**PURCHASE
      AND SALE AGREEMENT**


**AND**


**JOINT
      ESCROW INSTRUCTIONS**














By
      and
      Between














HCPI
      TRUST,


a
      Maryland real estate investment trust,





“Seller”








and








EMERITUS
      CORPORATION,


a
      Washington corporation,





as
      “Buyer”



































**TABLE
      OF CONTENTS**






Page1
              DEFINITIONS
              12
              SALE
                  OF THE PROPERTIES
              43
              ESCROW
              44
              PURCHASE
                  PRICE; ALLOCATION OF PURCHASE PRICE
              55
              CONDITIONS
                  TO CLOSING
              66
              CLOSING
                  OF ESCROW
              107
              TERMINATION
              158
              REPRESENTATIONS
                  AND WARRANTIES
              189
              CERTAIN
                  EVENTS PRIOR TO CLOSING
              2010
              POST-CLOSING
                  MATTERS
              2011
              BROKERS
              2112
              MISCELLANEOUS
                  PROVISIONS
              21


EXHIBITS


A
            Master
                LeaseB
            Escrow
                General ProvisionsC
            Form
                of DeedD
            Form
                of Bill of SaleE
            Form
                of Amendment to Master LeaseF
            Release
                of ClaimsG
            Purchase
                Price Allocation








**i**


**PURCHASE
      AND SALE AGREEMENT**




**AND
      JOINT ESCROW INSTRUCTIONS**




THIS
      PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this “Agreement”) is
      made and entered into as of March __, 2007 (the “Effective Date”), by and
      between HCPI TRUST, a Maryland real estate investment trust (“Seller”), and
      EMERITUS CORPORATION, a Washington corporation (“Buyer”), as
      follows:




**RECITALS**




A.  Seller
      is
      the owner of the Properties (as defined below), which are currently leased,
      together with certain other property, to Buyer and certain Affiliates (as
      defined below) of Buyer pursuant to the Master Lease (as defined
      below).




B.  Buyer
      desires to purchase the Properties from Seller and Seller desires to sell the
      Properties to Buyer on the terms and subject to the conditions set forth herein.




**AGREEMENT**




NOW,
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which are hereby acknowledged, Buyer and Seller agree as follows:




**1.**  **DEFINITIONS**




For
      all
      purposes of this Agreement, except as otherwise expressly provided herein 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 references in this Agreement to designated
“Articles,” “Sections” and other subdivisions are to the designated Articles,
      Sections and other subdivisions of this Agreement; (iii) the word “including”
shall have the same meaning as the phrase “including, without limitation,” and
      other phrases of similar import; and (iv) the words “herein,” “hereof” and
“hereunder” and other words of similar import refer to this Agreement as a whole
      and not to any particular Article, Section or other subdivision.




**1.1**  **1031
      Exchange** :
      As
      defined in Section 6.8.




**1.2**  **Additional
      Charges** **:** As
      defined in the Master Lease.




**1.3**  **Additional
      Rent** **:** As
      defined in the Master Lease (including Percentage Rent and CPI Rent, as each
      are
      defined in the Master Lease).




**1.4**  **Affiliate** **:** As
      defined in the Master Lease.




**1.5**  **ALTA
      Survey** **:** As
      defined in Section 5.1.1.1(c).




**1.6**  **Base
      Gross Revenues** **:** As
      defined in the Master Lease.




**1.7**  **Bill
      of Sale** **:** As
      defined in Section 6.2.2.







**1.8**  **Cash
      Security Deposit** **:** As
      defined in the Master Lease.




**1.9**  **Cash
      Security Deposit Credit** .
      As
      defined in Section 4.2.




**1.10**  **Close
      of Escrow, Closing Date and/or Closing** :
      As
      defined in Section 6.1.




**1.11**  **Closing
      Breakpoint** **:** As
      defined in Section 6.5.2 below.




**1.12**  **Closing
      Funds** **:** As
      defined in Section 4.3.




**1.13**  **Condemnation** **:** As
      defined in the Master Lease.




**1.14**  **Condemnor** **:** As
      defined in the Master Lease.




**1.15**  **Contingency
      Period** **:** The
      period commencing on the Effective Date and expiring on March 15,
      2007.




**1.16**  **Cost
      of Living Index** :
      As
      defined in the Master Lease.




**1.17**  **Deed** **:** As
      defined in Section 6.2.1.




**1.18**  **Effective
      Date** **:** As
      defined in the preface to this Agreement.




**1.19**  **Escrow
      Holder** **:** As
      defined in Section 3.1.




**1.20**  **Event
      of Default** **:** As
      defined in the Master Lease.




**1.21**  **Funds** **:** Immediately available funds in the form of cash, wire transfer of funds, or
      a
      certified or bank cashier’s check drawn on a reputable financial institution
      acceptable to Escrow Holder.




**1.22**  **Gross
      Revenues** **:** As
      defined in the Master Lease.




**1.23**  **Guarantor** **:** As
      defined in the Master Lease.




**1.24**  **Hazardous
      Substance** **:** As
      defined in the Master Lease.




**1.25**  **Impositions** **:** As
      defined in the Master Lease.




**1.26**  **Intervening
      Liens** **:** As
      defined in Section 5.1.1.1.




**1.27**  **Laws** **:** All
      applicable governmental laws, codes, ordinances, regulations, judgments,
      permits, approvals or other requirements.




**1.28**  **Lease
      Year** **:** As
      defined in the Master Lease.




**1.29**  **Lessee** **:** As
      defined in the Master Lease.




**2**


**1.30**  **Lessor** **:** As
      defined in the Master Lease.




**1.31**  **Liabilities** **:** Any
      claim, liability, loss, cost, action, damage, expense or fees, including but
      not
      limited to reasonable attorney’s fees and costs of defense.




**1.32**  **Lien
      and Litigation Reports** **:** As
      defined in Section 5.1.1.4.




**1.33**  **Major
      Loss** **:** shall
      mean, as to any Property, a casualty loss or damage to such Property or any
      loss
      due to a Condemnation which, in either such event, results in a loss of Buyer’s
      financing for the transactions contemplated hereby.




**1.34**  **Master
      Lease** **:** That
      Amended and Restated Master Lease identified on **Exhibit
      “A”** attached
      hereto among Seller and certain Affiliates of Seller, collectively as “Lessor,”
and Buyer and certain Affiliates of Buyer, collectively as “Lessee” covering the
      Properties and certain other property as more particularly described therein,
      as
      the same may have been amended or modified from time to time in accordance
      with
      the terms thereof .




**1.35**  **Master
      Lease Amendment** **:** A
      certain Sixth Amendment to Amended and Restated Master Lease among the Lessor
      and the Lessee, and consented to by the Guarantor, in the form attached hereto
      as **Exhibit
      “E”** ,
      to be
      executed and delivered by Lessor, Lessee and Guarantor, on the Closing Date.




**1.36**  **Minimum
      Rent** **:** As
      defined in the Master Lease.




**1.37**  **Opening
      of Escrow** **:** As
      defined in Section 3.3.




**1.38**  **Organizational
      Documents** **:** Collectively, as applicable, the articles or certificate of incorporation,
      certificate of limited partnership or certificate of limited liability company,
      bylaws, partnership agreement, operating company agreement, trust agreement,
      statements of partnership, fictitious business name filings and all other
      organizational documents relating to the creation, formation and/or existence
      of
      a business entity, together with resolutions of the board of directors, partner
      or member consents, trustee certificates, incumbency certificates and all other
      documents or instruments approving or authorizing the transactions contemplated
      by this Agreement.




**1.39**  **Outside
      Closing Date** **:** Subject
      to extension as provided in the last sentence of Section 5.1.1.1(b) and in
      Section 6.8 below, March 31, 2007.




**1.40**  **Permitted
      Exceptions** **:** As
      defined in Section 5.1.1.1.




**1.41**  **Properties** **:** Collectively, the “Leased Property” as defined in the Master Lease of each of
      the “Easley, SC (Countryside) Facility,” the “Easley, SC (Summit Place)
      Facility,” and the “Spartanburg, SC Facility,” less any portion of any which has
      been taken by reason of any Condemnation or other exercise of the power of
      eminent domain (each, a “Property”).




**1.42**  **Purchase
      Price** **:** As
      defined in Section 4.1.




**3**


**1.43**  **Release
      of Claim:** As
      defined in Section 6.3.2.




**1.44**  **Rent
      and Charges** **:** All
      accrued and unpaid Minimum Rent, Additional Rent and any Additional Charges
      (whether or not billed) payable by the Lessee under the Master Lease with
      respect to the Properties, through and including the day prior to Closing Date
      (prorated to the extent applicable for the month during which the Closing
      occurs).




**1.45**  **Seller’s
      Legal Costs** **:** Collectively,
      the legal fees, expenses and disbursements to counsel incurred by Seller in
      connection with the preparation and negotiation of this Agreement and the
      Exhibits hereto and the consummation of the transactions contemplated hereunder
      and thereunder.




**1.46**  **Seller’s
      Transaction Costs** **:** Collectively, Seller’s Legal Costs and the other fees and expenses of and
      disbursements made by Seller in connection with the transactions contemplated
      by
      this Agreement and the Exhibits hereto, including accountants and other
      professional fees and travel expenses, excluding , however ,
      any
      third-party escrow and accommodator costs incurred by Seller and attributable
      solely to the 1031 Exchange.




**1.47**  **Title
      Company** **:** Old
      Republic Title, 2201 Sixth Avenue, Ste. 1110, Seattle, Washington 98121, Attn:
      Cathrin Weis, Fax No.: (206) 441-1953.




**1.48**  **Title
      Documents** **:** As
      defined in Section 5.1.1.1.




**1.49**  **Title
      Policies** **:** As
      defined in Section 6.4.




**1.50**  **Title
      Reports** **:** As
      defined in Section 5.1.1.1.




**2.**  **SALE
      OF THE PROPERTIES**




Buyer
      agrees to purchase from Seller, and Seller agrees to sell to Buyer, all of
      the
      Properties on the terms and subject to the conditions set forth
      herein.




**3.**  **ESCROW**




**3.1**  **General
      Instructions** .
      Title
      Company is also hereby designated as escrow holder (sometimes herein referred
      to
      as “Escrow Holder”). Escrow Holder’s Escrow number, Escrow Officer for the
      transactions contemplated hereby, address for notices and wiring information
      is
      set forth below Title Company’s acceptance of this Escrow. Escrow Holder’s
      general conditions or provisions, which are attached hereto as **Exhibit
      “B”** are
      incorporated by reference herein; provided, however, that in the event of any
      inconsistency between **Exhibit
      “B”** and any
      of the provisions of this Agreement, the provisions of this Agreement shall
      control. Buyer and Seller each shall execute, deliver and be bound by such
      further escrow instructions or other instruments as may be reasonably requested
      by the other party or by Escrow Holder from time to time, so long as the same
      are consistent with this Agreement. Escrow Holder shall not comply with the
      unilateral instructions of only one party without the consent of the other
      party
      hereto unless otherwise expressly required to do so in this Agreement.




