LEASE AGREEMENT


                                     BETWEEN


                      HCRI RIDGELAND POINTE PROPERTIES, LLC


                                       AND


                         RIDGELAND ASSISTED LIVING, LLC


                               SEPTEMBER 29, 2003


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                                TABLE OF CONTENTS
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ARTICLE  1:     LEASED  PROPERTY,  TERM  AND  DEFINITIONS     1
1.1     Leased  Property     1
1.2     Term     1
1.3     Definitions     1
ARTICLE  2:     RENT     9
2.1     Base  Rent     9
2.1.1     Base  Rent  Adjustment     9
2.2     Additional  Rent     9
2.3     Place  of  Payment  of  Rent     9
2.4     Net  Lease     9
2.5     No  Termination,  Abatement,  Etc.     10
2.6     Transaction  Fee     10
ARTICLE  3:     IMPOSITIONS  AND  UTILITIES     10
3.1     Payment  of  Impositions     10
3.2     Definition  of  Impositions     11
3.3     Escrow  of  Impositions     12
3.4     Utilities     12
3.5     Discontinuance  of  Utilities     13
3.6     Business  Expenses     13
3.7     Permitted  Contests     13
ARTICLE  4:     INSURANCE     13
4.1     Property  Insurance     13
4.2     Liability  Insurance     14
4.3     Builder's  Risk  Insurance     15
4.4     Insurance  Requirements     15
4.5     Replacement  Value     16
4.6     Blanket  Policy     16
4.7     No  Separate  Insurance     16
4.8     Waiver  of  Subrogation     16
4.9     Mortgages     17
4.10     Escrows     17
ARTICLE  5:     INDEMNITY     17
5.1     Tenant's  Indemnification     17
5.1.1     Notice  of  Claim     18
5.1.2     Survival  of  Covenants     18
5.1.3     Reimbursement  of  Expenses     18
5.2     Environmental  Indemnity;  Audits     18
5.3     Limitation  of  Landlord's  Liability     18
ARTICLE  6:     USE  AND  ACCEPTANCE  OF  PREMISES     19
6.1     Use  of  Leased  Property     19
6.2     Acceptance  of  Leased  Property     19
6.3     Conditions  of  Use  and  Occupancy     19
ARTICLE  7:     MAINTENANCE  AND  MECHANICS'  LIENS     20
7.1     Maintenance     20
7.2     Required  Alterations     20
7.3     Mechanic's  Liens     20
7.4     Replacements  of  Fixtures  and  Landlord's  Personal  Property     21
7.5     Lender  Maintenance  Reserve  Escrow     21
ARTICLE  8:     DEFAULTS  AND  REMEDIES     21
8.1     Events  of  Default     21
8.2     Remedies     23
8.3     Right  of  Setoff     26
8.4     Performance  of  Tenant's  Covenants     26
8.5     Late  Payment  Charge     26
8.6     Default  Rent     27
8.7     Attorneys'  Fees     27
8.8     Escrows  and  Application  of  Payments     27
8.9     Remedies  Cumulative     27
8.10     Waivers     27
8.11     Obligations  Under  the  Bankruptcy  Code     28
ARTICLE  9:     DAMAGE  AND  DESTRUCTION     28
9.1     Notice  of  Casualty     28
9.2     Substantial  Destruction     28
9.3     Partial  Destruction     29
9.4     Restoration     29
9.5     Insufficient  Proceeds     30
9.6     Not  Trust  Funds     30
9.7     Landlord's  Inspection     30
9.8     Landlord's  Costs     30
9.9     No  Rent  Abatement     31
ARTICLE  10:     CONDEMNATION     31
10.1     Total  Taking     31
10.2     Partial  Taking     31
10.3     Condemnation  Proceeds  Not  Trust  Funds     31
ARTICLE  11:     TENANT'S  PROPERTY     32
11.1     Tenant's  Property     32
11.2     Requirements  for  Tenant's  Property     32
ARTICLE  12:     RENEWAL  OPTIONS     33
12.1     Renewal  Options     33
12.2     Effect  of  Renewal     33
ARTICLE  13:     RIGHT  OF  FIRST  OPPORTUNITY     34
13.1     Right  of  First  Opportunity     34
13.2     Closing     35
ARTICLE  14:     NEGATIVE  COVENANTS     36
14.1     No  Debt     36
14.2     No  Liens     36
14.3     No  Guaranties     36
14.4     No  Transfer     36
14.5     No  Dissolution     36
14.6     Subordination  of  Payments  to  Affiliates     36
14.7     Change  of  Location  or  Name     36
ARTICLE  15:     AFFIRMATIVE  COVENANTS     37
15.1     Perform  Obligations     37
15.2     Proceedings  to  Enjoin  or  Prevent  Construction     37
15.3     Documents  and  Information     37
15.3.1     Furnish  Documents     37
15.3.2     Furnish  Information     37
15.3.3     Further  Assurances  and  Information     37
15.3.4     Material  Communications     38
15.3.5     Requirements  for  Financial  Statements     38
15.4     Compliance  With  Laws     38
15.5     Broker's  Commission     38
15.6     Existence  and  Change  in  Ownership     38
15.7     Financial  Covenants     39
15.7.1     Definitions     39
15.7.2     Coverage  Ratio     39
15.8     Facility  Licensure  and  Certification     39
15.9     Transfer  of  License  and  Facility  Operations     39
15.9.1     Licensure     39
15.9.2     Facility  Operations     39
15.10     Bed  Operating  Rights     40
15.11     Power  of  Attorney     40
15.12     Compliance  with  Loan  Documents     41
ARTICLE  16:     ALTERATIONS,  CAPITAL  IMPROVEMENTS,  AND  SIGNS     42
16.1     Prohibition  on  Alterations  and  Improvements     42
16.2     Approval  of  Alterations     42
16.3     Permitted  Alterations     43
16.4     Requirements  for  Permitted  Alterations     43
16.5     Ownership  and  Removal  of  Permitted  Alterations     44
16.6     Minimum  Qualified  Capital  Expenditures     44
16.7     Signs     44
ARTICLE  17:     RESERVED     44
ARTICLE  18:     ASSIGNMENT  AND  SALE  OF  LEASED  PROPERTY     44
18.1     Prohibition  on  Assignment  and  Subletting     44
18.2     Requests  for  Landlord's Consent to Assignment, Sublease or Management
Agreement     45
18.3     Agreements  with  Residents     46
18.4     Sale  of  Leased  Property     46
18.5     Assignment  by  Landlord     46
ARTICLE  19:     HOLDOVER  AND  SURRENDER     46
19.1     Holding  Over     46
19.2     Surrender     47
19.3     Indemnity     47
ARTICLE  20:     RESERVED     47
ARTICLE  21:     QUIET  ENJOYMENT,  SUBORDINATION,  ATTORNMENT  AND  ESTOPPEL
CERTIFICATES     47
21.1     Quiet  Enjoyment     47
21.2     Subordination     47
21.3     Attornment     48
21.4     Estoppel  Certificates     48
ARTICLE  22:     REPRESENTATIONS  AND  WARRANTIES     49
22.1     Organization  and  Good  Standing     49
22.2     Power  and  Authority     49
22.3     Enforceability     49
22.4     Government  Authorizations     49
22.5     Financial  Statements     49
22.6     Condition  of  Facility     50
22.7     Compliance  with  Laws     50
22.8     No  Litigation     50
22.9     Consents     50
22.10     No  Violation     51
22.11     Reports  and  Statements     51
22.12     ERISA     51
22.13     Chief  Executive  Office     51
22.14     Other  Name  or  Entities     51
22.15     Parties  in  Possession     51
22.16     Access     52
22.17     Utilities     52
22.18     Condemnation  and  Assessments     52
22.19     Zoning     52
22.20     Pro  Forma  Statement     52
22.21     Environmental  Matters     52
22.22     Leases  and  Contracts     53
22.23     No  Default     53
22.24     Tax  Status     53
ARTICLE  23:     RESERVED     53
ARTICLE  24:     SECURITY  INTEREST     53
24.1     Collateral     53
24.2     Additional  Documents     54
24.3     Notice  of  Sale     54
24.4     Recharacterization     55
24.5     Subordination     55
ARTICLE  25:     MISCELLANEOUS     55
25.1     Notices     55
25.2     Advertisement  of  Leased  Property     55
25.3     Entire  Agreement     55
25.4     Severability     55
25.5     Captions  and  Headings     56
25.6     Governing  Law     56
25.7     Memorandum  of  Lease     56
25.8     Waiver     56
25.9     Binding  Effect     56
25.10     No  Offer     56
25.11     Modification     56
25.12     Landlord's  Modification     57
25.13     No  Merger     57
25.14     Laches     57
25.15     Limitation  on  Tenant's  Recourse     57
25.16     Construction  of  Lease     57
25.17     Counterparts     57
25.18     Custody  of  Escrow  Funds     57
25.19     Landlord's  Status  as  a  REIT     57
25.20     Exhibits     58
25.21     WAIVER  OF  JURY  TRIAL     58
25.22     CONSENT  TO  JURISDICTION     58
25.23     Attorney's  Fees  and  Expenses     58
25.24     Survival     59
25.25     Time     59

SCHEDULE  1:     INITIAL  RENT  SCHEDULE
EXHIBIT  A:     LEGAL  DESCRIPTIONS
EXHIBIT  B:     PERMITTED  EXCEPTIONS
EXHIBIT  C:     FACILITY  INFORMATION
EXHIBIT  D:     LANDLORD'S  PERSONAL  PROPERTY
EXHIBIT  E:     DOCUMENTS  TO  BE  DELIVERED
EXHIBIT  F:     TENANT'S  CERTIFICATE  AND  FACILITY  FINANCIAL  REPORTS
EXHIBIT  G:     GOVERNMENT  AUTHORIZATIONS  TO  BE  OBTAINED;  ZONING  PERMITS
EXHIBIT  H:     PENDING  LITIGATION
EXHIBIT  I:     LIST  OF  LEASES  AND  CONTRACTS
EXHIBIT  J:     WIRE  TRANSFER  INSTRUCTIONS
EXHIBIT  K:     BASE  PRICE


