event of Default, Lessor shall be entitled to
     exercise  any and all rights or remedies available to a secured party under
the  Uniform  Commercial  Code,  or  available to a lessor under the laws of the
State,  with  respect to Lessee's Personal Property and the Intangible Property,
including  the  right  to  sell  the  same  at  public  or  private  sale.
182.
183.     Lessor's  Right  to  Cure  Lessee's  Default
         --------------------------------------------
     .  If  Lessee shall fail to make any payment or to perform any act required
to  be  made  or  performed  hereunder, Lessor, without waiving or releasing any
obligation  or  default,  may,  but  shall  be under no obligation to, make such
payment  or  perform  such act for the account and at the expense of Lessee, and
may,  to  the  extent  permitted  by law, enter upon the Leased Property and any
Capital  Addition  thereto for such purpose and take all such action thereon as,
in  Lessor's  opinion,  may be necessary or appropriate therefor.  No such entry
shall be deemed an eviction of Lessee.  All sums so paid by Lessor and all costs
and  expenses,  including  reasonable attorneys' fees and expenses, so incurred,
together  with  interest thereon at the Overdue Rate from the date on which such
sums  or  expenses  are  paid  or incurred by Lessor, shall be paid by Lessee to
Lessor  on  demand.
184.
                        (See also Addendum Section 46.9)
                         --- ---- -------- ------- ----
185.     Purchase  of  the  Leased  Property
         -----------------------------------
     .  If  Lessee purchases the Leased Property from Lessor, Lessor shall, upon
receipt from Lessee of the applicable purchase price, together with full payment
of  any  unpaid  Rent  due  and  payable with respect to any period ending on or
before  the date of the purchase, deliver to Lessee an appropriate deed or other
conveyance conveying the entire interest of Lessor in and to the Leased Property
to  Lessee  free  and clear of all encumbrances other than (i) those that Lessee
has  agreed  hereunder  to  pay or discharge; (ii) those mortgage liens, if any,
which Lessee has agreed in writing to accept and to take title subject to; (iii)
those  liens  and encumbrances which were in effect on the date of conveyance of
the  Leased  Property  to  Lessor;  and  (iv)  any  other encumbrances permitted
hereunder to be imposed on the Leased Property which are assumable at no cost to
Lessee  or  to  which  Lessee may take subject without cost to Lessee; provided,
however, that in no event shall Lessee be obligated to assume or take subject to
any encumbrance with a principal balance in excess of the applicable purchase or
option price, and provided further that where the purchase price is equal to the
Minimum  Repurchase Price and if any such encumbrance may not be removed without
penalty,  the  applicable  purchase  price shall be increased or decreased by an
amount  equal  to  the  positive  or  negative  effect  on  Fair  Market  Value
attributable  to  the  interest  rate,  amortization  schedule,  maturity  date,
prepayment  penalty  and  other  terms  and conditions of such encumbrance.  The
difference  between  the  applicable  purchase  price  and  the  total  of  the
encumbrances  assumed  or  taken subject to shall be paid to Lessor or as Lessor
may  direct  in  immediately  available funds.  All expenses of such conveyance,
including  the  cost  of  title insurance, attorneys' fees incurred by Lessor in
connection  with  such  conveyance and release, transfer taxes and recording and
escrow  fees,  shall  be  paid  by  Lessee.
186.
                        (See also Addendum Section 46.10)
                         --- ---- -------- ------- -----
187.     Renewal  Term
         -------------
     .  Provided  that Lessee exercises its right to renew the lease for both of
the  Properties  in  accordance  with the respective terms of the renewal option
relating  to  each  such  lease  and provided that no Event of Default, or event
which,  with  notice  or  lapse  of  time  or both, would constitute an Event of
Default,  has occurred and is continuing, either at the date of exercise or upon
the commencement of the Extended Term, then Lessee shall have the right to renew
this  Lease  for one (1) ten year renewal term (the "Extended Term), upon giving
                                                     -------------
written  notice  to  Lessor of such renewal not less than twelve (12) months and
not  more  than  fifteen (15) months prior to the expiration of the then current
Fixed  Term.  During  the Extended Term, all of the terms and conditions of this
Lease  shall continue in full force and effect.  Notwithstanding anything to the
contrary  in  this  Article  XIX,  Lessor, in its sole discretion, may waive the
condition  to  Lessee's  right  to renew this Lease that no Event of Default, or
event  which, with notice or lapse of time or both, would constitute an Event of
Default,  have occurred or be continuing, and the same may not be used by Lessee
as a means to negate the effectiveness of Lessee's exercise of its renewal right
for  such  Extended  Term.
188.
189.     Holding  Over
         -------------
     .  Except  as  provided  in  Section  19.1,  if Lessee shall for any reason
remain  in  possession  of  the  Leased Property after the expiration or earlier
termination  of  the  Fixed  Term,  such possession shall be as a month-to-month
tenant  during  which  time Lessee shall pay as Rent each month twice the sum of
(i)  monthly  Minimum Rent and CPI Rent applicable to the prior Lease Year, plus
(ii)  all  Additional  Charges  and all other sums payable by Lessee pursuant to
this  Lease.  During  such  period  of  month-to-month  tenancy, Lessee shall be
obligated  to  perform and observe all of the terms, covenants and conditions of
this  Lease,  but  shall  have  no rights hereunder other than the right, to the
extent  given  by law to month-to-month tenancies, to continue its occupancy and
use  of  the  Leased  Property.  Nothing  contained  herein shall constitute the
consent,  express  or implied, of Lessor to the holding over of Lessee after the
expiration  or  earlier  termination  of  this  Lease.
190.