**4**


**3.2**  **Tax
      Reporting Person** .
      For
      purposes of complying with Internal Revenue Code § 6045(e), as amended effective
      January 1, 1991, Escrow Holder is hereby designated as the “person
      responsible for closing the transaction,” and also as the “reporting person” for
      purposes of filing any information returns with the Internal Revenue Service
      concerning this transaction, as required by law.




**3.3**  **Opening
      of Escrow** .
      Escrow
      shall be deemed open when not less than four (4) originals of this Agreement,
      fully signed by all parties either together or in counterparts, are delivered
      to
      Escrow Holder (the “Opening of Escrow”), which shall occur within two (2)
      business days after execution of this Agreement by Buyer and Seller. Escrow
      Holder shall immediately notify Buyer, Seller and their respective attorneys
      in
      writing of the official date of the Opening of Escrow.




**4.**  **PURCHASE
      PRICE; ALLOCATION OF PURCHASE PRICE**




**4.1**  **Purchase
      Price** .
      The
      purchase price for the Properties shall be Twenty-Eight Million Six Hundred
      Fifty Thousand Dollars ($28,650,000.00) (the “Purchase Price”). The Purchase
      Price shall be allocated among the Properties and the various components thereof
      as set forth on **Exhibit
      “G”** attached
      hereto and incorporated herein by this reference. Such allocation is final
      and
      conclusive for all purposes and neither Seller nor Buyer shall use a different
      allocation, including in any state or federal tax returns filed by such
      party.




**4.2**  **Cash
      Security Deposit Credit** .
      Buyer
      and Seller acknowledge and agree that, as of the Effective Date, the Lessee
      has
      deposited with the Lessor pursuant to Article XXI of the Master Lease a Cash
      Security Deposit in the approximate amount of $5,554,524, of which approximately
      $1,401,195 is allocable to the Properties. In addition, as of the Effective
      Date, accrued and unpaid interest on such Cash Security Deposit is approximately
      $1,925,637. Pursuant to the Master Lease Amendment, the Lessor has agreed the
      Lessee may cause the Lessor to apply all or a portion of the sum of the
      following to the Purchase Price payable hereunder: (i) that portion of the
      Cash
      Security Deposit allocable to the Properties, plus (ii) all accrued and unpaid
      interest on the entire Cash Security Deposit as of the Closing Date, plus (iii)
      up to an additional $1,158,000 of the Cash Security Deposit. The amount of
      the
      forgoing that Buyer elects to cause the Lessee to apply towards the Purchase
      Price shall be referred to herein as the “Cash Security Deposit Credit.” No
      later than 2:00 p.m., Pacific Standard Time, on the day prior to the Closing
      Date, Buyer shall cause the Lessee to deliver to the Lessor written instructions
      as to the amount of Cash Security Deposit Credit, and at the Closing, the Lessor
      shall deliver outside of Escrow the Cash Security Deposit Credit from the Cash
      Security Deposit under the Master Lease.




**4.3**  **Closing
      Funds** .
      No
      later than 10:00 a.m., Pacific Standard Time, on the Closing Date, Escrow Holder
      shall calculate and Buyer shall wire Funds into Escrow (using wiring
      instructions reasonably satisfactory to Escrow Holder) in an amount which,
      when
      added to the Cash Security Deposit Credit, shall equal the Purchase Price plus
      any other sums payable by Buyer hereunder (the “Closing Funds”).




**5**


**5.**  **CONDITIONS
      TO CLOSING**




**5.1**  **Buyer’s
      Conditions** .




**5.1.1**  **Contingency
      Period Conditions** .
      Provided that Buyer is not in breach or default of any provisions of this
      Agreement, the obligation of Buyer to purchase the Properties shall be subject
      to satisfaction of each of the conditions set forth in this Section 5.1.1
      within the Contingency Period. Seller and Buyer expressly acknowledge and agree
      that each of the conditions in this Section 5.1.1 is for the benefit of and
      may
      be waived only by Buyer as hereinafter provided.




**5.1.1.1**  **Title
      and Survey Approval.**




(a)  Buyer
      shall have reasonably approved the condition of title to each Property as
      provided in this Section 5.1.1.1. As soon as practicable following the Opening
      of Escrow, Buyer shall order and shall cause to be delivered to Buyer and
      Seller, at Buyer’s sole cost and expense, a current preliminary title report or
      title commitment for each Property (each, a “Title Report,” and collectively,
      the “Title Reports”) prepared by Title Company, together with legible copies of
      all documents (the “Title Documents”) shown on each Title Report as exceptions
      affecting title to the applicable Property. Buyer shall take title to each
      Property subject to (collectively, the “Permitted Exceptions”): (a) all
      matters described in Section 6.4 and (b) all other items shown on the
      applicable Title Report, excepting only such other items or matters as Buyer
      disapproves in writing within the time and in the manner provided in
      Section 5.2.1 below. Buyer shall be deemed to have approved each Title
      Report and all such other items or matters referenced therein, unless Buyer
      has
      delivered written notice of its disapproval thereof within the time and in
      the
      manner provided in Section 5.2.1 below and all such matters so deemed
      approved shall become additional “Permitted Exceptions” hereunder.




(b)  Any
      liens, encumbrances, easements, restrictions, conditions, covenants, rights,
      rights-of-way, and other matters materially affecting title to any Property
      which are created or which may appear of record after the date of the applicable
      Title Report for such Property but before the Closing Date and which are not Permitted Exceptions (collectively, the “Intervening Liens”) shall also be
      subject to Buyer’s reasonable approval and Buyer shall have until the later of
      (i) the expiration of the Contingency Period and (ii) five (5) days
      after notice from Seller or Title Company of any Intervening Lien to submit
      written reasonable objections thereto in the manner set forth herein. If Buyer
      fails to submit any such objections in the manner and within the time herein
      provided then Buyer shall be deemed to have approved the Intervening Lien with
      respect to such Property and the same shall become an additional “Permitted
      Exception” hereunder with respect to such Property. If, on the other hand, Buyer
      makes any such reasonable objection in the manner and within the time herein
      provided, then the provisions of Section 5.2.2 shall apply with respect to
      Seller’s right to cure the same and Buyer’s right to terminate the Agreement.
      The Outside Closing Date will be extended, if necessary, to provide the parties
      with the time needed to review, object and respond to any Intervening Lien
      in
      accordance with the provisions of this Section 5.1.1.1(b) and Section 5.2.2.
      below.




**6**


(c)  Buyer
      shall have received, at Buyer’s sole cost and expense, and reasonably approved
      an ALTA survey of each Property completed in accordance with the current Minimum
      Standard Detail requirements for ALTA/ACSM Land Title Surveys, jointly
      established and adopted by ALTA and ACSM that meet the requirements of a Class
      A
      Survey as defined therein, certified to Buyer, any lender of Buyer, Seller
      and
      Title Company as being true and accurate (each, an “ALTA Survey”). As soon as
      practicable following the Opening of Escrow, Buyer shall order an ALTA Survey
      of
      each Property and upon receipt thereof shall furnish copies of the same to
      Seller. Buyer shall be deemed to have approved each ALTA Survey for a Property
      unless Buyer has delivered written notice of its disapproval thereof within
      the
      time and in the manner provided in Section 5.2.1. For purposes of Buyer’s
      approval of each ALTA Survey, it is agreed that Buyer shall not be entitled
      to
      disapprove any matter disclosed by such ALTA Survey if the same (i) was
      previously disclosed on the survey of the applicable Property at the time Seller
      acquired the same or otherwise relates to a Permitted Exception, or (ii) was
      created or suffered after the date of Seller’s acquisition of such Property
      either by the Lessee or at the request or with the consent of the
      Lessee.




**5.1.1.2**  **Approval
      of Financing** .
      Buyer
      shall have obtained a satisfactory loan commitment from a lender satisfactory
      to
      Buyer in its sole and absolute discretion in order to finance Buyer’s purchase
      of the Properties (the “Loan Commitment”). Buyer shall be fully and solely
      responsible for compliance with all lender requirements, and for payment of
      all
      fees and charges imposed by Escrow Holder, Title Company, lender or others
      in
      connection with such loan. Buyer shall be deemed to have approved the Loan
      Commitment, unless Buyer has delivered written notice of its disapproval thereof
      within the time and in the manner provided in Section 5.2.1 below.




**5.1.1.3**  **Phase
      1 Environmental Report** . Buyer
      shall have received, at Buyer’s sole cost and expense, and reasonably approved a
      written Phase 1 environmental assessment for each Property from one or more
      qualified geotechnical or engineering firms acceptable to and retained by Buyer,
      concerning the presence, handling, treatment and disposal of Hazardous
      Substances on, in or under each Property. As soon as practicable following
      the
      Opening of Escrow, Buyer shall order such Phase 1 assessments for each Property
      and upon receipt thereof shall furnish copies of the same to Seller. Buyer
      shall
      be deemed to have approved each Phase 1 environmental assessment for a
      Property unless Buyer has delivered written notice of its reasonable disapproval
      thereof within the time and in the manner provided in Section
      5.2.1.




**5.1.1.4**  **Liens** .
      Buyer
      shall have received, at Buyer’s sole cost and expense, and reasonably approved
      UCC, tax lien and judgment search reports on Seller and each of the Properties
      (the “Lien and Litigation Reports”) from a reputable search firm (e.g., CT
      Corporation or Prentice-Hall Corporation) showing no liens or judgments
      affecting any of the Properties created or suffered by reason of any acts or
      omissions of Seller or any Affiliate thereof. As soon as reasonably practicable
      following the Opening of Escrow, Buyer shall order such Lien and Litigation
      Reports, and upon receipt thereof shall furnish copies of the same to Seller.
      Buyer shall be deemed to have approved the Lien and Litigation Reports unless
      Buyer has delivered written notice of its disapproval thereof within the time
      and in the manner provided in Section 5.2.1 below.




**7**


**5.1.2**  **Additional
      Conditions** .
      Provided that Buyer is not in breach or default of any provisions of this
      Agreement, the obligation of Buyer to purchase the Properties shall also be
      subject to satisfaction of each of the conditions set forth in this Section
      5.1.2 on and as of the Closing Date. Seller and Buyer expressly acknowledge
      and
      agree that each of the conditions set forth in this Section 5.1.2 is for the
      benefit of and may be waived only by Buyer as herein provided.




**5.1.2.1**  **Seller’s
      Representations and Warranties** .
      Seller’s representations and warranties set forth in Section 8 below shall be
      true and correct in all material respects on the Closing Date as if made again
      on the Closing Date.