<PAGE>


                                 LEASE AGREEMENT


          This  Lease  Agreement ("Lease") is made effective as of September 29,
2003  (the  "Effective  Date")  between HCRI RIDGELAND POINTE PROPERTIES, LLC, a
limited  liability  company  organized  under  the laws of the State of Delaware
("Landlord"  as  further  defined  in  1.3  below),  having its principal office
located  at One SeaGate, Suite 1500, P.O. Box 1475, Toledo, Ohio 43603-1475, and
RIDGELAND  ASSISTED LIVING, LLC, a limited liability company organized under the
laws  of  the  State of Washington ("Tenant"), having its chief executive office
located  at  3131  Elliott  Avenue,  Suite  500,  Seattle,  Washington  98121.
                                 R E C I T A L S
A.     As  of  the  date  hereof, Landlord acquired the Leased Property (defined
below)  from Tenant and paid the Acquisition Payment (defined below) towards the
purchase price for the Leased Property.  The amount paid by Tenant for the costs
     incurred  by Landlord in connection with its acquisition from Tenant of the
Leased  Property,  if  any,  shall  be  considered  Tenant's  contribution.
B.     Landlord  desires  to  lease  the  Leased  Property  to Tenant and Tenant
desires  to  lease the Leased Property from Landlord upon the terms set forth in
this  Lease.
          NOW,  THEREFORE,  Landlord  and  Tenant  agree  as  follows:
   ARTICLE 1:     LEASED PROPERTY, TERM AND DEFINITIONSLEASED PROPERTY, TERM AND
                                   DEFINITIONS
1.1     Leased  PropertyLeased  Property.  Landlord  hereby leases to Tenant and
        --------------------------------
Tenant hereby leases from Landlord the Leased Property, subject, however, to the
     Permitted Exceptions and subject to the terms and conditions of this Lease.
1.2     TermTerm.  The  initial term ("Initial Term") of this Lease commences on
        --------
the  Effective Date and expires at 12:00 Midnight Eastern Time on the day before
the 15th anniversary of the Commencement Date (the "Expiration Date"); provided,
     however, that Tenant has one or more options to renew the Lease pursuant to
Article  12.
1.3     DefinitionsDefinitions.  Except as otherwise expressly provided, [i] the
        ----------------------
     terms  defined  in  this section have the meanings assigned to them in this
section  and  include  the  plural  as well as the singular; [ii] all accounting
terms  not  otherwise  defined  herein  have  the  meanings  assigned to them in
accordance  with  generally  accepted  accounting  principles  as  of  the  time
applicable;  and  [iii] the words "herein", "hereof" and "hereunder" and similar
words  refer  to  this  Lease  as  a  whole  and  not to any particular section.
     "$4,400,000  Note"  means  the note granted by Guarantor to HCN dated as of
August  28,  2003,  as  amended  or  restated.
"Acquisition  Payment" means any payment by Landlord to acquire Leased Property.
"ADA"  means  the  federal  statute entitled Americans with Disabilities Act, 42
U.S.C.  12101,  et  seq.
"Additional  Rent"  has  the  meaning  set  forth  in  2.2.
"Affiliate"  means  Guarantor  and any person, corporation, partnership, limited
liability  company,  trust,  or other legal entity that, directly or indirectly,
controls,  or  is  controlled  by,  or  is  under  common control with Tenant or
Guarantor.  "Control" (and the correlative meanings of the terms "controlled by"
and  "under  common control with") means the possession, directly or indirectly,
of  the power to direct or cause the direction of the management and policies of
such  entity.  "Affiliate"  includes,  without  limitation,  each Guarantor.  An
Affiliate of Tenant shall specifically exclude Columbia Pacific Management, Inc.
or  any  Affiliate  thereof  and Holiday Retirement Corporation or any Affiliate
thereof  and,  prior  to the date of its acquisition thereof, Alterra Healthcare
Corporation  or  any  Affiliate  thereof.
"Annual Company Budget" means Tenant's projection of its financial statement for
the  next  fiscal  year (or the 12-month rolling forward period, if applicable),
which  shall  include  the balance sheet, statement of income, statement of cash
flows,  statement  of shareholders' equity and statement of capital expenditures
for  the  applicable  period.
"Annual  Financial Statements" means [i] an audited Facility Financial Statement
for  the  most  recent  fiscal  year; and [ii] for Guarantor, if Guarantor is or
includes  a  corporation,  partnership  or limited liability company, an audited
balance  sheet  and  statement  of  income  for  the  most  recent  fiscal year.
"Bankruptcy Code" means the United States Bankruptcy Code set forth in 11 U.S.C.
101,  et  seq.,  as  amended  from  time  to  time.
"Base  Price"  has  the  meaning  set  forth  on  Exhibit  K.
"Base  Rent"  has  the meaning set forth in  2.1, as increased from time to time
pursuant  to  2.2.
"Business Day" means any day other than a Saturday, Sunday, or national holiday.
"Casualty"  has  the  meaning  set  forth  in  9.1.
"CERCLA"  means  the  Comprehensive  Environmental  Response,  Compensation  and
Liability  Act  of  1980,  as  amended  from  time  to  time.
"Closing"  means  the  closing  of  the  lease of the Leased Property to Tenant.
"Collateral"  has  the  meaning  set  forth  in  24.1.
"Commencement  Date" means the Effective Date if such date is the first day of a
month,  and  if  it  is  not,  the  first  day  of the first month following the
Effective  Date.
"Commitment"  means  the  Commitment Letter for the Lease dated March 5, 2002 as
modified  by  the  letter  dated  March  31,  2003.
"CPI"  means  the  United States Department of Labor, Bureau of Labor Statistics
Revised  Consumer  Price  Index for All Urban Consumers (1982-84=100), U.S. City
Average,  All Items, or, if that index is not available at the time in question,
the  index  designated by such Department as the successor to such index, and if
there  is no index so designated, an index for an area in the United States that
most  closely  corresponds  to  the  entire  United  States,  published  by such
Department,  or  if  none,  by  any  other instrumentality of the United States.
"Default  Rent"  has  the  meaning  set  forth  in  8.6.
"Effective  Date"  means  the  date  of  this  Lease.
"Environmental  Laws"  means  all federal, state, and local laws, ordinances and
policies the purpose of which is to protect human health and the environment, as
amended  from  time to time, including, but not limited to, [i] CERCLA; [ii] the
Resource  Conservation  and  Recovery  Act;  [iii]  the  Hazardous  Materials
Transportation  Act; [iv] the Clean Air Act; [v] Clean Water Act; [vi] the Toxic
Substances Control Act; [vii] the Occupational Safety and Health Act; [viii] the
Safe  Drinking  Water  Act;  and  [ix]  analogous  state  laws  and regulations.
"Event  of  Default"  has  the  meaning  set  forth  in  8.1.
"Expiration  Date"  has  the  meaning  set  forth  in  1.2.
"Facility"  means  the  Facility  located  on  the  Land, including the Facility
Property.
"Facility  Cash  Flow"  has  the  meaning  set  forth  in  15.7.1.
"Facility  Coverage  Ratio"  has  the  meaning  set  forth  in  15.7.1.
"Facility  Financial  Statement"  means  a  financial statement for the Facility
which  shall  include  the balance sheet, statement of income, statement of cash
flows, statement of shareholders' equity, occupancy census data (including payor
mix), statement of capital expenditures and a comparison of the actual financial
data  versus  the  Annual  Company  Budget  for  the  applicable  period.
"Facility Name" means the name under which the Facility has done business during
the Term.  The Facility Name in use by the Facility on the Effective Date is set
forth  on  the  attached  Exhibit  C.
"Facility  Property"  means the Land on which the Facility is located, the legal
description  of  which  is set forth on Exhibit A, the Improvements on the Land,
the  Related  Rights,  and  Landlord's  Personal  Property.
"Facility  State"  means  the  State  in  which  the  Facility  is  located.
"Facility  Uses"  means  the uses relating to the operation of the Facility as a
facility  of  the  type  and operating the number of beds and units set forth on
Exhibit  C.
"Financial  Statements"  means  [i]  the  annual,  quarterly  and  year  to date
financial  statements  of  Tenant;  and  [ii]  all  operating statements for the
Facility,  that  were  submitted  to  Landlord  prior  to  the  Effective  Date.
"Fixtures"  means  all  permanently  affixed  equipment, machinery, fixtures and
other  items  of  real  and/or  personal property (excluding Landlord's Personal
Property), including all components thereof, now and hereafter located in, on or
used  in  connection  with,  and permanently affixed to or incorporated into the
Improvements,  including,  without  limitation,  all furnaces, boilers, heaters,
electrical  equipment,  heating, plumbing, lighting, ventilating, refrigerating,
incineration,  air  and water pollution control, waste disposal, air-cooling and
air-conditioning  systems  and  apparatus,  sprinkler systems and fire and theft
protection  equipment,  built-in  oxygen  and  vacuum  systems, towers and other
devices  for  the  transmission  of  radio, television and other signals, all of
which, to the greatest extent permitted by law, are hereby deemed by the parties
hereto to constitute real estate, together with all replacements, modifications,
alterations  and  additions  thereto.
"Government  Authorizations"  means  all permits, licenses, approvals, consents,
and  authorizations  required  to comply with all Legal Requirements, including,
but  not  limited  to,  [i]  zoning  permits, variances, exceptions, special use
permits,  conditional  use  permits,  and  consents; [ii] the permits, licenses,
provider  agreements  and  approvals required for licensure and operation of the
Facility in accordance with the Facility Uses and, if applicable, certified as a
provider  under  the  federal  Medicare  and  state  Medicaid  programs;  [iii]
environmental,  ecological, coastal, wetlands, air, and water permits, licenses,
and  consents;  [iv]  curb  cut,  subdivision,  land  use, and planning permits,
licenses,  approvals  and consents; [v] building, sign, fire, health, and safety
permits,  licenses,  approvals,  and  consents;  and [vi] architectural reviews,
approvals,  and  consents  required  under  restrictive  covenants.
"Guarantor"  means  Emeritus  Corporation,  a  Washington  corporation.
"Guaranty" means the Unconditional and Continuing Lease Guaranty entered into by
Guarantor  to guarantee payment and performance of the Obligor Group Obligations
and  any  amendments  thereto  or  substitutions  or  replacements  therefore.
"Hazardous  Materials"  means  any  substance  [i] the presence of which poses a
hazard  to  the health or safety of persons on or about the Land, including, but
not  limited  to,  asbestos containing materials; [ii] which requires removal or
remediation  under  any  Environmental  Law,  including, without limitation, any
substance  which  is  toxic,  explosive,  flammable,  radioactive,  or otherwise
hazardous;  or  [iii]  which  is  regulated  under  or  classified  under  any
Environmental  Law  as  hazardous  or  toxic, including, but not limited to, any
substance  within  the  meaning  of "hazardous substance", "hazardous material",
"hazardous  waste",  "toxic  substance", "regulated substance", "solid waste" or
"pollutant"  as  defined  in  any  Environmental  Law.
"HCN"  means  Health  Care  REIT,  Inc.,  a  Delaware  corporation.
"HIPDB"  means  the  Healthcare Integrity and Protection Data Bank maintained by
the  Department  of  Health  and  Human  Services.
"Impositions"  has  the  meaning  set  forth  in  3.2.
"Improvements"  means all buildings, structures, Fixtures and other improvements
of every kind on any portion of the Land, including, but not limited to, alleys,
sidewalks,  utility  pipes,  conduits  and lines (on-site and off-site), parking
areas  and  roadways  appurtenant  to  such  buildings  and  structures,  now or
hereafter  situated  upon  any  portion  of  the  Land.
"Initial  Term"  has  the  meaning  set  forth  in  1.2.
"Investment  Amount"  is  an aggregate concept and means the sum of all Landlord
Payments  outstanding  at  the  applicable  time.
"Land"  means  the  real  property  described  in  Exhibit  A  attached  hereto.
"Landlord"  means  HCRI  Ridgeland  Pointe  Properties,  LLC.
"Landlord  Affiliate"  means  any  person,  corporation,  partnership,  limited
liability  company,  trust,  or other legal entity that, directly or indirectly,
controls,  or  is  controlled  by,  or  is  under  common control with Landlord.
"Control"  (and the correlative meanings of the terms "controlled by" and "under
common control with") means the possession, directly or indirectly, of the power
to  direct or cause the direction of the management and policies of such entity.
"Landlord  Payment"  means  the  Acquisition  Payment or any advance by Landlord
under  the  terms  hereof.
"Landlord's  Personal Property" means all Personal Property owned by Landlord on
the  Effective  Date and located at the Facility, including, without limitation,
all  personal  property  listed on the attached Exhibit D, together with any and
all  replacements  thereof, and all Personal Property that pursuant to the terms
of  this  Lease  becomes  the  property  of  Landlord  during  the  Term.
"Lease"  means  this  Lease  Agreement,  as  amended  from  time  to  time.
"Lease  Documents"  means  this Lease and all documents executed by Landlord and
Tenant  relating  to  this  Lease  or  the  Facility.
"Lease Payments" means the sum of the Base Rent payments (as increased from time
to  time)  for  the  applicable  period.
"Lease  Year"  means  each  consecutive period of 365 or 366 days throughout the
Term.  The  first  Lease  Year commences on the Commencement Date and expires on
the  day  before  the  first  anniversary  of  the  Commencement  Date.
"Leased  Property"  means  all  of  the  Land,  Improvements, Related Rights and
Landlord's  Personal  Property.
"Legal  Requirements"  means  all  laws,  regulations,  rules,  orders,  writs,
injunctions,  decrees,  certificates,  requirements,  agreements,  conditions of
participation  and  standards  of any federal, state, county, municipal or other
governmental  entity,  administrative  agency,  insurance  underwriting  board,
architectural  control  board,  private  third-party  payor,  accreditation
organization,  or  any  restrictive  covenants  applicable  to  the development,
construction, condition and operation of the Facility by Tenant for the Facility
Uses, including, but not limited to, [i] zoning, building, fire, health, safety,
sign,  and  subdivision regulations and codes; [ii] certificate of need laws (if
applicable);  [iii]  licensure to operate as the Facility in accordance with its
Facility  Uses;  [iv]  Medicare  and  Medicaid  certification  requirements  (if
applicable);  [v]  the ADA; [vi] any Environmental Laws; and [vii] requirements,
conditions  and  standards  for  participation  in  third-party  payor insurance
programs.
"Lender" means JPMorgan Chase Bank (formerly known as the Chase Manhattan Bank),
trustee  for  the  registered  certificateholders  of Credit Suisse First Boston
Mortgage  Securities Corp. Commercial Mortgage Pass-Through Certificates, Series
2000-PS4.
"Letter  of  Credit"  shall  mean  on  the  Effective  Date the letter of credit
required  by  Lender  in  the amount of 5% of the outstanding amount of the loan
assumed by Landlord and any time after the Effective Date shall mean such letter
of  credit  as  required  by  Lender which may be reduced from time to time as a
result  of  draws  thereunder.
"Loan  Documents"  as  used  herein  means the Loan Documents, as defined in the
Note,  and  includes the [i] Assumption Agreement, by and among Landlord, Tenant
and  Lender;  [ii]  the Assumption of Obligations of Guarantor by and among HCN,
Guarantor  and  Lender;  [iii] the Subordination and Standstill Agreement by and
among  Tenant, Landlord, HCN, Guarantor and Lender; and [iv] any other documents
executed  in  connection  with  the  Note  Assumption executed by either Tenant,
Guarantor,  Landlord  and/or  HCN.
"Material  Obligation"  means  [i] any indebtedness with respect to any critical
care  equipment  and  for  all  other  equipment  any  indebtedness in excess of
$250,000.00 at the Facility secured by a security interest in or a lien, deed of
trust  or mortgage on any of the Leased Property (or any part thereof, including
any  Personal  Property) and any agreement relating thereto; [ii] any obligation
or  agreement  that is material to the construction or operation of the Facility
or  that  is  material  to  Tenant's business or financial condition and where a
breach  thereunder, if not cured within any applicable cure period, would have a
material  adverse  affect on the financial condition of Tenant or the results of
operations  at the Facility; [iii] any unsecured indebtedness or lease of Tenant
that  has an outstanding principal balance or obligation of at least $250,000.00
and  any  agreement  relating  thereto;  and  [iv]  any indebtedness or lease of
Guarantor,  other  than this Lease, that has an outstanding principal balance or
obligation  of  at  least  $1,000,000.00.
"Mortgage"  means  the  Deed of Trust and Security Agreement dated September 29,
1999  from  Tenant  in  favor  of  Lender to secure the Note, as assigned to and
assumed  by  Landlord  and  as  the  same  may  be  amended  from  time to time.
"Negotiation  Period"  has  the  meaning  set  forth  in  Exhibit  K.
"Net  Operating  Income"  means  the  pre-tax  net income of Tenant plus [i] the
amount  of the provision for depreciation and amortization; plus [ii] the amount
of  the provision for interest and lease payments, if any; plus [iii] the amount
of  the  provision  for Rent payments; plus [iv] the amount of the provision for
management  fees.
"Note"  means  the  Fixed  Rate  Note  dated  September 29, 1999 in the original
principal  amount  of  $4,330,000.00  from  Tenant  to Lender as assigned to and
assumed  by  Landlord  and  as  the  same  may  be  amended  from  time to time.
"Obligor  Group  Obligations"  means  all payment and performance obligations of
Tenant  or  Guarantor  to Landlord or any Landlord Affiliate, including, but not
limited  to,  all  obligations under this Lease, any loans extended to Tenant or
Guarantor  by  Landlord  or any Landlord Affiliate and all documents executed by
Tenant or Guarantor in favor of Landlord or any Landlord Affiliate in connection
with  this  Lease,  any  loan  or  any  other  obligation.
"Offer"  has  the  meaning  set  forth  in  13.1.
"Opportunity  Notice"  has  the  meaning  set  forth  in  13.1(a).
"Organization  State"  means  the  State  in  which  an  entity  is  organized.
"Organizational  Documents"  means  [i]  for  a  corporation,  its  Articles  of
Incorporation  certified by the Secretary of State of the Organization State, as
amended  to  date,  and its Bylaws certified by such entity, as amended to date;
[ii]  for  a partnership, its Partnership Agreement certified by such entity, as
amended  to  date, and the Partnership Certificate, certified by the appropriate
authority (if applicable), as amended to date; and [iii] for a limited liability
company, its Articles of Organization certified by the Secretary of State of the
Organization State, as amended to date, and its Operating Agreement certified by
such  entity,  as  amended  to  date.
"Periodic  Financial Statements" means an unaudited Facility Financial Statement
for  the  most  recent  month.
"Permitted  Exceptions"  means all easements, liens, encumbrances, restrictions,
agreements and other title matters existing as of the Effective Date, including,
without  limitation,  the  exceptions  to  title set forth on Exhibit B attached
hereto,  and any sublease of any portion of the Leased Property made in complete
accordance  with  Article  18.
"Permitted  Liens"  means  [i] liens granted to Landlord; [ii] liens customarily
incurred  by Tenant in the ordinary course of business for items not delinquent,
including  mechanic's liens and deposits and charges under worker's compensation
laws;  [iii]  liens  for taxes and assessments not yet due and payable; [iv] any
lien,  charge, or encumbrance which is being contested in good faith pursuant to
this  Lease; [v] the Permitted Exceptions; and [vi] purchase money financing and
capitalized  equipment leases for the acquisition of personal property provided,
however,  that  Landlord  obtains  a  nondisturbance agreement from the purchase
money lender or equipment lessor in form and substance as may be satisfactory to
Landlord  if  the  original  cost  of  the  equipment  exceeds  $250,000.00.
"Personal  Property"  means  all  machinery,  equipment, furniture, furnishings,
movable  walls  or  partitions,  computers  (and all associated software), trade
fixtures  and  other  personal  property (but excluding consumable inventory and
supplies  owned by Tenant) used in connection with the Leased Property, together
with  all  replacements  and  alterations  thereof and additions thereto, except
items,  if  any,  included  within  the  definition of Fixtures or Improvements.
"Pro  Forma  Statement" means a financial forecast for the Facility for the next
five-year  period  prepared  in  accordance  with  the  standards  for forecasts
established  by  the  American  Institute  of  Certified  Public  Accountants.
"Protected  Period"  has  the  meaning  set  forth  in  13.1(a).
"Qualified Capital Expenditures" means the expenditures capitalized on the books
of  Tenant  for  any  of  the following:  replacement of furniture, fixtures and
equipment, including refrigerators, ranges, major appliances, bathroom fixtures,
doors  (exterior  and  interior),  central  air conditioning and heating systems
(including  cooling  towers,  water  chilling  units, furnaces, boilers and fuel
storage  tanks)  and  replacement  of  siding;  roof  replacements,  including
replacements  of  gutters,  downspouts,  eaves  and  soffits;  major repairs and
replacements  of  plumbing  and  sanitary systems; overhaul of elevator systems;
repaving,  resurfacing and sealcoating of sidewalks, parking lots and driveways;
repainting of entire building exterior and normal maintenance and repairs needed
to  maintain the quality and condition of the Facility in the market in which it
operates,  but  excluding  Alterations.
"Receivables"  means [i] all of Tenant's rights to receive payment for providing
resident  care  and  services as set forth in any accounts, contract rights, and
instruments,  and  [ii]  those  documents,  chattel  paper,  inventory proceeds,
provider  agreements,  participation  agreements, ledger sheets, files, records,
computer  programs, tapes, and agreements relating to Tenant's rights to receive
payment  for  providing  resident  care  services.
"Related  Rights"  means  all easements, rights (including bed operating rights)
and  appurtenances  relating  to  the  Land  and  the  Improvements.
"Renewal  Date"  means  the  first  day  of  each  Renewal  Term.
"Renewal  Option"  has  the  meaning  set  forth  in  12.1.
"Renewal  Term"  has  the  meaning  set  forth  in  12.1.
"Rent"  means  Base  Rent,  Additional  Rent  and  Default  Rent.
"Rent Schedule" means the schedule issued by Landlord to Tenant showing the Base
Rent  to be paid by Tenant pursuant to the terms of this Lease, as such schedule
is amended from time to time by Landlord.  The initial Rent Schedule is attached
to  this  Lease  as  Schedule 1 or, after review and approval by Tenant, will be
attached  following  Closing if the Rent Schedule cannot be determined until the
day  of  Closing.
"Replacement  Operator"  has  the  meaning  set  forth  in  15.9.1.
"Right  of  First  Opportunity  Event"  has  the  meaning  set  forth  in  13.1.
"Secured  Party"  has  the  meaning  set  forth  in  24.1.
"Tenant"  has the meaning set forth in the introductory paragraph of this Lease.
"Tenant's  Property"  has  the  meaning  set  forth  in  11.1.
"Term"  means  the  Initial  Term  and  each  Renewal  Term.
                             ARTICLE 2:     RENTRENT
2.1     Base  RentBase  Rent.  Tenant shall pay Landlord base rent ("Base Rent")
        --------------------
in  advance in consecutive monthly installments payable on the first day of each
month  during  the  Term  commencing on the Commencement Date.  If the Effective
Date is not the first day of a month, Tenant shall pay Landlord Base Rent on the
     Effective  Date  for  the partial month, i.e., for the period commencing on
the Effective Date and ending on the day before the Commencement Date.  The Base
Rent  payable  for  the  Initial  Term  is  as shown on the Rent Schedule, to be
adjusted  pursuant  to  2.1.1.  The  Base  Rent  for  each  Renewal Term will be
determined  in  accordance  with  12.2.
2.1.1     Base  Rent  AdjustmentBase  Rent  Adjustment .  In accordance with the
          ----------------------
terms  of  the Loan Documents, monthly payments of principal and interest due to
Lender  under  the Note ("Loan Payment") shall be paid by Tenant.  On October 1,
2003,  the  Base Rent due on October 1, 2003 shall be reduced by an amount equal
to  the  Loan  Payment  (as  of  the Effective Date in the amount of $40,394.42)
divided  by  30  times  the  number of days starting with the Effective Date and
ending on September 30, 2003.  On November 1, 2003, and on the first day of each
     month  thereafter  that  Tenant  makes a Loan Payment, the Base Rent due on
November 1, 2003 and on the first day of each month thereafter, shall be reduced
by an amount equal to the Loan Payment made by Tenant.  If Landlord makes a Loan
Payment, the Base Rent for each month thereafter shall not be reduced until such
time  as  Landlord  has  been  repaid the Loan Payment made by Landlord.  Tenant
shall deliver to Landlord written evidence, satisfactory to Landlord, of payment
of  the  Loan  Payment  within five Business Days of payment of same, but in any
event  prior  to  the  10th  day  of  each  month.
2.2     Additional  RentAdditional Rent.  In addition to Base Rent, Tenant shall
        -------------------------------
pay  all  other  amounts,  liabilities, obligations and Impositions which Tenant
assumes or agrees to pay under this Lease including any fine, penalty, interest,
     charge  and  cost which may be added for nonpayment or late payment of such
items  (collectively  the  "Additional  Rent").
2.3     Place of Payment of RentPlace of Payment of Rent.  Tenant shall make all
        ------------------------------------------------
     payments of Rent to Landlord by electronic wire transfer in accordance with
the  wiring  instructions  set  forth  in  Exhibit J attached hereto, subject to
change  in  accordance with other written instructions provided by Landlord from
time  to  time.
2.4          Net LeaseNet Lease.  This Lease shall be deemed and construed to be
             ------------------
     an  "absolute  net  lease", and Tenant shall pay all Rent and other charges
and expenses in connection with the Leased Property throughout the Term, without
abatement,  deduction,  recoupment  or  setoff.  Landlord  shall have all legal,
equitable  and  contractual  rights, powers and remedies provided either in this
Lease  or  by  statute  or  otherwise  in  the  case  of nonpayment of the Rent.
2.5     No  Termination,  Abatement, EtcNo Termination, Abatement, Etc..  Except
        ---------------------------------------------------------------
as  otherwise  specifically provided in this Lease, Tenant shall remain bound by
this  Lease in accordance with its terms.  Tenant shall not, without the consent
of  Landlord, modify, surrender or terminate the Lease, nor seek nor be entitled
to  any  abatement,  deduction,  deferment  or  reduction  of Rent, or setoff or
recoupment  against  the  Rent.  Except as expressly provided in this Lease, the
obligations  of  Landlord  and Tenant shall not be affected by reason of [i] any
damage  to,  or  destruction  of,  the  Leased Property or any part thereof from
whatever  cause or any Taking (as hereinafter defined) of the Leased Property or
any  part  thereof;  [ii]  the lawful or unlawful prohibition of, or restriction
upon, Tenant's use of the Leased Property, or any part thereof, the interference
     with  such  use by any person, corporation, partnership or other entity, or
by  reason  of  eviction by paramount title; [iii] any claim which Tenant has or
might  have  against  Landlord  or  by  reason  of  any default or breach of any
warranty  by  Landlord  under this Lease or any other agreement between Landlord
and  Tenant,  or  to which Landlord and Tenant are parties; [iv] any bankruptcy,
insolvency, reorganization, composition, readjustment, liquidation, dissolution,
winding  up or other proceeding affecting Landlord or any assignee or transferee
of Landlord; or [v] any other cause, whether similar or dissimilar to any of the
foregoing,  other  than  a  discharge  of  Tenant from any such obligations as a
matter  of law.  Except as otherwise specifically provided in this Lease, Tenant
hereby  specifically  waives all rights, arising from any occurrence whatsoever,
which  may now or hereafter be conferred upon it by law [a] to modify, surrender
or  terminate this Lease or quit or surrender the Leased Property or any portion
thereof;  or  [b]  entitling  Tenant  to any abatement, reduction, suspension or
deferment  of  the  Rent  or  other  sums  payable  by  Tenant  hereunder.  The
obligations  of  Landlord and Tenant hereunder shall be separate and independent
covenants  and  agreements  and  the  Rent  and all other sums payable by Tenant
hereunder  shall  continue to be payable in all events unless the obligations to
pay  the  same  shall  be  terminated pursuant to the express provisions of this
Lease  or  by  termination  of  this  Lease  other than by reason of an Event of
Default.  Nothing  in  this  2.5  shall  be  construed  to limit any right which
Tenant  may have to bring a separate action against Landlord for any claim which
Tenant  may  have  or  allege  to  have  against  Landlord.
2.6     Transaction FeeTransaction Fee.  On the Effective Date, Tenant shall pay
        ------------------------------
     a  transaction  fee  to Landlord in an amount equal to 1% of the Investment
Amount.
        ARTICLE 3:     IMPOSITIONS AND UTILITIESIMPOSITIONS AND UTILITIES
3.1     Payment  of  ImpositionsPayment  of  Impositions.  Tenant  shall pay, as
        ------------------------------------------------
Additional  Rent,  all  Impositions  that  may be levied or become a lien on the
Leased  Property or any part thereof at any time (whether prior to or during the
Term),  without  regard  to  prior ownership of said Leased Property, before any
fine,  penalty,  interest,  or  cost  is incurred; provided, however, Tenant may
contest  any  Imposition  in  accordance  with  3.7.  Tenant  shall  deliver  to
Landlord  [i]  not  more  than  five days after the due date of each Imposition,
copies  of  the  invoice for such Imposition and the check delivered for payment
thereof; and [ii] not more than 30 days after the due date of each Imposition, a
     copy  of  the  official  receipt  evidencing such payment or other proof of
payment  satisfactory  to Landlord.  Tenant's obligation to pay such Impositions
shall  be  deemed  absolutely fixed upon the date such Impositions become a lien
upon  the  Leased  Property  or any part thereof.  Tenant, at its expense, shall
prepare and file all tax returns and reports in respect of any Imposition as may
be required by governmental authorities.  Tenant shall be entitled to any refund
due  from  any  taxing  authority  if  no  Event  of Default shall have occurred
hereunder  and  be  continuing and if Tenant shall have paid all Impositions due
and  payable  as  of  the date of the refund.  Landlord shall be entitled to any
refund  from  any  taxing  authority  if an Event of Default has occurred and is
continuing.  Any  refunds  retained by Landlord due to an Event of Default shall
be  applied as provided in  8.8.  Landlord and Tenant shall, upon request of the
other,  provide  such  data as is maintained by the party to whom the request is
made  with  respect  to  the  Leased Property as may be necessary to prepare any
required  returns  and  reports.  In the event governmental authorities classify
any  property  covered by this Lease as personal property, Tenant shall file all
personal  property  tax  returns  in  such jurisdictions where it may legally so
file.  Landlord,  to the extent it possesses the same, and Tenant, to the extent
it possesses the same, will provide the other party, upon request, with cost and
depreciation records necessary for filing returns for any property so classified
as  personal  property.  Where  Landlord  is  legally  required to file personal
property  tax returns, Tenant will be provided with copies of assessment notices
indicating a value in excess of the reported value in sufficient time for Tenant
to file a protest.  Tenant may, at Tenant's option and at Tenant's sole cost and
expense, protest, appeal, or institute such other proceedings as Tenant may deem
appropriate  to  effect  a  reduction  of  real  estate  or  personal  property
assessments  and  Landlord,  at  Tenant's  expense  as  aforesaid,  shall  fully
cooperate  with  Tenant  in such protest, appeal, or other action.  Tenant shall
reimburse  Landlord  for  all personal property taxes paid by Landlord within 30
days  after  receipt  of  billings accompanied by copies of a bill therefore and
payments thereof which identify the personal property with respect to which such
payments  are  made.  Impositions  imposed  in  respect to the tax-fiscal period
during which the Term terminates shall be adjusted and prorated between Landlord
and Tenant as of the termination date, whether or not such Imposition is imposed
before  or  after  such termination, and Tenant's obligation to pay its prorated
share  thereof  shall  survive  such  termination.
3.2     Definition  of  ImpositionsDefinition  of  Impositions.  "Impositions"
        ------------------------------------------------------
means, collectively, [i] taxes (including, without limitation, all capital stock
     and  franchise  taxes  of  Landlord  imposed  by  the Facility State or any
governmental  entity  in  the  Facility  State  due to this lease transaction or
Landlord's ownership of the Leased Property and the income arising therefrom, or
due to Landlord being considered as doing business in the Facility State because
of  Landlord's ownership of the Leased Property or lease thereof to Tenant), all
real  estate  and  personal  property  ad  valorem,  sales  and use, business or
occupation,  single  business,  gross  receipts,  transaction privilege, rent or
similar  taxes; [ii] assessments (including, without limitation, all assessments
for public improvements or benefits, whether or not commenced or completed prior
to  the  date  hereof and whether or not to be completed within the Term); [iii]
ground  rents, water, sewer or other rents and charges, excises, tax levies, and
fees  (including, without limitation, license, permit, inspection, authorization
and  similar  fees); [iv] all taxes imposed on Tenant's operations of the Leased
Property,  including,  without  limitation,  employee  withholding taxes, income
taxes  and  intangible taxes; [v] all taxes imposed by the Facility State or any
governmental  entity in the Facility State with respect to the conveyance of the
Leased  Property  by Landlord to Tenant or Tenant's designee, including, without
limitation,  conveyance  taxes; and [vi] all other governmental charges, in each
case  whether  general  or  special,  ordinary  or extraordinary, or foreseen or
unforeseen,  of  every  character  in respect of the Leased Property or any part
thereof and/or the Rent (including all interest and penalties thereon due to any
failure  in payment by Tenant), which at any time prior to, during or in respect
of  the  Term hereof may be assessed or imposed on or in respect of or be a lien
upon  [a]  Landlord  or  Landlord's  interest in the Leased Property or any part
thereof;  [b]  the  Leased Property or any part thereof or any rent therefrom or
any  estate,  right, title or interest therein; or [c] any occupancy, operation,
use  or possession of, or sales from, or activity conducted on, or in connection
with  the Leased Property or the leasing or use by Tenant of the Leased Property
or  any part thereof.  Tenant shall not, however, be required to pay any capital
gains tax or any tax based on net income imposed on Landlord by any governmental
entity  other than the capital stock and franchise taxes described in clause [i]
above.
3.3     Escrow  of  ImpositionsEscrow of Impositions.  Tenant shall deposit with