191.     Letters  of  Credit
         -------------------
     .  The  parties acknowledge that Lessor or an Affiliate of Lessor currently
holds and will hold certain letters of credit delivered or hereafter required to
be  delivered  by Lessee and/or Lessee's Affiliates pursuant to certain existing
leases  between  Lessor  or an Affiliate of Lessor and Lessee or an Affiliate of
Lessee  (collectively, the "Letters of Credit").  A list of such other leases is
                            -----------------
attached hereto as Exhibit E (the "Other Leases").  Pursuant to the terms of the
                   ---------       ------------
Other Leases and pursuant to the Letters of Credit, the Letters of Credit secure
Lessee's  and  any  Affiliate  of  Lessee's obligations under any lease or other
agreement  or  instrument with or in favor of Lessor or any Affiliate of Lessor.
In  that  regard, the parties acknowledge that the Letters of Credit also secure
Lessee's  obligations  under  this  Lease at the times, and for the purposes set
forth  below.  No  notice to Lessee or any Affiliate of Lessee shall be required
to  enable  Lessor  to  draw  upon  the  Letters  of  Credit  hereunder.
192.     Uses  of  Letters  of  Credit
         -----------------------------
     .  Lessor  shall  have  the  right to draw upon the Letters of Credit up to
their  full  amounts  whenever  an  Event of Default has occurred.  No such draw
shall  (i) cure or constitute a waiver of an Event of Default, (ii) be deemed to
fix  or  determine the amounts to which Lessor is entitled to recover under this
Lease  or  otherwise,  or  (iii)  be  deemed to limit or waive Lessor's right to
pursue  any  remedies  provided  for  in  this  Lease.
193.
194.     Risk  of  Loss
         --------------
     .  The  risk  of loss or of decrease in the enjoyment and beneficial use of
the  Leased  Property  as  a consequence of the damage or destruction thereof by
fire,  the  elements,  casualties,  thefts,  riots,  wars  or  otherwise,  or in
consequence  of  foreclosures,  attachments, levies or executions (other than by
Lessor and Persons claiming from, through or under Lessor) is assumed by Lessee,
and  except  as  otherwise provided herein no such event shall entitle Lessee to
any  abatement  of  Rent.
195.
196.     General  Indemnification
         ------------------------
     .  In  addition  to  the  other  indemnities  contained  herein,  and
notwithstanding  the existence of any insurance carried by or for the benefit of
Lessor or Lessee, and without regard to the policy limits of any such insurance,
Lessee  shall  protect,  indemnify,  save  harmless  and  defend Lessor from and
against  all  liabilities,  obligations,  claims,  damages  penalties, causes of
action,  costs  and  expenses, including reasonable attorneys', consultants' and
experts'  fees  and  expenses,  imposed  upon or incurred by or asserted against
Lessor  by reason of: (i) any accident, injury to or death of Persons or loss of
or  damage  to  property  occurring on or about the Leased Property or adjoining
sidewalks;  (ii)  any  use, misuse, non-use, condition, maintenance or repair by
Lessee  of  the  Leased  Property;  (iii)  any  failure on the part of Lessee to
perform  or comply with any of the terms of this Lease; (iv) the non-performance
of  any of the terms and provisions of any and all existing and future subleases
of  the  Leased  Property to be performed by any party thereunder; (v) any claim
for  malpractice, negligence or misconduct committed by any Person on or working
from  the  Leased  Property;  and  (vi)  the  violation  by  Lessee of any Legal
Requirement.  Any  amounts  which  become  payable  by Lessee under this Article
shall  be  paid  within  ten (10) days after liability therefor is determined by
litigation  or  otherwise,  and  if  not  timely paid shall bear interest at the
Overdue  Rate  from  the  date  of  such  determination  to the date of payment.
Lessee,  at its sole cost and expense, shall contest, resist and defend any such
claim,  action  or  proceeding  asserted  or  instituted  against  Lessor or may
compromise or otherwise dispose of the same as Lessee sees fit.  For purposes of
this  Article  XXIII,  any acts or omissions of Lessee, or by employees, agents,
assignees,  contractors,  subcontractors  or  others  acting for or on behalf of
Lessee  (whether  or  not they are negligent, intentional, willful or unlawful),
shall  be  strictly  attributable  to  Lessee.
Lessor  shall  indemnify,  save  harmless and defend Lessee from and against all
liabilities,  obligations,  claims,  damages, penalties, causes of action, costs
and expenses, including, but not limited to, reasonable attorneys' fees, imposed
upon  or  incurred  by  or  asserted  against  Lessee  as  a result of the gross
negligence  or  willful  misconduct  of  Lessor.  Lessor,  at its expense, shall
contest,  resist,  and  defend  any  claim,  action  or  proceeding  asserted or
instituted  against  Lessee  with  respect to the foregoing or may compromise or
otherwise  dispose  of  the  same  as Lessor sees fit.  Any amounts which become
payable  by  Lessor  under this Section shall be paid within ten (10) days after
liability  therefor  on  the  part  of  Lessor  is  determined  by litigation or
otherwise,  and  if  not  timely  paid  shall  bear a late charge (to the extent
permitted by law) at the Overdue Rate from the date of such determination to the
date  of  payment.
197.
     24.     Subletting  and  Assignment.
             ---------------------------
198.     Prohibition
         -----------
     .  Lessee  shall  not, without Lessor's prior written consent, which may be
withheld  in  Lessor's sole and absolute discretion, voluntarily or by operation
of  law  assign  (which  term  includes  any  sale, encumbering, pledge or other
transfer  or  hypothecation)  this  Lease,  master sublet all or any part of the
Leased  Property  or  engage  the  services  of any Person for the management or
operation  of the Facility.  Lessee acknowledges that Lessor is relying upon the
expertise  of  Lessee  in  the operation of the Facility and that Lessor entered
into this Lease with the expectation that Lessee would remain in and operate the
Facility  during  the  entire  Term  and for that reason Lessor retains sole and
absolute  discretion  in  approving  or  disapproving  any  assignment or master
sublease.  If  Lessee is a corporation or partnership, any transfer of its stock
(other  than  a  transfer  of  any of Lessee's stock owned by Daniel R. Baty for
estate  planning purposes) or partnership interests (or the stock or partnership
interests  of the entity(ies) that controls Lessee) or any dissolution or merger
or  consolidation  of  Lessee  (or  its  controlling entity(ies)) with any other
entity,  which  results  in  any  Person  (other  than  Daniel R. Baty) and such
Person's  Affiliates  collectively owning greater than twenty-five percent (25%)
of  the  total  outstanding shares of any class of Lessee's stock or partnership
interests,  or  the  sale  or  other transfer of all or substantially all of the
assets  of  Lessee  (or  its  controlling  entity(ies)),  shall  constitute  an
assignment of Lessee's interest in this Lease within the meaning of this Article
XXIV  and  the  provisions  requiring  consent  contained  herein  shall  apply
(provided,  however, that the foregoing provision regarding transfer of Lessee's
            -------
stock  constituting  an  assignment  shall  not  apply  if (i) Lessee's stock is
publicly traded, and (ii) Lessee's Consolidated Net Worth after such transfer is
not less than Lessee's Consolidated Net Worth as of the Commencement Date).  Any
sublease  of  more  than  ten percent (10%) of the Facility to any Person or its
Affiliates,  in  one transaction or in a series of transactions, shall be deemed
to  be  a master sublease hereunder.  For any sublease transaction not requiring
the  consent of Lessor hereunder, Lessee shall, within ten (10) days of entering
into  any such sublease, notify Lessor of the existence of such sublease and the
identity  of  the  sublessee  and supply Lessor with a copy of the sublease, any
related  documentation  and  any  other  materials  or  information  reasonably
requested  by  Lessor.
199.     Lessor  will  not  unreasonably  withhold  its  written  consent  to an
assignment  of  this Lease to (A) any Person which acquires all or substantially
all  of the assets and business of Lessee by virtue of a merger or consolidation
of,  with  or into Lessee or (B) any purchaser of 51% or more of the outstanding
voting  stock,  membership  interests  or  partnership interest of Lessee, if in
Lessor's  reasonable judgment such assignee, together with any guarantor of such
assignee's  obligations under this Lease, has (1) a consolidated net worth equal
to  or  greater than Lessee's Consolidated Net Worth at the time of the proposed
assignment  or  as  of  the Commencement Date, whichever is greater, and (2) the
operational  expertise  and  reputation  at least equal to that of Lessee at the
time  of  the  proposed  assignment or as of the Commencement Date, whichever is
greater.
200.     Consent
         -------
     .  If Lessee desires at any time to assign this Lease, to master sublet the
Facility  or  any  portion  thereof or engage the services of any Person for the
management  or  operation  of  the Facility, it shall first notify Lessor of its
desire  to  do  so  and  shall  submit in writing to Lessor: (i) the name of the
proposed master sublessee, assignee or manager; (ii) the terms and provisions of
the proposed master sublease, assignment or management agreement; and (iii) such
financial  information  as Lessor reasonably may request concerning the proposed
master  sublessee,  assignee  or  manager.
201.     Lessor  may,  as a condition to granting such consent, require that the
obligations  of  any  sublessee,  assignee,  or manager which is an Affiliate of
another  Person  be  guaranteed  by  its parent or controlling Person if (i) the
Consolidated  Net  Worth  of  Lessee would be diminished as a result of any such
assignment  of Lessee's interest described in this Article XXIV, or (ii) the new
controlling Person(s) would have a consolidated net worth less than the Lessee's
     Consolidated Net Worth as of the Closing Date and that any guaranty of this
Lease be reaffirmed by any Guarantor notwithstanding such subletting, assignment
or  management  arrangement.  Any  sublease  shall  be  expressly  subject  and
subordinate  to  all  applicable  terms and conditions of this Lease and provide
that  Lessor, at its option and without any obligation to do so, may require any
sublessee  to  attorn  to  Lessor,  in  which  event  Lessor shall undertake the
obligations  of  Lessee,  as  sublessor under such sublease from the time of the
exercise  of  such  option  to the termination of such sublease and in such case
Lessor  shall  not  be  liable for any prepaid rents or security deposit paid by
such sublessee to Lessee unless Lessor actually receives the same from Lessee or
for  any  other prior defaults of Lessee under such sublease.  In the event that
Lessor shall not require such attornment with respect to any sublease, then such
sublease  shall  automatically  terminate  upon  the  expiration  or  earlier
termination  of  this Lease, including any early termination by mutual agreement
of  Lessor  and  Lessee.  Furthermore,  any  sublease,  assignment or management
agreement  shall expressly provide that the sublessee, assignee or manager shall
furnish  Lessor  with such financial and operational information and information
about the physical condition of the Facility, including the information required
by  Section  25.2  herein,  as  Lessor  may  request  from  time  to  time.
202.     Lessor  may,  as  a  condition  to  its  consent  to  any  such  master
subletting,  require  Lessee  to pay to Lessor one hundred percent (100%) of all
Transfer  Consideration.  "Transfer  Consideration"  shall  mean  the  positive
                           -----------------------
difference,  if  any,  between  the  Fair  Market Rental and the Rent payable by
Lessee  determined  on  a  monthly basis, prorating the Rent, as appropriate, if
less  than  all  of the Facility is sublet; provided, however, in no event shall
                                            --------  -------
Lessor  be  entitled  to  receive  any  amount in excess of the amount Lessee is
entitled  to  receive  as  a  result  of  the  master  sublease.  The  Transfer
Consideration  for each month shall be paid by Lessee to Lessor monthly when the
Minimum  Rent  is  due  for  the  duration  of  the  master  subletting.
203.     Lessor  may,  as  a  condition  to  its  consent  to  any assignment or
management  arrangement, require Lessee to pay to Lessor upon the effective date
of  such  assignment  or  management  arrangement an amount equal to one hundred
percent (100%) of the Transfer Consideration for the remaining Term of the Lease
     assuming  all  renewal  options  are  exercised  and  there  is  no  early
termination  of  the  Lease  and Lessor shall refund any amounts attributable to
renewal  options if they subsequently are not exercised with interest thereon at
the  Prime  Rate;  provided,  however,  in  no event shall Lessor be entitled to
                   --------   -------
receive  any  amount  in excess of the amount Lessee is entitled to receive as a
result  of  the  assignment  or  management  agreement.
204.     The  consent  by  Lessor  to  any  assignment,  master  subletting  or
management  arrangement  shall  not  constitute  a  consent  to  any  subsequent
assignment,  master  subletting  or  management  arrangement by Lessee or to any
subsequent or successive assignment, master subletting or management arrangement
     by  the  master sublessee, assignee or manager.  Any purported or attempted
assignment,  sublease,  management  agreement  or  other  permission  to use the
Facility  contrary  to  the provisions of this Article shall be void and, at the
option  of  Lessor,  shall  terminate  this  Lease.
205.     Notwithstanding  the preceding, Lessee may sublease or assign the Lease
to an Affiliate of Lessee without the written consent of Lessor and Lessee shall
     not  be required to pay any Transfer Consideration to Lessor as a result of
such  sublease or assignment to an Affiliate, but such sublease or assignment of
the Lease from Lessee to an Affiliate of Lessee will not relieve Lessee from its
obligations  under  the  Lease  or  any Guarantor from its obligations under any
guaranty  of  this  Lease.
206.     Costs
         -----
     .  Lessee shall reimburse Lessor for Lessor's reasonable costs and expenses
incurred in conjunction with the processing and documentation of any assignment,
master  subletting  or  management arrangement, including reasonable attorneys',
architects',  engineers'  or  other consultants' fees whether or not such master
sublease,  assignment  or  management  agreement  is  actually  consummated.
207.     No  Release  of  Lessee's  Obligations
         --------------------------------------
     .  No  assignment,  subletting or management agreement shall relieve Lessee
of its obligation to pay the Rent and to perform all of the other obligations to
be  performed by Lessee hereunder.  The liability of Lessee named herein and any
immediate  and  remote  successor  in  interest  of  Lessee  (by  assignment  or
otherwise), and the due performance of the obligations of this Lease on Lessee's
part  to  be performed or observed, shall not in any way be discharged, released
or impaired by any (i) agreement which modifies any of the rights or obligations
of  the parties under this Lease, (ii) stipulation which extends the time within
which  an  obligation  under  this Lease is to be performed, (iii) waiver of the
performance  of  an  obligation  required  under  this Lease, or (iv) failure to
enforce  any  of  the  obligations  set  forth  in  this  Lease.
208.     Assignment  of  Lessee's  Rights  Against  Sublease
         ---------------------------------------------------
..  If  Lessor  shall consent to a master subletting, then the written instrument
of  consent,  executed  and  acknowledged by Lessor, Lessee and sublessee, shall
contain  a  provision  substantially  similar  to  the  following:
209.     Lessee  and  sublessee  hereby  agree  that,  if  sublessee shall be in
default  of  any  obligation  of  Lessee  under the sublease, which default also
constitutes  a default by Lessee under the Lease, then Lessor shall be permitted
to  avail  itself  of  all  of  the  rights  and remedies available to Lessee in
connection  therewith.
210.     Without  limiting  the  generality  of  the  foregoing, Lessor shall be
permitted  (by  assignment  of  a  cause of action or otherwise) to institute an
action or proceeding against sublessee in the name of Lessee in order to enforce
     Lessee's rights under the sublease, and also shall be permitted to take all
ancillary  actions  (e.g.,  serve  default  notices  and demands) in the name of
Lessee  as  Lessor  reasonably  shall  determine  to  be  necessary.
211.     Lessee  agrees  to cooperate with Lessor, and to execute such documents
as  shall  be reasonably necessary, in connection with the implementation of the
foregoing  rights  of  Lessor.
212.     Lessee expressly acknowledges and agrees that the exercise by Lessor of
     any  of  the foregoing rights and remedies shall not constitute an election
of  remedies,  and  shall  not  in any way impair Lessor's entitlement to pursue
other  rights  and  remedies  directly  against  Lessee.
213.     Reserved
         --------
     .
214.     REIT  Protection
         ----------------
     .  Anything contained in this Lease to the contrary notwithstanding, Lessee
shall  not  (i)  sublet,  assign  or enter into a management arrangement for the
Leased Property on any basis such that the rental or other amounts to be paid by
the  sublessee,  assignee  or  manager thereunder would be based, in whole or in
part,  on  the  income  or  profits  derived  by  the business activities of the
sublessee,  assignee  or  manager;  (ii)  furnish  or render any services to the
sublessee,  assignee  or  manager  or  manage  or operate the Leased Property so
subleased,  assigned or managed; (iii) sublet, assign or enter into a management
arrangement for the Leased Property to any Person in which Lessee or Lessor owns
an  interest,  directly  or indirectly (by applying constructive ownership rules
set  forth  in  Section  856(d)(5) of the Code); or (iv) sublet, assign or enter
into  a management arrangement for the Leased Property in any other manner which
could cause any portion of the amounts received by Lessor pursuant to this Lease
or  any  sublease  to  fail  to qualify as "rents from real property" within the
meaning  of  Section  856(d)  of the Code, or any similar or successor provision
thereto  or  which  could cause any other income of Lessor to fail to qualify as
income  described  in  Section  856(c)(2)  of  the  Code.
215.     Prepaid  Rent
         -------------
     .  Lessee  shall  not  require or accept prepayment for more than three (3)
months'  use  of  individual units or rooms of the Facility.  Amounts charged to
residents  for  individual units or rooms shall not be materially less than fair
market  value.
216.
     25.     Officer's  Certificates  and  Financial  Statements.
             ---------------------------------------------------
217.     Officer's  Certificate
         ----------------------
     .  At any time and from time to time upon Lessee's receipt of not less than
ten  (10)  days' prior written request by Lessor, Lessee shall furnish to Lessor
an  Officer's  Certificate  certifying  (i) that this Lease is unmodified and in
full  force  and  effect,  or  that  this  Lease  is in full force and effect as
modified  and  setting forth the modifications; (ii) the dates to which the Rent
has  been paid; (iii) whether or not, to the best knowledge of Lessee, Lessor is