**5.1.2.2**  **Seller’s
      Performance** .
      Seller
      shall have performed all of its obligations under this Agreement which by the
      terms of this Agreement are required to be performed by Seller as of or prior
      to
      the Closing Date.




**5.1.2.3**  **Purchase
      of All the Properties** .
      The
      Closing hereunder shall occur simultaneous with respect to all of the
      Properties.




**5.1.2.4**  **Occurrence
      of the Closing by the Outside Date** .
      The
      Closing shall occur on or before the Outside Closing Date.




**5.2**  **Buyer’s
      Approval, Disapproval or Waiver of Conditions and Seller’s Specific Cure
      Rights** .




**5.2.1**  **Buyer’s
      Approval, Disapproval or Waiver of Conditions** .
      On or
      before 5:00 p.m., Pacific Standard Time, on the day the Contingency
      Period expires, Buyer shall approve, disapprove or waive each of the conditions
      set forth in Section 5.1.1.1(a), 5.1.1.1(c), 5.1.1.2, 5.1.1.3 and 5.1.1.4
      by delivery of a reasonably detailed writing with respect to each such condition
      to Seller and Escrow Holder, including the specific grounds for disapproval
      thereof. In addition, prior to Closing Buyer shall notify Seller and Escrow
      Holder in writing in the event that as of the date of Closing, any of the
      conditions set forth in Section 5.1.2 have not been satisfied or waived by
      Buyer; provided, however, that if either of the conditions set forth in Sections
      5.1.2.3 or 5.1.2.4 have not been satisfied as a result of any act or omission
      of
      Buyer, then Buyer shall not be entitled to disapprove such condition, but rather
      the same shall, following any applicable notice and cure period pursuant to
      Section 7.2 below, constitute a default by Buyer hereunder. In the event that
      Buyer is not entitled to disapprove a condition or Buyer fails to approve,
      disapprove or waive such condition, if applicable, within the time and in the
      manner herein specified, then such condition shall be deemed conclusively
      satisfied or waived by Buyer and thereafter shall not be a condition precedent
      to the performance by Buyer of its respective obligations
      hereunder.




**5.2.2**  **Seller’s
      Cure Rights with Respect to Title and Liens** .
      If
      Buyer is entitled to and in fact disapproves either of the conditions set forth
      in Section 5.1.1.1(a), 5.1.1.1(c) or 5.1.1.4 within the time and in the
      manner provided in Section 5.2.1 above or the condition in
      Section 5.1.1.1(b) with respect to any Intervening Lien in the manner and
      within the time therein provided, then Seller shall have until 5:00 p.m.,
      Pacific Standard Time, on the fifth




**8**


(5th)
      day
      following the date of its receipt of Buyer’s written notice of disapproval
      thereof in which to investigate the disapproved item and to notify Buyer and
      Escrow Holder in writing that Seller in its sole discretion either:




(a)  Has
      cured
      or will cure the disapproved item prior to the Close of Escrow; or




(b)  Cannot
      or
      will not cure the disapproved item. Seller’s inability or failure to elect to
      cure any item so disapproved within the time and in the manner herein provided
      shall be deemed to constitute Seller’s election not to cure the
      same.




**5.3**  **“** **AS
      IS” SALE** .
      It is
      expressly understood and agreed that Buyer is acquiring each of the Properties
      “AS IS,” in its present state and condition, without any representations or
      warranties from Seller of any kind whatsoever, either express or implied, except
      as expressly set forth in Section 8 below. In particular, except as expressly
      set forth in Section 8 below, Seller makes no representation or warranty
      respecting the use, condition, title, operation or management of any of the
      Properties, or compliance with any applicable Laws relating to zoning,
      subdivision, planning, buildings, fire, safety, earthquake, health or
      environmental matters, the presence or absence of Hazardous Substances, or
      compliance with any other covenants, conditions and restrictions (whether or
      not
      of record). Buyer represents that it is knowledgeable in real estate matters
      and
      is relying upon Buyer’s own investigation and analysis in purchasing each of the
      Properties, as well as the fact that Buyer or its Affiliate originally sold
      to
      Seller and/or developed on behalf of Seller each of the Properties and at all
      times thereafter have leased and exclusively controlled the same. Buyer further
      represents that it has had ample opportunity to inspect and has, in fact, made
      all of the investigations Buyer deems necessary in purchasing each of the
      Properties. As a result, Buyer hereby expressly waives any notice requirements
      which may be imposed upon Seller pursuant to § 25359.7 of the California Health
& Safety Code or any other similar and applicable Laws. If this Agreement is
      not terminated but Buyer acquires the Properties as provided herein, Buyer
      shall
      have thereby approved all aspects of each of the Properties and this transaction
      and thereby waives any claim or liability against Seller.




**5.4**  **Seller’s
      Conditions** .
      Provided that Seller is not in breach or default of any provision of this
      Agreement, the obligation of Seller to sell the Properties (and each of them)
      shall be subject to satisfaction of each of the conditions set forth in this
      Section 5.4. Seller and Buyer expressly acknowledge and agree that each of
      the
      conditions set forth in this Section 5.4 is for the benefit of and may be waived
      only by Seller as in writing.




**5.4.1**  **No
      Default Under Master Lease** .
      Prior
      to the Closing, (a) no Event of Default, or event which with notice and/or
      passage of time would constitute an Event of Default by Lessee under the Master
      Lease shall have occurred and (b) all Rent and Charges shall be paid as and
      when due under the Master Lease, through but not including the Closing
      Date.




**5.4.2**  **Purchase
      of All Properties** . **** The
      Closing hereunder shall occur simultaneously with respect to all of the
      Properties.




**9**


**5.4.3**  **Occurrence
      of Closing by the Outside Closing Date** .
      The
      Closing shall occur on or before the Outside Closing Date.




**5.4.4**  **Buyer’s
      Representations and Warranties** .
      Buyer’s
      representations and warranties set forth in Section 8 below shall be true and
      correct in all material respects on the Closing Date as if made again on the
      Closing Date.




**5.4.5**  **Buyer’s
      Performance** .
      Buyer
      shall have performed all of its obligations under this Agreement which by the
      terms of the Agreement are required to be performed by Buyer as of or prior
      to
      the Closing Date.




**5.5**  **Seller’s
      Approval, Disapproval or Waiver of Conditions** **.** Prior to
      the Closing, Seller shall notify Buyer and Escrow Holder in writing in the
      event
      that as of the date of Closing, any of the conditions set forth in Section
      5.4
      have not been satisfied or waived by Seller; provided, however, that if either
      of the conditions set forth in Sections 5.4.2 or 5.4.3 have not been satisfied
      as a result of any act or omission of Seller, then Seller shall not be entitled
      to disapprove such condition, but rather the same shall, following any
      applicable notice and cure period pursuant to Section 7.2 below, constitute
      a
      default by Seller hereunder. In the event that Seller is not entitled to
      disapprove a condition or Seller fails to approve, disapprove or waive such
      condition, if applicable, prior to the Closing, then such condition shall be
      deemed conclusively satisfied or waived by Seller and thereafter shall not
      be a
      condition precedent to the performance by Seller of its respective obligations
      hereunder.




**6.**  **CLOSING
      OF ESCROW**




**6.1**  **Closing
      Date** .
      Subject
      to extension in order to implement the provisions of Sections 5.1.1.1(b) or
      6.8,
      and unless this Agreement has been earlier terminated in accordance with the
      applicable provisions of Section 7 below, Escrow shall close on the Outside
      Closing Date; provided, however, that subject to satisfaction or waiver of
      each
      of the conditions set forth in Sections 5.1 and 5.4, Buyer shall be entitled
      to
      close Escrow prior to the Outside Closing Date upon not less than five (5)
      days’
notice to Seller and Escrow Holder; provided further, however, that in no event
      shall the closing occur prior to January 5, 2007. The terms “Close of Escrow”
and/or “Closing” are used in this Agreement to mean the time and date the
      transactions contemplated hereby are closed and title is insured in Buyer’s name
      in accordance with the provisions of Section 6.4 below, regardless whether
      the
      applicable Deed is actually recorded in the land records in which the applicable
      Property is situated. The term “Closing Date” as used in this Agreement means
      the date that the Closing occurs.




**6.2**  **Deposits
      by Seller** .
      At or
      before 2:00 p.m., Pacific Standard Time, on that date which is not less than
      one
      (1) business day before the Close of Escrow, Seller shall deliver to Escrow
      Holder the following items for handling as described below; provided ,
      that
      Escrow need not be concerned with the form or content but only with manual
      delivery of all of the following other than items 6.2.1 and 6.2.3:




**10**


**6.2.1**  **Deeds** .
      With
      respect to each Property, a duly executed and acknowledged deed (each, a “Deed”)
      conveying the real property comprising such Property to Buyer in the form of
      (a) **Exhibit
      “C”** attached;




**6.2.2**  **Bill
      of Sale** .
      A duly
      executed and acknowledged quit claim bill of sale conveying any right, title
      and
      interest of Seller in and to any tangible personal property located on or within
      each Property to Buyer, without warranty except as expressly set forth therein,
      in the form of attached **Exhibit
      “D”** (the
“Bill of Sale”);




**6.2.3**  **Master
      Lease Amendment** .
      The
      Master Lease Amendment duly executed by the Lessor;




**6.2.4**  **Seller’s
      Certificate** **.** If any
      express representation or warranty of Seller set forth in Section 8 hereof
      needs
      to be modified due to changes since the Effective Date, a certificate of Seller,
      dated as of the Closing Date and executed on behalf of Seller by a duly
      authorized representative thereof, identifying any such representation or
      warranty which is not, or no longer is, true and correct and explaining the
      state of facts giving rise to the change. In no event shall Seller be liable
      to
      Buyer for, or be deemed to be in default hereunder by reason of any breach
      of a
      representation or warranty set forth in Section 8 hereof which results from
      any
      change that (i) occurs between the Effective Date and the Closing Date and
      (ii)
      is either expressly permitted under the terms of this Agreement or beyond the
      reasonable control of Seller to prevent. The occurrence of a change in a
      representation or warranty which is permitted hereunder or is beyond the
      reasonable control of Seller to prevent shall, if materially adverse to Buyer,
      constitute the non-fulfillment of the conditions set forth in Section 5.1.2.1
      hereof. If, despite changes or other matters described in such certificate,
      the
      Closing occurs, Seller’s representations and warranties set forth in this
      Agreement shall be deemed to have been modified by all statements made in such
      certificate;




**6.2.5**  **Evidence
      of Authority** .
      Such
      certificates or documents as may be reasonably required by Escrow Holder in
      order to cause each Title Policy to be issued and the Close of Escrow to occur;
      provided, however, that in no event shall Seller be required to execute a
      so-called owner’s affidavit/indemnity or a mechanics’ lien indemnity with
      respect to any Property;




**6.2.6**  **Closing
      Statement** .
      A duly
      executed and acknowledged counterpart of a joint buyer/seller estimated closing
      statement to be prepared by Escrow Holder and delivered to Seller and Buyer
      (the
“Closing Statement”); and




**6.2.7**  **Additional
      Items** .
      Any
      additional funds and/or instruments, signed and properly acknowledged by Seller,
      if appropriate, as may be necessary to comply with Seller’s obligations under
      this Agreement.