        --------------------------------------------
Landlord on the first day of each month a sum equal to 1/12th of the Impositions
     assessed  against  the  Leased Property for the preceding tax year for real
estate  taxes,  which  sums  shall  be  used  by Landlord toward payment of such
Impositions.  In  addition,  if  an Event of Default occurs and while it remains
uncured,  Tenant  shall,  at  Landlord's  election, deposit with Landlord on the
first  day  of  each  month  a  sum  equal to 1/12th of the Impositions assessed
against  the  Leased  Property  for  the  preceding tax year other than for real
estate  taxes,  which  sums  shall  be  used  by Landlord toward payment of such
Impositions.  Tenant,  on  demand,  shall  pay  to Landlord any additional funds
necessary  to  pay  and  discharge  the  obligations  of  Tenant pursuant to the
provisions  of  this  section.  The  receipt  by Landlord of the payment of such
Impositions  by and from Tenant shall only be as an accommodation to Tenant, the
mortgagees,  and  the  taxing authorities, and shall not be construed as rent or
income  to Landlord, Landlord serving, if at all, only as a conduit for delivery
purposes.  The  foregoing provision shall become applicable only at such time as
the  escrow  of  Impositions  is not required by Lender, it being understood and
agreed  that  for so long as Lender requires that the real estate tax portion of
the Imposition be escrowed with Lender, Tenant shall be deemed to have fulfilled
its  obligations  under this  3.3 with respect to the real estate tax portion of
the  Imposition  provided  Tenant  receives  notice  either  from Lender or from
Landlord  as  required  pursuant  to  15.12.4 and then Tenant makes the required
escrow payment of the real estate tax portion of the Imposition to Lender as and
when  due.
3.4     UtilitiesUtilities.  Tenant  shall  pay,  as Additional Rent, all taxes,
        ------------------
assessments,  charges,  deposits,  and  bills  for utilities, including, without
limitation,  charges for water, gas, oil, sanitary and storm sewer, electricity,
telephone  service,  and  trash  collection,  which  may  be charged against the
occupant of the Improvements during the Term.  If an Event of Default occurs and
     while  it  remains  uncured,  Tenant shall, at Landlord's election, deposit
with Landlord on the first day of each month a sum equal to 1/12th of the amount
of the annual utility expenses for the preceding Lease Year, which sums shall be
used  by  Landlord  to  pay  such  utilities.  Tenant  shall,  on demand, pay to
Landlord any additional amount needed to pay such utilities.  Landlord's receipt
of  such  payments  shall  only  be  an  accommodation to Tenant and the utility
companies  and  shall  not  constitute  rent  or  income  to  Landlord.  Absent
circumstances  beyond  Tenant's  reasonable  control,  Tenant shall at all times
maintain  that  amount of heat necessary to ensure against the freezing of water
lines.  Tenant  hereby  agrees  to indemnify and hold Landlord harmless from and
against  any liability or damages to the utility systems and the Leased Property
that  may  result  from  Tenant's  failure  to  maintain  sufficient heat in the
Improvements  absent  circumstances  beyond  Tenant's  reasonable  control.
3.5     Discontinuance  of  UtilitiesDiscontinuance of Utilities.  Landlord will
        --------------------------------------------------------
not  be  liable  for  damages  to  person  or  property  or  for  injury  to, or
interruption  of,  business  for  any  discontinuance of utilities nor will such
discontinuance  in  any  way  be  construed as an eviction of Tenant or cause an
abatement  of rent or operate to release Tenant from any of Tenant's obligations
under  this  Lease.
3.6     Business  ExpensesBusiness  Expenses.  Tenant  shall  promptly  pay  all
        ------------------------------------
expenses  and costs incurred in connection with the operation of the Facility on
the  Leased Property, including, without limitation, employee benefits, employee
vacation and sick pay, consulting fees, and expenses for inventory and supplies.
3.7     Permitted  ContestsPermitted  Contests.  Tenant,  on  its  own  or  on
        --------------------------------------
Landlord's behalf (or in Landlord's name), but at Tenant's expense, may contest,
     by  appropriate  legal  proceedings  conducted  in  good faith and with due
diligence,  the  amount  or validity or application, in whole or in part, of any
Imposition  or  any  Legal  Requirement  or  insurance  requirement or any lien,
attachment,  levy, encumbrance, charge or claim provided that [i] in the case of
an  unpaid Imposition, lien, attachment, levy, encumbrance, charge or claim, the
commencement  and  continuation of such proceedings shall suspend the collection
thereof  from  Landlord  and  from  the Leased Property; [ii] neither the Leased
Property  nor  any Rent therefrom nor any part thereof or interest therein would
be  in any immediate danger of being sold, forfeited, attached or lost; [iii] in
the  case  of a Legal Requirement, Landlord would not be in any immediate danger
of  civil  or  criminal  liability  for  failure to comply therewith pending the
outcome  of  such  proceedings;  [iv]  in  the event that any such contest shall
involve  a  sum of money or potential loss in excess of $50,000.00, Tenant shall
deliver to Landlord and its counsel an opinion of Tenant's counsel to the effect
set  forth  in clauses [i], [ii] and [iii], to the extent applicable; [v] in the
case  of  a Legal Requirement and/or an Imposition, lien, encumbrance or charge,
Tenant  shall  give  such  reasonable security as may be demanded by Landlord to
insure ultimate payment of the same and to prevent any sale or forfeiture of the
affected  Leased  Property  or  the  Rent  by  reason  of  such  nonpayment  or
noncompliance;  provided,  however,  the provisions of this section shall not be
construed to permit Tenant to contest the payment of Rent (except as to contests
concerning  the  method of computation or the basis of levy of any Imposition or
the  basis  for  the  assertion of any other claim) or any other sums payable by
Tenant  to Landlord hereunder; [vi] in the case of an insurance requirement, the
coverage required by Article 4 shall be maintained; and [vii] if such contest be
finally  resolved  against  Landlord or Tenant, Tenant shall, as Additional Rent
due  hereunder,  promptly  pay the amount required to be paid, together with all
interest  and  penalties  accrued  thereon,  or comply with the applicable Legal
Requirement  or  insurance  requirement.  Landlord,  at  Tenant's expense, shall
execute  and deliver to Tenant such authorizations and other documents as may be
reasonably  required in any such contest, and, if reasonably requested by Tenant
or  if  Landlord  so  desires,  Landlord  shall join as a party therein.  Tenant
hereby  agrees  to  indemnify  and  save  Landlord harmless from and against any
liability,  cost  or  expense  of  any kind that may be imposed upon Landlord in
connection  with  any  such  contest  and  any  loss  resulting  therefrom.
                        ARTICLE 4:     INSURANCEINSURANCE
4.1     Property InsuranceProperty Insurance.  At Tenant's expense, Tenant shall
        ------------------------------------
     maintain  in  full force and effect a property insurance policy or policies
insuring  the  Leased  Property  against  the  following:
(a)     Loss  or  damage  commonly covered by a "All Risk" or "Special Form", as
the  case  may  be,  policy  insuring  against  physical  loss  or damage to the
Improvements  and Personal Property, including, but not limited to, risk of loss
from  fire  and  other hazards, collapse, transit coverage, vandalism, malicious
mischief,  theft,  earthquake (if the Leased Property is in earthquake zone 1 or
2)  and  sinkholes  (if usually recommended in the area of the Leased Property).
The  policy  shall be in the amount of the full replacement value (as defined in
4.5)  of  the  Improvements and Personal Property and shall contain a deductible
amount  acceptable  to  Landlord.  Landlord  shall  be  named  as  an additional
insured.  The  policy  shall  include  a  stipulated value endorsement or agreed
amount  endorsement  and endorsements for contingent liability for operations of
building  laws,  demolition  costs,  and  increased  cost  of  construction.
(b)     If  applicable,  loss  or damage by explosion of steam boilers, pressure
vessels,  or  similar  apparatus,  now  or  hereafter  installed  on  the Leased
Property,  in  commercially  reasonable  amounts  acceptable  to  Landlord.
(c)     Consequential  loss  of  rents  and income coverage insuring against all
"All  Risk"  or  "Special  Form",  as  the case may be, risk of physical loss or
damage  with  limits and deductible amounts acceptable to Landlord covering risk
of  loss  during the course of reconstruction, and containing an endorsement for
extended  period  of  indemnity of at least 90 days, and shall be written with a
stipulated  amount  of  coverage  if  available  at  a  reasonable  premium.
(d)     If  the  Leased Property is located, in whole or in part, in a federally
designated 100-year flood plain area, flood insurance for the Improvements in an
amount  equal  to  the  lesser  of  [i]  the  full  replacement  value  of  the
Improvements;  or  [ii]  the  maximum  amount  of  insurance  available  for the
Improvements  under  all  federal  and  private  flood  insurance  programs.
(e)     Loss  or  damage  caused  by the breakage of plate glass in commercially
reasonable  amounts  acceptable  to  Landlord.
(f)     Loss  or  damage  commonly covered by blanket crime insurance, including
employee  dishonesty,  loss  of  money  orders  or  paper  currency, depositor's
forgery, and loss of property of patients accepted by Tenant for safekeeping, in
commercially  reasonable  amounts  acceptable  to  Landlord.
4.2     Liability  InsuranceLiability  Insurance.  At  Tenant's  expense, Tenant
        ----------------------------------------
shall  maintain  liability  insurance  against  the  following:
(a)     Claims  for  personal  injury  or  property  damage  commonly covered by
comprehensive  general  liability  insurance  with  endorsements  for incidental
malpractice,  contractual,  personal  injury,  owner's  protective  liability,
voluntary  medical  payments,  products  and  completed  operations,  broad form
property  damage,  and  extended  bodily  injury,  with  commercially reasonable
amounts  for  bodily  injury,  property  damage,  and voluntary medical payments
acceptable  to  Landlord,  but  with  a  combined  single limit of not less than
$5,000,000.00  per  occurrence.
(b)     Claims  for  personal  injury  and  property  damage commonly covered by
comprehensive  automobile  liability insurance, covering all owned and non-owned
automobiles,  with  commercially  reasonable amounts for bodily injury, property
damage,  and  for automobile medical payments acceptable to Landlord, but with a
combined  single  limit  of  not  less  than  $5,000,000.00  per  occurrence.
(c)     Claims  for  personal injury commonly covered by medical malpractice and
professional  liability  insurance in commercially reasonable amounts acceptable
to  Landlord.
(d)     Claims  commonly  covered  by  workers'  compensation  insurance for all
persons  employed  by Tenant on the Leased Property.  Such workers' compensation
insurance  shall be in accordance with the requirements of all applicable local,
state,  and  federal  law.
4.3     Builder's  Risk  InsuranceBuilder's  Risk Insurance.  In connection with
        ----------------------------------------------------
any  construction,  Tenant  shall  maintain in full force and effect a builder's
completed  value  risk  coverage  ("Builder's  Risk Coverage") of insurance in a
nonreporting  form  insuring  against  all  "All  Risk" risk of physical loss or
damage  to  the  Improvements,  including, but not limited to, risk of loss from
fire  and  other  hazards,  collapse,  transit  coverage,  vandalism,  malicious
mischief,  theft,  earthquake  (if Leased Property is in earthquake zone 1 or 2)
and  sinkholes (if usually recommended in the area of the Leased Property).  The
Builder's  Risk  Coverage  shall  include  endorsements  providing  coverage for
building  materials  and  supplies  and  temporary premises.  The Builder's Risk
Coverage  shall  be  in  the  amount  of  the  full  replacement  value  of  the
Improvements  and  shall  contain  a  deductible  amount acceptable to Landlord.
Landlord  shall  be named as an additional insured.  The Builder's Risk Coverage
shall  include  an  endorsement  permitting  initial  occupancy.
4.4     Insurance  RequirementsInsurance Requirements.  The following provisions
        ---------------------------------------------
shall  apply  to  all  insurance  coverages  required  hereunder:
(a)     The  form and substance of all policies shall be subject to the approval
of  Landlord,  which  approval  will  not  be  unreasonably  withheld.
(b)     The carriers of all policies shall have a Best's Rating of "A" or better
and  a  Best's Financial Category of XII or higher and shall be authorized to do
insurance  business  in  the  Facility  State.
(c)     Tenant shall be the "named insured" and Landlord shall be an "additional
insured"  on  each  policy.
(d)     Tenant  shall  deliver  to Landlord certificates or policies showing the
required  coverages  and  endorsements.  The policies of insurance shall provide
that  the  policy  may not be canceled or not renewed, and no material change or
reduction  in  coverage  may  be  made,  without at least 30 days' prior written
notice  to  Landlord.
(e)     The  policies  shall  contain  a  severability  of  interest  and/or
cross-liability  endorsement,  provide  that  the acts or omissions of Tenant or
Landlord  will  not invalidate the coverage of the other party, and provide that
Landlord  shall  not  be  responsible  for  payment  of  premiums.
(f)     All  loss  adjustment  shall require the written consent of Landlord and
Tenant,  as  their  interests  may  appear.
(g)     At  least  30  days  prior  to  the expiration of each insurance policy,
Tenant  shall  deliver  to Landlord a certificate showing renewal of such policy
and  payment  of  the  annual  premium  therefor  and  a  current Certificate of
Compliance  (in  the form delivered at the time of Closing) completed and signed
by  Tenant's  insurance  agent.
4.5     Replacement  ValueReplacement  Value.  The term "full replacement value"
        ------------------------------------
means the actual replacement cost thereof from time to time, including increased
     cost of construction endorsement, with no reductions or deductions.  Tenant
shall,  in  connection  with  each  annual policy renewal, deliver to Landlord a
redetermination  of  the full replacement value by the insurer or an endorsement
indicating  that  the Leased Property is insured for its full replacement value.
If Tenant makes any Permitted Alterations (as hereinafter defined) to the Leased
Property, Landlord may have such full replacement value redetermined at any time
after  such  Permitted  Alterations  are  made,  regardless  of  when  the  full
replacement  value  was  last  determined.
4.6     Blanket  PolicyBlanket Policy.  Notwithstanding anything to the contrary
        -----------------------------
contained  in  this  Article  4, Tenant may carry the insurance required by this
Article under a blanket policy of insurance, provided that the coverage afforded
     Tenant  will  not  be  reduced or diminished or otherwise be different from
that  which  would exist under a separate policy meeting all of the requirements
of  this  Lease.
4.7     No  Separate  InsuranceNo Separate Insurance.  Tenant shall not take out
        --------------------------------------------
separate  insurance concurrent in form or contributing in the event of loss with
that  required  in  this  Article,  or increase the amounts of any then existing
insurance,  by  securing an additional policy or additional policies, unless all
parties  having  an  insurable  interest in the subject matter of the insurance,
including  Landlord  and  any  mortgagees,  are  included  therein as additional
insureds  or  loss  payees, the loss is payable under said insurance in the same
manner  as losses are payable under this Lease, and such additional insurance is
not  prohibited by the existing policies of insurance.  Tenant shall immediately
notify  Landlord  of the taking out of such separate insurance or the increasing
of any of the amounts of the existing insurance by securing an additional policy
     or  additional  policies.
4.8     Waiver  of  SubrogationWaiver  of Subrogation.  Each party hereto hereby
        ---------------------------------------------
waives  any  and  every claim which arises or may arise in its favor and against
the  other  party  hereto during the Term for any and all loss of, or damage to,
any  of  its  property  located  within  or upon, or constituting a part of, the
Leased  Property,  which  loss  or  damage  is  covered by valid and collectible
insurance  policies, to the extent that such loss or damage is recoverable under
such  policies.  Said  mutual  waiver  shall  be  in  addition  to,  and  not in
limitation or derogation of, any other waiver or release contained in this Lease
     with  respect  to  any  loss  or  damage to property of the parties hereto.
Inasmuch as the said waivers will preclude the assignment of any aforesaid claim
by  way  of  subrogation  (or  otherwise)  to an insurance company (or any other
person),  each  party  hereto  agrees immediately to give each insurance company
which  has  issued  to  it policies of insurance, written notice of the terms of
said  mutual  waivers, and to have such insurance policies properly endorsed, if
necessary,  to  prevent the invalidation of said insurance coverage by reason of
said  waivers,  so  long  as such endorsement is available at a reasonable cost.
4.9     MortgagesMortgages.  The  following  provisions  shall apply if Landlord
        ------------------
now  or  hereafter places a mortgage on the Leased Property or any part thereof:
[i] Tenant shall obtain a standard form of lender's loss payable clause insuring
     the  interest  of  the  mortgagee;  [ii]  Tenant  shall deliver evidence of
insurance  to such mortgagee; [iii] loss adjustment shall require the consent of
the  mortgagee;  and  [iv]  Tenant  shall  provide  such  other  information and
documents  as  may  be  required  by  the  mortgagee.
4.10     EscrowsEscrows.  After  an  Event  of  Default occurs hereunder, Tenant
         --------------
shall  make  such  periodic  payments  of  insurance premiums in accordance with
Landlord's  requirements  after  receipt  of  notice  thereof  from  Landlord.
                        ARTICLE 5:     INDEMNITYINDEMNITY
5.1     Tenant's  IndemnificationTenant's  Indemnification.  Tenant  hereby
        --------------------------------------------------
indemnifies and agrees to hold harmless Landlord and HCN (jointly and severally,
     "Indemnified  Party"),  any successors or assigns of Indemnified Party, and
Indemnified  Party's  and  such  successor's  and  assign's directors, officers,
employees  and  agents  from  and against any and all demands, claims, causes of
action,  fines,  penalties,  damages  (including consequential damages), losses,
liabilities  (including  strict  liability), judgments, and expenses (including,
without  limitation,  reasonable attorneys' fees, court costs, and the costs set
forth  in  8.7)  incurred  in  connection  with or arising from:  [i] the use or
occupancy of the Leased Property by Tenant or any persons claiming under Tenant;
[ii] any activity, work, or thing done, or permitted or suffered by Tenant in or
about the Leased Property; [iii] any acts, omissions, or negligence of Tenant or
any  person  claiming  under  Tenant,  or  the  contractors,  agents, employees,
invitees,  or visitors of Tenant or any such person; [iv] any breach, violation,
or  nonperformance  by  Tenant  or  any  person  claiming  under  Tenant  or the
employees,  agents,  contractors, invitees, or visitors of Tenant or of any such
person, of any term, covenant, or provision of this Lease or any law, ordinance,
or  governmental  requirement  of  any  kind, including, without limitation, any
failure to comply with any applicable requirements under the ADA; [v] any injury
or  damage to the person, property or business of Tenant, its employees, agents,
contractors,  invitees,  visitors,  or any other person entering upon the Leased
Property;  [vi]  any  construction,  alterations,  changes  or demolition of the
Facility  performed  by  or contracted for by Tenant or its employees, agents or
contractors;  [vii]  any  obligations,  costs  or  expenses  arising  under  any
Permitted  Exceptions;  and  [viii] any claim under a Loan Document arising from
the acts or omissions of Tenant or Guarantor, including, but not limited to, (a)
any claim against HCN under an Indemnity Agreement granted by HCN to Lender; and
(b)  any  applicable  make-whole  premium  payable  to  Lender as a result of an
acceleration  of  the  Loan.  If  any  action  or  proceeding is brought against
Landlord,  its  employees,  or  agents by reason of any such claim, Tenant, upon
notice  from  Landlord,  will  defend the claim at Tenant's expense with counsel
reasonably satisfactory to Landlord.  All amounts payable to Landlord under this
section  shall  be  payable on written demand and any such amounts which are not
paid  within  10  days after demand therefore by Landlord shall bear interest at
Landlord's  rate  of  return as provided in the Commitment.  In case any action,
suit  or  proceeding is brought against Tenant by reason of any such occurrence,
Tenant shall use its commercially reasonable efforts to defend such action, suit
or  proceeding.  Nothing  in this  5.1 shall be construed as requiring Tenant to
indemnify  Landlord  with  respect to Landlord's own gross negligence or willful
misconduct  or  with  respect to any claim under the Loan Documents arising from
the  acts  or  omissions  of  Landlord  or  HCN.
5.1.1     Notice  of  ClaimNotice  of  Claim  .  Landlord shall notify Tenant in
          -----------------
writing  of  any claim or action brought against Landlord in which indemnity may
be  sought  against Tenant pursuant to this section.  Such notice shall be given
in  sufficient  time  to  allow Tenant to defend or participate in such claim or
action,  but  the  failure  to  give  such  notice  in sufficient time shall not
constitute  a  defense hereunder nor in any way impair the obligations of Tenant
under  this  section  unless  the failure to give such notice precludes Tenant's
defense  of  any  such  action.
5.1.2     Survival  of CovenantsSurvival of Covenants .  The covenants of Tenant
          ----------------------
contained  in  this  section  shall  remain  in  full force and effect after the
termination  of  this  Lease  until  the  expiration of the period stated in the
applicable statute of limitations during which a claim or cause of action may be
     brought  and  payment in full or the satisfaction of such claim or cause of
action  and  of  all  expenses  and charges incurred by Landlord relating to the
enforcement  of  the  provisions  herein  specified.
5.1.3     Reimbursement  of  ExpensesReimbursement  of  Expenses  .  Unless
          ---------------------------
prohibited by law, Tenant hereby agrees to pay to Landlord all of the reasonable
     fees, charges and reasonable out-of-pocket expenses related to the Facility
and required hereby, or incurred by Landlord in enforcing the provisions of this
Lease.
5.2     Environmental  Indemnity; AuditsEnvironmental Indemnity; Audits.  Tenant
        ---------------------------------------------------------------
hereby  indemnifies  and  agrees  to  hold  harmless Landlord, any successors to
Landlord's  interest  in  this  Lease,  and  Landlord's  and  such  successors'
directors,  officers,  employees and agents from and against any losses, claims,
damages  (including  consequential  damages),  penalties,  fines,  liabilities
(including  strict liability), costs (including cleanup and recovery costs), and
expenses  (including  expenses  of  litigation  and  reasonable consultants' and
attorneys'  fees)  incurred  by  Landlord  or  any  other indemnitee or assessed
against any portion of the Leased Property by virtue of any claim or lien by any
     governmental  or  quasi-governmental  unit,  body,  or agency, or any third
party,  for  cleanup  costs  or  other  costs pursuant to any Environmental Law.
Tenant's  indemnity  shall  survive  the  termination  of this Lease.  Provided,
however, Tenant shall have no indemnity obligation with respect to [i] Hazardous
Materials  first  introduced  to the Leased Property subsequent to the date that
Tenant's  occupancy  of the Leased Property shall have fully terminated; or [ii]
Hazardous  Materials  introduced  to the Leased Property by Landlord, its agent,
employees,  successors or assigns.  If at any time during the Term of this Lease
any  governmental  authority  notifies  Landlord or Tenant of a violation of any
Environmental  Law  or  Landlord reasonably believes that a Facility may violate
any  Environmental Law, Landlord may require one or more environmental audits of
such  portion  of  the  Leased  Property,  in  such form, scope and substance as
specified  by Landlord, at Tenant's expense.  Tenant shall, within 30 days after
receipt  of  an  invoice  from  Landlord,  reimburse  Landlord for all costs and
expenses  incurred  in  reviewing  any  environmental  audit, including, without
limitation,  reasonable  attorneys'  fees  and  costs.
5.3     Limitation  of  Landlord's  LiabilityLimitation of Landlord's Liability.
        -----------------------------------------------------------------------
Landlord,  its  agents,  and employees, will not be liable for any loss, injury,
death,  or  damage  (including  consequential  damages) to persons, property, or
Tenant's  business  occasioned  by  theft, act of God, public enemy, injunction,
riot, strike, insurrection, war, court order, requisition, order of governmental
     body  or authority, fire, explosion, falling objects, steam, water, rain or
snow,  leak or flow of water (including water from the elevator system), rain or
snow  from  the  Leased  Property  or into the Leased Property or from the roof,
street, subsurface or from any other place, or by dampness or from the breakage,
leakage,  obstruction,  or  other  defects  of  the  pipes,  sprinklers,  wires,
appliances,  plumbing,  air  conditioning,  or  lighting  fixtures of the Leased
Property,  or from construction, repair, or alteration of the Leased Property or
from  any  acts  or  omissions  of  any  other occupant or visitor of the Leased
Property,  or  from  any  other  cause  beyond  Landlord's  control.
   ARTICLE 6:     USE AND ACCEPTANCE OF PREMISESUSE AND ACCEPTANCE OF PREMISES
6.1     Use  of  Leased  PropertyUse  of  Leased Property.  Tenant shall use and
        -------------------------------------------------
occupy  the  Leased Property exclusively for the Facility Uses specified for the
Facility and for all lawful and licensed ancillary uses, including the operation
     of  an  Alzheimer's  Memory  Loss  Unit,  provided Tenant complies with all
applicable Legal Requirements and for no other purpose without the prior written
consent  of Landlord.  Tenant shall obtain and maintain all approvals, licenses,
and  consents needed to use and operate the Leased Property as herein permitted.
Tenant  shall  deliver  to  Landlord  complete  copies of surveys, examinations,
certification  and  licensure  inspections,  compliance  certificates, and other
similar reports issued to Tenant by any governmental agency within 10 days after
Tenant's  receipt  of  each  item.
6.2     Acceptance  of  Leased  PropertyAcceptance  of  Leased Property.  Tenant
        ---------------------------------------------------------------
acknowledges  that  [i] Tenant and its agents have had an opportunity to inspect
the  Leased Property; [ii] Tenant has found the Leased Property fit for Tenant's
use;  [iii]  Landlord  will  deliver  the  Leased  Property to Tenant in "as-is"
condition; [iv] Landlord is not obligated to make any improvements or repairs to
     the  Leased  Property;  and  [v]  the  roof,  walls,  foundation,  heating,
ventilating,  air  conditioning,  telephone,  sewer,  electrical,  mechanical,
elevator,  utility,  plumbing,  and other portions of the Leased Property are in
good  working  order.  Tenant  waives  any claim or action against Landlord with
respect  to the condition of the Leased Property.  LANDLORD MAKES NO WARRANTY OR
REPRESENTATION,  EXPRESS  OR  IMPLIED,  IN RESPECT OF THE LEASED PROPERTY OR ANY
PART  THEREOF,  EITHER  AS  TO  ITS FITNESS FOR USE, DESIGN OR CONDITION FOR ANY
PARTICULAR  USE  OR  PURPOSE  OR  OTHERWISE, OR AS TO QUALITY OF THE MATERIAL OR
WORKMANSHIP  THEREIN,  LATENT OR PATENT, IT BEING AGREED THAT ALL SUCH RISKS ARE
TO  BE  BORNE  BY  TENANT.
6.3     Conditions of Use and OccupancyConditions of Use and Occupancy .  Tenant
        -------------------------------
     agrees  that during the Term it shall use and keep the Leased Property in a
careful,  safe and proper manner; not commit or suffer waste thereon; not use or
occupy  the  Leased  Property  for  any unlawful purposes; not use or occupy the
Leased  Property  or  permit the same to be used or occupied, for any purpose or
business deemed extra-hazardous on account of fire or otherwise; keep the Leased
Property in such repair and condition as may be required by the Board of Health,
or  other  city, state or federal authorities, free of all cost to Landlord; not
permit  any  acts to be done which will cause the cancellation, invalidation, or
suspension  of any insurance policy; and permit Landlord and its agents to enter
upon  the  Leased  Property  at  all  reasonable  times to examine the condition
thereof.  Landlord  shall  have  the  right  to have an annual inspection of the
Leased  Property  performed and Tenant shall pay an inspection fee of the lesser
of  $1,500.00  or  Landlord's  reasonable  out-of-pocket expenses within 30 days
after  receipt  of  Landlord's  invoice.
 ARTICLE 7:     MAINTENANCE AND MECHANICS' LIENSMAINTENANCE AND MECHANICS' LIENS
7.1     MaintenanceMaintenance .  Tenant shall maintain, repair, and replace the
        -----------
     Leased  Property,  including,  without  limitation,  all  structural  and
nonstructural repairs and replacements to the roof, foundations, exterior walls,
HVAC  systems,  equipment,  parking  areas,  sidewalks,  water,  sewer  and  gas
connections,  pipes  and  mains.  Tenant shall pay, as Additional Rent, the full
cost  of  maintenance,  repairs,  and  replacements.  Tenant  shall maintain all
drives, sidewalks, parking areas, and lawns on or about the Leased Property in a
clean  and  orderly  condition, free of accumulations of dirt, rubbish, snow and
ice.  Tenant  shall  at  all  times  maintain,  operate and otherwise manage the
Leased  Property  on  a  basis  and  in  a  manner consistent with the standards
currently  maintained  by  Tenant at the Leased Property.  All repairs shall, to
the  extent  reasonably  achievable,  be  at  least equivalent in quality to the
original work or the property to be repaired shall be replaced.  Tenant will not
take or omit to take any action the taking or omission of which might materially
impair  the  value or the usefulness of the Leased Property or any parts thereof
for  the  Facility  Uses.  Tenant  shall  permit  Landlord to inspect the Leased
Property  at  all  reasonable  times  and  on  reasonable advance notice, and if
Landlord  has  a  reasonable basis to believe that there are maintenance problem
areas  and  gives  Tenant  written  notice thereof setting forth its concerns in
reasonable  detail, Tenant shall deliver to Landlord a plan of correction within
10  Business  Days  after receipt of the notice.  Tenant shall diligently pursue
correction  of  all  problem areas within 60 days after receipt of the notice or
such longer period as may be necessary for reasons beyond its reasonable control
such  as  shortage of materials or delays in securing necessary permits, but not
caused by lack of diligence by Tenant and, upon expiration of the 60-day period,
shall deliver evidence of completion to Landlord or an interim report evidencing
Tenant's diligent progress towards completion and, at the end of the next 60-day
period,  evidence  of  satisfactory completion.  Upon completion, Landlord shall
have  the  right to re-inspect the Facility and Tenant shall pay a re-inspection
fee  of $750.00 plus Landlord's reasonable out-of-pocket expenses within 30 days
after  receipt of Landlord's invoice.  At each inspection of the Leased Property
by  Landlord,  the Facility employee in charge of maintenance shall be available
to  tour  the  Facility  with  Landlord  and  answer  questions.
7.2     Required  AlterationsRequired  Alterations  .  Tenant shall, at Tenant's
        ---------------------
sole  cost and expense, make any additions, changes, improvements or alterations
to  the Leased Property, including structural alterations, which may be required
by  any governmental authorities, including those required to maintain licensure
or  certification  under  the  Medicare and Medicaid programs (if so certified),
whether  such  changes  are  required  by  Tenant's  use,  changes  in  the law,
ordinances, or governmental regulations, defects existing as of the date of this
     Lease,  or  any  other  cause  whatsoever.  All  such  additions,  changes,
improvements  or  alterations  shall  be  deemed to be Permitted Alterations and
shall comply with all laws requiring such alterations and with the provisions of
16.4.
7.3     Mechanic's  LiensMechanic's  Liens  .  Tenant shall have no authority to
        -----------------
permit  or create a lien against Landlord's interest in the Leased Property, and
Tenant  shall  post notices or file such documents as may be required to protect
Landlord's  interest in the Leased Property against liens.  Tenant hereby agrees
to defend, indemnify, and hold Landlord harmless from and against any mechanic's
     liens  against  the  Leased  Property by reason of work, labor, services or
materials  supplied  or  claimed  to  have  been  supplied  on  or to the Leased
Property.  Subject  to Tenant's right to contest the same in accordance with the
terms  of  this  Lease,  Tenant  shall remove, bond-off, or otherwise obtain the
release  of any mechanic's lien filed against the Leased Property within 10 days
after notice of the filing thereof.  Tenant shall pay all expenses in connection
therewith,  including,  without  limitation,  damages, interest, court costs and
reasonable  attorneys'  fees.
7.4     Replacements of Fixtures and Landlord's Personal PropertyReplacements of
        ---------------------------------------------------------
     Fixtures  and  Landlord's  Personal  Property  .  Tenant  shall  not remove
Fixtures  and  Landlord's  Personal  Property from the Leased Property except to
replace  the  Fixtures and Landlord's Personal Property with other similar items
of  equal  quality and value.  Items being replaced by Tenant may be removed and
shall  become  the  property of Tenant and items replacing the same shall be and
remain  the  property  of  Landlord.  Tenant shall execute, upon written request
from  Landlord, any and all documents necessary to evidence Landlord's ownership
of  Landlord's  Personal Property and replacements therefor.  Tenant may finance
replacements  for  the  Fixtures  and  Landlord's Personal Property by equipment
lease or by a security agreement and financing statement if, with respect to any
financing  of  critical  care  equipment  and with respect to any other Personal
Property  having  a value in excess of $250,000.00 [i] Landlord has consented to
the  terms and conditions of the equipment lease or security agreement; and [ii]
the  equipment lessor or lender has entered into a nondisturbance agreement with
Landlord upon terms and conditions reasonably acceptable to Landlord, including,
without  limitation,  the following:  [a] Landlord shall have the right (but not
the  obligation)  to  assume such security agreement or equipment lease upon the
occurrence  of an Event of Default under this Lease; [b] the equipment lessor or
lender  shall notify Landlord of any default by Tenant under the equipment lease
or  security  agreement  and give Landlord a reasonable opportunity to cure such
default;  and  [c]  Landlord shall have the right to assign its rights under the
equipment lease, security agreement, or nondisturbance agreement.  Tenant shall,