in  default in the performance of any covenant, agreement or condition contained
in  this Lease and, if so, specifying each such default of which Lessee may have
knowledge;  and  (iv) responses to such other questions or statements of fact as
Lessor,  any  ground  or  underlying  lessor,  any  purchaser  or any current or
prospective  Facility  Mortgagee  shall reasonably request.  Lessee's failure to
deliver  such  statement within such time shall constitute an acknowledgement by
Lessee  that (x) this Lease is unmodified and in full force and effect except as
may  be  represented  to the contrary by Lessor; (y) Lessor is not in default in
the performance of any covenant, agreement or condition contained in this Lease;
and  (z)  the  other  matters  set  forth  in such request, if any, are true and
correct.  Any  such certificate furnished pursuant to this Article may be relied
upon  by  Lessor  and  any  current or prospective Facility Mortgagee, ground or
underlying  lessor  or  purchaser  of  the  Leased  Property.
218.     Statements
         ----------
     .  Lessee  shall  furnish  the  following  statements  to  Lessor:
219.     within  120 days after the end of each of Lessee's fiscal years, a copy
of  the  audited  consolidated  balance  sheets  of  Lessee and its consolidated
Subsidiaries as of the end of such fiscal year, and related audited consolidated
     statements  of  income,  changes  in  common  stock and other stockholders'
equity  and  changes  in  the  financial position of Lessee and its consolidated
Subsidiaries for such fiscal year, prepared in accordance with GAAP applied on a
basis  consistently maintained throughout the period involved, such consolidated
financial  statements  to be certified by nationally recognized certified public
accountants;
220.     within  120  days  after the end of Lessee's fiscal years, and together
with  the  annual audit report furnished in accordance with clause (a) above, an
Officer's  Certificate  stating  that  to the best of the signer's knowledge and
belief  after making due inquiry, Lessee is not in default in the performance or
observance  of any of the terms of this Lease, or if Lessee shall be in default,
specifying  all  such defaults, the nature thereof, and the steps being taken to
remedy  the  same;
221.     within  thirty  (30)  days after the end of each month for those months
occurring  from  the  Commencement Date to three months after the first month in
which  the average Cash Flow Coverage for the Facility equals or exceeds 1.3 for
such  month,  all  consolidated  financial reports Lessee produces for reporting
purposes  and  detailed statements of income and detailed operational statistics
regarding  occupancy  rates,  patient  and resident mix and patient and resident
rates  by type for the Facility; and thereafter within sixty (60) days after the
end  of  each of Lessee's quarters, all quarterly consolidated financial reports
Lessee  produces  for  reporting  purposes and detailed statements of income and
detailed  operational statistics regarding occupancy rates, patient and resident
mix  and  patient  and  resident  rates  by  type  for  the  Facility;
222.     within  120 days after the end of each of Lessee's fiscal years, a copy
of  each cost report, if any, filed with the appropriate governmental agency for
the  Facility;
223.     within  thirty  (30)  days after they are required to be filed with the
SEC,  copies  of  any  annual  reports  and  of information, documents and other
reports,  or  copies  of  such  portions  of any of the foregoing as the SEC may
prescribe,  which Lessee is required to file with the SEC pursuant to Section 13
or  15(d)  of  the  Securities  Exchange  Act  of  1934,  as  amended;
224.     within  three  (3) Business Days after Lessee's receipt thereof, copies
of  all  written  communications  received  by Lessee from any regulatory agency
relating  to (i) surveys of the Facility for purposes of licensure, Medicare and
Medicaid  certification  and  accreditation  and  (ii) any proceeding, formal or
informal,  with  respect  to  cited  deficiencies  with  respect to services and
activities  provided  and  performed  at  the  Facility,  including  patient and
resident  care,  patient  and resident activities, patient and resident therapy,
dietary,  medical  records,  drugs  and  medicines,  supplies,  housekeeping and
maintenance,  or  the  condition  of  the  Facility,  and involving an actual or
threatened  warning,  imposition  of  a  fine  or  a  penalty,  or  suspension,
termination or revocation of the Facility's license to be operated in accordance
     with  its  Primary  Intended  Use;
225.     [Intentionally  Omitted];
226.     immediately  upon  Lessee's  receipt  thereof,  copies  of all material
claims, complaints, notices, warnings or asserted violations relating in any way
     to  the  Leased  Property  or  Lessee's  use  thereof;  and
227.     with  reasonable  promptness,  such  other  information  respecting the
financial  and  operational condition and affairs of Lessee and the Facility and
the  physical  condition of the Leased Property and any Capital Addition thereto
as  Lessor  may reasonably request, in the form of a questionnaire or otherwise,
from  time  to  time.
228.     Charges
         -------
     .  Lessee  acknowledges  that the failure to furnish Lessor with any of the
certificates  or  statements  required  by this Article XXV will cause Lessor to
incur  costs  and expenses not contemplated hereunder, the exact amount of which
is  presently  anticipated to be extremely difficult to ascertain.  Accordingly,
if  Lessee  fails  to  furnish Lessor with any of the certificates or statements
required  by this Article XXV, Lessee shall pay to Lessor upon demand $1,000 for
each  such  failure  as  Additional Charges.  The parties agree that this charge
represents a fair and reasonable estimate of the costs that Lessor will incur by
reason  of  Lessee's  failure  to  furnish  Lessor  with  such  certificates and
statements.
229.
230.     Lessor's  Right  to  Inspect  and  Show the Leased Property and Capital
         -----------------------------------------------------------------------
Additions
    -----
     .  Lessee shall permit Lessor and its authorized representatives to inspect
the Leased Property and any Capital Addition thereto during usual business hours
and  on  reasonable  notice  subject  to  any  security,  health,  safety  or
confidentiality  requirements  of  Lessee  or any Legal Requirement or Insurance
Requirement.
231.
232.     No  Waiver
         ----------
     .  No  failure  by Lessor to insist upon the strict performance of any term
hereof  or to exercise any right, power or remedy hereunder and no acceptance of
full  or  partial payment of Rent during the continuance of any default or Event
of Default shall constitute a waiver of any such breach or of any such term.  No
waiver  of  any breach shall affect or alter this Lease, which shall continue in
full  force  and  effect  with  respect to any other then existing or subsequent
breach.
233.
234.     Remedies  Cumulative
         --------------------
     .  Each  legal,  equitable or contractual right, power and remedy of Lessor
now  or hereafter provided either in this Lease or by statute or otherwise shall
be  cumulative  and  concurrent  and  shall be in addition to every other right,
power  and remedy and the exercise or beginning of the exercise by Lessor of any
one  or  more  of  such  rights,  powers  and  remedies  shall  not preclude the
simultaneous  or  subsequent  exercise  by  Lessor  of  any or all of such other
rights,  powers  and  remedies.
235.
236.     Acceptance  of  Surrender
         -------------------------
     .  No  surrender  to  Lessor of this Lease or of the Leased Property or any
part  thereof  or  of  any  interest therein, shall be valid or effective unless
agreed  to  and  accepted  in  writing  by  Lessor  and  no act by Lessor or any
representative  or  agent  of  Lessor,  other  than such a written acceptance by
Lessor,  shall  constitute  an  acceptance  of  any  such  surrender.
237.
238.     No  Merger
         ----------
     .  There  shall  be  no  merger  of  this  Lease or of the leasehold estate
created  hereby  by  reason of the fact that the same Person may acquire, own or
hold,  directly  or  indirectly,  (i) this Lease or the leasehold estate created
hereby  or  any interest in this Lease or such leasehold estate and (ii) the fee
estate  in  the  Leased  Property.
239.
240.     Conveyance  by  Lessor
         ----------------------
     .  If Lessor or any successor owner of the Leased Property shall convey the
Leased  Property  other  than  as  security for a debt, Lessor or such successor
owner,  as  the  case  may  be,  shall  thereupon  be  released  from all future
liabilities  and  obligations of the Lessor under this Lease arising or accruing
from and after the date of such conveyance or other transfer and all such future
liabilities  and  obligations  shall  thereupon  be  binding upon the new owner.
241.
242.     Quiet  Enjoyment
         ----------------
     .  So  long  as Lessee shall pay the Rent as the same becomes due and shall
fully  comply  with  all  of  the  terms  of  this  Lease  and fully perform its
obligations  hereunder,  Lessee shall peaceably and quietly have, hold and enjoy
the Leased Property for the Term, free of any claim or other action by Lessor or
anyone  claiming  by,  through  or  under  Lessor,  but subject to all liens and
encumbrances  of  record  as  of  the  date  hereof, or the Commencement Date or
created  thereafter as permitted hereunder or thereafter consented to by Lessee.
No failure by Lessor to comply with the foregoing covenant shall give Lessee any
right  to  cancel  or  terminate this Lease or abate, reduce or make a deduction
from or offset against the Rent or any other sum payable under this Lease, or to
fail  to  perform any other obligation of Lessee hereunder.  Notwithstanding the
foregoing,  Lessee  shall  have the right, by separate and independent action to
pursue any claim it may have against Lessor as a result of a breach by Lessor of
the  covenant  of  quiet  enjoyment  contained  in  this  Article.
243.
244.     Notices
         -------
     .  Any notice, consent, approval, demand or other communication required or
permitted  to  be  given  hereunder  (a  "notice") must be in writing and may be
                                          ------
served  personally  or  by  U.S.  Mail.  If  served  by  U.S.  Mail, it shall be
addressed  as  follows:
If  to  Lessor:     Health  Care  Property  Investors,  Inc.
4675  MacArthur  Court,  Suite  900
Newport  Beach,  California  92660
Attn:  Legal  Department
Fax:  (949)  221-0607
with  a  copy  to:     Latham  &  Watkins
650  Town  Center  Drive,  Suite  2000
Costa  Mesa,  California  92626
Attn:  David  C.  Meckler,  Esq.
Fax:  (714)  755-8290
If  to  Lessee:     Emeritus  Corporation
3131  Elliott  Avenue
Suite  500
Seattle,  Washington  98121
Attn:  Raymond  Brandstrom
Fax:  (206)  443-5432
with  a  copy  to:     The  Nathanson  Group  PLLC
1411  Fourth  Ave.,  Suite  905
Seattle,  Washington  98101
Attn:  Randi  S.  Nathanson,  Esq.
Fax:  (206)  623-1738
Any  notice  which  is  personally  served  shall  be effective upon the date of
service;  any  notice  given  by U.S. Mail shall be deemed effectively given, if
deposited in the United States Mail, registered or certified with return receipt
requested,  postage  prepaid  and  addressed  as  provided above, on the date of
receipt,  refusal or non-delivery indicated on the return receipt.  In addition,
either  party  may  send  notices  by  facsimile  or  by a nationally recognized
overnight  courier service provides written proof of delivery (such as U.P.S. or
Federal  Express).  Any  notice  sent  by  facsimile  shall  be  effective  upon
confirmation  of  receipt  in  legible form, and any notice sent by a nationally
recognized  overnight  courier shall be effective on the date of delivery to the
party  at  its  address  specified  above as set forth in the courier's delivery
receipt.  Either  party  may,  by  notice  to the other from time to time in the
manner  herein  provided,  specify  a  different  address  for  notice purposes.
245.
246.     Appraiser
         ---------
     .  If  it  becomes  necessary  to  determine  the Fair Market Value or Fair
Market  Rental  for  any  purpose of this Lease, the same shall be determined by
Valuation Counselors, or in the event Valuation Counselors no longer exists upon
the date the same is to be determined, any other nationally recognized appraisal
firm,  in  which one or more of the members, officers or principals of such firm
are  members  of  the  American  Institute  of  Real  Estate  Appraisers (or any
successor  organization  thereto),  as  may  be selected by Lessor in writing to
Lessee  (the  "Appraiser").  Lessor  shall cause such Appraiser to determine the
               ---------
Fair  Market  Value or Fair Market Rental as of the relevant date (giving effect
to the impact, if any, of inflation from the date of the Appraiser's decision to
the  relevant  date)  and the determination of such Appraiser shall be final and
binding  upon  the  parties.  If  the Facility had reached stabilized operations
prior  to  the  Commencement Date, to the extent consistent with sound appraisal
practice  as  then  existing at the time of any such appraisal, an appraisal for
Fair  Market  Value  shall be made on a basis consistent with the basis on which
the  Leased  Property  was appraised for purposes of determining its fair market
value  at  the  time the Leased Property was acquired by Lessor.  This provision
for  determination  by appraisal shall be specifically enforceable to the extent
such  remedy  is available under applicable law, and any determination hereunder
shall  be  final  and  binding  upon the parties except as otherwise provided by
applicable  law.  Lessor  and  Lessee  shall  each  pay one-half of the fees and
expenses  of  the Appraiser and one-half of all other cost and expenses incurred
in  connection  with  such  appraisal.
247.
[INTENTIONALLY  OMITTED]
248.
249.     Lessor  May  Grant  Liens
         -------------------------
     .  Without  the  consent of Lessee, Lessor may, from time to time, directly
or indirectly, create or otherwise cause to exist any lien, encumbrance or title
retention agreement upon the Leased Property, or any portion thereof or interest
therein,  whether  to  secure  any  borrowing  or  other  means  of financing or
refinancing.  This Lease is and at all times shall be subject and subordinate to
any  ground  or  underlying  leases, mortgages, trust deeds or like encumbrances
(collectively,  "Priority  Encumbrances"), which may now or hereafter affect the
                 ----------------------
Leased Property and to all renewals, modifications, consolidations, replacements
and  extensions  of  any  such  lease, mortgage, trust deed or like encumbrance;
provided,  however,  that  the  subjection  and  subordination of this Lease and
    ----   -------
Lessee's  leasehold  interest  hereunder  to  any  Priority Encumbrance shall be
    -
conditioned  upon  the  execution by the holder of each Priority Encumbrance and
    -
delivery  to  Lessee of a nondisturbance and attornment agreement which provides
that  so  long as no default has occurred and is continuing beyond the period of
time allowed for the remedy thereof under the terms of this Lease, the holder of
such  Priority  Encumbrance  (i)  shall  not  disturb  either Lessee's leasehold
interest  or  possession  of  the  Leased  Property in accordance with the terms
hereof,  or  any  of  its  rights,  privileges  and  options,  (ii) shall permit
application  of  all  proceeds  of  insurance  and  all  Awards  and payments in
connection  with  the  taking  of  all  or any portion of the Leased Property in
accordance  with  the  provisions  of  Articles  XIV and XV of this Lease, (iii)
waives  all Priority Encumbrance rights or interests in any of Lessee's Personal
Property,  and  (iv) shall execute a release of such rights, privileges, options
and  all  liens and claims that the holder of such Priority Encumbrance may have
in  the Leased Property upon payment of the purchase price therefor in the event
Lessee  exercises  any  of its options or rights to purchase the Leased Property
provided  in this Lease.  In connection with the foregoing and at the request of
Lessor, Lessee shall promptly execute a reasonable subordination, nondisturbance
and  attornment  agreement  which  will  incorporate  the terms set forth in the
preceding  sentence.  Except  for  the  documents  described  in  the  preceding
sentences,  this  clause  shall  be  self-operative and no further instrument of
subordination  shall  be  required  by any ground or underlying lessor or by any
mortgagee  or  beneficiary,  affecting  any  lease  or  the Leased Property.  In
confirmation  of  such  subordination,  Lessee  shall  execute  promptly  any
certificate  that  Lessor  may  request  for  such  purposes.
250.     Attornment
         ----------
     .  If Lessor's interest in the Leased Property is sold or conveyed upon the
exercise  of  any  remedy provided for in any Facility Mortgage, or otherwise by
operation  of  law:  (i)  at  the new owner's option, Lessee shall attorn to and
recognize  the new owner as Lessee's Lessor under this Lease or enter into a new
lease  substantially  in  the  form of this Lease with the new owner, and Lessee
shall  take  such  actions  to  confirm the foregoing within ten (10) days after
request;  and (ii) the new owner shall not be (a) liable for any act or omission
of  Lessor  under  this Lease occurring prior to such sale or conveyance, or (b)
subject  to any offset, abatement or reduction of rent because of any default of
Lessor  under  this  Lease  occurring  prior  to  such  sale  or  conveyance.
251.
252.     Hazardous  Substances
         ---------------------
     .  Lessee  shall  not  allow  any Hazardous Substance to be located in, on,
under  or  about  the Leased Property or incorporated in the Facility; provided,
                                                                       --------
however, that Hazardous Substances may be brought, kept, used or disposed of in,
  -----
on  or about the Leased Property in quantities and for purposes similar to those
brought,  kept,  used or disposed of in, on or about similar facilities used for
purposes  similar  to  the  Primary  Intended  Use  or  in  connection  with the
construction  of facilities similar to the Facility and which are brought, kept,
used and disposed of in strict compliance with Legal Requirements.  Lessee shall
not  allow  the  Leased  Property to be used as a waste disposal site or for the
manufacturing,  handling,  storage,  distribution  or  disposal of any Hazardous
Substance.
253.     Notices
         -------
     .  Lessee  shall  provide  to Lessor promptly, and in any event immediately
upon  Lessee's  receipt  thereof,  a  copy  of  any notice, or notification with
respect  to,  (i)  any  violation  of  a Legal Requirement relating to Hazardous
Substances  located  in,  on,  or  under  the  Leased  Property  or any adjacent
property;  (ii)  any  enforcement,  cleanup,  removal,  or other governmental or
regulatory action instituted, completed or threatened with respect to the Leased
Property; (iii) any claim made or threatened by any Person against Lessee or the
Leased  Property  relating to damage, contribution, cost recovery, compensation,
loss,  or  injury  resulting  from  or  claimed  to  result  from  any Hazardous
Substance;  and  (iv)  any  reports  made  to  any  federal,  state  or  local
environmental  agency  arising  out  of  or  in  connection  with  any Hazardous
Substance  in,  on,  under  or  removed  from the Leased Property, including any
complaints,  notices,  warnings  or asserted violations in connection therewith.
254.     Remediation
         -----------