**6.3**  **Deposits
      by Buyer** .
      At or
      before 10:00 a.m., Pacific Standard Time, on the date of the Close of Escrow,
      Buyer shall deliver or cause to be delivered to Escrow Holder:




**11**


**6.3.1**  **Funds** .
      Immediately available Closing Funds by wire transfer into Escrow Holder’s
      depository bank account in an amount which, when added to the Cash Security
      Deposit Credit shall equal the Purchase Price plus all Closing costs, charges
      or
      prorations payable by Buyer hereunder, as the same shall be more particularly
      set forth on the Closing Statement;




**6.3.2**  **Release
      of Claims** **:** A
      Release of Claims duly executed by Buyer and the Lessee in the form attached
      hereto as **Exhibit
      “F”** (the
“Release of Claims”);




**6.3.3**  **Master
      Lease Amendment** **:** The
      Master Lease, duly executed by Buyer and each Affiliate of Buyer as Lessee
      thereunder, and Guarantor.




**6.3.4**  **Buyer’s
      Certificate** **.** If any
      representation or warranty of Buyer set forth in Section 8 hereof needs to
      be
      modified due to changes since the Effective Date, a certificate of Buyer
      addressed to Seller, dated as of the Closing Date and executed on behalf of
      Buyer by a duly authorized representative thereof, identifying any such
      representation or warranty which is not, or no longer is, true and correct
      and
      explaining the state of facts giving rise to the change. In no event shall
      Buyer
      be liable to Seller for, or be deemed to be in default hereunder by reason
      of
      any breach of a representation or warranty set forth in Section 8 hereof which
      results from any change that (i) occurs between the Effective Date and the
      Closing Date and (ii) is either expressly permitted under the terms of this
      Agreement or is beyond the reasonable control of Buyer to prevent. The
      occurrence of a change in a representation or warranty which is permitted
      hereunder or is beyond the reasonable control of Buyer to prevent shall, if
      materially adverse to Seller, constitute the non-fulfillment of the conditions
      set forth in Section 5.4.4 hereof. If, despite changes or other matters
      described in such certificate, the Closing occurs, Buyer’s representations and
      warranties set forth in this Agreement shall be deemed to have been modified
      by
      all statements made in such certificate;




**6.3.5**  **Evidence
      of Authority** .
      Such
      certificates or documents as may be reasonably required by Escrow Holder in
      order to cause each Title Policy to be issued and the Close of Escrow to
      occur;




**6.3.6**  **Closing
      Statement** .
      A duly
      executed and acknowledged counterpart of the Closing Statement; and




**6.3.7**  **Additional
      Items** .
      Any
      additional Funds and/or instruments, signed and properly acknowledged by Buyer,
      if appropriate, as may be necessary to comply with Buyer’s obligations under
      this Agreement.




**6.4**  **Issuance
      of Title Policies** .
      At the
      Close of Escrow, Title Company shall be in a position to issue to Buyer, with
      a
      copy to Seller, a policy of title insurance with respect to each Property,
      insuring good and indefeasible title to such Property vested in Buyer as of
      the
      Closing Date, free of all encumbrances except: (a) liens for Impositions; (b)
      those liens or encumbrances which were in effect on the date Seller or Seller’s
      Affiliate(s) first acquired title to or an interest in the Property; (c) those
      liens or encumbrances consented to by the Lessee during the term of the Master
      Lease with respect to the Properties (or the Original Leases, as defined in
      the
      Master




**12**


Lease
      with respect to the Properties) or which were created or suffered by Buyer
      or
      Lessee prior to the Closing; and (d) all other exceptions shown on the
      applicable Title Report (or any supplements thereto issued prior to the Closing)
      or disclosed by the applicable ALTA Survey for such Property and not disapproved
      by Buyer pursuant to Sections 5.2.1 or 5.1.1.1(b) above. Each policy (a “Title
      Policy”), when issued, shall:




(i)  be
      in
      current ALTA extended coverage form;




(ii)  include
      such endorsements as Buyer may reasonably require (subject to availability);
      and




(iii)  be
      issued
      in the amount of the Purchase Price allocated to the respective Property
      pursuant to **Exhibit
      “G”** attached
      hereto.




The
      cost
      of each Title Policy and all endorsements thereto shall be borne by Buyer as
      provided in Section 6.6 below.





**6.5**  **Prorations** .




**6.5.1**  **Impositions
      and Other Expenses** .
      Buyer
      and Seller acknowledge and agree that the Master Lease is absolutely net to
      the
      Lessor, and that the Lessee is solely responsible for any and all Impositions,
      insurance premiums, utility charges and other expenses incurred in connection
      with the operation, maintenance and use of the respective Property. Accordingly,
      Buyer and/or the Lessee shall be solely responsible for all such amounts whether
      accruing prior to or after the Closing and there shall be no prorations on
      account thereof between Buyer and Seller hereunder.




**6.5.2**  **Rents** .
      Notwithstanding anything to the contrary herein, all Rents and Charges shall
      belong to and be paid over to the Lessor by the Lessee, on the Closing Date.
      Minimum Rent shall be prorated based upon the actual number of days in the
      month
      in which the Closing occurs. For purposes of prorating any Additional Rent
      payable under the Master Lease with respect to the Property, the following
      shall
      apply:




(a)  To
      the
      extent Additional Rent payable for the then-current Lease Year for any Property
      is calculated and determined on the basis of a percentage of Gross Revenues
      in
      excess of the applicable Base Gross Revenues, such Additional Rent with respect
      to such Property shall be equal to the applicable percentage of Gross Revenues
      for such Property for such Lease Year in excess of the applicable Closing
      Breakpoint. For purposes of the foregoing, the “Closing Breakpoint” shall mean
      the applicable Base Gross Revenues multiplied by a fraction the numerator of
      which is the number of days in the current Lease Year for such applicable
      Property through, but not including the Closing Date, and that the denominator
      of which is three hundred sixty-five (365).




(b)  To
      the
      extent Additional Rent payable for the then-current Lease Year for any Property
      is calculated and determined on the basis of an increase in the Cost of Living
      Index, such Additional Rent shall be determined and paid in accordance with
      the




**13**


applicable
      provisions of the Master Lease for the number of days in such Lease Year
      through, but not including, the Closing Date.




(c)  In
      the
      event that the amount of Additional Rent payable under such Lease is subject
      to
      either a floor or a ceiling, the amount of such floor or ceiling, as the case
      may be, shall also be prorated based upon a three hundred sixty-five (365)
      day
      year.




(d)  Buyer
      and
      Seller shall cooperate to estimate the proration amount for Additional Rent
      as
      of the Closing in good faith, and shall submit such amount to Escrow Holder
      at
      least one (1) business day prior to the Close of Escrow. In determining such
      proration amount, Buyer shall be credited with any payments on account of
      Additional Rent previously paid to the Lessor for the applicable current Lease
      Year. Within thirty (30) days after the Closing Date, the Lessee shall make
      a
      final calculation of Additional Rent up to the Closing for each Property,
      together with an Officer’s Certificate (as defined in the Master Lease) setting
      forth the calculation thereof. Buyer shall promptly pay to Seller any deficiency
      in the payment of Additional Rent for each Property made at the Closing, and
      Seller shall promptly pay to Buyer the amount of any overpayment of Additional
      Rent for any Property.




(e)  The
      obligation to prorate and pay Additional Rent for each Property shall survive
      the Closing.




**6.6**  **Closing
      and Transaction Costs** .




**6.6.1**  Upon
      the
      Closing, Buyer shall be responsible for:




(a)  any
      and
      all state, municipal or other documentary, transfer, stamp, sales, use or
      similar taxes payable in connection with the delivery of any instrument or
      document provided in or contemplated by this Agreement or the Exhibits hereto,
      any agreement or commitment described or referred to herein or the transactions
      contemplated herein together with interest and penalties, if any,
      thereon;




(b)  all
      expenses of or related to the issuance of the Title Policy (including the costs
      of any ALTA Survey required by Buyer and the Title Company), chain of title
      reports, and all escrow fees and charges;




(c)  the
      charges for or in connection with the recording and/or filing of any instrument
      or document provided herein or contemplated by this Agreement or any agreement
      or document described or referred to herein;




(d)  Buyer’s
      legal, accounting and other professional fees and expenses and the cost of
      all
      instruments and documents required to be delivered, or to be caused to be
      delivered, by Buyer hereunder;




(e)  Seller’s
      Transaction Costs; and




(f)  All
      other
      costs and expenses incurred in connection with the transactions contemplated
      hereunder and the Exhibits hereto.




**14**


**6.6.2**  If
      the
      Closing does not occur for any reason other than Seller’s default hereunder,
      Buyer shall pay all title and Escrow cancellation charges and expenses and
      shall
      pay to Seller all of Seller’s Transaction Costs. If the Closing does not occur
      by reason of Seller’s default hereunder, then in such event Seller shall be
      solely responsible for Seller’s Transaction Costs and for any title and Escrow
      cancellation charges and expenses.




**6.7**  **Completion
      and Distribution of Documents** .
      Escrow
      Holder shall also undertake the following at or promptly after the Close of
      Escrow:




**6.7.1**  If
      necessary, Escrow Holder is authorized and instructed to insert the date Escrow
      closes as the date of any documents conveying or terminating interests herein
      or
      to become operative as of the Closing Date.




**6.7.2**  Cause
      each Deed and any other recordable instrument which the parties so direct to
      be
      recorded in the appropriate land records office where the respective property
      is
      located; and




**6.7.3**  Cause
      each non-recorded document to be delivered to the party acquiring rights
      thereunder, or for whose benefit such document was obtained.




**6.8**  **Seller’s
      Election of 1031 Exchange** .
      Seller
      may elect to sell the Properties to Buyer in the form of a tax-deferred exchange
      pursuant to Section 1031 of the Internal Revenue Code of 1986, as amended (“1031
      Exchange”); provided, however, such 1031 Exchange shall not be a condition to
      Seller’s obligation to close the transactions contemplated by this Agreement;
      provided further, however, that Seller shall be entitled, in its sole
      discretion, to extend the Closing Date (including the Outside Closing Date)
      for
      up to ten (10) days by written notice delivered to Buyer and Escrow Holder
      no
      less than three
      (3) days
      prior to the scheduled Closing Date in order to accommodate such a 1031
      Exchange. In the event that Seller shall so elect a 1031 Exchange, Seller shall
      give written notice to Buyer and Escrow Holder of such election. Buyer shall
      fully cooperate with any such 1031 Exchange, including executing and delivering
      additional documents requested or approved by Seller; provided, that Buyer
      shall
      not be required to incur any additional Liabilities or financial obligations
      as
      a consequence of any of the foregoing exchange transactions. Seller hereby
      indemnifies and holds Buyer harmless from any Liabilities to which Buyer may
      be
      exposed due to any participation by Buyer in such a 1031 Exchange transaction.