within 30 days after receipt of an invoice from Landlord, reimburse Landlord for
all  costs and expenses incurred in reviewing and approving the equipment lease,
security agreement, and nondisturbance agreement, including, without limitation,
reasonable  attorneys'  fees  and  costs.
7.5     Lender  Maintenance  Reserve  EscrowLender  Maintenance  Reserve Escrow.
        ------------------------------------
Upon  request  from  Tenant,  Landlord shall cooperate with Tenant to secure the
release  of funds held by Lender in the Lender Maintenance Reserve Escrow to the
extent  such  funds  are available as set forth in the Loan Documents.  Tenant's
obligations  set  forth  in  this  Article  7  shall not be conditioned upon the
release  of  funds  by  Lender  from  the  Lender  Maintenance  Reserve  Fund.
            ARTICLE 8:     DEFAULTS AND REMEDIESDEFAULTS AND REMEDIES
8.1     Events  of DefaultEvents of Default .  The occurrence of any one or more
        ------------------
of  the  following  shall  be an event of default ("Event of Default") hereunder
without  any  advance  notice  to  Tenant  unless  specified  herein:
(a)     Tenant fails to pay in full any installment of Base Rent, any Additional
     Rent  or  any  other monetary obligation payable by Tenant under this Lease
within  10  days  after  such  payment  is  due.
(b)     Tenant or Guarantor (where applicable) fails to comply with any covenant
set  forth  in  Article  14,   15.6,  15.7,  15.8  or  15.12  of  this  Lease.
(c)     Tenant  fails  to  observe  and perform any other covenant, condition or
agreement  under  this  Lease  to  be  performed  by Tenant and [i] such failure
continues  for  a  period  of  30  days after written notice thereof is given to
Tenant  by  Landlord;  or  [ii]  if,  by reason of the nature of such default it
cannot  be  remedied  within  30  days,  Tenant  fails to proceed with diligence
reasonably  satisfactory  to  Landlord  after  receipt of the notice to cure the
default  or,  in  any  event,  fails  to  cure such default within 60 days after
receipt of the notice.  The foregoing notice and cure provisions do not apply to
any Event of Default otherwise specifically described in any other subsection of
8.1.
(d)     Tenant  abandons  or  vacates(except  during  a  period  of  repair  or
reconstruction  after  damage, destruction or a Taking) the Facility Property or
any material part thereof, ceases to operate any Facility, ceases to do business
or  ceases  to  exist  for  any  reason  for  any  one  or  more  days.
(e)     [i]  The  filing  by  Tenant  or  Guarantor  of  a  petition  under  the
Bankruptcy  Code  or  the  commencement of a bankruptcy or similar proceeding by
Tenant  or  Guarantor; [ii] the failure by Tenant or Guarantor within 60 days to
dismiss  an  involuntary  bankruptcy  petition  or  other  commencement  of  a
bankruptcy,  reorganization or similar proceeding against such party, or to lift
or  stay  any  execution,  garnishment or attachment of such consequence as will
impair  its  ability to carry on its operation at the Leased Property; [iii] the
entry  of  an order for relief under the Bankruptcy Code in respect of Tenant or
Guarantor;  [iv]  any  assignment  by Tenant or Guarantor for the benefit of its
creditors; [v] the entry by Tenant or Guarantor into an agreement of composition
with  its creditors; [vi] the approval by a court of competent jurisdiction of a
petition  applicable  to  Tenant  or  Guarantor  in  any  proceeding  for  its
reorganization  instituted  under  the  provisions  of  any  state  or  federal
bankruptcy,  insolvency,  or  similar  laws;  [vii]  appointment by final order,
judgment,  or  decree  of  a  court of competent jurisdiction of a receiver of a
whole or any substantial part of the properties of Tenant or Guarantor (provided
such  receiver  shall  not have been removed or discharged within 60 days of the
date  of  his  qualification).
(f)     [i]  Any  receiver,  administrator,  custodian  or  other  person  takes
possession  or control of any of the Leased Property and continues in possession
for  60  days;  [ii] any writ against any of the Leased Property is not released
within  60  days;  [iii]  any judgment is rendered or proceedings are instituted
against  the  Leased Property, Tenant which adversely affect the Leased Property
or  any  part  thereof,  which is not dismissed for 60 days (except as otherwise
provided  in  this  section);  [iv]  all  or a substantial part of the assets of
Tenant  are  attached,  seized,  subjected to a writ or distress warrant, or are
levied upon, or come into the possession of any receiver, trustee, custodian, or
assignee for the benefit of creditors; [v] Tenant is enjoined, restrained, or in
any  way  prevented  by  court  order,  or  any proceeding is filed or commenced
seeking  to  enjoin,  restrain  or  in  any way prevent Tenant or Guarantor from
conducting  all or a substantial part of its business or affairs; or [vi] except
as  otherwise permitted hereunder, a final notice of lien, levy or assessment is
filed  of  record  with respect to all or any part of the Leased Property or any
property  of  Tenant  or  Guarantor  located  at  the Leased Property and is not
dismissed,  discharged,  or  bonded-off  within  30  days.
(g)     Any representation or warranty made by Tenant or Guarantor in this Lease
or any other document executed in connection with this Lease, any guaranty of or
other  security  for  this  Lease,  or  any  report,  certificate,  application,
financial  statement  or  other  instrument  furnished  by  Tenant  or Guarantor
pursuant  hereto  or thereto shall prove to be false, misleading or incorrect in
any  material  respect  as  of  the  date  made.
(h)     Tenant  or  any  Affiliate  of  Tenant  defaults  on any indebtedness or
obligation  to  Landlord or any Landlord Affiliate, any Obligor Group Obligation
or  any  agreement  with  Landlord or any Landlord Affiliate, including, without
limitation, any lease with Landlord or any Landlord Affiliate, or the occurrence
of  a  default  under  any Material Obligation, and any applicable grace or cure
period  with  respect  to  default under such indebtedness or obligation expires
without  such  default  having  been  cured.  This provision applies to all such
indebtedness,  obligations  and  agreements  as  they  may be amended, modified,
extended,  or  renewed  from  time  to  time.
(i)     Any  guarantor  of  this  Lease  dissolves,  terminates,  is adjudicated
incompetent,  files  a petition in bankruptcy, or is adjudicated insolvent under
the  Bankruptcy  Code  or  any other insolvency law, or fails to comply with any
covenant  or  requirement  of  such  guarantor set forth in this Lease or in the
guaranty  of  such  guarantor,  which  is  not  cured within any applicable cure
period.
(j)     The  license  for  the Facility or any other Government Authorization is
canceled,  suspended,  reduced  to  provisional  or  temporary,  or  otherwise
invalidated,  or license revocation or decertification proceedings are commenced
against  Tenant, and in each instance, such action is not stayed pending appeal,
or,  as  a result of the acts or omissions of Tenant, any reduction of more than
5%  occurs  in  the  number  of  licensed  beds  or units at the Facility, or an
admissions  ban is issued for the Facility and remains in effect for a period of
more  than  45  days.
8.2     RemediesRemedies  .  Upon  the  occurrence  of an Event of Default under
        --------
this  Lease  or  any  Lease  Document, and at any time thereafter until Landlord
waives the default in writing or acknowledges cure of the default in writing, at
     Landlord's  option, without declaration, notice of nonperformance, protest,
notice  of  protest,  notice  of  default, notice to quit or any other notice or
demand  of  any  kind,  Landlord  may  exercise  any and all rights and remedies
provided  in this Lease or any Lease Document or otherwise provided under law or
in  equity,  including,  without  limitation,  any  one or more of the following
remedies:
(a)     Landlord may re-enter and take possession of the Leased Property without
     terminating  this  Lease,  and lease the Leased Property for the account of
Tenant,  holding Tenant liable for all costs of Landlord in reletting the Leased
Property and for the difference in the amount received by such reletting and the
amounts  payable  by  Tenant  under  the  Lease.
(b)     Landlord  may  terminate this Lease by written notice to Tenant, exclude
Tenant  from  possession  of the Leased Property and use commercially reasonable
efforts  to  lease  the Leased Property to others, holding Tenant liable for the
difference  in  the amounts received from such reletting and the amounts payable
by  Tenant  under  this  Lease.
(c)     Landlord  may re-enter the Leased Property and have, repossess and enjoy
the  Leased  Property  as  if  this  Lease had not been made, and in such event,
Tenant  and its successors and assigns shall remain liable for any contingent or
unliquidated  obligations  or  sums  owing  at  the  time  of such repossession.
(d)     Landlord  may have access to and inspect, examine and make copies of the
books  and  records  and  any  and  all  accounts, data and income tax and other
returns  of  Tenant  insofar  as  they pertain to the Leased Property subject to
landlord's obligation to maintain the confidentiality of any patient or employee
information  in  accordance with the requirements of applicable State or federal
law.
(e)     Landlord  may  accelerate  all of the unpaid Rent hereunder based on the
then  current Rent Schedule so that the aggregate Rent for the unexpired term of
this  Lease  becomes  immediately  due  and  payable.
(f)     Landlord  may  take  whatever  action  at law or in equity as may appear
necessary  or desirable to collect the Rent and other amounts payable under this
Lease  then  due  and  thereafter  to  become due, or to enforce performance and
observance  of  any  obligations,  agreements  or covenants of Tenant under this
Lease.
(g)     With  respect  to  the  Collateral  or  any  portion thereof and Secured
Party's  security interest therein, Secured Party may exercise all of its rights
as  secured party under Article 9 of the Uniform Commercial Code.  Secured Party
may  sell  the  Collateral  by  public  or private sale upon five days notice to
Tenant.  Tenant  agrees  that a commercially reasonable manner of disposition of
the  Collateral  shall  include, without limitation and at the option of Secured
Party, a sale of the Collateral, in whole or in part, concurrently with the sale
of  the  Leased  Property.
(h)     Secured  Party  may  obtain control over and collect the Receivables and
apply  the  proceeds  of  the  collections  to satisfaction of the Obligor Group
Obligations  unless prohibited by law.  Tenant appoints Landlord or its designee
as attorney for Tenant with powers [i] to receive, to endorse, to sign and/or to
deliver,  in  Tenant's name or Secured Party's name, any and all checks, drafts,
and  other instruments for the payment of money relating to the Receivables, and
to  waive demand, presentment, notice of dishonor, protest, and any other notice
with  respect  to any such instrument; [ii] to sign Tenant's name on any invoice
or  bill  of  lading relating to any Receivable, drafts against account debtors,
assignments  and  verifications  of Receivables, and notices to account debtors;
[iii] to send verifications of Receivables to any account debtor; and [iv] to do
all  other  acts  and  things  necessary  to carry out this Lease.  Absent gross
negligence  or  willful  misconduct of Secured Party, Secured Party shall not be
liable  for  any omissions, commissions, errors of judgment, or mistakes in fact
or  law  made  in  the  exercise of any such powers.  At Secured Party's option,
Tenant shall [i] provide Secured Party a full accounting of all amounts received
on  account of Receivables with such frequency and in such form as Secured Party
may  require,  either with or without applying all collections on Receivables in
payment of the Obligor Group Obligations or [ii] deliver to Secured Party on the
day  of  receipt  all such collections in the form received and duly endorsed by
Tenant.  At  Secured Party's request, Tenant shall institute any action or enter
into  any  settlement  determined  by  Secured  Party  to be necessary to obtain
recovery  or redress from any account debtor in default of Receivables.  Secured
Party  may give notice of its security interest in the Receivables to any or all
account  debtors  with instructions to make all payments on Receivables directly
to Secured Party, thereby terminating Tenant's authority to collect Receivables.
After  terminating Tenant's authority to enforce or collect Receivables, Secured
Party  shall  have  the  right  to take possession of any or all Receivables and
records  thereof and is hereby authorized to do so, and only Secured Party shall
have  the right to collect and enforce the Receivables.  Prior to the occurrence
and during the continuance of an Event of Default, at Tenant's cost and expense,
but  on  behalf  of  Secured Party and for Secured Party's account, Tenant shall
collect or otherwise enforce all amounts unpaid on Receivables and hold all such
collections  in  trust  for  Secured  Party,  but  Tenant  may  commingle  such
collections  with Tenant's own funds, until Tenant's authority to do so has been
terminated,  which  may be done only after an Event of Default.  Notwithstanding
any  other  provision  hereof,  Secured  Party  does  not assume any of Tenant's
obligations  under any Receivable, and Secured Party shall not be responsible in
any  way  for  the  performance  of  any  of the terms and conditions thereof by
Tenant.
(i)     Without  waiving  any prior or subsequent Event of Default, Landlord may
waive  any  Event  of  Default or, with or without waiving any Event of Default,
remedy  any  default.
(j)     Landlord  may terminate its obligation, if any, to disburse any Landlord
Payments.
(k)     Landlord  may  enter  and  take  possession of the Land and the Facility
without  terminating  this Lease and complete construction and renovation of the
Improvements  (or  any part thereof) and perform the obligations of Tenant under
the  Lease  Documents.  Without limiting the generality of the foregoing and for
the  purposes  aforesaid,  Tenant  hereby  appoints  Landlord  its  lawful
attorney-in-fact  with  full  power  to  do  any of the following:  [i] complete
construction,  renovation  and  equipping  of  the  Improvements  in the name of
Tenant;  [ii]  use  unadvanced  funds  remaining under the Investment Amount, or
funds that may be reserved, escrowed, or set aside for any purposes hereunder at
any  time,  or  to advance funds in excess of the Investment Amount, to complete
the  Improvements; [iii] make changes in the plans and specifications that shall
be  necessary  or  desirable  to  complete the Improvements in substantially the
manner  contemplated  by the plans and specifications; [iv] retain or employ new
general  contractors,  subcontractors,  architects, engineers, and inspectors as
shall be required for said purposes; [v] pay, settle, or compromise all existing
bills  and  claims,  which  may be liens or security interests, or to avoid such
bills  and  claims  becoming  liens  against  the  Facility or security interest
against  fixtures  or  equipment,  or  as  may be necessary or desirable for the
completion  of  the  construction  and  equipping of the Improvements or for the
clearance  of title; [vi] execute all applications and certificates, in the name
of  Tenant,  that  may be required in connection with any construction; [vii] do
any  and  every  act  that  Tenant  might do in its own behalf, to prosecute and
defend  all  actions  or  proceedings  in  connection with the Improvements; and
[viii]  to  execute,  deliver  and file all applications and other documents and
take any and all actions necessary to transfer the operations of the Facility to
Secured  Party  or  Secured Party's designee.  This power of attorney is a power
coupled  with  an  interest  and  cannot  be  revoked.
(l)     Landlord  may  apply,  with  or  without  notice  to  Tenant,  for  the
appointment  of  a  receiver ("Receiver") for Tenant or Tenant's business or for
the  Leased  Property.  Unless  prohibited  by law, such appointment may be made
either  before  or  after  termination  of  Tenant's  possession  of  the Leased
Property, without notice, without regard to the solvency or insolvency of Tenant
at  the  time  of  application  for such Receiver and without regard to the then
value  of  the  Leased Property, and Secured Party may be appointed as Receiver.
After the occurrence and during the continuance of an Event of Default, Landlord
shall  be entitled to appointment of a receiver as a matter of right and without
the  need  to  make any showing other than the existence of an Event of Default.
The  Receiver  shall  have  the  power to collect the rents, income, profits and
Receivables  of  the Leased Property during the pendency of the receivership and
all  other  powers  which  may  be  necessary or are usual in such cases for the
protection, possession, control, management and operation of the Leased Property
during the whole of said proceeding.  All sums of money received by the Receiver
from such rents and income, after deducting therefrom the reasonable charges and
expenses  paid  or  incurred  in connection with the collection and disbursement
thereof,  shall  be  applied  to  the  payment of the Rent or any other monetary
obligation of Tenant under this Lease, including, without limitation, any losses
or  damages  incurred  by Landlord under this Lease.  Tenant, if requested to do
so,  will  consent  to  the  appointment  of  any  such  Receiver  as aforesaid.
(m)     Landlord  may  terminate any management agreement with respect to any of
the  Leased Property and shall have the right to retain one or more managers for
the  Leased Property at the expense of Tenant, such manager(s) to serve for such
term  and  at  such  compensation as Landlord reasonably determines is necessary
under  the  circumstances.
8.3     Right of SetoffRight of Setoff .  Landlord may, and is hereby authorized
        ---------------
     by  Tenant  to, at any time and from time to time without advance notice to
Tenant  (any such notice being expressly waived by Tenant), setoff or recoup and
apply any and all sums held by Landlord, any indebtedness of Landlord to Tenant,
and  any  claims  by  Tenant against Landlord, against any obligations of Tenant
hereunder and against any claims by Landlord against Tenant, whether or not such
obligations  or  claims  of  Tenant  are matured and whether or not Landlord has
exercised  any  other  remedies  hereunder.  The  rights  of Landlord under this
section  are  in  addition  to  any  other rights and remedies Landlord may have
against  Tenant.
8.4     Performance  of  Tenant's  CovenantsPerformance  of Tenant's Covenants .
        ------------------------------------
Landlord may perform any obligation of Tenant which Tenant has failed to perform
     within  five  days  after  Landlord  has  sent  a  written notice to Tenant
informing  it  of  its  specific  failure.  Tenant  shall  reimburse Landlord on
demand,  as  Additional Rent, for any expenditures thus incurred by Landlord and
shall  pay  interest  thereon  at  Landlord's  rate of return as provided in the
Commitment.
8.5     Late  Payment  ChargeLate Payment Charge .  Tenant acknowledges that any
        ---------------------
default  in the payment of any installment of Rent payable hereunder will result
in  loss  and  additional  expense  to Landlord in servicing any indebtedness of
Landlord  secured by the Leased Property, handling such delinquent payments, and
meeting  its  other  financial obligations, and because such loss and additional
expense  is extremely difficult and impractical to ascertain, Tenant agrees that
in  the  event any Rent payable to Landlord hereunder is not paid within 10 days
after  the  due  date, Tenant shall pay a late charge of 5% of the amount of the
overdue  payment  as  a  reasonable  estimate  of such loss and expenses, unless
applicable  law  requires  a  lesser  charge,  in  which  event the maximum rate
permitted  by  such law may be charged by Landlord.  The 10-day grace period set
forth  in  this  section  shall  not  extend the time for payment of Rent or the
period  for  curing  any  default  or  constitute  a  waiver  of  such  default.
8.6     Default  RentDefault  Rent .  At Landlord's option at any time after the
        -------------
occurrence  of  an  Event  of  Default  and  while such Event of Default remains
uncured,  the  Base  Rent payable under this Lease shall be increased to reflect
Landlord's  rate of return of 18.5% per annum on the Investment Amount ("Default
Rent");  provided, however, that if a court of competent jurisdiction determines
that  any  other amounts payable under this Lease are deemed to be interest, the
Default  Rent  shall  be  adjusted to ensure that the aggregate interest payable
under  this Lease does not accrue at a rate in excess of the maximum legal rate.
8.7     Attorneys'  FeesAttorneys' Fees .  Tenant shall pay all reasonable costs
        ----------------
and  expenses  incurred by Landlord in enforcing or preserving Landlord's rights
under  this  Lease,  whether or not an Event of Default has actually occurred or
has  been  declared and thereafter cured, including, without limitation, [i] the
fees,  expenses,  and  costs  of  any  litigation,  appellate,  receivership,
administrative,  bankruptcy,  insolvency  or  other  similar  proceeding;  [ii]
reasonable  attorney,  paralegal, consulting and witness fees and disbursements;
and  [iii]  the  expenses,  including,  without  limitation, lodging, meals, and
transportation,  of Landlord and its employees, agents, attorneys, and witnesses
in  preparing  for  litigation,  administrative, bankruptcy, insolvency or other
similar  proceedings  and  attendance  at  hearings,  depositions, and trials in
connection  therewith.  All  such  reasonable  costs, expenses, charges and fees
payable  by  Tenant  shall  be  deemed  to  be Additional Rent under this Lease.
8.8     Escrows and Application of PaymentsEscrows and Application of Payments .
        -----------------------------------
     As  security  for  the performance of the Obligor Group Obligations, Tenant
hereby  assigns  to  Landlord  all  its right, title, and interest in and to all
monies  escrowed  with  Landlord  under this Lease and all deposits with utility
companies,  taxing  authorities and insurance companies; provided, however, that
Landlord  shall  not exercise its rights hereunder until an Event of Default has
occurred.  Any  payments received by Landlord under any provisions of this Lease
during  the  existence or continuance of an Event of Default shall be applied to
the  Obligor  Group  Obligations  in  the  order  which  Landlord may determine.
8.9     Remedies  CumulativeRemedies  Cumulative  .  The  remedies  of  Landlord
        --------------------
herein  are  cumulative  to  and  not in lieu of any other remedies available to
Landlord  at  law or in equity.  The use of any one remedy shall not be taken to
exclude  or  waive  the  right  to  use  any  other  remedy.
8.10     WaiversWaivers  .  Tenant  waives [i] any notice required by statute or
         -------
other  law  as  a condition to bringing an action for possession of, or eviction
from,  any  of  the Leased Property, [ii] any right of re-entry or repossession,
[iii] any right to a trial by jury in any action or proceeding arising out of or
     relating  to  this Lease, [iv]  any right of redemption whether pursuant to
statute,  at  law  or  in equity, [v] all presentments, demands for performance,
notices  of  nonperformance,  protest,  notices of protest, notices of dishonor,
notices  to  quit  and  any  other notice or demand of any kind other than those
specifically  provided for in this Lease, and [vi] all notices of the existence,
creation  or  incurring  of any obligation or advance under this Lease before or
after  this  date.
8.11     Obligations  Under  the Bankruptcy CodeObligations Under the Bankruptcy
         ---------------------------------------
Code  .  Upon  filing  of  a  petition by or against Tenant under the Bankruptcy
Code,  Tenant, as debtor and as debtor-in-possession, and any trustee who may be
appointed with respect to the assets of or estate in bankruptcy of Tenant, agree
     to  pay  monthly  in  advance on the first day of each month, as reasonable
compensation  for  the use and occupancy of the Leased Property, an amount equal
to  all Rent due pursuant to this Lease.  Included within and in addition to any
other  conditions  or  obligations  imposed  upon Tenant or its successor in the
event  of the assumption and/or assignment of this Lease are the following:  [i]
the cure of any monetary defaults and reimbursement of pecuniary loss within not
more  than  five Business Days of assumption and/or assignment; [ii] the deposit
of  an  additional  amount equal to not less than three months' Base Rent, which
amount  is agreed to be a necessary and appropriate deposit to adequately assure
the future performance under this Lease of the Tenant or its assignee; and [iii]
the  continued use of the Leased Property for the Facility Uses.  Nothing herein
shall  be  construed as an agreement by Landlord to any assignment of this Lease
or a waiver of Landlord's right to seek adequate assurance of future performance
in  addition  to  that  set  forth  hereinabove  in connection with any proposed
assumption  and/or  assignment  of  this  Lease.
           ARTICLE 9:     DAMAGE AND DESTRUCTIONDAMAGE AND DESTRUCTION
9.1     Notice  of CasualtyNotice of Casualty .  If the Leased Property shall be
        -------------------
destroyed,  in  whole  or in part, or damaged by fire, flood, windstorm or other
casualty  in  excess  of  $150,000.00  (a "Casualty"), Tenant shall give written
notice  thereof to Landlord within two Business Days after the occurrence of the
Casualty.  Within  15  days  after  the  occurrence  of  the Casualty or as soon
thereafter  as  such information is reasonably available to Tenant, Tenant shall
provide  the  following  information to Landlord:  [i] the date of the Casualty;
[ii]  the  nature  of  the  Casualty;  [iii]  a  description  of  the  damage or
destruction  caused  by  the  Casualty,  including  the  type of Leased Property
damaged and the area of the Improvements damaged; [iv] a preliminary estimate of
     the  cost to repair, rebuild, restore or replace the Leased Property; [v] a
preliminary  estimate  of  the  schedule  to  complete  the  repair, rebuilding,
restoration  or  replacement  of  the Leased Property; [vi] a description of the
anticipated  property  insurance  claim,  including the name of the insurer, the
insurance  coverage  limits,  the  deductible  amount,  the  expected settlement
amount,  and  the  expected  settlement  date;  and  [vii]  a description of the
business  interruption  claim,  including the name of the insurer, the insurance
coverage  limits, the deductible amount, the expected settlement amount, and the
expected  settlement date.  Within five days after request from Landlord, Tenant
will  provide  Landlord with copies of all correspondence to the insurer and any
other  information  reasonably  requested  by  Landlord.
9.2     Substantial  DestructionSubstantial  Destruction  .
        ------------------------
9.2.1     If  the  Facility Improvements are substantially destroyed at any time
other  than  during the final 18 months of the Initial Term or any Renewal Term,
Tenant  shall  promptly rebuild and restore such Improvements in accordance with
9.4  and Landlord shall make the insurance proceeds available to Tenant for such
restoration.  The term "substantially destroyed" means any casualty resulting in
     the  loss  of  use of 50% or more of the licensed beds at any one Facility.
9.2.2     If  the  Facility  Improvements are substantially destroyed during the
final  18  months of the Initial Term or any Renewal Term, Landlord may elect to
terminate  this  Lease and retain the insurance proceeds unless Tenant exercises
its  option  to  renew as set forth in  9.2.3.  If Landlord elects to terminate,
Landlord  shall  give notice ("Termination Notice") of its election to terminate
this  Lease  within  30 days after receipt of Tenant's notice of the damage.  If
Tenant  does  not exercise its option to renew under  9.2.3 within 15 days after
delivery  of  the Termination Notice, this Lease shall terminate on the 15th day
after  delivery  of  the  Termination  Notice.  If  this Lease is so terminated,
Tenant  shall  be  liable  to  Landlord  for  all Rent and all other obligations
accrued  under  this  Lease  through  the  effective  date  of  termination.
9.2.2.1     If  the Facility Improvements are substantially destroyed during the
final  18  months of the Initial Term or the Renewal Term and Landlord gives the
Termination  Notice,  Tenant  shall have the option to renew this Lease.  Tenant
shall  give  Landlord irrevocable notice of Tenant's election to renew within 15
days  after  delivery of the Termination Notice.  If Tenant elects to renew, the
Renewal  Term  will be in effect for the balance of the then current Term plus a
15-year  period.  The  Renewal  Term  will  commence  on the third day following
Landlord's receipt of Tenant's notice of renewal.  All other terms of this Lease
     for  the  Renewal  Term  shall  be  in  accordance  with  Article  12.  The
Improvements  will  be  restored  by Tenant in accordance with the provisions of
this  Article  9  regarding  partial  destruction.
9.3     Partial  DestructionPartial  Destruction .  If the Facility Improvements
        --------------------
are not substantially destroyed, then Tenant shall comply with the provisions of
     9.4  and Landlord shall make the insurance proceeds available to Tenant for
such  restoration.
9.4     RestorationRestoration .  Subject to any limitations imposed by law with
        -----------
     respect  to  the  rebuilding  of the Leased Premises, Tenant shall promptly
repair, rebuild, or restore the damaged Leased Property, at Tenant's expense, so
as  to  make  the Leased Property at least equal in value to the Leased Property
existing  immediately  prior  to  such occurrence and as nearly similar to it in
character  as  is  practicable and reasonable.  Before beginning such repairs or
rebuilding  with respect to any Casualty, or letting any contracts in connection
with  such  repairs  or  rebuilding, Tenant will submit for Landlord's approval,
which  approval  Landlord  will  not  unreasonably  withhold or delay, plans and
specifications meeting the requirements of  16.2 for such repairs or rebuilding.
Promptly  after  receiving  Landlord's approval of the plans and specifications,
Tenant  will begin such repairs or rebuilding and will prosecute the repairs and
rebuilding to completion with diligence, subject, however, to strikes, lockouts,
acts  of  God,  embargoes,  governmental  restrictions,  and other causes beyond
Tenant's  reasonable  control.  Landlord  will  make available to Tenant the net
proceeds  of  any  fire  or  other  casualty insurance paid to Landlord for such
repair  or  rebuilding  as  the same progresses, after deduction of any costs of
collection, including reasonable attorneys' fees.  Payments will be made against
properly  certified  vouchers of a competent architect in charge of the work and
approved  by Landlord.  Payments for deposits for the repairing or rebuilding or
delivery  of  materials  to the Facility will be made upon Landlord's receipt of
evidence  satisfactory  to  Landlord that such payments are required in advance.
With  respect  to any Casualty, prior to commencing the repairing or rebuilding,
Tenant  shall  deliver  to  Landlord  for Landlord's approval a schedule setting
forth  the  estimated  monthly draws for such work.  Landlord will contribute to
such  payments  out  of the insurance proceeds an amount equal to the proportion
that  the total net amount received by Landlord from insurers bears to the total
estimated  cost  of  the  rebuilding  or repairing, multiplied by the payment by
Tenant  on  account of such work.  Landlord may, however, withhold 10% from each
payment  until  the  work  is completed and proof has been furnished to Landlord
that  no lien or liability has attached or will attach to the Leased Property or
to  Landlord  in  connection  with  such  repairing  or  rebuilding.  Upon  the
completion  of  rebuilding  and the furnishing of such proof, the balance of the
net proceeds of such insurance payable to Tenant on account of such repairing or
rebuilding will be paid to Tenant.  If required by law as a result of the nature
or  extent of the damage, Tenant will obtain and deliver to Landlord a temporary
or  final  certificate  of  occupancy  before  the  damaged  Leased  Property is
reoccupied  for  any  purpose.  Tenant shall complete such repairs or rebuilding
free and clear of mechanic's or other liens, and in accordance with the building
codes  and all applicable laws, ordinances, regulations, or orders of any state,
municipal,  or  other  public authority affecting the repairs or rebuilding, and
also  in  accordance with all requirements of the insurance rating organization,
or  similar  body.  Any  remaining  proceeds of insurance after such restoration
will  be  Tenant's  property.
9.5     Insufficient  ProceedsInsufficient  Proceeds  .  If  the proceeds of any
        ----------------------
insurance  settlement  are  not  sufficient to pay the costs of Tenant's repair,
rebuilding or restoration under  9.4 in full, Tenant shall deposit with Landlord
     at  Landlord's  option, and within 10 days of Landlord's request, an amount
sufficient in Landlord's reasonable judgment to complete such repair, rebuilding
or  restoration  or shall provide Landlord with evidence reasonably satisfactory
to  Landlord that Tenant has available the funds needed to complete such repair,
rebuilding  or  restoration.  Tenant  shall  not,  by  reason  of the deposit or
payment,  be  entitled  to  any  reimbursement from Landlord or diminution in or
postponement  of  the  payment  of  the  Rent.
9.6     Not  Trust FundsNot Trust Funds .  Notwithstanding anything herein or at
        ----------------
law  or  equity to the contrary, none of the insurance proceeds paid to Landlord
as  herein  provided shall be deemed trust funds, and Landlord shall be entitled
to  dispose  of  such  proceeds as provided in this Article 9.  Tenant expressly
assumes  all  risk of loss, including a decrease in the use, enjoyment or value,
of the Leased Property from any casualty whatsoever, whether or not insurable or
     insured  against.
9.7     Landlord's  InspectionLandlord's  Inspection  .  During  the progress of
        ----------------------
such  repairs or rebuilding, Landlord and its architects and engineers may, from
time  to time, inspect the Leased Property and will be furnished, if required by
them,  with  copies  of all plans, shop drawings, and specifications relating to
such  repairs  or  rebuilding.  Tenant  will  keep all plans, shop drawings, and
specifications  at  the  building, and Landlord and its architects and engineers
may  examine  them at all reasonable times and on reasonable notice.  If, during
such  repairs or rebuilding, Landlord and its architects and engineers determine
that  the  repairs  or  rebuilding  are  not  being  done in accordance with the
approved  plans  and specifications, Landlord will give prompt notice in writing
to  Tenant,  specifying  in detail the particular deficiency, omission, or other
respect  in  which Landlord claims such repairs or rebuilding do not accord with
the  approved  plans  and  specifications.  Upon the receipt of any such notice,
Tenant will cause corrections to be made to any deficiencies, omissions, or such
     other  respect.  Tenant's  obligations  to  supply  insurance, according to
Article  4,  will be applicable to any repairs or rebuilding under this section.
9.8     Landlord's  CostsLandlord's  Costs .  Tenant shall, within 30 days after
        -----------------
receipt  of  an  invoice from Landlord, pay the costs, expenses, and fees of any
architect  or  engineer  employed  by  Landlord  to  review  any  plans  and
specifications  and  to  supervise  and  approve  any  construction,  or for any
services  rendered  by such architect or engineer to Landlord as contemplated by
any of the provisions of this Lease, or for any services performed by Landlord's
     attorneys  in  connection  therewith.
9.9     No  Rent  AbatementNo  Rent Abatement .  Rent will not abate pending the
        -------------------
repairs  or  rebuilding  of  the  Leased  Property.