     .  If Lessee becomes aware of a violation of any Legal Requirement relating
to  any  Hazardous  Substance  in, on, under or about the Leased Property or any
adjacent  property,  or if Lessee, Lessor or the Leased Property becomes subject
to  any  order of any federal, state or local agency to repair, close, detoxify,
decontaminate  or  otherwise  remediate  the  Leased  Property,  Lessee  shall
immediately  notify Lessor of such event and, at its sole cost and expense, cure
such  violation  or effect such repair, closure, detoxification, decontamination
or  other  remediation.  If  Lessee fails to implement and diligently pursue any
such  cure,  repair,  closure,  detoxification,  decontamination  or  other
remediation,  Lessor  shall have the right, but not the obligation, to carry out
such  action  and  to  recover  from  Lessee  all of Lessor's costs and expenses
incurred  in  connection  therewith.
255.     Indemnity
         ---------
     .  Lessee  shall  indemnify,  defend,  protect,  save,  hold  harmless, and
reimburse  Lessor  for,  from  and against any and all costs, losses (including,
losses of use or economic benefit or diminution in value), liabilities, damages,
assessments, lawsuits, deficiencies, demands, claims and expenses (collectively,
"Environmental  Costs")  (whether  or  not arising out of third-party claims and
 --------------------
regardless  of  whether  liability  without  fault  is  imposed, or sought to be
 --
imposed,  on Lessor) incurred in connection with, arising out of, resulting from
 --
or  incident  to,  directly  or indirectly, before or during (but not after) the
Term  or  such  portion  thereof  during  which the Leased Property is leased to
Lessee  (i)  the  production, use, generation, storage, treatment, transporting,
disposal,  discharge,  release or other handling or disposition of any Hazardous
Substances from, in, on or about the Leased Property (collectively, "Handling"),
                                                                     --------
including the effects of such Handling of any Hazardous Substances on any Person
or  property  within  or outside the boundaries of the Leased Property, (ii) the
presence  of any Hazardous Substances in, on, under or about the Leased Property
and (iii) the violation of any Environmental Law.  "Environmental Costs" include
                                                    -------------------
interest,  costs  of  response,  removal, remedial action, containment, cleanup,
investigation,  design, engineering and construction, damages (including actual,
consequential  and  punitive  damages)  for personal injuries and for injury to,
destruction  of  or  loss  of  property  or  natural  resources,  relocation  or
replacement  costs,  penalties,  fines,  charges  or  expenses, attorney's fees,
expert  fees,  consultation  fees,  and  court  costs,  and  all amounts paid in
investigating,  defending  or  settling  any  of  the  foregoing.
Without  limiting  the  scope  or  generality of the foregoing, Lessee expressly
agrees to reimburse Lessor for any and all costs and expenses incurred by Lessor
in  connection  with, arising out of, resulting from or incident to, directly or
indirectly,  before  or  during (but not after) the Term or such portion thereof
during  which  the  Leased  Property  is  leased  to  Lessee  of  the following:
256.     In  investigating  any  and all matters relating to the Handling of any
Hazardous  Substances,  in,  on,  from,  under  or  about  the  Leased Property;
257.     In  bringing  the  Leased  Property  into  compliance  with  all  Legal
Requirements;  and
258.     Removing, treating, storing, transporting, cleaning-up and/or disposing
     of  any  Hazardous Substances used, stored, generated, released or disposed
of  in,  on,  from,  under  or  about  the  Leased  Property  or  off-site.
     If  any  claim  is made by Lessor for reimbursement for Environmental Costs
incurred  by  it hereunder, Lessee agrees to pay such claim promptly, and in any
event to pay such claim within thirty (30) calendar days after receipt by Lessee
of  notice  thereof.  If  any such claim is not so paid and Lessor is ultimately
found  or agrees to be responsible therefore, Lessee agrees also to pay interest
on  the  amount  paid  from  the  date of the first notice of such claim, at the
Overdue  Rate.
259.     Environmental  Inspection
         -------------------------
     .  Lessor  shall  have the right, from time to time, during normal business
hours  and  upon not less than five (5) days written notice to Lessee, except in
the  case of an emergency in which event no notice shall be required, to conduct
an  inspection  of the Leased Property to determine the existence or presence of
Hazardous  Substances  on  or  about the Leased Property.  Lessor shall have the
right  to  enter  and inspect the Leased Property, conduct any testing, sampling
and  analyses  it  deems necessary and shall have the right to inspect materials
brought  into  the  Leased Property.  Lessor may, in its discretion, retain such
experts  to conduct the inspection, perform the tests referred to herein, and to
prepare  a  written  report  in  connection  therewith.  All  costs and expenses
incurred  by  Lessor  under  this  Section shall be paid on demand as Additional
Charges  by Lessee to Lessor.  Failure to conduct an environmental inspection or
to  detect  unfavorable  conditions  if such inspection is conducted shall in no
fashion  be  intended as a release of any liability for environmental conditions
subsequently  determined  to  be  associated  with  or  to  have occurred during
Lessee's  tenancy.  Lessee  shall  remain liable for any environmental condition
related  to  or  having  occurred  during  its  tenancy  regardless of when such
conditions  are  discovered  and regardless of whether or not Lessor conducts an
environmental  inspection  at the termination of the Lease.  The obligations set
forth in this Article shall survive the expiration or earlier termination of the
Lease.
260.
261.     Memorandum  of  Lease
         ---------------------
     .  Lessor and Lessee shall, promptly upon the request of either, enter into
a  short form memorandum of this Lease, in form suitable for recording under the
laws  of  the  State.  Lessee  shall pay all costs and expenses of recording any
such  memorandum  and  shall fully cooperate with Lessor in removing from record
any  such  memorandum  upon  the  expiration or earlier termination of the Term.
262.
263.     Sale  of  Assets
         ----------------
     .  Notwithstanding  any  other provision of this Lease, Lessor shall not be
required  to  (i)  sell or transfer the Leased Property, or any portion thereof,
which is a real estate asset as defined in Section 856(c)(6)(B), or functionally
equivalent  successor  provision,  of  the  Code,  to Lessee if Lessor's counsel
advises  Lessor  that  such  sale  or  transfer  may  not  be a sale of property
described  in  Section  857(b)(6)(C),  or  functionally  equivalent  successor
provision,  of  the  Code  or  (ii) sell or transfer the Leased Property, or any
portion  thereof, to Lessee if Lessor's counsel advises Lessor that such sale or
transfer  could result in an unacceptable amount of gross income for purposes of
the  ninety five percent (95%) gross income test contained in Section 856(c)(2),
or  functionally equivalent successor provision, of the Code.  If Lessee has the
obligation  to purchase the property pursuant to the terms herein, and if Lessor
determines not to sell such property pursuant to the above sentence, then Lessee
shall  purchase  such  property,  upon  and  subject to all applicable terms and
conditions set forth in this Lease, including the provisions of Article XXXV, at
such  time  as  the transaction, upon the advice of Lessor's counsel, would be a
sale  of  property  (to  the  extent the Leased Property is a real estate asset)
described  in  Section  857(b)(6)(C),  or  functionally  equivalent  successor
provision,  of the Code, and would not result in an unacceptable amount of gross
income for purposes of the ninety five percent (95%) gross income test contained
in Section 856(c)(2), or functionally equivalent successor provision of the Code
and  until  such  time Lessee shall lease the Leased Property from Lessor at the
Fair  Market  Rental  determined  in  accordance  with  Article XXXIV; provided,
                                                                       --------
however,  that  if  Lessee's  obligation  to purchase arises pursuant to Section
      -
16.5,  and  if  the  events giving rise to the Event of Default for which Lessor
exercised  its  right  to  put the Leased Property to Lessee pursuant to Section
16.5  has  been  cured  prior  to  the time Lessor determines to sell the Leased
Property,  then  this  Lease  shall continue in full force and effect as if such
Event  of  Default  had  not  occurred.  If Lessee has the right to purchase the
property pursuant to the terms herein, and if Lessor determines not to sell such
property pursuant to the above sentence, Lessee's right, if any, to purchase any
or  all  of  such  property  shall, upon notice to Lessor that Lessee intends to
continue  such  right,  continue  and  be  exercisable,  upon and subject to all
applicable  terms  and  conditions  set  forth  in  this  Lease,  including  the
provisions  of Article XXXV, at such time as the transaction, upon the advice of
Lessor's counsel, would be a sale of property (to the extent the Leased Property
is  a  real  estate  asset)  described  in Section 857(b)(6)(C), or functionally
equivalent  successor  provision,  of  the  Code,  and  would  not  result in an
unacceptable  amount  of  gross  income  for purposes of the ninety five percent
(95%)  gross  income  test  contained  in  Section  856(c)(2),  or  functionally
equivalent  successor  provision  of  the  Code and until such time Lessee shall
lease  the  Leased  Property from Lessor at the Fair Market Rental determined in
accordance  with  Article  XXXIV.
264.
265.     Subdivision
         -----------
     .  If the Land is in excess of that which is required to operate the Leased
Property  in  accordance with its Primary Intended Use, Lessor may subdivide the
Land  and amend this Lease and the legal descriptions attached hereto as Exhibit
                                                                         -------
A-1  and  Exhibit A-2 such that the Land contains only so much of the Land as is
---       -----------
necessary to operate the Leased Property in accordance with its Primary Intended
Use.  If  Lessor  subdivides  the  Land,  Lessee  shall  have  the  right  to an
appropriate  abatement  of  Rent  payable and the right to reasonably adjust any
other  obligations  of  either  party  accordingly.  After  any such subdivision
Lessee  shall  have  no rights to any land which is no longer part of the Leased
Property  and Lessor may sell, lease or develop any land which is no longer part
of  the  Leased  Property;  provided  that  Lessor may not use such land for the
                            --------
operation  of  a  facility  providing  adult congregate care and assisted living
services;  and provided further that Lessor may not sell or lease such land to a
               ----------------
third  party that Lessor knows intends to use such land for the development of a
facility  providing  adult  congregate  care  and  assisted living services.  If
Lessor  elects to subdivide the Land Lessee shall cooperate with Lessor and take
all  actions  reasonably  requested  by  Lessor  to  effect  such  subdivision.
266.
267.     Authority
         ---------
     .  If  Lessee  is  a  corporation,  trust, or partnership, Lessee, and each
individual  executing this Lease on behalf of Lessee, represent and warrant that
each  is  duly  authorized to execute and deliver this Lease on behalf of Lessee
and  shall  within  thirty  (30)  days  after execution of this Lease deliver to
Lessor  evidence  of  such  authority  satisfactory  to  Lessor.
268.
269.     Attorneys'  Fees
         ----------------
     .  If  Lessor  or  Lessee  brings an action or other proceeding against the
other  to  enforce  any  of  the  terms,  covenants  or conditions hereof or any
instrument  executed  pursuant  to  this  Lease,  or  by reason of any breach or
default  hereunder  or  thereunder,  the  party prevailing in any such action or
proceeding  and  any  appeal  thereupon  shall  be  paid  all  of  its costs and
reasonable  outside  attorneys'  fees  incurred  therein.  In  addition  to  the
foregoing and other provisions of this Lease that specifically require Lessee to
reimburse,  pay or indemnify against Lessor's attorneys' fees, Lessee shall pay,
as  Additional  Charges,  all  of  Lessor's  reasonable  outside attorneys' fees
incurred  in  connection  with  the administration or enforcement of this Lease,
including  attorneys' fees incurred in connection with the renewal of this Lease
for  the  Extended  Term,  the  review  of  any  letters  of credit, the review,
negotiation  or  documentation  of  any  subletting,  assignment,  or management
arrangement or any consent requested in connection therewith, and the collection
of  past  due  Rent.
270.
271.     Brokers
         -------
     .  Lessee  warrants  that  it  has not had any contact or dealings with any
Person  or real estate broker which would give rise to the payment of any fee or
brokerage  commission in connection with this Lease, and Lessee shall indemnify,
protect,  hold  harmless  and  defend Lessor from and against any liability with
respect to any fee or brokerage commission arising out of any act or omission of
Lessee.  Lessor  warrants  that  it has not had any contact or dealings with any
Person  or real estate broker which would give rise to the payment of any fee or
brokerage  commission in connection with this Lease, and Lessor shall indemnify,
protect,  hold  harmless  and  defend Lessee from and against any liability with
respect to any fee or brokerage commission arising out of any act or omission of
Lessor.
272.
273.     Miscellaneous
         -------------
     .
274.     Survival.  Anything  contained  in  this  Lease  to  the  contrary
         --------
notwithstanding,  all claims against, and liabilities and indemnities of, Lessee
         --
or  Lessor  arising  prior  to the expiration or earlier termination of the Term
shall  survive  such  expiration  or  termination.
275.     Severability.  If  any  term  or  provision  of  this  Lease  or  any
         ------------
application  thereof  shall  be  held invalid or unenforceable, the remainder of
         -
this  Lease  and  any  other  application of such term or provision shall not be
affected  thereby.
276.     Non-Recourse.  Lessee  specifically agrees to look solely to the Leased
         ------------
Property  for  recovery  of any judgment from Lessor.  It is specifically agreed
that  no  constituent  partner  in Lessor or officer or employee of Lessor shall
ever  be  personally  liable  for  any  such  judgment or for the payment of any
monetary  obligation  to  Lessee.  The  provision  contained  in  the  foregoing
sentence  is  not  intended to, and shall not, limit any right that Lessee might
otherwise  have  to  obtain  injunctive relief against Lessor, or any action not
involving  the  personal  liability of Lessor.  Furthermore, except as otherwise
expressly provided herein, in no event shall Lessor ever be liable to Lessee for
     any  indirect  or  consequential  damages  suffered by Lessee from whatever
cause.
277.     Licenses.  Upon  the  expiration  or  earlier  termination of the Term,
         --------
Lessee  shall use its best efforts to transfer to Lessor or Lessor's nominee and
shall  cooperate  with Lessor or Lessor's designee or nominee in connection with
the processing by Lessor or Lessor's designee or nominee of any applications for
     all  licenses,  operating permits and other governmental authorization, all
contracts, including contracts with governmental or quasi-governmental entities,
business  records,  data, patient and resident records, and patient and resident
trust  accounts,  which  may  be  necessary  or  useful for the operation of the
Facility;  provided  that  the  costs  and  expenses of any such transfer or the
           --------
processing  of any such application shall be paid by Lessor or Lessor's designee
or  nominee.  Lessee shall not commit any act or be remiss in the undertaking of
any  act  that  would jeopardize the licensure or certification of the Facility,
and  Lessee  shall  comply with all requests for an orderly transfer of the same
upon  the  expiration  or  early  termination  of  the  Term.  In addition, upon
request,  Lessee shall promptly deliver copies of all books and records relating
to  the  Leased  Property  and  its  operation to Lessor or Lessor's designee or
nominee  but Lessee shall not be required to deliver corporate financial records
or  proprietary  materials.  Lessee  shall  indemnify,  defend, protect and hold
harmless  Lessor  from and against any loss, damage, cost or expense incurred by
Lessor  or Lessor's designee or nominee in connection with the correction of any
and  all  deficiencies  of  a  physical  nature  identified  by any governmental
authority  responsible  for  licensing  the Leased Property in the course of any
change  of  ownership  inspection and audit and previously identified during the
Term  by  such  governmental  authority.
278.     Successors  and  Assigns.  This  Lease shall be binding upon Lessor and
         ------------------------
its  successors and assigns and, subject to the provisions of Article XXIV, upon
Lessee  and  its  successors  and  assigns.
279.     Governing  Law.  (See Also Addendum Section 46.11)  THIS LEASE (AND ANY
         --------------    --- ---- -------- ------- -----
AGREEMENT  FORMED  PURSUANT  TO  THE  TERMS  HEREOF)  SHALL  BE GOVERNED BY, AND
CONSTRUED  AND  ENFORCED  IN  ACCORDANCE  WITH,  THE  INTERNAL LAWS OF THE STATE
(WITHOUT  REGARD  TO  PRINCIPLES OF CONFLICTS OF LAW) AND ANY APPLICABLE LAWS OF
THE  UNITED  STATES  OF  AMERICA.  LESSEE AND LESSOR EACH HEREBY (I) IRREVOCABLY
SUBMIT  TO  THE  JURISDICTION  OF  THE STATE AND FEDERAL COURTS OF THE STATE AND
CONSENT  TO  SERVICE  OF  PROCESS IN ANY LEGAL PROCEEDINGS ARISING OUT OF, OR IN
CONNECTION  WITH,  THIS  LEASE  (OR  ANY  AGREEMENT FORMED PURSUANT TO THE TERMS
HEREOF),  BY  ANY MEANS AUTHORIZED BY APPLICABLE LAW; (II) IRREVOCABLY WAIVE, TO
THE  FULLEST  EXTENT PERMITTED BY LAW, ANY OBJECTION TO WHICH SUCH PARTY MAY NOW
OR  HEREINAFTER  HAVE  TO  THE LYING OR TO THE LAYING OF VENUE OF ANY LITIGATION
ARISING OUT OF, IN CONNECTION WITH, THIS LEASE (OR ANY AGREEMENT FORMED PURSUANT
     TO  THE  TERMS  HEREOF),  BROUGHT  IN  THE  STATE  COURTS OF ORANGE COUNTY,
CALIFORNIA,  OR  IN  THE  UNITED STATES DISTRICT COURT FOR THE DISTRICT IN WHICH
SUCH  COUNTY IS LOCATED; AND (III) IRREVOCABLY WAIVE ANY CLAIM IN ANY LITIGATION
BROUGHT  IN  ANY  SUCH  COURT  THAT THE SAME HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
280.     Waiver  of  Trial by Jury.  EACH OF LESSOR AND LESSEE ACKNOWLEDGES THAT
         -------------------------
IT  HAS  HAD  THE  ADVICE OF COUNSEL OF ITS CHOICE WITH RESPECT TO ITS RIGHTS TO
TRIAL  BY  JURY UNDER THE CONSTITUTION OF THE UNITED STATES AND THE STATE.  EACH
OF  LESSOR  AND LESSEE HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM,  DEMAND,  ACTION  OR CAUSE OF ACTION (i) ARISING UNDER THIS LEASE (OR ANY
AGREEMENT  FORMED  PURSUANT TO THE TERMS HEREOF) OR (ii) IN ANY MANNER CONNECTED
WITH  OR RELATED OR INCIDENTAL TO THE DEALINGS OF LESSOR AND LESSEE WITH RESPECT
TO  TIES  LEASE  (OR  ANY  AGREEMENT FORMED PURSUANT TO THE TERMS HEREOF) OR ANY
OTHER  INSTRUMENT,  DOCUMENT  OR  AGREEMENT  EXECUTED OR DELIVERED IN CONNECTION
HEREWITH,  OR  THE  TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER
NOW EXISTING OR HEREINAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR
     OTHERWISE;  EACH  OF  LESSOR AND LESSEE HEREBY AGREES AND CONSENTS THAT ANY
SUCH  CLAIM,  DEMAND,