**7.**  **TERMINATION**




**7.1**  **Early
      Termination for Failure of Conditions or Major Loss** **.**




**7.1.1**  **Termination
      by Buyer** .




(a)  If
      Buyer
      is entitled to and in fact disapproves any of the conditions set forth in
      Section 5.1.1.1(a), 5.1.1.1(c) or 5.1.1.4 within the time provided in
      Section 5.2.1 or the condition set forth in Section 5.1.1.1(b) with respect
      to
      any Intervening Lien in the manner or within the time therein provided, and
      Seller notifies Buyer and Escrow Holder that Seller cannot or will not cure
      such
      disapproved condition, or if Seller fails to notify Buyer and Escrow Holder




**15**


that
      Seller intends to cure such disapproved condition within the time and in the
      manner provided in Section 5.2.2 above, if at all, then Buyer shall have
      until 5:00 p.m., Pacific Standard Time, on the fifth (5th) day following (i)
      its
      receipt of Seller’s notice or (ii) the date Seller is deemed to have elected not
      to cure pursuant to Section 5.2.2(b), to notify Seller and Escrow Holder in
      writing that Buyer in its sole discretion either:




(1)  Waives
      its prior objections to such condition and will proceed to purchase all of
      the
      Properties, subject to any then remaining conditions, without any reduction
      or
      offset to the Purchase Price; or




(2)  Thereby
      terminates Escrow and this Agreement.




(b)  If
      Buyer
      is entitled to and in fact disapproves any of the conditions set forth in
      Sections 5.1.1.2, 5.1.1.3 or 5.1.2.1 through 5.1.2.4, inclusive, then Escrow
      and
      this Agreement shall automatically terminate upon receipt by Seller and Escrow
      Holder of Buyer’s written notice of disapproval of such condition within the
      time and in the manner provided in Section 5.2.1; provided, however, that if
      the
      failure of (i) the condition set forth in Section 5.1.2.2 results from a breach
      or default by Seller of its obligations under this Agreement or (ii) the
      condition set forth in Section 5.1.2.1 results from a breach of an express
      representation or warranty of Seller pursuant to Section 8 when made, then
      in
      lieu of terminating this Agreement and Escrow pursuant to this Section 7.1,
      Buyer shall be entitled to exercise its rights pursuant to Section 7.2
      below.




(c)  In
      the
      event of a Major Loss prior to the Closing, Buyer may terminate Escrow and
      this
      Agreement by written notice to Seller in accordance with the provisions of
      Section 9.2 below.




**7.1.2**  **Termination
      by Seller** .
      If
      Seller disapproves any of the conditions set forth in Section 5.4 above, then
      Escrow and this Agreement shall automatically terminate upon receipt by Buyer
      and Escrow Holder of Seller’s written notice of disapproval thereof at any time
      prior to the Closing; provided, however, that if the failure of any of the
      conditions set forth in Sections 5.4.2, 5.4.3, 5.4.4 or 5.4.5 results from
      a
      breach or a default by Buyer of its obligations under this Agreement or from
      a
      breach of any express representation or warranty of Buyer pursuant to Section
      8
      when made, then in lieu of terminating this Agreement and Escrow pursuant to
      this Section 7.1.2, Seller shall be entitled to exercise its remedies pursuant
      to Section 7.2 below. In addition, notwithstanding the foregoing, the parties
      acknowledge and agree that the occurrence of any event of the type described
      in
      Section 5.4.1(a) above which results in the failure of the conditions set forth
      therein shall also constitute and be deemed a default by Buyer under this
      Agreement entitling Seller to exercise its remedies pursuant to Section 7.2
      below.




**7.1.3**  **Rights
      and Obligations Upon Termination for Failure of
      Conditions** .
      If
      Escrow and this Agreement are terminated in the manner and within the applicable
      time period(s) provided pursuant to either Section 7.1.1 or Section 7.1.2 above,
      (b) all instruments in Escrow shall be returned to the party depositing the
      same, (c) Buyer shall return all items previously delivered by Seller to Buyer,
      (d) the provisions of Section 6.6.2 above shall apply and (e) neither party
      shall have any further rights, obligations or Liabilities whatsoever to the
      other




**16**


party
      concerning the purchase and sale of the Property pursuant to this Agreement,
      except for those Liabilities which are expressly stated in this Agreement to
      survive termination.




**7.2**  **Termination
      by Reason of Default** .
      If the
      Closing fails to occur when and as provided in Section 6 above by reason of
      a
      breach or default (or deemed default as provided in the last sentence of Section
      7.1.2 above) of either party of any of its duties, obligations, representations
      or warranties under this Agreement, then the nondefaulting party may elect,
      by
      written notice to the defaulting party and to Escrow Holder, to terminate Escrow
      and this Agreement. Such termination shall be effective five (5) days after
      delivery of such notice (the “Effective Termination Date”); provided ,
      that
      (i) the nondefaulting party has performed or is in a position to perform
      all obligations on its part to be performed as of the Effective Termination
      Date
      other than those obligations which the non-defaulting party is prevented from
      having performed by reason of the defaulting party’s breach or default; and
      (ii) the defaulting party has not cured the default and the nondefaulting
      party has not waived such default by the Effective Termination Date. Except
      as
      otherwise provided below in this Section 7.2 and Section 6.6.2 above, Escrow
      Holder and the parties shall, upon such termination, return all of the other
      party’s funds and documents then held by them to the party depositing or
      delivering the same. Thereafter, each of the parties shall be discharged and
      released from all obligations and Liabilities except as otherwise provided
      in
      this Section 7.2 and Section 6.6.2 above and except for those obligations and
      Liabilities which are expressly intended to survive the termination of this
      Agreement, including those Liabilities set forth in Section 12.2
      below.




**7.2.1**  **Seller’s
      Damages** . If
      the
      Closing fails to occur by reason of a breach or default of this Agreement by
      Buyer, then Seller may either (a) terminate this Agreement as of the Effective
      Termination Date as provided in Section 7.2 above, in which case Buyer shall
      be
      liable for the cancellation and other charges and expenses as provided for
      in
      Section 6.6.2 and all of Seller’s Transaction Costs, or (b) enforce specific
      performance of the obligations of Buyer here-under; provided, however, that
      any
      action by Seller to seek such specific performance must be commenced within
      thirty (30) calendar days of the occurrence of the alleged default by Buyer;
      provided further, however, that, except as provided in Section 6.2.2 and except
      for Seller’s Transaction Costs, in no event whatsoever shall Buyer ever have any
      Liability (whether in law or equity) for damages as a result of a default by
      Buyer under this Agreement .




**7.2.2**  **Buyer’s
      Remedies** **.** If the
      Closing fails to occur by reason of a breach or default of this Agreement by
      Seller, then Buyer may either (a) terminate this Agreement as of the Effective
      Termination Date as provided in Section 7.2 above, in which case Seller shall
      be
      liable for the cancellation and other charges and expenses provided for in
      Section 6.6.2, or (b) enforce specific performance of the obligations of Seller
      here-under; provided, however, that any action by Buyer to seek such specific
      performance must be commenced within thirty (30) calendar days of the occurrence
      of the alleged default by Seller; provided further, however, that, except as
      provided in Section 6.2.2, in no event whatsoever shall Seller ever have any
      Liability (whether in law or equity) for damages as a result of a default by
      Seller under this Agreement.




**7.3**  **Relationship
      to Master Lease** **.** Notwithstanding
      anything to the contrary in this Agreement, no termination of this Agreement
      and
      Escrow by Seller or Buyer regardless of the reason therefor shall affect the
      rights or obligations of the Lessor or Lessee under the Master




**17**


Lease,
      which Master Lease shall remain in full force and effect (and unmodified by
      the
      Master Lease Amendment), following any such termination of this Agreement prior
      to the Closing.




**8.**  **REPRESENTATIONS
      AND WARRANTIES**




**8.1**  **In
      General** .
      In
      addition to any express agreements of either party contained herein, the
      following constitute representations and warranties by each party to the other,
      which shall be true and correct as of the date hereof, and the truth and
      accuracy of such representations and warranties as of the Close of Escrow by
      each party shall also constitute a condition to the Close of Escrow for the
      benefit of the party to whom such representations and warranties were
      made.




**8.2**  **By
      Each Party** .
      Each
      party hereto represents and warrants to the other as follows:




**8.2.1**  **Authority** .
      Such
      party has full power and authority to enter into and comply with the terms
      of
      this Agreement, and the individuals executing this Agreement on behalf of such
      party have actual right and authority to bind that party to the terms of this
      Agreement.




**8.2.2**  **Binding
      Effect** .
      No
      action or consent which has not been obtained is necessary to make this
      Agreement, and this Agreement and all documents to be executed hereunder are
      or
      will be when executed the valid and legally binding obligations of such party,
      enforceable in accordance with their respective terms, except as such
      enforceability may be limited by creditors’ rights laws and general principles
      of equity.




**8.2.3**  **No
      Conflict** .
      The
      execution and delivery of this Agreement and all other documents to be executed
      by such party hereunder, compliance with the provisions thereof and hereof
      and
      the consummation of the transactions contemplated hereunder and thereunder
      will
      not result in (a) a breach or violation of (i) any Laws applicable to such
      party
      now in effect, (ii) the Organizational Documents of such party, (iii) any
      judgment, order or decree of any governmental authority with jurisdiction
      binding on such party or (iv) any material agreement or instrument to which
      such
      party is a party or by which it is bound.




**8.2.4**  **Patriot
      Act** **.** To
      the
      actual knowledge of such party, such party and its respective Affiliates
      are **** in
      compliance with the requirements of Executive Order No. 13224, 66 Fed. Reg.
      49079 (Sept. 25, 2001) (the “Order”) and other similar requirements contained in
      the rules and regulations of the Office of Foreign Assets Control, Department
      of
      Treasury (“OFAC”) and in any enabling legislation or other Executive Orders or
      regulations in respect thereof (the Order and such other rules, regulations,
      legislation or orders collecting called the “Orders”). Neither such party nor
      any of their Affiliates (A) is listed on the Specially Designated Nationals
      and
      Blocked Person List maintained by OFAC pursuant to the Order and/or on any
      other
      list of terrorists or terrorist organizations maintained pursuant to any of
      the
      rules and regulations of OFAC or pursuant to any other applicable Orders (such
      lists are collectively referred to as the “Lists”), (B) is a Person (as defined
      in the Order) who has been determined by competent authority to be subject
      to
      the prohibitions contained in the Orders; or (C) is owned or controlled




**18**


by
      (including without limitation by virtue of such person being a director or
      owning voting shares or interests), or acts for or on behalf of, any person
      on
      the Lists or any other person who has been determined by competent authority
      to
      be subject to the prohibitions contained in the Orders. As used herein, the
      term
“actual knowledge” as it relates to Seller shall mean the actual knowledge
      (without investigation or the duty to conduct investigation) of Paul Brown
      and
      Brian J. Maas and as it relates to Buyer shall mean the actual knowledge
      (without investigation or the duty to conduct investigation) of Eric
      Mendelsohn.