                    ARTICLE 10:     CONDEMNATIONCONDEMNATION
10.1.1     Total  TakingTotal  Taking .  If, by exercise of the right of eminent
           -------------
domain  or  by conveyance made in response to the threat of the exercise of such
right  ("Taking"),  the  entire  Facility  Property  is taken, or so much of the
Facility  Property  is  taken  that  the  number  of  licensed beds/units at the
Facility  Property  is reduced by more than 25% as a result of such Taking, then
this Lease will end with respect to the Facility Property only on the earlier of
     the  vesting  of title to the Facility Property in the condemning authority
or  the  taking  of  possession  of  the  Facility  Property  by  the condemning
authority.  All  damages  awarded  for  such  Taking  under the power of eminent
domain  shall be the property of Landlord, whether such damages shall be awarded
as  compensation  for  diminution  in  value  of the leasehold or the fee of the
Facility  Property, provided, however, nothing herein shall preclude Tenant from
pursuing  a  separate  award for the Taking of its Tenant's Property (as defined
below)  or  for  relocation  costs  or  expenses.
10.2     Partial  TakingPartial  Taking  .  If,  after  a Taking, so much of the
         ---------------
Facility  Property  remains  that  the  Facility  Property  can  be  used  for
substantially  the  same  purposes  for which it was used immediately before the
Taking,  then [i] this Lease will end as to the part taken on the earlier of the
vesting  of  title  to  such  Leased Property in the condemning authority or the
taking  of possession of the Leased Property by the condemning authority and the
Rent  will  be  adjusted  accordingly; [ii] at its cost, Tenant shall restore so
much  of  the  Facility  Property  as  remains  to  a  sound  architectural unit
substantially suitable for the purposes for which it was used immediately before
     the  Taking,  using  good workmanship and new, first-class materials; [iii]
upon  completion  of the restoration, Landlord will pay Tenant the lesser of the
net  award  made  to Landlord on the account of the Taking (after deducting from
the  total  award,  reasonable attorneys', appraisers', and other fees and costs
incurred  in  connection with the obtaining of the award and amounts paid to the
holders  of  mortgages  secured  by  the  Facility Property), or Tenant's actual
out-of-pocket  costs of restoring the Facility Property; and [iv] Landlord shall
be  entitled  to  the balance of the net award except to the extent specifically
allocated  to the value of Tenant's Property or any relocation costs or expenses
incurred by Tenant as a result of such partial Taking.  The restoration shall be
completed  in  accordance with   9.4, 9.5, 9.7, 9.8 and 9.9 with such provisions
deemed  to  apply  to  condemnation  instead  of  casualty.
10.3     Condemnation  Proceeds  Not  Trust FundsCondemnation Proceeds Not Trust
         ----------------------------------------
Funds  .  Notwithstanding  anything  in  this  Lease  or at law or equity to the
contrary,  none of the condemnation award paid to Landlord shall be deemed trust
funds, and Landlord shall be entitled to dispose of such proceeds as provided in
     this  Article  10.  Tenant  expressly assumes all risk of loss, including a
decrease  in  the  use,  enjoyment,  or  value,  of the Leased Property from any
Taking.
               ARTICLE 11:     TENANT'S PROPERTYTENANT'S PROPERTY
11.1     Tenant's  PropertyTenant's  Property  .  Tenant shall have the right to
         ------------------
install,  place,  and  use  on  the  Leased  Property  such fixtures, furniture,
equipment,  inventory  and  other  personal  property  in addition to Landlord's
Personal  Property  as may be required or as Tenant may, from time to time, deem
necessary  or  useful to operate the Leased Property for its permitted purposes.
All  fixtures,  furniture,  equipment,  inventory,  and  other personal property
installed,  placed,  or  used on the Leased Property which is owned by Tenant or
leased  by  Tenant  from  third  parties is hereinafter referred to as "Tenant's
Property".
11.2     Requirements  for Tenant's PropertyRequirements for Tenant's Property .
         -----------------------------------
     Tenant  shall  comply  with all of the following requirements in connection
with  Tenant's  Property:
(a)     Tenant  shall,  at Tenant's sole cost and expense, maintain, repair, and
replace  Tenant's  Property.
(b)     Tenant  shall, at Tenant's sole cost and expense, keep Tenant's Property
insured  against  loss  or  damage  by  fire,  vandalism and malicious mischief,
sprinkler  leakage,  earthquake, and other physical loss perils commonly covered
by  fire  and  extended  coverage,  boiler  and  machinery,  and  difference  in
conditions insurance in an amount not less than 90% of the then full replacement
cost thereof.  Tenant shall use the proceeds from any such policy for the repair
and replacement of Tenant's Property.  The insurance shall meet the requirements
of  4.3.
(c)     Tenant  shall  pay  all  taxes  applicable  to  Tenant's  Property.
(d)     If Tenant's Property is damaged or destroyed by fire or any other cause,
Tenant  shall  have  the  right,  but  not  the obligation, to repair or replace
Tenant's  Property  (unless the same is required for the operation of the Leased
Property  in compliance with applicable Legal Requirements, in which case Tenant
shall be required to promptly repair or replace the same) unless Landlord elects
to  terminate  this  Lease  pursuant  to  9.2.2.
(e)     Unless an Event of Default or any event which, with the giving of notice
or  lapse  of  time, or both, would constitute an Event of Default has occurred,
Tenant  may  remove Tenant's Property from the Leased Property from time to time
provided  that  [i]  the  items  removed  are not required to operate the Leased
Property for the Facility Uses (unless such items are being replaced by Tenant);
and  [ii]  Tenant  repairs  any damage to the Leased Property resulting from the
removal  of  Tenant's  Property.
(f)     Tenant  shall  not,  without the prior written consent of Landlord or as
otherwise  provided  in  this  Lease,  remove  any  Tenant's  Property or Leased
Property.  Tenant shall, at Landlord's option, remove Tenant's Property upon the
termination  or  expiration  of  this  Lease  and shall repair any damage to the
Leased  Property  resulting  from  the  removal of Tenant's Property.  If Tenant
fails to remove Tenant's Property within 30 days after request by Landlord, then
Tenant  shall  be  deemed to have abandoned Tenant's Property, Tenant's Property
shall  become  the  property  of  Landlord,  and  Landlord may remove, store and
dispose  of  Tenant's  Property.  In  such  event, Tenant shall have no claim or
right  against Landlord for such property or the value thereof regardless of the
disposition  thereof  by  Landlord.  Tenant shall pay Landlord, upon demand, all
expenses  incurred  by  Landlord in removing, storing, and disposing of Tenant's
Property  and repairing any damage caused by such removal.  Tenant's obligations
hereunder  shall  survive  the  termination  or  expiration  of  this  Lease.
(g)     Tenant  shall  perform  its  obligations  under  any  equipment lease or
security  agreement  for  Tenant's  Property.  For equipment loans or leases for
critical  care  equipment and for all other equipment having an original cost in
excess  of  $250,000.00,  Tenant  shall cause such equipment lessor or lender to
enter  into  a  nondisturbance agreement with Landlord upon terms and conditions
acceptable  to  Landlord,  including,  without  limitation,  the following:  [i]
Landlord  shall have the right (but not the obligation) to assume such equipment
lease or security agreement upon the occurrence of an Event of Default by Tenant
hereunder;  [ii]  such  equipment  lessor or lender shall notify Landlord of any
default  by  Tenant  under  the  equipment  lease or security agreement and give
Landlord a reasonable opportunity to cure such default; and [iii] Landlord shall
have  the  right  to  assign  its  interest  in  the equipment lease or security
agreement  and  nondisturbance  agreement.  Tenant  shall,  within 30 days after
receipt  of  an  invoice  from  Landlord,  reimburse  Landlord for all costs and
expenses  incurred  in  reviewing  and  approving  the equipment lease, security
agreement  and  nondisturbance  agreement,  including,  without  limitation,
reasonable  attorneys'  fees  and  costs.
                 ARTICLE 12:     RENEWAL OPTIONSRENEWAL OPTIONS
12.1     Renewal  OptionsRenewal  Options  .  Tenant  has  the  option  to renew
         ----------------
("Renewal  Option")  this  Lease  for one 15-year renewal term ("Renewal Term").
Tenant  can  exercise the Renewal Option only upon satisfaction of the following
conditions:
(a)     There  shall be no uncured Event of Default, or any event which with the
passage of time or giving of notice would constitute an Event of Default, at the
     time  Tenant  exercises its Renewal Option nor on the date the Renewal Term
is  to  commence.
(b)     Tenant  shall  give  Landlord  irrevocable  written notice of renewal no
later  than  the  date  which is [i] 90 days prior to the expiration date of the
Initial  Term;  or  [ii]  15  days  after Landlord's delivery of the Termination
Notice  as  set  forth  in  9.2.3.
12.2     Effect  of  RenewalEffect  of  Renewal  .  The  following  terms  and
         -------------------
conditions  will  be  applicable  if  Tenant  renews  the  Lease:
(a)     Effective  Date.  Except  as otherwise provided in  9.2.3, the effective
        ---------------
date  of any Renewal Term will be the first day after the expiration date of the
Term.  The  first  day  of  the  Renewal Term is also referred to as the Renewal
Date.
(b)     Investment  Amount.  Effective  as  of  the  Renewal  Date,  a  single
        ------------------
Investment  Amount  will  be  computed  by summing all Landlord Payments made to
        -
date.
(c)     Rent  Adjustment.  Effective  as  of  the  Renewal  Date, Landlord shall
        ----------------
calculate  Base  Rent  for the Renewal Term in accordance with  2.1(c)(2) of the
Commitment  and  shall  issue  a  new  Rent  Schedule  reflecting  the Base Rent
adjustment.  Until Tenant receives a revised Rent Schedule from Landlord, Tenant
shall for each month [i] continue to make installments of Base Rent according to
the  Rent Schedule in effect on the day before the Renewal Date; and [ii] within
10  days following Landlord's issuance of an invoice, pay the difference between
the installment of Base Rent paid to Landlord for such month and the installment
of  Base  Rent  actually  due  for  such month as a result of the renewal of the
Lease.
(d)     Other  Terms  and Conditions.  Except for the modifications set forth in
        ----------------------------
this  12.2, all other terms and conditions of the Lease will remain the same for
the  Renewal  Term.
      ARTICLE 13:     RIGHT OF FIRST OPPORTUNITYRIGHT OF FIRST OPPORTUNITY
13.1     Right of First OpportunityRight of First Opportunity .  In the event at
         --------------------------
     any  time during the Term either [i] Landlord elects to seek a purchaser of
the  Leased  Property  (the "Right of First Opportunity Event") or [ii] Landlord
receives  a  bona  fide offer from a third party (the "Offer") setting forth the
terms  and  conditions  upon  which  it proposes to purchase the Leased Property
which it is interested in accepting, but in no event shall Landlord be obligated
to  accept  (the "Right of First Refusal Event"), the following provisions shall
apply:
(a)     In  the event of the occurrence of the Right of First Opportunity Event,
Landlord  shall  provide  Tenant  with  written notice of its intent to sell the
Leased  Property  and  its proposed terms with respect thereto (the "Opportunity
Notice").  Landlord  and  Tenant  shall  have a period of 30 days after Tenant's
receipt  of the Opportunity Notice (the "Protected Period") to negotiate in good
faith  with  respect  to  the  terms and conditions under which such transaction
shall  occur provided that in no event shall the purchase price be less than the
Base  Price  and  shall  occur  on  the  terms  and  conditions set forth in the
Transaction  Documents  (as  defined below) (the "Opportunity Transaction").  In
the event Landlord and Tenant are unable to reach agreement within the Protected
     Period  with  respect  to  the  terms  of the Opportunity Transaction, then
Landlord  shall  be  free  to  enter  into  negotiations  with  respect  to  the
Opportunity Transaction with any other person or entity; provided, however, that
Landlord  shall  not  be  permitted  to  consummate a transaction with any other
person  or  entity  on  terms  which  are  less favorable to Landlord than those
offered  to Tenant during the Protected Period without first offering Tenant the
opportunity  on  written  notice  setting  forth  such  terms  to consummate the
Opportunity  Transaction on such alternative terms and conditions (the "Modified
Opportunity  Notice");  provided,  however,  that Tenant shall be deemed to have
waived  its  right  to  proceed with such revised Opportunity Transaction in the
event  it  does  not  advise  Landlord of its election to proceed within 10 days
after  its  receipt  of  the  Modified  Opportunity  Notice.
(b)     In  the  event  of  the  occurrence  of  a Right of First Refusal Event,
Landlord  shall  provide  Tenant  with a true and correct copy of the Offer (the
"Right of First Refusal Notice").  Tenant shall have 20 days from its receipt of
the  Right  of  First Refusal Notice to advise Landlord in writing whether it is
prepared to purchase the Leased Property on the same terms and conditions as set
forth  in  the Offer.  Tenant's failure to so advise Landlord within such 20 day
period shall be deemed to be a determination by Tenant not to exercise the right
of  first  refusal  provided for herein, at which time Landlord shall be free to
consummate  the  transaction  which  was  the  subject  of  the Offer; provided,
however,  that  Landlord shall not be permitted to modify the terms specified in
the Offer in an manner more favorable to the third party than those reflected in
the  original  Offer  (the "Modified Offer") without first again offering Tenant
the  opportunity  to  consummate  a  transaction  on  the terms set forth in the
Modified  Offer;  provided,  however, that Tenant shall be deemed to have waived
its  right  to  proceed  with such a transaction in the event it does not advise
Landlord  of  its  election  to  proceed within 10 days after its receipt of the
Modified  Offer.
(c)     In  the  event  Landlord  does not consummate a transaction on the terms
provided  for  in the Offer or the Modified Offer, as applicable, within 90 days
after  the  date  thereof,  Landlord  shall  not be permitted to sell the Leased
Property to the Offeror or to any other party, whether on the terms set forth in
the  Offer  or  the  Modified  Offer,  as applicable, or pursuant to a new Offer
without again first offering Tenant an option to consummate a transaction on the
terms  specified  in  the  Offer,  the  Modified  Offer  or  any  new  Offer, as
applicable;  provided,  however,  that Tenant shall be deemed to have waived its
rights  hereunder  in  the  event it does not advise Landlord of its election to
proceed  within 10 days after its receipt of another copy of the Offer or of the
Modified  Offer  or  the  new  Offer,  as  applicable.
(d)     In  the  event  Tenant  exercises its right of first refusal or right of
first  opportunity  provided for herein, Tenant and Landlord shall have a period
of  30  days in which to enter into one or more written agreements outlining the
terms  and  conditions,  in  addition  to  those  set  forth in the Offer or the
Modified  Offer,  if  applicable, on which the sale will occur (the "Transaction
Documents").  In  the  event Landlord and Tenant fail to execute the Transaction
Documents  within  said  30  day  period,  then  Tenant  shall be deemed to have
forfeited  its  rights  hereunder  with  respect  to such transaction; provided,
however, that Landlord shall not be permitted to sell the Leased Property to any
other  person or entity on terms which are less favorable to Landlord than those
offered to Tenant during the Protected Period or beyond the expiration of the 90
day period provided for in clause (c), without first complying with the terms of
this  13.1  unless  Landlord  and  Tenant  failed  to  execute  the  Transaction
Documents  as  a result of Tenant's bad faith in the negotiation of the terms of
such  Transaction  Documents,  in which case Landlord shall be permitted to sell
the  Leased  Property  to  any other person or entity regardless of the terms of
such  transaction.
(e)     Any  sale  of the Lease Property by Landlord pursuant to this  13, other
than  to  Tenant,  shall  be  subject  to the rights of Tenant under this Lease,
including,  but  not  limited  to,  its  rights  under  this  13.
(f)     At  the  time  of  the acquisition of the Leased Property by Tenant, the
then  outstanding  amount  of principal and accrued and unpaid interest, if any,
due  under  the  $4,400,000  Note  shall  be  due and payable in full or if said
$4,400,000  Note  is  consolidated, then the lesser of $4,400,000.00 or the then
outstanding principal and accrued and unpaid interest of said consolidated note.
13.2     ClosingClosing  .  Any  closing  pursuant  to,  and the consequences to
         -------
Tenant  of  failing to close after exercising its rights under  13.1 shall be in
accordance  with  the  terms set forth in the Offer or Modified Offer and in the
Transaction  Documents  executed  pursuant  to  the  terms  of  this Article 13.
              ARTICLE 14:     NEGATIVE COVENANTSNEGATIVE COVENANTS
     Until  the  Obligor  Group  Obligations  shall have been performed in full,
Tenant  and  Guarantor  covenant  and  agree  that  Tenant  (and Guarantor where
applicable)  shall not do any of the following without the prior written consent
of  Landlord:
14.1     No  DebtNo Debt .  Tenant shall not create, incur, assume, or permit to
         --------
exist  any indebtedness with respect to the Leased Property other than [i] trade
debt incurred in the ordinary course of business; [ii] indebtedness for Facility
     working  capital  purposes;  and  [iii] indebtedness that is secured by any
Permitted  Lien.
14.2     No  LiensNo Liens .  Tenant shall not create, incur, or permit to exist
         ---------
any  lien, charge, encumbrance, easement or restriction upon the Leased Property
or  any  lien  upon  or  pledge  of any interest in Tenant, except for Permitted
Liens.
14.3     No  GuarantiesNo  Guaranties .  Tenant shall not create, incur, assume,
         --------------
or  permit to exist any guarantee of any loan or other indebtedness with respect
to  the Leased Property except for the endorsement of negotiable instruments for
collection  in  the  ordinary  course  of  business.
14.4     No  TransferNo  Transfer  .  Tenant  shall  not  sell, lease, sublease,
         ------------
mortgage,  convey,  assign or otherwise transfer any legal or equitable interest
in  the  Leased  Property  or  any  part  thereof,  except for transfers made in
connection  with  any  Permitted  Lien  or leases to the residents of the Leased
Property  or  commercial leases with respect to a portion of the leased Property
comprising in the aggregate less than 2,500 square feet provided such commercial
     leases  shall  be  for  services that are an integral part of the Facility.
14.5     No  DissolutionNo  Dissolution .  Tenant shall not dissolve, liquidate,
         ---------------
merge,  consolidate  or  terminate  its  existence  or  sell,  other  than  in a
sale/leaseback  or  sale/manage  back  transaction,  assign, lease, or otherwise
transfer  (whether  in  one  transaction  or in a series of transactions) all or
substantially  all  of  its  assets  (whether  now  owned or hereafter acquired)
unless, in the case of a merger or consolidation by Tenant, the surviving entity
     in  such  merger  has  a  net  worth  immediately  after  the  merger  or
consolidation  at  least  equal to that of the Tenant immediately prior thereto.
Tenant  shall  maintain  its  organizational  structure  as  a  special purpose,
bankruptcy  remote  entity  as  required  under  the  Loan  Documents.
14.6     Subordination  of  Payments  to  AffiliatesSubordination of Payments to
         -------------------------------------------
Affiliates  .  After  the occurrence of an Event of Default and until such Event
of  Default is cured (or waived in writing), Tenant and Guarantor shall not make
any  payments  or distributions (including, without limitation, salary, bonuses,
fees,  principal,  interest,  dividends,  liquidating  distributions, management
fees,  cash  flow  distributions  or  lease  payments but specifically excluding
salary  paid to employees of the Facility or employees of Tenant or Guarantor in
the  ordinary  course  of  business)  to Guarantor or any shareholder, member or
partner  of  Tenant  or  Guarantor.
14.7     Change  of  Location  or NameChange of Location or Name .  Tenant shall
         -----------------------------
not, without providing Landlord with 30 days prior notice thereof, change any of
     the  following:  [i]  the  location  of  the principal place of business or
chief  executive office of Tenant, or any office where any of Tenant's books and
records  are  maintained;  [ii]  the name under which Tenant conducts any of its
business or operations; or [iii] reorganize or otherwise change its Organization
State.
           ARTICLE 15:     AFFIRMATIVE COVENANTSAFFIRMATIVE COVENANTS
15.1     Perform  ObligationsPerform  Obligations .  Tenant shall perform all of
         --------------------
its  obligations  under this Lease, the Government Authorizations, the Permitted
Exceptions,  and  all  Legal  Requirements.
15.2     Proceedings  to  Enjoin or Prevent ConstructionProceedings to Enjoin or
         -----------------------------------------------
Prevent  Construction  .  If  any  proceedings  are  filed  seeking to enjoin or
otherwise  prevent  or  declare  invalid  or  unlawful  Tenant's  construction,
occupancy,  maintenance,  or  operation  of the Facility or any portion thereof,
Tenant will cause such proceedings to be vigorously contested in good faith, and
     in  the  event  of  an  adverse ruling or decision, prosecute all allowable
appeals  therefrom,  and will, without limiting the generality of the foregoing,
resist  the entry or seek the stay of any temporary or permanent injunction that
may  be entered, and use its best commercially reasonable efforts to bring about
a  favorable  and  speedy  disposition  of  all  such  proceedings and any other
proceedings.
15.3     Documents  and  InformationDocuments  and  Information  .
         ---------------------------
15.3.1     Furnish  DocumentsFurnish  Documents  .  Tenant  shall  periodically
           ------------------
during  the  term  of  the  Lease  deliver  to  Landlord  the  Annual  Financial
Statements,  Periodic  Financial Statements, Annual Company Budget and all other
documents,  reports,  schedules  and  copies  described  on Exhibit E within the
specified  time  periods.  With each delivery of Annual Financial Statements and
Periodic  Financial  Statements  (other  than  the  monthly  Facility  Financial
Statement)  to  Landlord,  Tenant  shall  also deliver to Landlord a certificate
signed  by  the  Chief  Financial  Officer or managing member (as applicable) of
Tenant,  an  Annual  Facility  Financial  Report or Quarterly Facility Financial
Report, as applicable, and a Quarterly Facility Accounts Receivable Aging Report
     all  in  the  form  of  Exhibit  F.  In  addition,  Tenant shall deliver to
Landlord  the  applicable  Annual  Facility  Financial Report and the applicable
Quarterly  Facility  Accounts  Receivable  Aging  Report  (based  upon  internal
financial  statements)  within 60 days after the end of each fiscal year.  After
the occurrence of an Event of Default and receipt of Landlord's written request,
Tenant  shall  deliver  to Landlord an updated Annual Company Budget (based on a
12-month  rolling  forward  period)  within  10  Business  Days after receipt of
Landlord's  request.
15.3.2     Furnish  InformationFurnish Information .  Tenant and Guarantor shall
           --------------------
[i]  promptly  supply  Landlord  with  such information concerning its financial
condition, affairs and property, as Landlord may reasonably request from time to
     time  hereafter;  [ii] promptly notify Landlord in writing of any condition
or  event  that constitutes a breach or event of default of any term, condition,
warranty,  representation,  or  provisions of this Lease or any other agreement,
and  of any material adverse change in its financial condition; [iii] maintain a
standard  and  modern  system  of accounting; [iv] permit Landlord or any of its
agent  or  representatives to have access to and to examine all of its books and
records  regarding  the financial condition of the Facility at any time or times
hereafter during business hours and after reasonable oral or written notice; and
[v]  permit  Landlord  to copy and make abstracts from any and all of said books
and  records  subject  to  any  limitations imposed by State or federal law with
respect  to  the  confidentiality  of  patient  and  employee  records.
15.3.3     Further  Assurances and InformationFurther Assurances and Information
           -----------------------------------
..  Tenant shall, on request of Landlord from time to time, execute, deliver, and
     furnish  documents as may be necessary to fully consummate the transactions
contemplated  under  this  Lease.  Within 15 days after a request from Landlord,
Tenant  shall  provide to Landlord such additional information regarding Tenant,
Tenant's  financial  condition,  or the Facility as Landlord, or any existing or
proposed  creditor  of  Landlord, or any auditor or underwriter of Landlord, may
reasonably  require  from time to time, including, without limitation, a current
Tenant's  Certificate  and  Facility  Financial Report in the form of Exhibit F.
From and after and during the continuance of an Event of Default, Landlord shall
have the right to require Tenant to provide to Landlord, at Tenant's expense, an
appraisal  prepared  by  an  MAI appraiser setting forth the current fair market
value  of  the  Leased  Property.
15.3.4     Material  CommunicationsMaterial  Communications  .  Tenant  shall
           ------------------------
transmit  to  Landlord,  within  five  days  after receipt thereof, any material
communication  affecting  a  Facility, this Lease, the Legal Requirements or the
Government  Authorizations,  and  Tenant  will  promptly  respond  to Landlord's
inquiry  with  respect  to  such  information.  Tenant  shall notify Landlord in
writing within five days after Tenant has knowledge of any potential, threatened
     or  existing litigation or proceeding against, or investigation of, Tenant,
Guarantor  or the Facility that would reasonably be expected to adversely affect
the  right  to  operate  the  Facility  or  Landlord's  title to the Facility or
Tenant's  interest  therein.
15.3.5     Requirements  for  Financial  StatementsRequirements  for  Financial
           ----------------------------------------
Statements  .  Tenant  shall  meet the following requirements in connection with
the  preparation  of  the  financial  statements:  [i]  all  audited  financial
statements  shall  be  prepared  in  accordance with general accepted accounting
principles  consistently  applied; [ii] all unaudited financial statements shall
be  prepared  in  a  manner  substantially  consistent  with  prior  audited and
unaudited  financial  statements  submitted  to  Landlord;  [iii]  all financial
statements  shall fairly present the financial condition and performance for the
relevant  period in all material respects; [iv] the audited financial statements
shall  include  all notes to the financial statements and a complete schedule of
contingent  liabilities  and  transactions  with Affiliates; and [v] the audited
financial  statements  shall  contain  an  unqualified  opinion.
15.4     Compliance With LawsCompliance With Laws.  Tenant shall comply with all
         ----------------------------------------
     Legal Requirements and keep all Government Authorizations in full force and
effect.  Subject  to  Tenant's  right to contest the same in accordance with the
terms  of  this  Lease,  Tenant  shall  pay  when due all taxes and governmental
charges of every kind and nature that are assessed or imposed upon Tenant at any
time  during  the  term of the Lease, including, without limitation, all income,
franchise,  capital  stock,  property,  sales  and  use,  business,  intangible,
employee  withholding,  and  all taxes and charges relating to Tenant's business
and  operations  at the Leased Property.  Tenant shall be solely responsible for
compliance  with  all  Legal Requirements, including the ADA, and Landlord shall
have  no  responsibility  for  such  compliance.
15.5     Broker's  CommissionBroker's  Commission.  Tenant  shall  indemnify
         ----------------------------------------
Landlord  from  claims  of  brokers  arising  by  the  execution  hereof  or the
consummation  of the transactions contemplated hereby and from expenses incurred
by  Landlord in connection with any such claims (including reasonable attorneys'
fees).
15.6     Existence  and  Change  in  OwnershipExistence and Change in Ownership.
         ----------------------------------------------------------------------
Except  as  otherwise  specifically  provided herein, Tenant and Guarantor shall
maintain  its  existence throughout the term of this Lease and any change in the
ownership  of  Tenant,  directly  or  indirectly, shall require Landlord's prior
written  consent.
15.7     Financial CovenantsFinancial Covenants.  The defined terms used in this
         --------------------------------------
     section  are  defined  in  15.7.1.  The  method  of valuing assets shall be
consistent  with  the  Financial  Statements.  The following financial covenants
shall  be  met  throughout  the  term  of  this  Lease:
15.7.1     DefinitionsDefinitions  .
           -----------
(a)     "Facility  Cash  Flow"  means  the net income of Tenant arising from the
Facility as reflected on the Facility Financial Statement plus [i] the amount of
     the  provision  for  depreciation and amortization; plus [ii] the amount of
the  provision  for  management fees; plus [iii] the amount of the provision for
income  taxes;  plus [iv] the amount of the provision for Base Rent payments and
interest  and  equipment lease payments, if any; minus [v] an imputed management
fee  equal  to  5%  of gross revenues (net of contractual allowances); and minus
[vi]  an  imputed replacement reserve of $250 per licensed unit at the Facility,
per  year.
(b)     "Facility  Coverage  Ratio"  is  the ratio of [i] Facility Cash Flow for
each  applicable period; to [ii] the Base Rent payments and all debt service and
equipment  lease  payments  relating  for  the  applicable  period.
15.7.2     Coverage RatioCoverage Ratio .  Tenant shall maintain for each fiscal
           --------------
     quarter a Facility Coverage Ratio for the Facility of not less than 1.00 to
1.00  for the third and fourth quarter of 2003 and the first quarter of 2004 and
a  Facility  Coverage  Ratio  of  not  less  than  1.25 to 1.00 for each quarter
thereafter.
15.8     Facility  Licensure  and  CertificationFacility  Licensure  and
         ---------------------------------------
Certification  .  Tenant  shall  [i] give written notice to Landlord within five
         ---
days  after  an inspection of the Facility with respect to health care licensure
or  certification  has  occurred; and [ii] deliver to Landlord copies of each of
the  reports,  notices,  correspondence and all other items and documents listed
under  item  no. 18 of Exhibit E within five days after receipt thereof.  Tenant
acknowledges  that  it  has  reviewed  Exhibit  E  and  agrees  to the foregoing
obligation.  If  Tenant  receives  a  Facility  survey or inspection report with
material  deficiencies, notice of failure to comply with a plan of correction or
an HIPDB adverse action report, Tenant shall cure all deficiencies and implement
     all corrective actions by the date required by the regulatory authority and
shall  deliver  evidence  of  same  to  Landlord.
15.9     Transfer  of  License  and  Facility  OperationsTransfer of License and
         ------------------------------------------------
Facility  Operations  .  If  this  Lease  is terminated due to expiration of the
Term,  pursuant  to  an  Event  of Default or for any reason other than Tenant's
purchase  of  the  Leased Property, or if Tenant vacates the Leased Property (or
any  part  thereof) without termination of this Lease (other than during periods
of  repair  or  reconstruction  after  damage,  destruction  or  a  Taking), the
following  provisions  shall  be  immediately  effective:
15.9.1     LicensureLicensure  .  Tenant  shall  execute,  deliver  and file all
           ---------
documents  and  statements  requested  by Landlord to effect the transfer of the
Facility  license  and  Government  Authorizations  to  a  replacement  operator
designated  by  Landlord  ("Replacement  Operator"),  subject  to  any  required
approval  of  governmental  regulatory  authorities, and Tenant shall provide to
Landlord all information and records required by Landlord in connection with the
     transfer  of  the  license  and  Government  Authorizations.
15.9.2     Facility  OperationsFacility  Operations  .  In order to facilitate a
           --------------------
responsible  and  efficient  transfer  of the operations of the Facility, Tenant
shall,  if  and to the extent requested by Landlord, [i] deliver to Landlord the
most  recent updated reports, notices, schedules and documents listed under item
nos.  17,  18,  19, 20 and 21 of Exhibit E; [ii] assuming Tenant has not already
vacated the Leased Property, continue and maintain the operation of the Facility
     in  the  ordinary  course  of  business,  including  using its commercially
reasonable efforts to retain the residents at the Facility to the fullest extent
practicable  and consistent with applicable laws and regulations, until transfer
of the Facility operations to the Replacement Operator is completed; [iii] enter
into  such management agreements, operations transfer agreements and other types
of  agreements  that  may be reasonably requested by Landlord or the Replacement
Operator,  provided, however, in no event shall Tenant be required to permit the
Replacement  Operator to operate the Leased Property under their licenses unless
they  receive  confirmation  that  doing  so  will  not violate applicable Legal
Requirements  and they get appropriate indemnities from the Replacement Operator
in  form  and  substance  reasonably  acceptable  to  Tenant;  and  [iv] provide
reasonable  access during normal business hours and on reasonable advance notice
for  Landlord  and  its  agents  to  show  the Facility to potential replacement
operators.  Tenant  consents  to  the  distribution  by  Landlord  to  potential
replacement  operators  of  Facility  financial  statements,  licensure reports,
financial  and  property  due diligence materials and other documents, materials
and information relating to the Facility.  The provisions of this section do not
create  or  establish  any  rights  in  Tenant  or  any third party and Landlord
reserves  all  rights  and  remedies  relating  to  termination  of  this Lease.
15.10     Bed  Operating  RightsBed  Operating Rights .  Tenant acknowledges and
          ----------------------
agrees  that the rights to operate the beds located at the Facility as set forth
on Exhibit C under the law of the Facility State, to relocate such bed operating
     rights to another location or locations, and to transfer such bed operating
rights  to  third parties, are property of the Landlord and are an integral part
of  the real and personal property that constitutes the Leased Property.  Tenant
has  only  the  right  to  use  of such rights during the term of this Lease and
subject  to  its  terms  and  conditions.  Subject  to applicable law and to the
extent  permitted  by  law,  all  operating rights shall automatically revert to
Landlord or Landlord's designee upon the expiration or termination of this Lease
for  any reason whatsoever (other than Tenant's purchase of the Leased Property)
without  any  requirement  of  a  transfer  or  the  payment  of  additional
consideration.
15.11     Power  of  AttorneyPower  of  Attorney  .  Effective  upon  [i]  the