<PAGE>
------
ACTION  OR CAUSE OF ACTION SHALL BE DECIDED BY A COURT TRIAL WITHOUT A JURY, AND
THAT  EITHER  PARTY MAY FILE A COPY OF THIS SECTION WITH ANY COURT AS CONCLUSIVE
EVIDENCE  OF  THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL
BY  JURY.
LESSOR'S  INITIALS:
LESSEE'S  INITIALS:
281.     Entire  Agreement.  This  Lease,  together  with  the  other  Emeritus
         -----------------
Documents,  as  defined  in the Contract of Acquisition, the Exhibits hereto and
thereto  and  such  other documents as are contemplated hereunder or thereunder,
constitutes  the  entire  agreement  of  the parties with respect to the subject
matter  hereof,  and  may  not  be changed or modified except by an agreement in
writing signed by the parties.  Lessor and Lessee hereby agree that all prior or
     contemporaneous oral understandings, agreements or negotiations relative to
the  leasing  of  the Leased Property are merged into and revoked by this Lease.
282.     Headings.  All titles and headings to sections, subsections, paragraphs
         --------
     or  other  divisions  of  this  Lease  are  only for the convenience of the
parties and shall not be construed to have any effect or meaning with respect to
the other contents of such sections, subsections, paragraphs or other divisions,
such  other  content  being  controlling  as  to the agreement among the parties
hereto.
283.     Counterparts.  This  Lease  may  be  executed  in  any  number  of
         ------------
counterparts,  each  of  which shall be a valid and binding original, but all of
         ---
which  together  shall  constitute  one  and  the  same  instrument.
284.     Joint  and  Several.  If  more than one Person is the Lessee under this
         -------------------
Lease,  the  liability  of  such  Persons  under  this  Lease shall be joint and
several.
285.     Interpretation.  Both  Lessor  and  Lessee  have  been  represented  by
         --------------
counsel  and  this  Lease  and every provision hereof has been freely and fairly
negotiated.  Consequently,  all  provisions  of  this Lease shall be interpreted
according  to their fair meaning and shall not be strictly construed against any
party.
286.     Time  of  Essence.  Time  is  of  the  essence  of  this Lease and each
         -----------------
provision  hereof  in  which  time  of  performance  is  established.
287.     Further  Assurances.  The parties' agree to promptly sign all documents
         -------------------
reasonably  requested  to  give  effect  to  the  provisions  of  this  Lease.
                            [SIGNATURE PAGE FOLLOWS]