**8.3**  **By
      Seller Only** .
      Seller
      represents and warrants to Buyer as follows:




**8.3.1**  **Authority
      of Lessor** .
      The
      Lessor has full power and authority to execute and deliver the Master Lease
      Amendment pursuant to the terms of this Agreement and that when so executed
      and
      delivered, such Master Lease Amendment shall constitute the valid and binding
      obligations of the Lessor, enforceable against such Lessor in accordance with
      its respective terms, except as such enforceability may be limited by creditors’
rights laws and general principles of equity.




**8.3.2**  **No
      Tax Withholding** .
      In
      accordance with Section 1445 of the Internal Revenue Code and the
      applicable provisions of the California Revenue and Taxation Code, (a) Seller
      is
      not now, and at Closing will not be, a “foreign person,” and (b) Buyer need not
      withhold tax at the Closing as a result of this transfer. Seller shall deliver
      a
      separate nonforeign/residency affidavit, executed by Seller, if reasonably
      required to do so by Escrow Holder.




**8.3.3**  **Litigation,
      Etc.** To the
      actual knowledge of Seller (without investigation and without the duty to
      conduct any investigation), there are no actions, proceedings or investigations
      pending or threatened against or affecting Seller seeking to enjoin, challenge
      or collect damages in connection with the transactions contemplated by this
      Agreement or which would reasonably be expected to materially and adversely
      affect the ability of Seller to carry out the transactions contemplated by
      this
      Agreement or which in any way challenge or affect Seller’s ownership of the
      Properties, or any of them.




**8.4**  **By
      Buyer Only** **.** Buyer
      represents and warrants to Seller as follows:




**8.4.1**  **Authority
      of Lessees** .
      The
      Lessee and Guarantor have full power and authority to execute and deliver the
      documents and instruments required to be delivered by them pursuant to the
      terms
      of this Agreement (including the Master Lease Amendment) and that when so
      executed and delivered, such instruments shall constitute the valid and binding
      obligations of the Lessee and Guarantor, enforceable against them in accordance
      with their respective terms, except as such enforceability may be limited by
      creditors’ rights laws and general principles of equity.




**8.4.2**  **Litigation,
      Etc.** To the
      actual knowledge of Buyer (without investigation and without the duty to conduct
      any investigation), there are no actions, proceedings or investigations pending
      or to the knowledge of Buyer threatened against or affecting Buyer seeking
      to
      enjoin, challenge or collect damages in connection with the transactions
      contemplated




**19**


by
      this
      Agreement or which would reasonably be expected to materially and adversely
      affect the ability of Buyer to carry out the transactions contemplated herein.




**9.**  **CERTAIN
      EVENTS PRIOR TO CLOSING**




**9.1**  **Minor
      Loss** .
      In the
      event of loss (including a loss due to a Condemnation) or damage to a Property
      or any portion thereof which is not a Major Loss and which occurs prior to
      the
      Closing, this Agreement shall remain in full force and effect, Buyer shall
      nonetheless proceed to purchase the Properties and consummate this Agreement
      in
      accordance with the terms hereof and all insurance proceeds or Condemnation
      awards payable by reason thereof shall belong to Buyer.




**9.2**  **Major
      Loss** **.** In
      the
      event of a Major Loss which occurs to any Property or portion thereof prior
      to
      the Closing, Buyer may by written notice to Seller given within ten (10) days
      after the occurrence of such Major Loss terminate this Agreement. If Buyer
      fails
      to elect to terminate this Agreement by written notice to Seller given within
      such ten (10) day period following the occurrence of such Major Loss, then
      Buyer
      shall be deemed to have elected to proceed with Closing with respect to the
      Properties, this Agreement shall remain in full force and effect, Buyer shall
      proceed to purchase the Properties and consummate this Agreement in accordance
      with the terms hereof and all insurance proceeds or Condemnation awards payable
      by reason thereof shall belong to Buyer.




**9.3**  **Prompt
      Notices** **.** Seller
      shall give prompt notice to Buyer, and Buyer shall give prompt notice to Seller,
      of (i) the occurrence, or failure to occur, of any event which occurrence
      or failure would be likely to cause (A) any representation or warranty
      contained in this Agreement to be untrue or inaccurate in any material respect
      or (B) any covenant, condition or agreement contained in this Agreement not
      to be complied with or satisfied in all material respects and (ii) any
      failure of Seller or Buyer, as the case may be, to comply with or satisfy any
      covenant, condition or agreement to be complied with or satisfied under this
      Agreement.




**9.4**  **Satisfaction
      of Conditions** **.** From and
      after the Effective Date, each party covenants and agrees with the other to
      use
      good faith, commercially reasonable efforts to satisfy or cause to be satisfied
      all conditions precedent to such party’s obligations hereunder which are in such
      party’s control or over which such party exercises control.




**10.**  **POST-CLOSING
      MATTERS**




**10.1**  **Confidentiality** .
      Each
      party shall hold in strict confidence all information received from the other
      party concerning this transaction and shall not release any such information
      to
      third parties (other than attorneys, accountants or other professional
      consultants, or lenders of the parties) without the prior written consent of
      the
      other party unless otherwise required by Law. Buyer and Seller will jointly
      prepare and issue any and all releases of information to the public relating
      to
      the sale of the Properties. Each party will undertake to consult with the other
      prior to responding to any inquiries made by any third party respecting the
      transactions contemplated by this Agreement.




**20**


**10.2**  **Indemnification
      by Buyer** .
      In
      addition to the other indemnities of Buyer contained herein, Buyer shall
      protect, indemnify, save harmless and defend Seller and its partners,
      predecessors, successors and assigns, and their respective past, present and
      future officers, directors, employees, agents, representatives, attorneys and
      all persons acting by, through, under or in concert with any of the foregoing,
      from and against all Liabilities, based upon, relating or arising out of the
      Properties, or any of them, whether accruing before or after the Closing Date,
      including any Liabilities relating to the presence or existence of Hazardous
      Substances of any kind, on, under or about the Properties, or any of them,
      or on
      adjoining or neighboring property, or arising from any use of the Properties,
      or
      any of them; provided, however, the foregoing indemnity shall not extend to
      any
      Liabilities which are solely and proximately caused by the gross negligence
      or
      willful misconduct of Seller. Payment shall not be condition precedent to
      enforcement of the foregoing indemnification. The provisions of Section 10.2
      shall specifically survive the execution and delivery of this Agreement and
      the
      Deeds and the occurrence of the Closing.




**11.**  **BROKERS**




Seller
      and Buyer each represents and warrants to the other that no broker or finder
      or
      other real estate agent is entitled to any commission, finder’s fee or other
      compensation resulting from any action on its part. Each party agrees to
      indemnify, defend, protect and hold the other party and the Properties harmless
      against any Liabilities for any broker’s commission or finder’s fee for which it
      is responsible or which is asserted as a result of its own act or omission
      in
      connection with this transaction.




**12.**  **MISCELLANEOUS
      PROVISIONS**




**12.1**  **Assignment;
      Binding on Successors** .
      This
      Agreement shall be binding upon and shall inure to the benefit of Buyer and
      Seller and their respective representatives, successors and assigns; provided,
      however, that Buyer shall not have the right to assign this Agreement or any
      interest or right under this Agreement or under the Escrow or to appoint a
      nominee to act as Buyer under this Agreement without obtaining the prior written
      consent of Seller, which consent may be given or withheld in the sole and
      absolute discretion of Seller; provided, however, that without in any way
      relieving Buyer of any of its duties, covenants or obligations hereunder, upon
      written notice to Seller given not less than five (5) business days prior to
      the
      scheduled Closing Date, Buyer may, without the consent of Seller, assign its
      rights and obligations hereunder to one or more Affiliates of Buyer. Any
      attempted assignment in violation of this provision shall be null and void.




**12.2**  **Attorneys’
      Fees** .
      In any
      dispute or action between the parties arising out of this Agreement or the
      Escrow, or in connection with the Properties, or any of them, the prevailing
      party shall be entitled to have and recover from the other party its costs
      and
      attorneys’ fees related thereto, whether by final judgment or by out of court
      settlement.




**12.3**  **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:




**21**


If
      to
      Seller:  Health
      Care Property Investors, Inc.




3760
      Kilroy
      Airport Way, Suite 300




Long
      Beach,
      California 90806




Attn:  Legal
      Department




Fax:  (562)
      733-5200






with
      a
      Copy to:  Latham
      & Watkins LLP




650
      Town
      Center Drive, Suite 2000




Costa
      Mesa,
      California 92626-1925




Attn:  David
      C.
      Meckler, Esq.




Fax:  (714)
      755-8290






If
      to
      Buyer:  Emeritus
      Corporation




3131
      Elliott
      Avenue, Suite 500




Seattle,
      Washington 98121




Phone:  (206)
      301-4493




Fax:  (206)
      301-4500




Attn:  Eric
      Mendelson






with
      a
      copy to:  Riddell
      Williams P.S.




1001
      Fourth
      Avenue, Suite 4500




Seattle,
      WA
      98154




Fax:  (206)
      389-1708




Attn:  David
      D.
      Buck, Esq.




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 which 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.




**12.4**  **Governing
      Law** .
      THIS
      AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
      OF
      THE STATE OF CALIFORNIA, EXCEPT TO THE EXTENT PREEMPTED BY FEDERAL LAWS. EACH
      OF
      BUYER AND SELLER HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF THE STATE
      AND
      FEDERAL COURTS OF THE STATE OF CALIFORNIA AND CONSENT TO SERVICE OF PROCESS
      IN
      ANY LEGAL PROCEEDING ARISING OUT OF, OR IN CONNECTION WITH, THIS AGREEMENT,
      BY
      ANY MEANS AUTHORIZED BY CALIFORNIA LAW.




**22**


**12.5**  **Interpretation** .
      All
      provisions herein shall be construed in all cases as a whole according to its
      fair meaning, neither strictly for nor against either Buyer or Seller and
      without regard for the identity of the party initially preparing this Agreement.
      Titles and captions are inserted for convenience only and shall not define,
      limit or construe in any way the scope or intent of this Agreement. References
      to Sections are to Sections as numbered in this Agreement unless expressly
      stated otherwise.