          -------------------
occurrence  and  during  the  continuance  of  an  Event  of  Default,  or  [ii]
termination  of  this  Lease  for any reason other than Tenant's purchase of the
Leased  Property,  Tenant  hereby  irrevocably  and  unconditionally  appoints
Landlord,  or  Landlord's  authorized  officer,  agent, employee or designee, as
Tenant's  true  and lawful attorney-in-fact, to act for Tenant in Tenant's name,
place,  and stead, to execute, deliver and file all applications and any and all
other  necessary  documents  and  statements  to  effect the issuance, transfer,
reinstatement,  renewal  and/or  extension  of  the  Facility  license  and  all
Governmental  Authorizations  issued  to  Tenant  or  applied  for  by Tenant in
connection  with  Tenant's  operation of the Facility, to permit any designee of
Landlord  or any other transferee to operate the Facility under the Governmental
Authorizations,  and  to  do  any  and  all  other acts incidental to any of the
foregoing,  but  only  in the event Tenant fails to take such actions or execute
such  documents  after  a  request  from  Landlord.  Tenant  irrevocably  and
unconditionally  grants  to  Landlord  as  its  attorney-in-fact  full power and
authority  to  do  and  perform every act necessary and proper to be done in the
exercise  of any of the foregoing powers as fully as Tenant might or could do if
personally  present or acting, with full power of substitution, hereby ratifying
and  confirming  all that said attorney shall lawfully do or cause to be done by
virtue  hereof.  This  power  of  attorney  is  coupled  with an interest and is
irrevocable  prior  to Tenant's purchase of the Leased Property.  Landlord shall
provide  Tenant  with copies of any documents filed and/or with a summary of any
action  taken  pursuant  to  this  power  of  attorney.
15.12     Compliance with Loan DocumentsCompliance with Loan Documents .  Tenant
          ------------------------------
     and  Guarantor  acknowledge  that  [i]  Landlord  is  acquiring  the Leased
Property  subject  to  the  Mortgage;  [ii]  Landlord  and  HCN  will assume the
obligations set forth in the Mortgage and Loan Documents; and [iii] Landlord and
HCN would not have assumed the obligations set forth in the Mortgage or the Loan
Documents  without Tenant and Guarantor's agreement to comply with the terms and
conditions set forth in the Loan Documents as hereinafter set forth.  Tenant and
Guarantor  have each reviewed the Loan Documents and are familiar with the terms
and conditions thereof.  Tenant and Guarantor agree to comply with the terms and
conditions  set  forth  in  the  Loan  Documents  to  the  extent such terms and
conditions  apply  to  Tenant  or  Guarantor,  or  the operation of the Facility
including,  but  not  limited  to,  satisfying  all  insurance  requirements,
maintaining  required  reserves  and  escrow  accounts,  making  payments  due
thereunder  other  than  regularly scheduled payments of principal and interest,
and  granting  access  to  the  Property to the Lenders as set forth in the Loan
Documents.  Neither  Tenant  nor  Guarantor  shall,  in  connection  with either
Tenant's  or  Guarantor's  compliance  with the terms and conditions of the Loan
Documents  and  the  operation of the Facility, create or permit any third party
(other  than  Landlord  for  which  neither  Tenant  nor  Guarantor  assumes any
responsibility  hereunder)  to create any condition that would cause an Event of
Default, as defined in any such Loan Documents.  Tenant's or Guarantor's failure
to  comply with the Loan Documents to the extent such terms and conditions apply
to Tenant or Guarantor, or the operation of the Facility and to cure same within
any  applicable cure period provided for in the Loan Documents shall be an Event
of  Default  under  this  Lease.
15.12.1       Tenant  acknowledges that under the terms of Landlord's assumption
of the Loan Documents, Lender has required the Letter of Credit.  Tenant agrees,
     at  Tenant's  sole  cost  and  expense,  to deliver the Letter of Credit to
Lender  and,  except  as  otherwise  provided  herein, to maintain the Letter of
Credit in effect for so long as required by Lender.  In the event of a draw upon
the  Letter  of  Credit  or  upon the expiration of the Letter of Credit, Tenant
shall  be  responsible,  at  Tenant's  sole  cost  and  expense,  to  provide  a
replacement  Letter  of  Credit  satisfactory  to  Lender unless the draw on the
Letter  of  Credit  is  caused  by  a  Landlord  Default as defined in  15.12.2.
15.12.2       In  the  event  of  a  Landlord  Default,  as hereinafter defined,
Landlord shall (i) upon demand by Tenant, reimburse Tenant for any amounts drawn
by  Lender  under  the  Letter  of  Credit  and for any other costs and expenses
incurred by Tenant as a result thereof, including but not limited to, reasonable
attorney  fees;  (ii)  thereafter  be  obligated,  at  Landlord's  sole cost and
expense,  to  provide  and  continuously maintain a replacement Letter of Credit
satisfactory to Lender unless a subsequent draw is caused by a Tenant Default as
defined  in  15.12.3,  in  which case  15.12.1 shall apply; and (iii) indemnify,
defend  and  hold  harmless  Tenant  and  Guarantor from and against any and all
demands,  claims,  causes  of  action,  fines,  penalties,  damages  (including
consequential  damages),  losses,  liabilities  (including  strict  liability),
judgments  and  expenses  (including,  without limitation, reasonable attorneys'
fees,  court  costs  and  the costs described in  8.7) to the extent incurred by
Tenant  as  a result of the Landlord Default including, but not limited to, as a
result  of  the  foreclosure  by  Lender  with  respect to any of the collateral
provided  by  Tenant  or Guarantor under the Loan Documents or the taking of any
other  action  by  the Lender against Tenant or Guarantor under the terms of the
Loan  Documents.  Landlord Default shall mean an Event of Default under the Loan
Document caused solely by the acts or omissions of Landlord or HCN and is not an
Event  of  Default  under a Loan Document arising due to Tenant's or Guarantor's
failure  to comply with the terms and conditions of a Loan Document as agreed to
by  Tenant  and  Guarantor  pursuant  to  15.12  ("Landlord  Defaults").
15.12.3       Upon  the  occurrence  of  an  Event  of  Default  under  the Loan
Documents  caused  by  Tenant  ("Tenant Default"), Tenant or Guarantor shall (i)
upon  demand by Landlord or HCN, reimburse Landlord or HCN for any amounts drawn
by  Lender  under  the  Letter  of  Credit  and for any other costs and expenses
incurred  by  Landlord or HCN as a result thereof, including but not limited to,
reasonable attorney fees; provided, however, this clause (i) shall only apply if
the  Tenant  Default  occurs after the occurrence of a Landlord Default and at a
time when the Letter of Credit has been posted by Landlord pursuant to  15.12.2;
(ii)  thereafter be obligated, at Tenant's sole cost and expense, to provide and
continuously  maintain  a  replacement  Letter  of Credit satisfactory to Lender
unless a subsequent draw is caused by a Landlord Default, in which case  15.12.2
shall apply; and (iii) indemnify, defend and hold harmless Landlord and HCN from
and  against  any  and  all demands, claims, causes of action, fines, penalties,
damages (including consequential damages), losses, liabilities (including strict
liability),  judgments  and  expenses (including, without limitation, reasonable
attorneys'  fees,  court  costs  and  the costs described in  8.7) to the extent
incurred by Landlord or HCN as a result of the Tenant Default including, but not
limited  to, as a result of the foreclosure by Lender with respect to any of the
collateral provided by Landlord or HCN under the Loan Documents or the taking of
any  other  action  by the Lender against Landlord or HCN under the terms of the
Loan  Documents.
15.12.4       Landlord  shall,  within  five Business Days after receipt thereof
from  Lender,  deliver  to  Tenant all notices received by Landlord from Lender.
Tenant  shall,  within  five  Business  Days  after receipt thereof from Lender,
deliver  to  Landlord  all  notices  received  by  Tenant from Lender.  Landlord
further  acknowledges  and  agrees  that  Tenant  shall not be in default of its
obligations  under  this  15.12  in  the  event  Tenant  fails  to  fulfill  the
obligations  imposed under a Loan Document as and when due solely as a result of
the  failure  of Landlord to remit any such Lender notice within the time period
specified  herein  and  that  in  the event of a draw by Lender on the Letter of
Credit  as  a result thereof, the same shall be deemed to be a Landlord Default.
ARTICLE 16:     ALTERATIONS, CAPITAL IMPROVEMENTS, AND SIGNSALTERATIONS, CAPITAL
                             IMPROVEMENTS, AND SIGNS
16.1     Prohibition  on  Alterations and ImprovementsProhibition on Alterations
         -----------------------------------------------------------------------
and  Improvements.  Except  for  Permitted Alterations (as hereinafter defined),
 ----------------
Tenant  shall  not  make  any  structural or nonstructural changes, alterations,
 -
additions  and/or  improvements  (hereinafter  collectively  referred  to  as
 -
"Alterations")  to  the  Leased  Property.
 -
16.2     Approval  of  AlterationsApproval of Alterations.  If Tenant desires to
         ------------------------------------------------
perform  any  Permitted  Alterations,  Tenant  shall  deliver to Landlord plans,
specifications,  drawings,  and  such  other  information  as  may be reasonably
requested  by  Landlord (collectively the "Plans and Specifications") showing in
reasonable detail the scope and nature of the Alterations that Tenant desires to
     perform.  It  is  the intent of the parties hereto that the level of detail
shall be comparable to that which is referred to in the architectural profession
as  "design  development  drawings"  as opposed to working or biddable drawings.
Landlord  agrees  not  to  unreasonably  delay  its  review  of  the  Plans  and
Specifications.  Within  30  days  after  receipt  of  an  invoice, Tenant shall
reimburse  Landlord for all costs and expenses incurred by Landlord in reviewing
and,  if  required,  approving  or  disapproving  the  Plans and Specifications,
inspecting  the  Leased  Property,  and otherwise monitoring compliance with the
terms of this Article 16.  Tenant shall comply with the requirements of  16.4 in
making  any  Permitted  Alterations.
16.3     Permitted  AlterationsPermitted  Alterations.  Permitted  Alterations
         --------------------------------------------
means  any  one  of  the  following:  [i] Alterations approved by Landlord; [ii]
Alterations  required  under  7.2;  [iii] Alterations affecting the structure of
the  Leased  Property  and  having  a  total  cost  of  less  than  $250,000.00
individually  or  in  the  aggregate;  [iv]  repairs, rebuilding and restoration
required  or  undertaken pursuant to  9.4 or [v] non-structural Alterations such
as  painting,  landscaping,  wallpapering,  installing new floor coverings, etc.
without  regard  to  the  cost  thereof.
16.4     Requirements  for  Permitted  AlterationsRequirements  for  Permitted
         ---------------------------------------------------------------------
Alterations.  Tenant  shall  comply  with  all  of the following requirements in
      -----
connection  with  any  Permitted  Alterations:
(a)     The  Permitted Alterations shall be made in accordance with the approved
Plans  and  Specifications.
(b)     The Permitted Alterations and the installation thereof shall comply with
all  applicable  legal  requirements  and  insurance  requirements.
(c)     The  Permitted  Alterations  shall  be  done  in  a good and workmanlike
manner,  shall  not  impair  the value or the structural integrity of the Leased
Property,  and  shall  be  free  and  clear  of  all  mechanic's  liens.
(d)     For  any  Permitted  Alterations  having  a total cost of $100,000.00 or
more,  Tenant  shall  deliver to Landlord a payment and performance bond, with a
surety  acceptable  to Landlord, in an amount equal to the estimated cost of the
Permitted Alterations, guaranteeing the completion of the work free and clear of
liens  and  in accordance with the approved Plans and Specifications, and naming
Landlord  and  any  mortgagee  of  Landlord  as  joint  obligees  on  such bond.
(e)     Tenant  shall,  at  Tenant's expense, obtain a builder's completed value
risk  policy of insurance insuring against all risks of physical loss, including
collapse  and transit coverage, in a nonreporting form, covering the total value
of  the  work  performed,  and  equipment, supplies, and materials, and insuring
initial  occupancy.  Landlord  and any mortgagee of Landlord shall be additional
insureds  of such policy.  Landlord shall have the right to approve the form and
substance  of  such  policy.
(f)     Tenant  shall  pay  the  premiums required to increase the amount of the
insurance  coverages required by Article 4 to reflect the increased value of the
Improvements resulting from installation of the Permitted Alterations, and shall
deliver  to  Landlord  a  certificate  evidencing  the  increase  in  coverage.
(g)     Tenant  shall,  not later than 60 days after completion of the Permitted
Alterations,  deliver to Landlord a revised "as-built" survey of the Facility if
the  Permitted  Alterations  altered the Land or "footprint" of the Improvements
and  an "as-built" set of Plans and Specifications for the Permitted Alterations
in  form  and  substance  satisfactory  to  Landlord.
(h)     Tenant  shall,  not  later than 30 days after Landlord sends an invoice,
reimburse  Landlord  for any reasonable costs and expenses, including attorneys'
fees  and architects' and engineers' fees, incurred in connection with reviewing
and  approving  the  Permitted Alterations and ensuring Tenant's compliance with
the  requirements  of  this  section.  The  daily  fee for Landlord's consulting
engineer  is  $750.00.
16.5     Ownership  and Removal of Permitted AlterationsOwnership and Removal of
         -----------------------------------------------
Permitted  Alterations  2.  The Permitted Alterations shall become a part of the
Leased  Property,  owned  by Landlord, and leased to Tenant subject to the terms
and  conditions  of  this  Lease.  Tenant  shall not be required or permitted to
remove  any  Permitted  Alterations.
16.6     Minimum  Qualified  Capital  ExpendituresMinimum  Qualified  Capital
         -----------------------------------------
Expenditures  .  During  each  calendar year of the Term, Tenant shall expend at
least  $300.00  per  unit  for  Qualified  Capital  Expenditures  to improve the
Facility.  Thereafter  throughout the Term, Tenant shall expend such amount each
calendar  year,  increased  annually  in proportion to increases in the CPI.  At
least  annually,  at  the  request of Landlord, Landlord and Tenant shall review
capital  expenditures  budgets  and  agree on modifications, if any, required by
changed  circumstances  and the changed conditions of the Leased Property.  Upon
request  from Tenant, Landlord shall cooperate with Tenant to secure the release
of  funds  held by Lender in the Lender Maintenance Reserve Escrow to the extent
such  funds  are  available  as  set  forth  in  the  Loan  Documents.  Tenant's
obligations set forth in this  16.6 shall not be conditioned upon the release of
     funds  by  Lender  from  the  Lender  Maintenance  Reserve  Fund.
16.7     SignsSigns.  Tenant  may,  at  its  own  expense,  erect  and  maintain
         ----------
identification signs at the Leased Property, provided such signs comply with all
     laws,  ordinances,  and regulations.  Upon the termination or expiration of
this  Lease  (other  than  as a result of the exercise by Tenant of its purchase
rights),  Tenant  shall,  within  30 days after notice from Landlord, remove the
signs  and  restore  the  Leased  Property  to  its  original  condition.
                        ARTICLE 17:     RESERVEDRESERVED
                                                --------
   ARTICLE 18:     ASSIGNMENT AND SALE OF LEASED PROPERTY ASSIGNMENT AND SALE OF
                                 LEASED PROPERTY
18.1     Prohibition  on  Assignment and SublettingProhibition on Assignment and
         -----------------------------------------------------------------------
Subletting.  Tenant  acknowledges  that  Landlord has entered into this Lease in
 ---------
reliance  on the personal services and business expertise of Tenant.  Tenant may
 -
not  assign,  sublet,  mortgage,  hypothecate,  pledge,  grant  a right of first
refusal  or  transfer  any interest in this Lease, or in the Leased Property, in
whole  or in part, without the prior written consent of Landlord, which Landlord
may  withhold  in  its sole and absolute discretion.  The following transactions
will  be  deemed  an  assignment  or sublease requiring Landlord's prior written
consent:  [i]  an assignment by operation of law; [ii] an imposition (whether or
not  consensual)  of  a lien, mortgage, or encumbrance upon Tenant's interest in
the  Lease;  [iii]  except  as  otherwise  permitted  by   14.4  and  18.3,  an
arrangement  (including, but not limited to, management agreements, concessions,
licenses, and easements) which allows the use or occupancy of all or part of the
     Leased  Property by anyone other than Tenant; and [iv] a material change of
ownership of Tenant other than changes resulting from the trading of Tenant's or
Guarantor's  stock  on  a  national  stock  exchange.  Landlord's consent to any
assignment,  right  of first refusal or sublease will not release Tenant (or any
guarantor)  from  its  payment and performance obligations under this Lease, but
rather Tenant, any guarantor, and Tenant's assignee or sublessee will be jointly
and  severally liable for such payment and performance.  An assignment, right of
first  refusal or sublease without the prior written consent of Landlord will be
void at Landlord's option.  Landlord's consent to one assignment, right of first
refusal  or  sublease  will  not  waive  the  requirement  of its consent to any
subsequent  assignment  or  sublease.  Notwithstanding the foregoing, Tenant may
enter  into  a  Management  Agreement  with  Guarantor.
18.2     Requests  for  Landlord's Consent to Assignment, Sublease or Management
         -----------------------------------------------------------------------
AgreementRequests  for  Landlord's Consent to Assignment, Sublease or Management
 -------------------------------------------------------------------------------
Agreement.  If  Tenant  is  required  to obtain Landlord's consent to a specific
 --------
assignment,  sublease,  or  management agreement, Tenant shall give Landlord [i]
 --
the name and address of the proposed assignee, subtenant or manager; [ii] a copy
 -
     of  the  proposed  assignment,  sublease  or  management  agreement;  [iii]
reasonably  satisfactory  information  about  the  nature, business and business
history  of the proposed assignee, subtenant, or manager and its proposed use of
the  Leased Property; and [iv] banking, financial, and other credit information,
and  references  about the proposed assignee, subtenant or manager sufficient to
enable  Landlord  to determine the financial responsibility and character of the
proposed assignee, subtenant or manager.  Any assignment, sublease or management
agreement  shall  contain  provisions  to  the  effect that [a] such assignment,
sublease  or management agreement is subject and subordinate to all of the terms
and  provisions  of  this  Lease  and  to  the  rights  of Landlord and that the
assignee,  subtenant  or  manager shall comply with all applicable provisions of
this  Lease;  [b]  such  assignment, sublease or management agreement may not be
modified  without  the  prior written consent of Landlord not to be unreasonably
withheld  or delayed; [c] if this Lease shall terminate before the expiration of
such  assignment,  sublease  or management agreement, the assignee, subtenant or
manager  thereunder  will, solely at Landlord's option and only upon the express
written  notice  of  attornment  from Landlord, attorn to Landlord and waive any
right  the  assignee, subtenant or manager may have to terminate the assignment,
sublease  or management agreement or surrender possession thereunder as a result
of  the termination of this Lease; and [d] if the assignee, subtenant or manager
receives  a written notice from Landlord stating that Tenant is in default under
this  Lease, the assignee, subtenant or manager shall thereafter pay all rentals
or  payments  under the assignment, sublease or management agreement directly to
Landlord  until  such  default  has  been  cured.  Any  attempt  or  offer by an
assignee,  subtenant  or  manager  to attorn to Landlord shall not be binding or
effective  without  the  express  written  consent  of  Landlord.  Tenant hereby
collaterally  assigns  to  Landlord,  as  security  for  the  performance of its
obligations  hereunder, all of Tenant's right, title, and interest in and to any
assignment,  sublease  or management agreement now or hereafter existing for all
or  part  of  the  Leased  Property.  Tenant  shall, at the request of Landlord,
execute  such other instruments or documents as Landlord may request to evidence
this  collateral  assignment.  If Landlord, in its sole and absolute discretion,
consents  to  such  assignment,  sublease, or management agreement, such consent
shall  not  be  effective  until  [i] a fully executed copy of the instrument of
assignment,  sublease  or  management  agreement has been delivered to Landlord;
[ii] in the case of an assignment, Landlord has received a written instrument in
which the assignee has assumed and agreed to perform all of Tenant's obligations
under the Lease; and [iii] Tenant has paid to Landlord a fee in the amount equal
to  the  lesser  of  Landlord's  actual  out-of-pocket  costs  and  expenses and
$2,500.00  (applies  only  to  consent  requests  after  the  Closing); and [iv]
Landlord  has  received  reimbursement  from  Tenant  or  the  assignee  for all
attorneys'  fees  and  expenses  and all other reasonable out-of-pocket expenses
incurred  in connection with determining whether to give its consent, giving its
consent  and  all  matters  relating  to the assignment (applies only to consent
requests  after  the  Closing).
18.3     Agreements  with  ResidentsAgreements  with Residents.  Notwithstanding
         -----------------------------------------------------
18.1,  Tenant may enter into an occupancy agreement with residents of the Leased
Property  without  the  prior  written consent of Landlord provided that [i] the
agreement  does  not  provide for lifecare services; [ii] the agreement does not
contain  any  type  of  rate  lock  provision or rate guaranty for more than one
calendar  year;  [iii]  the agreement does not provide for any rent reduction or
waiver  other  than  for  an  introductory period not to exceed six months; [iv]
Tenant  may  not collect rent for more than one month in advance, other than one
month  of  rent  collected  to  be  held  as security for the performance of the
resident's  obligation  to  Tenant; and [v] all residents of the Leased Property
are  accurately shown in accounting records for the Facility.  Without the prior
written  consent  of  Landlord  and Tenant shall not change the form of resident
occupancy  agreement that was submitted to Landlord prior to the Effective Date.
18.4     Sale  of  Leased  PropertySale  of Leased Property.  If Landlord or any
         --------------------------------------------------
subsequent owner of the Leased Property sells the Leased Property, its liability
     for the performance of its agreements in this Lease will end on the date of
the  sale  of  the Leased Property, and Tenant will look solely to the purchaser
for  the  performance  of  those  agreements.  For purposes of this section, any
holder  of a mortgage or security agreement which affects the Leased Property at
any time, and any landlord under any lease to which this Lease is subordinate at
any  time, will be a subsequent owner of the Leased Property when it succeeds to
the  interest  of  Landlord  or  any  subsequent  owner  of the Leased Property.
18.5     Assignment  by LandlordAssignment by Landlord .  Landlord may transfer,
         -----------------------
assign,  mortgage,  collaterally  assign,  or  otherwise  dispose  of Landlord's
interest  in  this  Lease  or  the  Leased  Property.
          ARTICLE 19:     HOLDOVER AND SURRENDERHOLDOVER AND SURRENDER
19.1     Holding  OverHolding  Over .  If Tenant, with or without the express or
         -------------
implied  consent  of  Landlord, continues to hold and occupy the Leased Property
(or any part thereof) after the expiration of the Term or earlier termination of
     this  Lease  (other  than  pursuant  to  Tenant's  purchase  of  the Leased
Property), such holding over beyond the Term and the acceptance or collection of
Rent in the amount specified below by Landlord shall operate and be construed as
creating  a  tenancy  from month to month and not for any other term whatsoever.
Said  month-to-month tenancy may be terminated by Landlord by giving Tenant five
days  written  notice, and at any time thereafter Landlord may re-enter and take
possession  of  the  Leased  Property.  If  without  Landlord's  consent  or  at
Landlord's request, Tenant continues after the expiration of the Term or earlier
termination  of  this  Lease to hold and occupy the Leased Property whether as a
month-to-month  tenant  or a tenant at sufferance or otherwise, Tenant shall pay
Rent  for  each month in an amount equal to the sum of [i] one and one-half (1 )
times  the  Base  Rent  payable  during  the  month  in which such expiration or
termination  occurs,  plus  [ii]  all Additional Rent accruing during the month,
plus  [iii]  any  and  all  other sums payable by Tenant pursuant to this Lease.
During  any  continued  tenancy  after  the  expiration  of  the Term or earlier
termination  of this Lease, Tenant shall be obligated to perform and observe all
of  the  terms, covenants and conditions of this Lease, but shall have no rights
hereunder  other  than  the  right,  to  the  extent given by applicable law, to
continue  its  occupancy  and  use  of  the Leased Property until the tenancy is
terminated.  Nothing  contained  herein shall constitute the consent, express or
implied,  of  Landlord  to  the  holding  over of Tenant after the expiration or
earlier  termination  of  this  Lease.
19.2     SurrenderSurrender.  Except  for [i] Permitted Alterations; [ii] normal
         ------------------
and  reasonable  wear  and tear (subject to the obligation of Tenant to maintain
the  Leased Property in good order and repair during the Term); and [iii] damage
and  destruction  not  required to be repaired by Tenant, Tenant shall surrender
and  deliver up the Leased Property at the expiration or termination of the Term
in  as  good order and condition as of the Commencement Date.  The provisions of
this  19.2  shall  not  apply in the event of the termination of this Lease upon
the  purchase  of  the  Leased  Property  by  Tenant.
19.3     IndemnityIndemnity  .  If  Tenant  fails to surrender the entire Leased
         ---------
Property or any part thereof upon the expiration or termination of this Lease in
     a  timely  manner  and  in accordance with the provisions of this Lease, in
addition  to  any other liabilities to Landlord accruing therefrom, Tenant shall
defend,  indemnify  and  hold  Landlord,  its  principals,  officers, directors,
agents,  and  employees  harmless  from  loss  or  liability resulting from such
failure,  including,  without  limiting the generality of the foregoing, loss of
rental  with  respect  to  any  new lease in which the rental payable thereunder
exceeds  the  Rent  collected by Landlord pursuant to this Lease during Tenant's
holdover  and  any claims by any proposed new tenant founded on Tenant's failure
to  surrender  the  Leased  Property.  The  provisions  of this Article 19 shall
survive  the  expiration  or  termination of this Lease.  The provisions of this
19.3  shall  not  apply  in  the event of the termination of this Lease upon the
purchase  of  the  Leased  Property  by  Tenant.
                       ARTICLE 20:     [RESERVED]RESERVED
      ARTICLE 21:     QUIET ENJOYMENT, SUBORDINATION, ATTORNMENT AND ESTOPPEL
CERTIFICATESQUIET ENJOYMENT, SUBORDINATION, ATTORNMENT AND ESTOPPEL CERTIFICATES
21.1     Quiet  EnjoymentQuiet Enjoyment.  So long as Tenant performs all of its
         -------------------------------
obligations  under  this  Lease, Tenant's possession of the Leased Property will
not  be  disturbed  by  Landlord  or  any  party  claiming  by, through or under
Landlord.
21.2     SubordinationSubordination.  Subject  to  the  terms  and conditions of
         --------------------------
this section, this Lease and Tenant's rights under this Lease are subordinate to
     any  ground lease or underlying lease, first mortgage, first deed of trust,
or  other  first  lien  against  the Leased Property, together with any renewal,
consolidation,  extension,  modification or replacement thereof, which now or at
any  subsequent  time affects the Leased Property or any interest of Landlord in
the  Leased  Property,  except  to the extent that any such instrument expressly
provides  that this Lease is superior.  The foregoing subordination provision is
expressly  conditioned upon any lessor or mortgagee being obligated and bound to
recognize  Tenant  as  the tenant under this Lease, and such lessor or mortgagee
shall  have  no  right  to disturb Tenant's possession, use and occupancy of the
Leased  Property or Tenant's enjoyment of its rights under this Lease unless and
until  an  Event  of  Default  occurs  hereunder.  Any  foreclosure  action  or
proceeding by any mortgagee with respect to the Leased Property shall not affect
Tenant's  rights  under this Lease and shall not terminate this Lease unless and
until  an  Event  of Default occurs hereunder.  The foregoing provisions will be
self-operative,  and  no  further instrument will be required in order to effect
them.  However,  Tenant  shall  execute, acknowledge and deliver to Landlord, at
any time and from time to time upon demand by Landlord, such documents as may be
requested  by  Landlord  or any mortgagee or any holder of any mortgage or other
instrument  described  in  this  section,  to  confirm  or  effect  any  such
subordination,  provided  that  any such document shall include a nondisturbance
provision as set forth in this section satisfactory to Tenant.  Any mortgagee of
the  Leased Property shall be deemed to be bound by the nondisturbance provision
set  forth in this section.  If Tenant fails or refuses to execute, acknowledge,
and  deliver any such document within 20 days after written demand, Landlord may
execute  acknowledge  and  deliver  any  such  document  on  behalf of Tenant as
Tenant's  attorney-in-fact.  Tenant  hereby constitutes and irrevocably appoints
Landlord,  its  successors and assigns, as Tenant's attorney-in-fact to execute,
acknowledge,  and  deliver  on  behalf of Tenant any documents described in this
section.  This power of attorney is coupled with an interest and is irrevocable.
21.3     AttornmentAttornment.  If  any  holder of any mortgage, indenture, deed
         --------------------
of  trust, or other similar instrument described in  21.2 succeeds to Landlord's
interest  in  the  Leased  Property,  Tenant  will  pay  to such holder all Rent
subsequently  payable  under  this  Lease.  Tenant shall, upon request of anyone
succeeding  to the interest of Landlord, automatically become the tenant of, and
attorn  to,  such  successor  in  interest  without  changing  this  Lease.  The
successor in interest will not be bound by [i] any payment of Rent for more than
     one  month  in  advance unless actually received by the successor; [ii] any
amendment  or  modification of this Lease thereafter made without its consent as
provided  in  this  Lease; [iii] any claim against Landlord arising prior to the
date  on which the successor succeeded to Landlord's interest; or [iv] any claim
or  offset of Rent against Landlord.  Upon request by Landlord or such successor
in  interest  and without cost to Landlord or such successor in interest, Tenant
will  execute,  acknowledge  and deliver an instrument or instruments confirming
the attornment.  If Tenant fails or refuses to execute, acknowledge, and deliver
any  such  instrument within 20 days after written demand, then Landlord or such
successor  in interest will be entitled to execute, acknowledge, and deliver any
document  on  behalf  of  Tenant  as  Tenant's  attorney-in-fact.  Tenant hereby
constitutes  and  irrevocably  appoints Landlord, its successors and assigns, as
Tenant's  attorney-in-fact  to  execute,  acknowledge,  and deliver on behalf of
Tenant  any  such  document.  This power of attorney is coupled with an interest
and  is  irrevocable.
21.4     Estoppel CertificatesEstoppel Certificates.  At the request of Landlord
         ------------------------------------------
     or any mortgagee or purchaser of the Leased Property, Tenant shall execute,
acknowledge,  and  deliver an estoppel certificate, in recordable form, in favor
of  Landlord or any mortgagee or purchaser of the Leased Property certifying the
following:  [i] that the Lease is unmodified and in full force and effect, or if
there  have  been  modifications  that  the  same is in full force and effect as
modified  and  stating  the modifications; [ii] the date to which Rent and other
charges  have  been  paid;  [iii]  whether  Tenant  or Landlord is in default or
whether  there  is any fact or condition known to Landlord or Tenant which, with
notice or lapse of time, or both, would constitute a default, and specifying any
existing  default, if any; [iv] that Tenant has accepted and occupies the Leased
Property;  [v]  that  Tenant  has  no defenses, setoffs, deductions, credits, or
counterclaims  against  Landlord,  if  that be the case, or specifying such that
exist;  and  [vi]  such  other  information  as  may  reasonably be requested by
Landlord  or any mortgagee or purchaser.  Any purchaser or mortgagee may rely on
this estoppel certificate.  If Tenant fails to deliver the estoppel certificates
to  Landlord  within 10 days after the request of Landlord, then Tenant shall be
deemed  to have certified that [a] the Lease is in full force and effect and has
not  been  modified,  or  that  the  Lease has been modified as set forth in the
certificate  delivered  to  Tenant; [b] Tenant has not prepaid any Rent or other
charges  except  for the current month; [c] Tenant has accepted and occupies the
Leased  Property; [d] neither Tenant nor Landlord is in default nor is there any
fact or condition which, with notice or lapse of time, or both, would constitute
a  default;  and  [e]  Tenant  has no defenses, setoffs, deductions, credits, or
counterclaims  against Landlord.  Tenant hereby irrevocably appoints Landlord as
Tenant's  attorney-in-fact  to  execute,  acknowledge,  and  deliver on Tenant's
behalf  any  estoppel certificate to which Tenant does not object within 10 days
after  Landlord  sends  the  certificate  to  Tenant.  This power of attorney is
coupled  with  an  interest  and  is  irrevocable.
  ARTICLE 22:     REPRESENTATIONS AND WARRANTIESREPRESENTATIONS AND WARRANTIES
     Tenant hereby makes the following representations and warranties, as of the
Effective  Date, to Landlord and acknowledge that Landlord is granting the Lease
in  reliance upon such representations and warranties.  Tenant's representations
and  warranties shall survive the Closing and, except to the extent made as of a
specific  date,  shall continue in full force and effect until the Obligor Group
Obligations  have  been  performed  in  full.
22.1     Organization  and  Good StandingOrganization and Good Standing.  Tenant
         --------------------------------------------------------------
is  a  limited  liability  company, duly organized, validly existing and in good
standing  under  the  laws of its Organization State.  Tenant is qualified to do
business  in  and  is  in  good  standing  under the laws of the Facility State.
22.2     Power  and  AuthorityPower  and  Authority.  Tenant  has  the power and
         ------------------------------------------
authority  to  execute,  deliver  and  perform this Lease.  Tenant has taken all
requisite  action necessary to authorize the execution, delivery and performance
of  its  obligations  under  this  Lease.
22.3     EnforceabilityEnforceability.  This  Lease  constitutes a legal, valid,
         ----------------------------