<PAGE>


     SIGNATURE  PAGE  TO  LEASE


|  OC_DOCS\419784.7[W2000]||
     IN  WITNESS  WHEREOF, the parties have caused this Lease to be executed and
attested  by  their  respective  officers  thereunto  duly  authorized.
HEALTH  CARE  PROPERTY  INVESTORS,  INC.,
a  Maryland  corporation



By:     /s/  Edward  J.  Henning
        ------------------------
Name:  Edward  J.  Henning
       -------------------
Its:      Senior  Vice  President
          -----------------------

EMERITUS  CORPORATION,
a  Washington  corporation



By:     /s/  Raymond  R.  Brandstrom
        ----------------------------
Name:  Raymond  R.  Brandstrom
       -----------------------
Its:      Vice  President  of  Finance
          ----------------------------



<PAGE>
------


     A-1  Page  1
                                   EXHIBIT A-1
                                   -----------
                          Description of Land - Biloxi

Lot  7,  GULF  COMMERCIAL  SUBDIVISION, City of Biloxi, Second Judicial District
of Harrison County, Mississippi, as shown on the map or plat thereof on file and
of  record in Plat Book 14, pages 4-6 in the office of the Chancery Clerk of the
Second  Judicial  District  of  Harrison  County,  Mississippi.


<PAGE>
------


     A-1


     A-2  Page  1
                                   EXHIBIT A-2
                                   -----------
                          Description of Land - Auburn

PARCEL  ONE

A  PORTION  OF  THE  SOUTHEAST QUARTER OF SECTION 29, TOWNSHIP 13 NORTH, RANGE 8
EAST,  M.D.B.  &  M.,  IN  THE UNINCORPORATED AREA OF PLACER COUNTY, CALIFORNIA,
SHOWN AS "REMAINDER" ON PARCEL MAP NO. 75529 FILED IN BOOK 28 OF PARCELS MAPS AT
PAGE  85,  PLACER  COUNTY  RECORDS,  AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:

BEGINNING  AT  A  POINT  ON THE NORTH-SOUTH CENTERLINE OF SAID SECTION 29, A 3/4
INCH  DIAMETER  IRON  PIPE  FOUND SET FOR THE SOUTHWEST CORNER OF SAID REMAINDER
PARCEL  WHICH  BEARS  NORTH  0  36'  26" WEST 228.69 FEET FROM THE SOUTH QUARTER
CORNER OF SAID SECTION 29; THENCE FROM THE POINT OF BEGINNING ALONG THE BOUNDARY
OF  SAID  REMAINDER  PARCEL  ON THE FOLLOWING (4) CONSECUTIVE COURSES: (1) ALONG
SAID  NORTH-SOUTH CENTERLINE NORTH 0  36' 26" WEST 488.26 FEET TO THE CENTERLINE
OF  EDUCATION  STREET,  (2)  ALONG SAID STREET CENTERLINE NORTH 89  23' 34" EAST
232.97  FEET,  (3)  SOUTH  0  36' 26" EAST 484.48 FEET AND (4) SOUTH 88  27' 41"
WEST  233.00  FEET  TO  THE  POINT  OF  BEGINNING.

ASSESSOR'S  PARCEL  NUMBER  051-180-076

PARCEL  TWO

AN  EASEMENT FOR INGRESS, EGRESS AND DRIVEWAY PURPOSES OVER, UPON AND ACROSS THE
PROPERTY SET FORTH IN THE DOCUMENT ENTITLED "RECIPROCAL EASEMENT AGREEMENT DATED
NOVEMBER  11,  1995 AND RECORDED NOVEMBER 17, 1995 AS INSTRUMENT NO. 1995-62386,
PLACER  COUNTY  RECORDS.



<PAGE>
------


                                       B-1
                                    EXHIBIT B
                                    ---------
                       List of Lessor's Personal Property
     All furniture, equipment, and tangible personal property, including but not
limited  to  the  following:  all  fabrics,  beds, mattresses, credenzas, desks,
mirrors,  framed  pictures,  prints,  art  work,  tables, chairs, lamps, luggage
racks,  draperies,  bed  spreads,  sofas,  nightstands, activity tables, stools,
shower curtains and hooks, registration equipment, planters, coat racks, ceiling
fans, memo holders, podiums, stands, window blinds, wastebaskets, copy machines,
file cabinets, typewriters, trash cans, safes, lockers, washers, dryers, towels,
washcloths, linens, blankets, mattress pads, pillows, laundry carts, maid carts,
vacuum  cleaners,  hand trucks, medical carts, time clocks, clothes hangers, ice
machines,  locksetters  and  equipment,  ice  bins,  blenders, moveable coolers,
beverage  dispensers, glass racks, syrup tanks, cash registers, coffee machines,
ranges, fryers, broilers, griddles, hot plates, warmers, toasters, waffle irons,
soup  wells,  microwaves,  heat  lamps,  timers,  dishwashers,  coffee grinders,
steamers, ovens, smallwares, china, silverware, glasses, t.v. sets, and supplies
of  every  type  and  nature  now  or  hereafter  used  in  the Facility and all
increases, substitutions, replacements, additions and accessions to any such, of
every  type,  and  any  certificate of occupancy and architectural drawings with
respect  to the Facility; excluding, however, other intangible personal property
relating  to the trade or business operated on the Facility, including operating
licenses  and  good will, and any inventory or vehicles relating to the trade or
business  operated  on  the  Facility.