**12.6**  **Gender;
      Joint Obligations** .
      As used
      in this Agreement, the masculine, feminine or neuter gender and the singular
      or
      plural number shall each be deemed to include the others where and when the
      context so dictates. If more than one party, trust or other entity is the Buyer
      hereunder, the obligations of all such parties shall be joint and
      several.




**12.7**  **No
      Waiver** .
      A
      waiver by either party of a breach of any of the covenants, conditions or
      agreements to be performed by the other party shall be in writing to be
      effective and no such written waiver shall be construed as a waiver of any
      succeeding breach of the same or other covenants, conditions or
      Agreements.




**12.8**  **Modifications** .
      Any
      alteration, change or modification of or to this Agreement, in order to become
      effective, must be made in writing and in each instance signed on behalf of
      each
      party to be charged.




**12.9**  **Severability** .
      If any
      term, provision, condition or covenant of this Agreement or its application
      to
      any party or circumstances shall be held, to any extent, invalid or
      unenforceable, the remainder of this Agreement, or the application of the term,
      provision, condition or covenant to persons or circumstances other than those
      as
      to whom or which it is held invalid or unenforceable, shall not be affected,
      and
      shall be valid and enforceable to the fullest extent permitted by
      law.




**12.10**  **Survival** .
      The
      conveyance of the Properties to Buyer shall constitute full performance and
      discharge of every representation, warranty and covenant and agreement of Seller
      to be performed hereunder by the Closing, notwithstanding anything herein to
      the
      contrary. Thereupon, all representations or warranties, covenants or agreements
      by either Buyer or Seller contained in this Agreement will terminate and will
      not survive the Closing, except for the representations and agreements which
      contemplate performance after Closing such as post-closing matters set forth
      in
      Section 10, payment of brokerage fees set forth in Section 11, all matters
      set
      forth in this Section 12.10 and the Release of Claims to be executed and
      delivered by Buyer and the Lessee in favor of Seller at the Closing.




**12.11**  **Merger
      of Prior Agreements** .
      This
      Agreement contains the entire understanding between the parties relating to
      the
      transaction contemplated by this Agreement. All prior or contemporaneous
      agreements, understandings, representations and statements, whether direct
      or
      indirect, oral or written, are merged into and superseded by this Agreement,
      and
      shall be of no further force or effect.




**12.12**  **Time
      of Essence** .
      Time is
      of the essence of this Agreement.




**23**


**12.13**  **Counterparts** .
      This
      Agreement may be signed in multiple counterparts which, when duly delivered
      and
      taken together, shall constitute a binding Agreement between all
      parties.




**12.14**  **Exhibits** .
      All
      exhibits attached to this Agreement are incorporated herein by
      reference.




**12.15**  **Cooperation
      of Parties** .
      Each
      party agrees to sign any other and further instruments and documents and take
      such other actions as may be reasonably necessary or proper in order to
      accomplish the intent of this Agreement.




**12.16**  **No
      Third Party Beneficiaries** .
      Except
      as otherwise expressly provided herein, the provisions of this Agreement are
      intended to be solely for the benefit of the parties hereto, and the execution
      and delivery of this Agreement shall not be deemed to confer any rights upon,
      nor obligate any of the parties hereunder, to any person or entity other than
      the parties to this Agreement.




**12.17**  **Dates** .
      If,
      pursuant to this Agreement, any date indicated herein falls on an official
      United States holiday, or a Saturday or Sunday, the date so indicated shall
      mean
      the next business day following such date.




**12.18**  **Property
      Disclosures** .
      Buyer
      hereby waives the right to receive and any obligation of Seller to deliver
      any
      disclosures applicable to any Property and required by Law; provided, however,
      if such waiver is permitted by applicable Law, then Buyer shall promptly notify
      Seller in writing thereof and Seller shall provide, at Buyer’s expense, any such
      required disclosures as soon as practicable following Seller’s receipt of
      Buyer’s notice.




[Signature
      Page Follows]









**24**


IN
      WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
      date
      first above written.




SELLER:
            HCPI
                TRUST, a Maryland real estate investment
                trust




By:/s/
                Brian J. Maas





Its:
                Senior Vice President








BUYER:
            EMERITUS
                CORPORATION,




a
      Delaware corporation




By:
                /s/ Eric Mendelsohn





Its:
                Director of Real Estate and Legal Affairs








**ACCEPTANCE
      BY TITLE COMPANY**




Title
      Company hereby agrees to establish an Escrow and act as the “Escrow Holder” in
      accordance with the provisions of the Agreement. Title Company further agrees
      to
      deliver immediately to Buyer and Seller fully executed copies of the Agreement.
      Title Company’s Escrow Number and Escrow Officer for the transaction
      contemplated hereby, address for notices for this Escrow, Escrow Account No.
      and
      wiring information is set forth below.




/s/
      Cathrin Weis








By:
      Cathrin Weis





Its:
      Escrow Officer





Date:
      _March 15, 2007





Escrow
      No.:    Emersky
      -


Emerpark
      -


Emerville
      -





Escrow
      Officer:   Cathrin
      Weis


Telephone
      No.: (206) 441-1955


Fax
      No.:
      (206) 441-1953





Address
      for Notices:   2201
      6 th Avenue


Suite
      1110


Seattle,
      WA 98121





Wiring
      Information:





Bank:







ABA
      No.:





Credit
      to:    Old
      Republic Title,









Account
      No.:





Reference:    HCPI/Emeritus


Attention:
      Cathrin Weiss


Re:
      HCP/Emeritus











**EXHIBIT
      A**




**LEASES**









That
      certain Amended and Restated Master Lease dated as of September 18, 2002, as
      amended by that certain First Amendment to Amended and Restated Master Lease
      dated August 31, 2003, that certain Second Amendment to Amended and Restated
      Master Lease dated January 26, 2004, that certain Third Amendment to Amended
      and
      Restated Master Lease dated April 22, 2004, that certain Fourth Amendment to
      Amended and Restated Master Lease dated July 30, 2004, and that certain Fifth
      Amendment to Amended and Restated Master Lease dated as of December 13,
      2005.














**A-1**


**EXHIBIT
      B**




**GENERAL
      ESCROW PROVISIONS**




1.
            All
                funds received in this escrow shall be deposited in a separate escrow
                fund
                account or accounts of Old Republic Title & Escrow (for the
                benefit of the parties hereto) with a State or National Bank qualified
                to
                do business in the State of Washington, such that each account shall
                be
                fully insured at all times by the Federal Deposit Insurance Corporation,
                to the maximum extent permitted by law. We shall have no obligation
                to
                account to you in any manner for the value of, or pay to you any
                benefit
                received by us, directly or indirectly, by reason of the deposit
                of the
                escrowed funds or the maintenance of such accounts with that
                bank.









All
      disbursements shall be made by wire transfer of funds to the account of the
      applicable party to whom such disbursements are owed as directed by such party.
      In the absence of written instruction from the party to whom such disbursement
      is owed naming the banking instruction, bank routing number and appropriate
      account number for deposit, the disbursement shall be made by check of Title
      Company. Any commitment made in writing to Title Company by any bank, trust
      company, insurance company, savings and loan association or other lender to
      deliver its check or funds into this escrow may, in the sole discretion of
      Title
      Company, be treated as the equivalent of a deposit in this escrow of the amount
      thereof, pursuant to the rules of RCW 48.29.190.




2.
            You
                are authorized to prepare, obtain, record and deliver the necessary
                instruments to carry out the terms and conditions of this escrow
                and to
                order to be issued at close of escrow the policy of title insurance
                as
                called for in these instructions. Close of escrow shall mean the
                date
                instruments are recorded.




3.
            All
                adjustments and prorations shall be made on the basis of a 30-day
                month.
                In all acts relating to fire insurance, rents and rental deposits,
                you
                shall be fully protected in assuming that the information provided
                you by
                the parties to this escrow, or their agent(s), is correct and that
                insurance premiums have been paid.




4.
            [Reserved]




5.
            Subject
                to the provisions of Section 15 below, you are not to be held accountable
                or liable for the sufficiency or correctness as to form, manner of
                execution, or validity of any instrument deposited in this escrow,
                nor as
                to the identity, authority or rights of any person executing the
                same.
                Your duties hereunder shall be limited to the proper handling of
                such
                money and the proper safekeeping of such instruments, or other documents
                received by you as escrow holder, and for the disposition of same
                in
                accordance with the written instructions accepted by you in this
                escrow.
                The foregoing shall not be deemed or construed to relieve you of
                any
                liability resulting from your gross negligence or willful
                misconduct.




6.
            You
                shall have no responsibility of notifying me or any of the parties
                to this
                escrow of any sale, resale, loan, exchange or other transaction involving
                any property herein described or of any profit realized by any person,
                firm or corporation in connection




**B-1**


therewith,
      regardless of the fact that such transaction(s) may be handled by you in this
      escrow or in another escrow.




7.
            No
                notice, demand or change of instruction shall be of any effect in
                this
                escrow unless given in writing by all parties affected thereby and
                except
                as otherwise specifically provided in the Agreement to which these
                General
                Provisions are attached. In the event a demand for the funds on deposit
                in
                this escrow is made, not concurred in by all parties hereto, the
                escrow
                holder, regardless of who made demand therefor, may elect to do any
                of the
                following:




i.
            Withhold
                and stop all further proceeding in, and performance of, this escrow
                pending a resolution of any conflict by and between the parties hereto;
                or




ii.
            File
                a suit in interpleader and obtain an order from the court allowing
                escrow
                holder to deposit all funds and documents in court and have no further
                liability hereunder, except for its own negligent or willful misconduct
                or
                any breach by escrow holder of any obligations in this
                Agreement.




8.
            If
                the conditions of this escrow have not been complied with at the
                time
                herein provided, you are nevertheless to complete the same as soon
                as the
                conditions (except as to time) have been complied with, unless Buyer
                has
                made written demand upon you for the return of money and instruments
                deposited by Buyer.




9.
            All
                parties hereto agree, jointly and severally, to pay on demand, as
                well as
                to indemnify and hold you harmless from and against all advances,
                charges,
                costs, damages, expenses, including cancellation fees, that are*properly*chargeable
                to the undersigned, judgments, attorney’s fees, expenses, obligations and
                liabilities of any kind or nature which, in good faith, you may incur
                or
                sustain in connection with this escrow, whether arising before or
                subsequent to the close of this escrow, including any and all balance
                for
                fees, costs or shortages due in connection with these instructions,
                except
                to the extent caused by the negligence or willful misconduct of the
                escrow
                holder.