and  binding  obligation  of  Tenant,  enforceable in accordance with its terms,
except  as  such  enforceability  may  be  limited  by creditors rights laws and
general  principles  of  equity.
22.4     Government AuthorizationsGovernment Authorizations.  The Facility is in
         --------------------------------------------------
     compliance  with all Legal Requirements.  All Government Authorizations are
in  full force and effect.  Except as otherwise noted in Exhibit G, Tenant holds
all  Government  Authorizations  necessary  for the operation of the Facility in
accordance  with  the  Facility  Uses.  No  prior notice to or approval from any
licensure  authority is required in connection with the Lease or the transfer of
the  fee  interest  in  the Leased Property to Landlord other than those notices
which  have  been  given  or  approval  which  have  been  obtained prior to the
Commencement  Date.
22.5     Financial  StatementsFinancial  Statements.  Tenant  has  furnished
         ------------------------------------------
Landlord  with  true,  correct  and  complete copies of the Financial Statements
described  on  Exhibit C.  The Financial Statements fairly present the financial
position  of  Tenant,  Guarantor  and  the  Facility,  as  applicable, as of the
respective  dates  and  the  results of operations for the periods then ended in
conformance  with  generally  accepted  accounting principles applied on a basis
consistent  with  prior periods.  The Financial Statements and other information
furnished  to  Landlord  are true, complete and correct and, as of the Effective
Date,  no  material  adverse  change  has  occurred since the furnishing of such
statements  and information.  As of the Effective Date, the Financial Statements
and  other  information  do  not  contain  any untrue statement or omission of a
material  fact  and  are  not  misleading  in  any material respect.  Tenant and
Guarantor  are  solvent, and no bankruptcy, insolvency, or similar proceeding is
pending  or  contemplated  by  or, to the knowledge of Tenant, against Tenant or
Guarantor.
22.6     Condition  of  FacilityCondition  of Facility.  To the best of Tenant's
         ---------------------------------------------
knowledge  and  except  as  otherwise disclosed in writing by Tenant to Landlord
prior  to  the  Effective  Date,  all  of the mechanical and electrical systems,
heating and air-conditioning systems, plumbing, water and sewer systems, and all
     other  items  of  mechanical  equipment  or  appliances are in good working
order,  condition and repair, are of sufficient size and capacity to service the
Facility  for  the  Facility Uses and conform with all applicable ordinances and
regulations,  and with all building, zoning, fire, safety, and other codes, laws
and  orders.  The  Improvements,  including  the  roof  and  foundation,  are
structurally  sound  and  free  from  leaks  and  other  defects.
22.7     Compliance  with  LawsCompliance  with  Laws.  To  the best of Tenant's
         --------------------------------------------
knowledge,  there  is  no  violation  of,  or  noncompliance with, [i] any laws,
orders,  rules  or  regulations,  ordinances  or  codes  of  any  kind or nature
whatsoever  relating  to  the  Facility  or  the  ownership or operation thereof
(including,  without limitation, building, fire, health, occupational safety and
health,  zoning and land use, planning and environmental laws, orders, rules and
regulations);  [ii]  any  covenants,  conditions,  restrictions  or  agreements
affecting  or  relating  to  the ownership, use or occupancy of the Facility; or
[iii]  any  order, writ, regulation or decree relating to any matter referred to
in  [i]  or  [ii]  above.
22.8     No  LitigationNo  Litigation.  As  of  the Effective Date and except as
         ----------------------------
disclosed on Exhibit H, [i] there are no actions or suits, or any proceedings or
     investigations  by  any  governmental  agency  or  regulatory  body pending
against  Tenant  with  respect  to  its operation at the Facility or against the
Facility;  [ii]  no  HIPDB  adverse  action  reports have been issued to Tenant,
Guarantor  or  the  Facility;  [iii]  Tenant  has  not  received  notice  of any
threatened  actions, suits, proceedings or investigations against Tenant or with
respect  to  its  operation at the Facility or against the Facility at law or in
equity,  or  before  any  governmental  board,  agency  or  authority  which, if
determined  adversely  to  Tenant  or  Guarantor, would materially and adversely
affect the Facility or title to the Facility (or any part thereof), the right to
operate the Facility as presently operated, or the financial condition of Tenant
or  Guarantor;  [iv]  there  are no unsatisfied or outstanding judgments against
Tenant  with  respect to its operations at the Facility or against the Facility;
[v]  there  is no labor dispute materially and adversely affecting the operation
or  business  conducted by Tenant at the Facility; and [vi] Tenant does not have
knowledge  of  any  facts or circumstances which might reasonably form the basis
for  any  such  action,  suit,  or  proceeding.
22.9     ConsentsConsents.  The  execution,  delivery  and  performance  of this
         ----------------
Lease  will  not  require  any  consent,  approval,  authorization,  order,  or
declaration  of,  or  any  filing  or registration with, any court, any federal,
state,  or  local  governmental  or regulatory authority, or any other person or
entity,  the  absence  of which would materially impair the ability of Tenant to
operate  the  Facility  for  the  Facility  Uses except for the post-acquisition
filing  for  licensure  of  the  Facility.
22.10     No  ViolationNo Violation.  The execution, delivery and performance of
          -------------------------
this Lease [i] do not and will not conflict with, and do not and will not result
     in  a breach of Tenant's Organizational Documents; [ii] do not and will not
conflict  with,  and  do  not and will not result in a breach of, and do not and
will  not  constitute a default under (or an event which, with or without notice
or  lapse of time, or both, would constitute a default under), any of the terms,
conditions  or  provisions of any agreement or other instrument or obligation to
which  Tenant  is a party or by which its assets are bound; and [iii] do not and
will  not  violate  any  order,  writ,  injunction,  decree,  statute,  rule  or
regulation  applicable  to  Tenant  or  the  Facility.
22.11     Reports  and  StatementsReports  and  Statements.  All  reports,
          ------------------------------------------------
statements,  certificates  and other data furnished by or on behalf of Tenant or
Guarantor to Landlord in connection with this Lease, and all representations and
     warranties  made herein or in any certificate or other instrument delivered
in  connection  herewith  and  therewith,  are  true and correct in all material
respects and do not omit to state any material fact or circumstance necessary to
make  the  statements contained herein or therein, in light of the circumstances
under  which  they  are  made,  not  misleading  as  of the date of such report,
statement,  certificate  or  other  data.  The  copies  of  all  agreements  and
instruments submitted to Landlord, including, without limitation, all agreements
relating  to  management  of the Facility and Tenant's working capital are true,
correct  and  complete  copies in all material respects and include all material
amendments  and  modifications  of  such  agreements.
22.12     ERISAERISA.  All  plans  (as  defined  in  4021(a)  of  the  Employee
          ----------
Retirement  Income Security Act of 1974, as amended or supplemented from time to
time  ("ERISA"))  for  which Tenant is an "employer" or a "substantial employer"
(as  defined  in   3(5) and 4001(a)(2) of ERISA, respectively) are in compliance
with ERISA and the regulations and published interpretations thereunder.  To the
     extent  Tenant  maintains  a  qualified  defined benefit pension plan:  [i]
there  exists no accumulated funding deficiency; [ii] no reportable event and no
prohibited  transaction has occurred; [iii] no lien has been filed or threatened
to  be filed by the Pension Benefit Guaranty Corporation established pursuant to
Subtitle  A  of  Title  IV of ERISA; and [iv] Tenant has not been deemed to be a
substantial  employer.
22.13     Chief  Executive  OfficeChief  Executive Office.  Tenant maintains its
          -----------------------------------------------
chief  executive  office and its books and records at Tenant's address set forth
in  the  introductory  paragraph  of  this  Lease.  Tenant  does not conduct any
business  or operations other than at Tenant's chief executive office and at the
Facility.
22.14     Other  Name  or  EntitiesOther  Name or Entities.  Except as disclosed
          ------------------------------------------------
herein,  none  of  Tenant's  business  is  conducted  through  any  subsidiary,
unincorporated  association  or  other entity and Tenant has not, within the six
years  preceding the date of this Lease [i] changed its name, [ii] used any name
other  than  the  name stated at the beginning of this Lease, or [iii] merged or
consolidated  with,  or  acquired any of the assets of, any corporation or other
business.
22.15     Parties  in  PossessionParties  in Possession.  Except as disclosed on
          ---------------------------------------------
Exhibit  B,  there  are  no  parties in possession of any Leased Property or any
portion  thereof  as  managers,  lessees, tenants at sufferance, or trespassers.
22.16     AccessAccess.  Except  as  otherwise disclosed in writing by Tenant to
          ------------
Landlord  prior  to  the  Effective  Date, access to the Land is directly from a
dedicated public right-of-way without any easement.  To the knowledge of Tenant,
     there  is  no  fact  or  condition which would result in the termination or
reduction  of  the  current  access  to  and from the Land to such right-of-way.
22.17     UtilitiesUtilities.  There  are  available  at the Land gas, municipal
          ------------------
water, and sanitary sewer lines, storm sewers, electrical and telephone services
     in operating condition which are adequate for the operation of the Facility
at  a  reasonable  cost.  Except  as otherwise disclosed in writing by Tenant to
Landlord  prior  to  the  Effective  Date, the Land has direct access to utility
lines  located  in  a dedicated public right-of-way without any easement.  As of
the  Effective  Date,  there  is  no  pending  or,  to  the knowledge of Tenant,
threatened  governmental  or third party proceeding which would impair or result
in  the  termination  of  such  utility  availability.
22.18     Condemnation  and  AssessmentsCondemnation and Assessments.  As of the
          ----------------------------------------------------------
Effective  Date, Tenant has not received notice of, and there are no pending or,
to  the best of Tenant's knowledge, threatened, condemnation, assessment (except
as  otherwise  disclosed in writing by Tenant to Landlord prior to the Effective
Date),  or  similar  proceedings  affecting  or relating to the Facility, or any
portion thereof, or any utilities, sewers, roadways or other public improvements
     serving  the  Facility.
22.19     ZoningZoning.  As  of the Effective Date, [i] the use and operation of
          ------------
the  Facility  for  the  Facility  Uses  is a permitted use under the applicable
zoning  code;  [ii]  except  as  disclosed  on  Exhibit G hereto, no special use
permits,  conditional use permits, variances, or exceptions have been granted or
are  needed  for  such use of the Facility; [iii] the Land is not located in any
special  districts  such  as historical districts or overlay districts; and [iv]
the  Facility  has  been  constructed  in  accordance with and complies with all
zoning  laws  in  effect  at  the  time  of its construction, including, but not
limited to, dimensional, parking, setback, screening, landscaping, sign and curb
     cut  requirements  or  the  Facility obtained required waivers or variances
from  such  requirements.
22.20     Pro  Forma  StatementPro  Forma  Statement.  Tenant  has  delivered to
          ------------------------------------------
Landlord  a true, correct and complete copy of the Pro Forma Statement.  The Pro
Forma  Statement  shows  Tenant's  reasonable expectation based on the facts and
circumstances known to Tenant, of the most likely results of Facility operations
     for  the  next  five-year period.  By its execution of this Lease, Landlord
acknowledges  and  agrees  that  the  Pro  Forma  Statement has been reviewed by
Landlord  and  that Tenant shall not be in default of its obligations under this
Lease  in  the  event  the  actual  results  of Facility operations for the next
five-year  period  differ  from  those  set  forth  in  the Pro Forma Statement.
22.21     Environmental  MattersEnvironmental  Matters.  During  the  period  of
          --------------------------------------------
Tenant's  ownership  or  possession  of  the Leased Property and, to the best of
Tenant's  knowledge  after  diligent  inquiry,  for the period prior to Tenant's
ownership  or  possession  of the Leased Property, [i] the Leased Property is in
compliance  with  all  Environmental  Laws;  [ii]  there  were  no  releases  or
threatened  releases  of  Hazardous  Materials  on,  from,  or  under the Leased
Property,  except  in compliance with all Environmental Laws; [iii] no Hazardous
Materials  have  been, are or will be used, generated, stored, or disposed of at
the  Leased  Property,  except  in  compliance with all Environmental Laws; [iv]
asbestos  has  not  been  and  will  not  be  used  in  the  construction of any
Improvements;  [v]  no  permit  is  or  has been required from the Environmental
Protection  Agency  or  any  similar  agency or department of any state or local
government  for  the  use  or  maintenance of any Improvements; [vi] underground
storage  tanks  on  or under the Land, if any, have been and currently are being
operated  in  compliance  with  all  applicable  Environmental  Laws;  [vii] any
closure,  abandonment  in  place or removal of an underground storage tank on or
from the Land was performed in compliance with applicable Environmental Laws and
     any such tank had no release contaminating the Leased Property or, if there
had  been  a  release,  the release was remediated in compliance with applicable
Environmental  Laws  to  the  satisfaction  of regulatory authorities; [viii] no
summons,  citation or inquiry has been made by any such environmental unit, body
or  agency  or  a  third  party  demanding  any right of recovery for payment or
reimbursement  for  costs  incurred under CERCLA or any other Environmental Laws
and the Land is not subject to the lien of any such agency; and [ix] to the best
of  Tenant's  knowledge,  the  environmental assessment of the Facility (and all
follow-up reports, supplements and amendments) that was delivered to Landlord by
Tenant  in  connection  with  the  closing  of  this Lease is true, complete and
accurate.  "Disposal" and "release" shall have the meanings set forth in CERCLA.
22.22     Leases  and  ContractsLeases  and Contracts.  As of the Effective Date
          -------------------------------------------
and  except  as  disclosed  on  Exhibit  I,  there  are  no  leases or contracts
(including,  but  not  limited  to,  insurance contracts, maintenance contracts,
construction  contracts, employee benefit plans, employment contracts, equipment
leases,  security agreements, architect agreements, and management contracts) to
which  Tenant  or  Guarantor  is  a party relating to any part of the ownership,
operation, possession, construction, management or administration of the Land or
     the  Facility.
22.23     No  DefaultNo  Default.  As  of  the  Effective  Date, [i] there is no
          ----------------------
existing  Event  of  Default  under  this  Lease; and [ii] no event has occurred
which,  with  the  giving  of  notice  or  the  passage  of time, or both, would
constitute  or  result  in  such  an  Event  of  Default.
22.24     Tax StatusTax Status.  If Tenant is a limited liability company, it is
          --------------------
     taxable as a partnership under the Internal Revenue Code and all applicable
facility  state  tax  laws.
                       ARTICLE 23:     [RESERVED] RESERVED
               ARTICLE 24:     SECURITY INTERESTSECURITY INTEREST
24.1     CollateralCollateral.  Tenant  hereby  grants  to  Landlord  and  HCN
         --------------------
(individually  and  collectively  called "Secured Party") a security interest in
the  following  described  property,  whether now owned or hereafter acquired by
Tenant  (the "Collateral"), to secure the payment and performance of the Obligor
Group  Obligations:
(a)     All  machinery,  furniture,  equipment,  trade  fixtures,  appliances,
inventory  and  all  other  goods  (as  "equipment", "inventory" and "goods" are
defined  for  purposes of Article 9 ("Article 9") of the Uniform Commercial Code
as  adopted  in  Mississippi) and any leasehold interest of Tenant in any of the
foregoing,  including,  without  limitation,  those  items  which  are to become
fixtures  or  which  are building supplies and materials to be incorporated into
any  improvement  or  fixture.
(b)     All  accounts,  contract  rights,  general  intangibles,  instruments,
documents,  and  chattel  paper  [as  "accounts",  "contract  rights",  "general
intangibles",  "instruments",  "documents"  and  "chattel paper" are defined for
purposes  of  Article  9]  now  or  hereafter  arising.
(c)     All  franchises,  permits,  licenses,  operating rights, certifications,
approvals,  consents,  authorizations  and other general intangibles, including,
without  limitation,  certificates of need, state health care facility licenses,
and  Medicare  and Medicaid provider agreements, to the extent permitted by law.
(d)     Unless  expressly  prohibited  by  the  terms  thereof,  all  contracts,
agreements,  contract rights and materials relating to the design, construction,
operation  or  management  of  any  improvements, including, but not limited to,
plans,  specifications,  drawings,  blueprints,  models,  mock-ups,  brochures,
flyers,  advertising  and  promotional  materials  and  mailing  lists.
(e)     All  subleases,  occupancy agreements, license agreements and concession
agreements,  written or unwritten, of any nature, now or hereafter entered into,
and  all  right, title and interest of Tenant thereunder, and including, without
limitation,  Tenant's  right, if any, to cash or securities deposited thereunder
whether  or  not the same was deposited to secure performance by the subtenants,
occupants,  licensees  and  concessionaires  of  their  obligations  thereunder,
including  the  right  to  receive  and  collect  the rents, revenues, and other
charges  thereunder.
(f)     All  ledger  sheets,  files,  records,  computer  programs, tapes, other
electronic  data  processing  materials,  and  other  documentation.
(g)     The  products  and proceeds of the preceding listed property, including,
without  limitation,  cash  and  non-cash  proceeds,  proceeds  of proceeds, and
insurance  proceeds.
24.2     Additional  DocumentsAdditional Documents.  At the request of Landlord,
         -----------------------------------------
Tenant  shall  execute additional security agreements, financing statements, and
such  other  documents  as  may be requested by Landlord to maintain and perfect
such  security  interest.  Tenant  hereby  irrevocably  appoints  Landlord,  its
successors  and  assigns,  as Tenant's attorney-in-fact to execute, acknowledge,
deliver  and file such documents on behalf of Tenant.  This power of attorney is
coupled with an interest and is irrevocable.  Tenant authorizes Landlord to file
     financing  statements describing the Collateral to perfect and maintain the
security  interest  granted  hereunder  without  the  signature  or  any further
authorization  of  Tenant.
24.3     Notice  of  SaleNotice  of  Sale.  With  respect  to  any sale or other
         --------------------------------
disposition  of  any  of  the  Collateral  after  the  occurrence of an Event of
Default,  Landlord,  Tenant  agrees  that  the  giving  of  five days' notice by
Landlord,  sent  by  overnight  delivery,  postage  prepaid,  to Tenant's notice
address  designating  the  time  and  place of any public sale or the time after
which any private sale or other intended disposition of such Collateral is to be
     made, shall be deemed to be reasonable notice thereof and Tenant waives any
other  notice  with  respect  thereto.
24.4     RecharacterizationRecharacterization.  Landlord  and Tenant intend this
         ------------------------------------
Lease  to  be  a  true  lease.  However,  if  despite the parties' intent, it is
determined  or  adjudged by a court for any reason that this Lease is not a true
lease  or if this Lease is recharacterized as a financing arrangement, then this
Lease  shall be considered a secured financing agreement and Landlord's title to
the  Leased  Property  shall  constitute  a  perfected  first  priority  lien in
Landlord's favor on the Leased Property to secure the payment and performance of
     all  the  Obligor  Group  Obligations.
24.5     SubordinationSubordination  Landlord  acknowledges  and agrees that the
         --------------------------
liens  and  rights  granted  to  Landlord under this Article 24 are and shall be
subordinate  to  any  liens and rights granted by Tenant in favor of Lender with
respect  to  the  Collateral.
                   ARTICLE 25:     MISCELLANEOUSMISCELLANEOUS
25.1     NoticesNotices.  Landlord  and  Tenant  hereby  agree that all notices,
         --------------
demands,  requests,  and  consents  (hereinafter "notices") required to be given
pursuant  to  the terms of this Lease shall be in writing, shall be addressed to
the  addresses  set forth in the introductory paragraph of this Lease, and shall
be  served  by  [i]  personal  delivery;  [ii]  certified  mail,  return receipt
requested,  postage  prepaid;  or [iii] nationally recognized overnight courier.
Notwithstanding  the  foregoing, any notice received by Landlord from Lender may
be  sent  to Tenant by facsimile at 206/301-4500 and deemed sent upon receipt of
successful  transmission.  Notwithstanding the foregoing, any notice received by
Tenant  from  Lender may be sent to Landlord, Attn:  Erin C. Ibele, by facsimile
at  419/247-2826  and  deemed sent upon receipt of successful transmission.  All
notices  shall be deemed to be given upon the earlier of actual receipt or three
Business  Days  after  mailing,  or  one  Business  Day  after  deposit with the
overnight  courier.  Any  notices meeting the requirements of this section shall
be  effective,  regardless  of  whether  or  not actually received.  Landlord or
Tenant  may  change  its  notice  address  at any time by giving the other party
notice  of  such  change.
25.2     Advertisement  of  Leased PropertyAdvertisement of Leased Property.  In
         ------------------------------------------------------------------
the  event  Tenant  fails to exercise its option to renew within the time period
set  forth  in  12.1  or  in  the  event, the parties hereto have not executed a
renewal  Lease  within 120 days prior to the expiration of this Lease, or Tenant
has  not  exercised  its  Right of First Opportunity, then Landlord or its agent
shall  have  the  right to enter the Leased Property at all reasonable times for
the  purpose  of  exhibiting the Leased Property to others and to place upon the
Leased  Property  for  and  during  the  period commencing 120 days prior to the
expiration  of  this  Lease,  "for  sale"  or  "for  rent"  notices  or  signs.
25.3     Entire  AgreementEntire  Agreement.  This  Lease  contains  the  entire
         ----------------------------------
agreement between Landlord and Tenant with respect to the subject matter hereof.
     No  representations,  warranties, and agreements have been made by Landlord
except as set forth in this Lease.  No oral agreements or understandings between
Landlord  and  Tenant  shall  survive  execution  of  this  Lease.
25.4     SeverabilitySeverability.  If  any  term  or provision of this Lease is
         ------------------------
held  or  deemed  by Landlord to be invalid or unenforceable, such holding shall
not  affect  the remainder of this Lease and the same shall remain in full force
and  effect, unless such holding substantially deprives Tenant of the use of the
Leased  Property  or  Landlord of the rents herein reserved, in which event this
Lease  shall  forthwith  terminate  as  if  by  expiration  of  the  Term.
25.5     Captions  and HeadingsCaptions and Headings.  The captions and headings
         -------------------------------------------
are  inserted  only  as  a matter of convenience and for reference and in no way
define, limit or describe the scope of this Lease or the intent of any provision
     hereof.
25.6     Governing  LawGoverning  Law.  This  Lease  shall  be  governed  by and
         ----------------------------
construed  in accordance with the laws of the State of Mississippi, except as to
matters  under  applicable  procedural conflicts of laws rules which require the
application  of  laws  of  another state, in which case the laws or conflicts of
laws  rules,  as  the  case  may  be,  of  such state shall govern to the extent
required.
25.7     Memorandum  of  LeaseMemorandum of Lease.  Tenant shall not record this
         ----------------------------------------
Lease.  Tenant shall, however, record a memorandum of lease approved by Landlord
     upon  Landlord's  request.
25.8     WaiverWaiver.  No  waiver  by  Landlord  of  any  condition or covenant
         ------------
herein  contained,  or of any breach of any such condition or covenant, shall be
held  or  taken  to  be  a  waiver  of any subsequent breach of such covenant or
condition,  or  to permit or excuse its continuance or any future breach thereof
or of any condition or covenant, nor shall the acceptance of Rent by Landlord at
     any  time when Tenant is in default in the performance or observance of any
condition  or  covenant  herein  be construed as a waiver of such default, or of
Landlord's  right  to  terminate this Lease or exercise any other remedy granted
herein  on  account  of  such  existing  default.
25.9     Binding  EffectBinding  Effect.  This  Lease  will  be binding upon and
         ------------------------------
inure  to  the  benefit  of the heirs, successors, personal representatives, and
permitted  assigns  of  Landlord  and  Tenant.
25.10     No  OfferNo  Offer.  Landlord's  submission of this Lease to Tenant is
          ------------------
not  an  offer  to  lease  the  Leased  Property, or an agreement by Landlord to
reserve  the  Leased  Property for Tenant.  Landlord will not be bound to Tenant
until  Tenant  has  duly  executed  and  delivered  duplicate original leases to
Landlord,  and  Landlord  has duly executed and delivered one of these duplicate
original  leases  to  Tenant.
25.11     ModificationModification.  This  Lease  may  only  be  modified  by  a
          ------------------------
writing  signed  by  both  Landlord  and  Tenant.  All references to this Lease,
whether in this Lease or in any other document or instrument, shall be deemed to
     incorporate  all amendments, modifications and renewals of this Lease, made
after  the  date hereof.  If Tenant requests Landlord's consent to any change in
ownership, merger or consolidation of Tenant or Guarantor, any assumption of the
Lease,  or  any  modification  of  the  Lease, Tenant shall provide Landlord all
relevant information and documents sufficient to enable Landlord to evaluate the
request.  In  connection  with  any such request, Tenant shall pay to Landlord a
fee  in  the  amount  equal  to  the  lesser  of $2,500.00 and Landlord's actual
reasonable  attorney's  fees  and  expenses  and  other reasonable out-of-pocket
expenses  incurred in connection with Landlord's evaluation of Tenant's request,
the preparation of any documents and amendments, the subsequent amendment of any
documents  between Landlord and its collateral pool lenders (if applicable), and
all  related  matters.
25.12     Landlord's  ModificationLandlord's  Modification.  Tenant acknowledges
          ------------------------------------------------
that, provided Lender consents or the Lender has been paid in full, Landlord may
     mortgage  the  Leased Property or use the Leased Property as collateral for
collateralized mortgage obligations or Real Estate Mortgage Investment Companies
(REMICS).  If  any  mortgage lender of Landlord desires any modification of this
Lease,  Tenant agrees to consider such modification in good faith and to execute
an  amendment  of  this  Lease  if  Tenant  finds  such modification acceptable.
Landlord  shall  not  do anything in connection with its financing of the Leased
Property  which  would  limit  the  rights  granted  Tenant  hereunder.
25.13     No  MergerNo  Merger.  The  surrender  of  this Lease by Tenant or the
          --------------------
cancellation  of  this  Lease  by  agreement  of  Tenant  and  Landlord  or  the
termination of this Lease on account of Tenant's default will not work a merger,
     and  will,  at  Landlord's option, terminate any subleases or operate as an
assignment to Landlord of any subleases.  Landlord's option under this paragraph
will  be  exercised  by  notice to Tenant and all known subtenants of the Leased
Property.
25.14     LachesLaches.  No delay or omission by either party hereto to exercise
          ------------
     any  right or power accruing upon any noncompliance or default by the other
party  with  respect  to  any of the terms hereof shall impair any such right or
power  or  be  construed  to  be  a  waiver  thereof.
25.15     Limitation  on  Tenant's  RecourseLimitation  on  Tenant's  Recourse.
          --------------------------------------------------------------------
Tenant's  sole  recourse  against Landlord, and any successor to the interest of
Landlord  in  the  Leased Property, is to the interest of Landlord, and any such
successor,  in  the  Leased Property.  Tenant will not have any right to satisfy
any judgment which it may have against Landlord, or any such successor, from any
     other  assets  of  Landlord,  or  any such successor.  In this section, the
terms  "Landlord"  and  "successor"  include  the  shareholders,  venturers, and
partners  of  "Landlord"  and  "successor"  and  the  officers,  directors,  and
employees of the same.  The provisions of this section are not intended to limit
Tenant's  right  to  seek  injunctive  relief  or  specific  performance.
25.16     Construction  of  LeaseConstruction  of  Lease.  This  Lease  has been
          ----------------------------------------------
prepared  by  Landlord  and its professional advisors and reviewed by Tenant and
its  professional  advisors.  Landlord,  Tenant, and their advisors believe that
this  Lease  is  the  product  of  all  their  efforts,  that it expresses their
agreement,  and  agree  that  it  shall  not  be  interpreted in favor of either
Landlord  or Tenant or against either Landlord or Tenant merely because of their
efforts  in  preparing  it.
25.17     CounterpartsCounterparts.  This  Lease  may  be  executed  in multiple
          ------------------------
counterparts,  each  of  which  shall  be  deemed  an  original  hereof.
25.18     Custody  of  Escrow  FundsCustody of Escrow Funds .  Any funds paid to
          --------------------------
Landlord in escrow hereunder may be held by Landlord or, at Landlord's election,
     by  a  financial institution, the deposits or accounts of which are insured
or guaranteed by a federal or state agency.  The funds shall not be deemed to be
held  in  trust,  may  be  commingled with the general funds of Landlord or such
other  institution,  and  shall  not  bear  interest.
25.19     Landlord's  Status  as  a  REITLandlord's  Status  as a REIT .  Tenant
          -------------------------------
acknowledges  that  Landlord  (or  a  Landlord  Affiliate)  has  elected and may
hereafter elect to be taxed as a real estate investment trust ("REIT") under the
     Internal  Revenue  Code.
25.20     ExhibitsExhibits  .  All  of the exhibits referenced in this Lease are
          --------
attached  hereto  and  incorporated  herein.
25.21     WAIVER  OF JURY TRIALWAIVER OF JURY TRIAL .  LANDLORD AND TENANT WAIVE
          ---------------------
TRIAL  BY  JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY OF THEM
AGAINST  THE  OTHER  ON  ALL  MATTERS  ARISING  OUT OF THIS LEASE OR THE USE AND
OCCUPANCY  OF THE LEASED PROPERTY (EXCEPT CLAIMS FOR PERSONAL INJURY OR PROPERTY
DAMAGE).  IF  LANDLORD  COMMENCES ANY SUMMARY PROCEEDING FOR NONPAYMENT OF RENT,
TENANT  WILL  NOT INTERPOSE, AND WAIVES THE RIGHT TO INTERPOSE, ANY COUNTERCLAIM
IN  ANY  SUCH  PROCEEDING.
25.22     CONSENT  TO  JURISDICTIONCONSENT  TO  JURISDICTION  .  TENANT  HEREBY
          -------------------------
IRREVOCABLY  SUBMITS  AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION AND VENUE OF
ANY  STATE  OR  FEDERAL COURT HAVING JURISDICTION OVER LUCAS COUNTY, OHIO OR ANY
COUNTY IN WHICH A FACILITY IS LOCATED FOR ANY ACTION OR PROCEEDING TO ENFORCE OR
     DEFEND  ANY MATTER ARISING FROM OR RELATED TO [I] THE COMMITMENT; [II] THIS
LEASE;  OR  [III] ANY DOCUMENT EXECUTED BY TENANT IN CONNECTION WITH THIS LEASE.
TENANT  HEREBY  IRREVOCABLY WAIVES, TO THE FULLEST EXTENT TENANT MAY EFFECTIVELY
DO  SO,  THE  DEFENSE  OF  AN  INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH
ACTION OR PROCEEDING.  TENANT AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING  SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION BY
SUIT  ON  THE  JUDGMENT  OR  IN  ANY  OTHER  MANNER  PROVIDED  BY  LAW.
     TENANT  AGREES  NOT  TO  INSTITUTE  ANY  LEGAL ACTION OR PROCEEDING AGAINST
LANDLORD  OR  ANY  DIRECTOR,  OFFICER,  EMPLOYEE, AGENT OR PROPERTY OF LANDLORD,
CONCERNING  ANY  MATTER ARISING OUT OF OR RELATING TO THE COMMITMENT, THIS LEASE
OR  ANY RELATED DOCUMENT IN ANY COURT OTHER THAN A STATE OR FEDERAL COURT HAVING
JURISDICTION  OVER  LUCAS  COUNTY,  OHIO  UNLESS SUCH COURT LACKS IN PERSONAM OR
SUBJECT  MATTER  JURISDICTION  IN  WHICH  CASE  TENANT  SHALL  HAVE THE RIGHT TO
INSTITUTE  SUCH  ACTION OR PROCEEDING BEFORE ANY COURT HAVING SUCH JURISDICTION.
TENANT  HEREBY  CONSENTS  TO SERVICE OF PROCESS BY LANDLORD IN ANY MANNER AND IN
ANY  JURISDICTION  PERMITTED  BY  LAW.  NOTHING  HEREIN  SHALL  AFFECT OR IMPAIR
LANDLORD'S  RIGHT  TO  SERVE  LEGAL  PROCESS  IN ANY MANNER PERMITTED BY LAW, OR
LANDLORD'S  RIGHT  TO  BRING  ANY  ACTION  OR  PROCEEDING  AGAINST TENANT OR THE
PROPERTY  OF  TENANT  IN  THE  COURTS  OF  ANY  OTHER  JURISDICTION.
25.23     Attorney's  Fees  and  ExpensesAttorney's  Fees and Expenses .  Tenant
          -------------------------------
shall  pay to Landlord all reasonable costs and expenses incurred by Landlord in
administering  this  Lease  and  the  security  for  this  Lease,  enforcing  or
preserving  Landlord's  rights under this Lease and the security for this Lease,
and  in  all  matters  of  collection,  whether  or  not an Event of Default has
actually  occurred or has been declared and thereafter cured, including, but not
limited  to,  [a]  reasonable attorney's and paralegal's fees and disbursements;
[b]  the  fees  and  expenses  of  any  litigation,  administrative, bankruptcy,
insolvency,  receivership and any other similar proceeding; [c] court costs; [d]
the  expenses  of  Landlord,  its  employees, agents, attorneys and witnesses in
preparing  for  litigation,  administrative,  bankruptcy,  insolvency  and other
proceedings  and  for  lodging,  travel,  and  attendance at meetings, hearings,
depositions,  and  trials;  and  [e]  consulting  and  witness fees and expenses
incurred  by  Landlord  in  connection  with any litigation or other proceeding;
provided,  however,  Landlord's internal bookkeeping and routine lease servicing
costs  are  not  payable  by  Tenant.
25.24     SurvivalSurvival .  The following provisions shall survive termination
          --------
     of  the  Lease:  Article  8  (Defaults and Remedies); Article 9 (Damage and
Destruction); Article 10 (Condemnation);  15.9 (Transfer of License and Facility
Operations);  15.10  (Bed  Operating  Rights);  18.2  (Assignment  or Sublease);
Article  19  (Holdover and Surrender); Article 24 (Security Interest) and  25.24
(Survival).
25.25     TimeTime  .  Time  is of the essence in the performance of this Lease.
          ----
            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