<PAGE>
------


     1


     C-1
                                    EXHIBIT C
                                    ---------
                           Form of Amendment to Lease
                           --------------------------
     This  First Amendment to Lease ("Amendment") is dated as of ______________,
                                      ---------
200__  by  and  between  ________________________________,  a__________________
("Lessor") and ________________________________, a__________________ ("Lessee").
     ---                                                               ------
                                    RECITALS
     A.     Lessor and Lessee entered into a lease dated as of _____________ __,
200__  (the  "Lease")  for  the  _______________  facility  located  in
              -----
___________________  and  the  _______________  facility  located  in
            ----
___________________.
            ----
B.     Lessor  and  Lessee  desire  to memorialize their understanding regarding
certain  provisions  of  the  Lease.
                                    AGREEMENT
     Capitalized  terms  not  otherwise  defined  herein  shall have the meaning
ascribed  to  them  in  the  Lease.  Lessor  and Lessee hereby agree as follows:
1.     The  Commencement  Date  of  the  Lease  is  __________________;
2.     The  Term  of  the  Lease  shall  end  on  __________________;
3.     The  first  Lease  Year for the Lease commences on _______________, 200__
and  ends  on  _______________,  200__;
4.     Subject  to  further upward adjustments as provided in Section 3.1 of the
Lease, the initial monthly Minimum Rent payable under the Lease shall be the sum
of  $______________;
Except  as  amended  above,  the Lease between Lessor and Lessee shall remain in
full  force  and  effect.  This  Amendment  may  be  executed  in  any number of
counterparts,  all  of  which  together  shall  constitute  one  and  the  same
instrument.
                            [SIGNATURE PAGE FOLLOWS]

<PAGE>


                                       C-2
     IN  WITNESS  WHEREOF,  the  parties hereto have caused this Amendment to be
executed  as  of  the  day  and  year  first  above  written.
     ,
HEALTH  CARE  PROPERTY  INVESTORS,  INC.,  a  Maryland  corporation     a
                                                                          --


By:     By:
Name:     Name:
Its:     Its:



<PAGE>
------


     D-1


     D-1
                                    EXHIBIT D
                                    ---------
                        Number of Units at Each Facility
                        --------------------------------

Biloxi,  Mississippi  (Loyalton  at  Biloxi)-81  units

Auburn,  California  (Emerald  Hills)-89  units


<PAGE>
------

                                       E-1
                                    EXHIBIT E
                                    ---------

                              LIST OF OTHER LEASES
                              --------------------

                                                  Lease
         Lessor     Lessee     Facility Name     City     State     Date
                                                                    ----
HCPI Trust     Emeritus Corporation     GREEN MEADOWS OF ALLENTOWN     ALLENTOWN
----------     --------------------     --------------------------     ---------
                                                                PA     19-Oct-95
                                                                --     ---------
Health  Care  Property  Investors, Inc.     Emeritus Corporation     SUMMER WIND
---------------------------------------     --------------------     -----------
                                        RESIDENCE     BOISE     ID     31-Aug-95
                                        ---------     -----     --     ---------
Health  Care Property Investors, Inc.     Emeritus Corporation     GREEN MEADOWS
-------------------------------------     --------------------     -------------
                                         AT DOVER     DOVER     DE     16-Oct-95
                                         --------     -----     --     ---------
HCPI  Trust     Emeritus  Corporation     COUNTRYSIDE  VILLAGE     EASLEY     SC
-----------     ---------------------     --------------------     ------     --
                                                                       26-Jan-96
                                                                       ---------
          HCPI Trust     Emeritus Corporation     SUMMIT PLACE     EASLEY     SC
          ----------     --------------------     ------------     ------     --
                                                                       26-Jan-96
                                                                       ---------
Texas  HCP  Holding, L.P.     Emeritus Corporation     THE PALISADES     EL PASO
-------------------------     --------------------     -------------     -------
                                                                 TX     1-Apr-97
                                                                 --     --------
Texas  HCP  Holding, L.P.     Emeritus Corporation     CAMBRIA LODGE     EL PASO
-------------------------     --------------------     -------------     -------
                                                                TX     23-Aug-96
                                                                --     ---------
Health  Care  Property  Investors,  Inc.     Emeritus  Corporation     SEABROOK
----------------------------------------     ---------------------     --------
                                     RETIREMENT     EVERETT     WA     27-Dec-95
                                     ----------     -------     --     ---------
Health Care Property Investors, Inc.     Emeritus Corporation     ROSEWOOD COURT
------------------------------------     --------------------     --------------
                                                  FULLERTON     CA     29-Mar-96
                                                  ---------     --     ---------
Health Care Property Investors, Inc.     Emeritus Corporation     HERITAGE LODGE
------------------------------------     --------------------     --------------
                                             HENDERSONVILLE     NC     26-Jan-96
                                             --------------     --     ---------
Health Care Property Investors, Inc.     Emeritus Corporation     HERITAGE HILLS
------------------------------------     --------------------     --------------
                              RETIREMENT     HENDERSONVILLE     NC     26-Jan-96
                              ----------     --------------     --     ---------
Health  Care  Property  Investors,  Inc.     Emeritus  Corporation     PINE PARK
----------------------------------------     ---------------------     ---------
                                             HENDERSONVILLE     NC     26-Jan-96
                                             --------------     --     ---------
HCPI  Trust     Emeritus  Corporation     GREEN  MEADOWS  OF LATROBE     LATROBE
-----------     ---------------------     --------------------------     -------
                                                                PA     19-Oct-95
                                                                --     ---------
Texas  HCP  Holding, L.P.     Emeritus Corporation     SHERWOOD PLACE     ODESSA
-------------------------     --------------------     --------------     ------
                                                                TX     27-Dec-95
                                                                --     ---------
Health  Care Property Investors, Inc.     Emeritus Corporation     GREEN MEADOWS
-------------------------------------     --------------------     -------------
                           AT PAINTED POST     PAINTED POST     NY     27-Dec-95
                           ---------------     ------------     --     ---------
Health  Care  Property Investors, Inc.     Emeritus Corporation     THE ARBOR AT
--------------------------------------     --------------------     ------------
                                    OLIVE GROVE     PHOENIX     AZ     11-Aug-95
                                    -----------     -------     --     ---------
Health  Care  Property Investors, Inc.     Emeritus Corporation     RENTON VILLA
--------------------------------------     --------------------     ------------
                                                     RENTON     WA     11-Aug-95
                                                     ------     --     ---------
Texas  HCP Holding, L.P.     Emeritus Corporation     AMBER OAKS     SAN ANTONIO
------------------------     --------------------     ----------     -----------
                                                                 TX     1-Apr-97
                                                                 --     --------
Texas  HCP  Holding,  L.P.     Emeritus  Corporation     REDWOOD SPRINGS     SAN
--------------------------     ---------------------     ---------------     ---
                                                      MARCOS     TX     1-Apr-97
                                                      ------     --     --------
     HCPI Trust     Emeritus Corporation     SKYLYN PLACE     SPARTANBURG     SC
     ----------     --------------------     ------------     -----------     --
                                                                       26-Jan-96
                                                                       ---------
Health  Care  Property Investors, Inc.     Emeritus Corporation     LAUREL LAKES
--------------------------------------     --------------------     ------------
                                        ESTATE     VOORHEES     NJ     27-Dec-95
                                        ------     --------     --     ---------
Health Care Property Investors, Inc.     Emeritus Corporation     GARRISON CREEK
------------------------------------     --------------------     --------------
                                                WALLA WALLA     WA     24-Jul-96
                                                -----------     --     ---------

(a)  Mortgage




                    ADDENDUM TO LEASE DATED SEPTEMBER 5, 2001
                  BETWEEN HEALTH CARE PROPERTY INVESTORS, INC.,
                             A MARYLAND CORPORATION,
                                 AS LESSOR, AND
                              EMERITUS CORPORATION,
                            A WASHINGTON CORPORATION,
                                    AS LESSEE
I.     FOR  RESTARTING  AUTOMATIC  NUMBERING  ONLY  --  WILL  NOT  PRINT!
     46.1     Interpretation.  The provisions of this Addendum shall be included
              --------------
in  and  form  a  part  of this Lease and shall supercede and override any other
provision  in  this  Lease  to  the  extent  the  same  are  inconsistent.
46.2     Provisions  Relating  to  Master  Lease.  Lessor  and  Lessee  hereby
         ----------------------------------------
acknowledge and agree that this Lease is and the parties intend the same for all
purposes  to  be  treated  as  a  single,  integrated and indivisible agreement.
Lessee  acknowledges that in order to induce Lessor to lease the Leased Property
of  each Facility to Lessee and as a condition thereto, Lessor insisted that the
parties  execute  this  Lease  covering  all  of  the  Facilities  in  a single,
integrated  and  indivisible  agreement.
46.3     Additional  Defined  Terms and Modifications to Defined Terms.  For all
         -------------------------------------------------------------
purposes  of  this  Lease,  except as otherwise expressly provided or unless the
context  otherwise  requires,  the terms defined in this Section 46.3 or defined
elsewhere  in  this  Lease  and  modified  in  this  Section 46.3 shall have the
meanings assigned to them in this Section 46.3 or as so modified in this Section
46.3,  as  applicable:
     Allocated  Lessor's Initial Investment:  With respect to each Facility, the
     --------------------------------------
amount  of total Lessor's Initial Investment payable hereunder from time to time
and  allocated  to  such  Facility  as  follows:
     Biloxi     42%

     Auburn     58%
     Allocated  Minimum  Rent  and CPI Rent:  With respect to each Facility, the
     --------------------------------------
amount  of  total  Minimum Rent and CPI Rent payable hereunder from time to time
and  allocated  to  such  Facility  as  follows:
     Biloxi     42%