10.
            Unless
                the Agreement otherwise provides or unless otherwise instructed by
                either
                Buyer or Seller, you are authorized to furnish copies of these
                instructions, any supplements or amendments thereto, notices of
                cancellation and closing statements to the attorneys, real estate
                broker(s) and lender(s) named in this
                escrow.




11.
            [Reserved]




12.
            [Reserved]




13.
            Any
                funds held in escrow which are unclaimed for a period of six (6)
                months by
                the parties entitled thereto shall be assessed a service/holding
                fee of
                $10.00 each month. Said service/holding fee may be withdrawn from
                any such
                funds being held to the extent allowed by law. After three (3) years
                from
                the deposit of funds into escrow, any amounts thereafter remaining
                unclaimed may be escheated to the State of Washington in compliance
                with
                the State of Washington’s Unclaimed Property Law and
                Regulations.




**B-2**


14.
            All
                documents, closing statements, and balances due the parties to this
                escrow
                are to be mailed by ordinary mail to said parties at the addresses
                shown
                opposite their signatures, unless otherwise
                instructed.




15.
            Notwithstanding
                the foregoing, if escrow holder is also acting as Title Company under
                this
                Agreement, nothing set forth in these General Escrow Provisions shall
                limit any liability set forth in the Title Policy provided in the
                Agreement. However, you are not to be responsible or liable for
                determination that there has been compliance with any matters that
                are
                excluded from coverage under the title insurance policy to be issued
                in
                conjunction with close of this escrow including, but not limited
                to,
                county or municipal ordinances and state, county or municipal subdivision
                or land division regulations or
                laws.




16.
            For
                purposes of complying with Internal Revenue Code § 6045(e), as amended
                effective January 1, 1991, escrow holder is hereby designated as
                the
                “person responsible for closing the transaction” and also as the
                “reporting person,” for purposes of filing any information returns with
                the Internal Revenue Service concerning this transaction, as required
                by
                law.





17.
            The
                undersigned acknowledge that escrow holder is relieved of any obligation
                to order or obtain any of the inspections or reports required by
                this
                transaction.





18.
            The
                undersigned acknowledge that escrow is relieved of any obligation
                to
                monitor, schedule the timing of, or obtain any party’s compliance with,
                any of the contingencies required by this
                transaction.








**B-3**


**EXHIBIT
      C**





**FORM
      DEED**








STATE
      OF
      SOUTH CAROLINA  )


)   SPECIAL
      WARRANTY DEED


COUNTY
      OF
      ________________  )








Grantee’s
      Address:




c/o
      Emeritus Corporation


3131
      Elliott Avenue, Suite 500


Seattle,
      Washington 98121





KNOW
      ALL
      MEN BY THESE PRESENTS, that HCPI TRUST, a Maryland real estate investment trust,
      hereinafter called “Grantor,” for and in consideration of the sum of
      __________________________________________ Dollars ($_________.00) paid by
      EMERITUS CORPORATION, a Delaware corporation, hereinafter called “Grantee,” the
      receipt of which is hereby acknowledged, granted, bargained, sold and released,
      and by these presents grant, bargain, sell and release until the Grantee,
      his/her heirs, successors and assigns:








**SEE
      ATTACHED EXHIBIT “A” FOR**


**LEGAL
      DESCRIPTION**








TAX
      MAP
      NO.:





This
      conveyance is made subject to all covenants, conditions, restrictions,
      reservations, rights, rights of way, easements, encumbrances, liens and title
      matters of record or which would be discovered by an accurate survey or physical
      inspection of the premises as of the date hereof (the “Permitted
      Exceptions”).





TOGETHER
      with all and singular the rights, members, hereditaments and appurtenances
      to
      the said premises belonging, or in anywise incident and
      appertaining.





TO
      HAVE
      AND TO HOLD, all and singular the premises before mentioned unto the said
      Grantee, its heirs, successors and assigns forever.





And,
      subject to the Permitted Exceptions, the Grantor does hereby bind itself and
      its
      heirs, to warrant and forever defend all and singular the said premises until
      the Grantee, its heirs and assigns against itself and its heirs and against
      every person whomsoever lawfully claiming or to claim the same, or any part
      thereof, by, through or under Grantor, but against none other.





[Signature
      pages follow]


**C-1**


WITNESS
      the hand and seal this ___ day of ___________ in the year of our Lord Two
      Thousand and Seven (2007) in the Two Hundred and Thirty-First (231 st )
      year of
      Sovereignty and Independence of the United States of America.





Signed,
      Sealed and Delivered in the Presence of:










Witness
      No. 1       Name
      of
      Witness No. 1










Witness
      No. 2       Name
      of
      Witness No. 2














HCPI
      TRUST, a Maryland


real
      estate investment trust





By:


Name:


Its:













STATE
                OF CALIFORNIA
            ))
                ss.COUNTY
                OF LOS ANGELES
            )


On
      _______________________, 2007 before me, ______________________________, a
      Notary Public, personally appeared ________________________________, personally
      known to me (or proved to me on the basis of satisfactory evidence) to be the
      person(s) whose name(s) is/are subscribed to the within instrument and
      acknowledged to me that he/she/they executed the same in his/her/their
      authorized capacity(ies), and that by his/her/their signature(s) on the
      instrument the person(s), or the entity upon behalf of which the person(s)
      acted, executed the instrument.




WITNESS
      my hand and official seal.








Signature
      _____________________________











**C-2**





**EXHIBIT
      A**





**LEGAL
      DESCRIPTION**








**C-3**


**EXHIBIT
      D**





**FORM
      OF QUITCLAIM BILL OF SALE**







FOR
      VALUABLE CONSIDERATION, the receipt and sufficiency of which are hereby
      acknowledged, HCPI TRUST, a Maryland real estate investment trust (“Seller”)
      does hereby convey to EMERITUS
      CORPORATION, a Delaware corporation (“ Buyer”),
      “AS IS” and without warranty of any kind, other than the warranty that Seller
      has not encumbered the same, all of Seller’s right, title and interest, if any,
      in and to any tangible personal property located upon the land described on Schedule
      1 attached
      hereto and hereby made a part hereof (the “Land”) or within the improvements
      located thereon.




TO
      HAVE
      AND TO HOLD all of said personal property unto Buyer, its successors and
      assigns, to its own use forever.




IN
      WITNESS WHEREOF, Seller has executed this Bill of Sale as of the ____ day of
      ________, 200_.




Seller:




HCPI
      TRUST, a Maryland real estate investment trust




By:





Its:













**D-1**


**Schedule
      1**





**LEGAL
      DESCRIPTION OF LAND**























Schedule
            1
 Bill
            of Sale


**EXHIBIT
      E**





**FORM
      OF MASTER LEASE AMENDMENT**








[See
      Attached]


























**E-1**


**EXHIBIT
      F**





**FORM
      OF RELEASE OF CLAIMS**





For
      valuable consideration, the receipt and adequacy of which are hereby
      acknowledged, the undersigned, EMERITUS CORPORATION, a Delaware corporation
      (“Emeritus”) and [name
      of each Lessee] (collectively with Emeritus, the “Releasors”), and hereby release and forever
      discharge the “Releasees” hereunder, consisting of HCPI TRUST, a Maryland real
      estate investment trust (“HCP”) and [name
      of each Lessor] ,
      and
      each of their predecessors, successors, partners, members and assigns, and
      its
      and their past, present and future partners, members, officers, directors,
      trustees, employees, agents, lenders, representatives, attorneys, and all
      persons acting by, through, under or in concert with Releasees, or any of them,
      of and from any and all manner of action or actions, cause or causes of action,
      in law or in equity, suits, debts, liens, contracts, agreements, promises,
      liabilities, claims, demands, damages, losses, costs or expenses, of any nature
      whatsoever, known or unknown, fixed or contingent, which Releasors, or any
      of
      them, now has or may hereafter have against each or any of the Releasees by
      reason of any matter, cause or thing whatsoever from the beginning of time
      to
      the date hereof arising out of, based upon or relating to those certain
“Properties” described in that certain Purchase and Sale Agreement Joint Escrow
      Agreement dated as of March ___, 2007, between Emeritus, as “Buyer,” and HCP, as
“Seller” (the “Purchase Agreement”), including, without limitation, the
      condition of the Properties and/or the presence or existence of any Hazardous
      Substances (as defined in the Purchase Agreement) in, on, under or about the
      Properties. The execution and delivery of this Release of Claims by Releasors
      is
      a condition to the Closing of the transaction contemplated by the Purchase
      Agreement




EACH
      RELEASOR ACKNOWLEDGES THAT IT HAS BEEN ADVISED BY LEGAL COUNSEL AND IS FAMILIAR
      WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS
      FOLLOWS:




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




EACH
      RELEASOR, BEING AWARE OF THIS CODE SECTION, HEREBY EXPRESSLY WAIVES ANY RIGHTS
      IT MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER STATUTES OR COMMON LAW
      PRINCIPLES OF SIMILAR EFFECT.




Each
      Releasor represents and warrants that it has not assigned or transferred any
      interest in any claim released by this Release of Claims which it may have
      against the Releasees, or any of them, and each Releasor agrees to indemnify,
      defend and hold Releasees, and each of them, harmless from and against any
      liabilities, claims, demands, damages, costs, expenses and attorneys’ fees
      incurred by Releasees, or any of them, as a result of any person asserting any
      such assignment or transfer. It is the intention of the parties that this
      indemnity does not require payment as a condition precedent to recovery
      thereunder by the Releasees.




**F-1**


Each
      Releasor agrees that if it hereafter commences any suit arising out of, based
      upon, or relating to, or in any manner asserts against Releasees, or any of
      them, any of the claims or obligations released in this Release of Claims,
      such
      Releasor shall pay to Releasees, and each of them, in addition to any other
      damages caused to Releasees thereby, all attorneys’ fees incurred by Releasees
      in defending or otherwise responding to such suit or claim.




Each
      Releasor further understands and agrees that the execution of this Release
      of
      Claims shall not constitute or be construed as an admission of any obligation
      of, or of the validity of any claim whatsoever by, the Releasees, or any of
      them, who have each consistently taken the position that they have no obligation
      whatsoever to such Releasor.




Notwithstanding
      the date of execution of this Release of Claims, this Release of Claims shall
      be
      and become effective only at the time of Closing (as defined in the Purchase
      Agreement).




IN
      WITNESS WHEREOF, the undersigned Releasors have executed this Release of Claims
      as of the ____ day of ___________, 200__.




“Releasors”
              
              EMERITUS
                CORPORATION,
              a
                Delaware corporation
              
              
              By:
              
              Title:,
              a
              
              
              By:
              
              Title:,
              a
              
              
              By:
              
              Title:





**F-2**





,
              a
              
              
              By:
              
              Title:








**F-3**


**EXHIBIT
      G**





**PURCHASE
      PRICE ALLOCATION**







**G-1**