     Auburn     58%
     Facilities:  Each  facility  currently  being  operated  on  the applicable
     ----------
portion  of  the  Leased  Property as more particularly described on Exhibit A-1
                                                                     -----------
(Biloxi)  and  Exhibit  A-2  (Auburn) attached hereto and incorporated herein by
   -----       ----------------------
this  reference  (each,  a  "Facility").
                             --------
     Fixtures:  With  respect  to  each  Facility,  the  Fixtures (as defined in
     --------
Article  I)  of  such  Facility.
Land:  With respect to each Facility, the Land (as defined in Article I) of such
----
Facility.
Leased Improvements:  With respect to each Facility, the Leased Improvements (as
--------------------
defined  in  Article  I)  of  such  Facility.
Leased Property:  With respect to each Facility, the Leased Property (as defined
----------------
in  Article  I)  of  such  Facility.
Lessee's  Personal  Property:  With  respect to each Facility, Lessee's Personal
-----------------------------
Property  (as  defined  in  Article  II)  of  such  Facility.
--
Lessor's  Personal  Property:  With respect to each Facility,  Lessor's Personal
----------------------------
Property  (as  defined  in  Article  I)  of  such  Facility.
Minimum  Repurchase Price:  With respect to each Facility at any given time, the
-------------------------
sum of (i) the Allocated Lessor's Initial Investment of such Facility, plus (ii)
any  Capital  Addition  Costs  funded  by  Lessor with respect to such Facility.
Primary  Intended  Use.  With  respect  to  each  Facility,  an  assisted living
----------------------
facility  containing  the number of units set forth on Exhibit D attached hereto
-------                                                ---------
and incorporated herein by this reference with respect to such Facility and such
other  uses  necessary  or  incidental  to  such  use.
Related  Rights:   With respect to each Facility, the Related Rights (as defined
----------------
in  Article  I)  of  such  Facility.
     46.4     Capital Additions and Other Alterations.   For purposes of Section
              ---------------------------------------
10.1  of  this  Lease, the amount of "$100,000.00" as set forth therein shall be
applied  and  calculated  separately  with  respect  to  each  Facility.
     46.5     Insurance  Requirements.  Lessee  shall  maintain  the  insurance
              -----------------------
required  by  Article  XIII with respect to the Leased Property of each Facility
and  the  Personal  Property  and  operations  thereon.
46.6     Insurance  Proceeds and Casualty.   The provisions of Article XIV shall
         --------------------------------
apply  separately  with respect to each Facility.  Accordingly, without limiting
the  generality  of  the  foregoing,  if  a Facility is damaged or destroyed and
Lessee  offers  to purchase the Leased Property of such Facility pursuant to any
provision  of  such  Article  XIV  and Lessor shall accept such offer, then this
Lease  shall  terminate  as to the Leased Property of such damaged Facility upon
payment  of  the  purchase  price  therefor and Lessor shall remit to Lessee all
insurance  proceeds  pertaining  to the Leased Property of such damaged Facility
being  held  in  trust  by Lessor.  In the event that this Lease shall terminate
with  respect  to any damaged Facility in accordance with the terms hereof, such
termination  shall  not  affect the Term of this Lease with respect to the other
Facility, and this Lease shall continue in full force and effect with respect to
such  other  Facility,  except  that  the  total  monthly  Minimum  Rent payable
hereunder  shall  be reduced by the amount of monthly Allocated Minimum Rent and
CPI  Rent  with  respect  to such damaged Facility as to which this Lease has so
terminated.
     46.7     Condemnation.   The  provisions  of  Article  XV  shall  apply
              ------------
separately  with  respect  to  each Facility.  Accordingly, without limiting the
generality of the foregoing, if the Leased Property of a Facility is totally and
permanently  taken  by  Condemnation or a portion of the Leased Property of such
Facility  is  taken  and  the  Facility  is  rendered Unsuitable for its Primary
Intended  Use,  then  in either event this Lease shall terminate with respect to
such  affected Facility as provided in Article XV.  In the event that this Lease
shall so terminate with respect to any such Facility, such termination shall not
affect the Term of this Lease with respect to the other Facility, and this Lease
shall  continue  in  full  force and effect with respect to such other Facility,
except  that the total monthly Minimum Rent and CPI Rent payable hereunder shall
be  reduced  by  the  amount of monthly Allocated Minimum Rent and CPI Rent with
respect  to  such  Facility  as  to  which  this  Lease  has  so  terminated.
46.8     Events  of  Default  and  Remedies.
         ----------------------------------
     (a)     If  an  Event  of Default shall have occurred, Lessor may terminate
this  Lease pursuant to Section 16.2 and this Addendum Section 46.8 with respect
to  any one or both of the Facilities (regardless whether the events giving rise
to  such Event of Default emanated from one or more Facilities) by giving Lessee
notice of such termination and the Term shall terminate and all rights of Lessee
under  this  Lease  shall  cease with respect to all such Facilities as to which
Lessor  has  elected  to  so terminate this Lease.  If an Event of Default shall
have  occurred  and be continuing, whether or not this Lease has been terminated
with  respect to any one or more (including all, if so elected by Lessor) of the
Facilities  pursuant  to  Section  16.2  and  this Addendum Section 46.8, Lessee
shall,  to  the  extent  permitted  by  law,  if  required  by  Lessor so to do,
immediately  surrender to Lessor possession of the Leased Property of all of the
Facilities  and  any  Capital  Additions  as  to  which Lessor has so elected to
terminate  this  Lease and quit the same and Lessor may enter upon and repossess
the  Leased  Property  of  such  Facility(ies)  and  any  Capital  Additions  by
reasonable  force,  summary  proceedings, ejectment or otherwise, and may remove
Lessee  and  all  other  Persons  and any of Lessee's Personal Property from the
Leased  Property  of  any  such  Facility(ies)  and  any  Capital  Additions.
(b)     The  provisions  of  Section 16.3 shall apply separately with respect to
each  Facility  (including all, if applicable) as to which Lessor has elected to
terminate  this  Lease following an Event of Default.  For purposes of computing
the unpaid Rent with respect to each Facility as to which this Lease has been so
terminated  following  and  Event of Default, such unpaid Rent shall be equal to
the  unpaid Allocated Minimum Rent and CPI Rent for each such Facility, together
with  all  Additional  Charges  payable  with  respect  to  each  such Facility.
(c)     If an Event of Default shall have occurred, Lessor may require Lessee to
purchase  the Leased Property pursuant to Section 16.5 and this Addendum Section
46.8  with  respect to any one or both of the Facilities (regardless whether the
events  giving  rise  to  such  Event  of  Default  emanated  from  one  or more
Facilities)  by  giving Lessee notice of such obligation to purchase.  If Lessor
exercises  such  right, Lessor shall convey the Leased Property to Lessee on the
date  fixed  therefor  in  accordance  with the provisions of Article XVIII upon
receipt  of the purchase price therefor and this Lease shall thereupon terminate
for  such  Facility  or Facilities that Lessor required Lessee to purchase.  Any
purchase  by  Lessee  of  the  Leased  Property of one or both of the Facilities
pursuant  to  Section  16.5  and  this Addendum Section 46.8 shall be in lieu of
damages  specified in Section 16.3.  For the purpose of calculating Minimum Rent
and  CPI Rent for such Facility for which Lessor has required Lessee to purchase
the  Leased  Property,  the same shall be equal to the then applicable Allocated
Minimum  Rent  and  CPI  Rent  for  such  Facility.
(d)     Notwithstanding  anything  in  this  Lease to the contrary, in the event
that  this  Lease  shall be terminated by Lessor with respect to any Facility by
reason  of  an Event of Default as provided in Sections 16.2 and/or 16.3 of this
Lease  (as  modified  by  this  Addendum  Section 46.8) or by reason of Lessor's
exercise  of  its  rights pursuant to Section 16.5 of this Lease (as modified by
this  Addendum  Section  46.8), such termination shall not affect the applicable
Term  of  this  Lease  with  respect  to the other Facility not so terminated by
Lessor,  and  this Lease shall continue in full force and effect with respect to
such  other  Facility,  except  that the total monthly Minimum Rent and CPI Rent
payable  hereunder  shall  be reduced by the amount of monthly Allocated Minimum
Rent  and  CPI  Rent  of  the Facility as to which this Lease has so terminated,
subject,  however,  to  Lessor's  right  to  recover  damages  or to receive the
applicable purchase price in each case with respect to such Facility as to which
this  Lease  has  been so terminated as provided in the applicable provisions of
Article  XVI  of  this  Lease  (as  modified  by  this  Addendum  Section 46.8).
     46.9     Provisions  Relating  to  Purchase  of  the  Leased  Property of a
              ------------------------------------------------------------------
Facility(ies).  For  purposes  of  calculating  the unpaid Rent for any Facility
      -------
purchased  by  Lessee,  the same shall be equal to the then applicable Allocated
Minimum Rent and CPI Rent for such Facility together with all Additional Charges
payable  for  such  Facility.
46.10     Renewal Matters.  Lessee shall only have the right to renew this Lease
          ---------------
for  the  Extended  Term  pursuant  to  Section  19.1 with respect to all of the
Facilities  (i.e.,  as  a group) then being leased by Lessee under this Lease at
time  of  exercise  of  such  right.
46.11     Governing  Law.  NOTWITHSTANDING  ANYTHING  TO THE CONTRARY IN SECTION
          --------------
45.1.6, THIS LEASE (AND ANY AGREEMENT FORMED PURSUANT TO THE TERMS HEREOF) SHALL
BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS
OF  THE  STATE  OF CALIFORNIA (WITHOUT REGARD OF PRINCIPLES OR CONFLICTS OF LAW)
AND  ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA, EXCEPT THAT (A) TO THE
EXTENT  THAT  APPLICATIONS OF THE LAWS OF THE STATE OF CALIFORNIA WOULD DEROGATE
FROM  THE  RIGHTS  OF  LESSOR  UNDER  THE  LAWS OF THE STATE IN WHICH THE LEASED
PROPERTY  OF A FACILITY IS LOCATED WITH RESPECT TO ENFORCEMENT OF THE RIGHTS AND
REMEDIES OF LESSOR UNDER THIS LEASE WITH RESPECT TO SUCH FACILITY, THEN THE LAWS
OF  THE STATE IN WHICH SUCH FACILITY IS LOCATED WILL CONTROL AND (B) ALL MATTERS
RELATING  TO RECOVERY OF POSSESSION OF THE LEASED PROPERTY OF ANY FACILITY (SUCH
AS  AN  ACTION FOR UNLAWFUL DETAINER OR OTHER SIMILAR ACTION) SHALL BE CONSTRUED
AND  ENFORCED  ACCORDING TO, AND GOVERNED BY, THE LAWS OF THE STATE IN WHICH THE
LEASED  PROPERTY  OF  SUCH  FACILITY  IS  LOCATED.
46.12     Condition  of  the Leased Property.  The acknowledgements contained in
          ----------------------------------
Section  7.1  of  this  Lease  are  subject  to  the  following:
     (a)     With  respect  to  the  Biloxi  Facility,  that  certain  Phase One
Environmental  Site  Assessment  dated  August  6, 2001, prepared by The Breland
Group  for  Lessee,  and
(b)     With  respect  to  the  Auburn  Facility,  that  certain  Phase  One
Environmental  Site  Assessment  dated  March  16, 2001, prepared by The Breland
Group  for  Lessee.
     46.13     New  Lease.  Lessor  shall  have  the right, at any time and from
               ----------
time  to  time  during the Term for any purpose, by written notice to Lessee, to
require Lessee to execute an amendment to this Lease whereby the Leased Property
of one or more Facilities (individually, a "Separated Property" or collectively,
the  "Separated  Properties")  is  separated and removed from this Lease, and to
simultaneously  execute  a  substitute  lease  with  respect  to  such Separated
Property(ies),  in  which  case:
     (a)     Lessor  and  Lessee shall execute a new lease (the "New Lease") for
such  Separated  Property(ies),  effective  as  of the date specified in Section
46.13(c)  below (the "New Lease Effective Date"), in the same form and substance
as  this  Lease,  but  with  such  changes  thereto  as necessary to reflect the
separation  of  the  Separated  Property(ies)  from  the  balance  of the Leased
Property,  including  the  following:
               (i)     The  total  monthly  Minimum  Rent payable under such New
Lease  shall be the total applicable monthly Allocated Minimum Rent (pursuant to
Section  46.3  above)  with  respect  to  such  Separated  Property(ies);
          (ii)     All  Minimum Rent escalations under the New Lease shall be at
the times and in the amounts set forth in this Lease for Minimum Rent increases;
          (iii)     The New Lease shall provide that the lessee thereunder shall
be  responsible  for  the  payment,  performance and satisfaction of all duties,
obligations  and liabilities arising under this Lease, insofar as they relate to
the Separated Property(ies), that were not paid, performed and satisfied in full
prior  to the effective date of the New Lease (and Lessee under this Lease shall
also  be  responsible  for  the  payment,  performance  and  satisfaction of the
aforesaid  duties, obligations and liabilities not paid, performed and satisfied
in  full  prior  to  the  effective  date  of  such  New  Lease).
     (b)     Lessor  and  Lessee  shall  also execute an amendment to this Lease
effective  as  of  the New Lease Date reflecting the separation of the Separated
Property(ies)  from  the  balance  of  the  Leased  Property  and  making  such
modifications  to  this  Lease  as  are  necessitated  thereby.
     (c)     In  the  case  of  any New Lease that is entered into in accordance
with  this Section 46.13, such New Lease shall be effective on the date which is
the earlier of (i) the date the New Lease is fully executed and delivered by the
parties thereto and (ii) the date specified in the written notice from Lessor to
Lessee  requiring  a New Lease as described above, which date shall be no sooner
than  ten  (10)  days  after  the  date  such  notice  is  issued.
     (d)     Lessor  and  Lessee shall take such actions and execute and deliver
such  documents,  including without limitation the New Lease and an amendment to
this  Lease,  as  are  reasonably  necessary  and  appropriate to effectuate the
provisions  and  intent  of  this  Section  46.13.
     (e)     Each party shall bear its own costs and expenses in connection with
any  New  Lease  entered  into  in  accordance  with  this  Section  46.13.
                            [Signature Page Follows]
<PAGE>
                       SIGNATURE PAGE TO ADDENDUM TO LEASE

     IN  WITNESS  WHEREOF,  the parties have caused this Addendum to be executed
and  their  respective  corporate  seals  to be hereunto affixed and attested by
their  respective  officers  thereunto  duly  authorized.

                                    "LESSOR"
                                       "LESSEE"
          HEALTH CARE PROPERTY INVESTORS, INC., a Maryland corporation
                    EMERITUS CORPORATION, a Washington corporation

By:  /s/  Edward  J.  Henning
     ------------------------
Name:  Edward  J.  Henning     By:  /s/  Raymond  R.  Brandstrom
       -------------------          ----------------------------
Its:  Senior  Vice  President     Name:  Raymond  R.  Brandstrom
      -----------------------            -----------------------
     Its:  Vice  President  of  Finance
           ----------------------------