<PAGE>

          IN  WITNESS  WHEREOF,  the  parties hereto have executed this Lease or
caused  the  same to be executed by their respective duly authorized officers as
of  the  date  first  set  forth  above.
Signed  and  acknowledged  in  the  presence  of:

     HCRI  RIDGELAND  POINTE  PROPERTIES,  LLC

     By:  Health  Care  REIT,  Inc.
Signature  Rita  J.  Rogge     Its:  Sole  Member
Print  Name  Rita  J.  Rogge
     By:  Erin  C.  Ibele
Signature  Kathleen  A.  Sullivan
Print  Name  Kathleen  A.  Sullivan     Title:  Vice  President  and  Corporate
Secretary

     RIDGELAND  ASSISTED  LIVING,  LLC

     By:  Emeritus  Properties  XI,  LLC
     Its:  Managing  Member

       By:  Emeritus  Corporation
      Its:  Sole  Member

Signature       By:   William  M.  Shorten
Print  Name
                   Title:  Director  of  Real  Estate  Finance
Signature
Print  Name       Tax  I.D.  No.:91-1941412



STATE  OF  OHIO    )
       )  SS:
COUNTY  OF  LUCAS  )

   The  foregoing  instrument  was  acknowledged  before  me  this  ___  day  of
September,  2003  by _________________________, the _________________________ of
Health  Care  REIT,  Inc.,  a  Delaware  corporation,  the  sole  member of HCRI
Ridgeland  Pointe  Properties,  LLC,  a  Delaware  limited liability company, on
behalf  of  the  company.


  Notary  Public

My  Commission  Expires:  [SEAL]

STATE  OF  WASHINGTON  )
  )  SS:
COUNTY  OF  KING  )

    The  foregoing  instrument  was  acknowledged  before  me  this  ___  day of
September,  2003  by _________________________, the _________________________ of
Emeritus  Corporation,  a  Washington  corporation,  the sole member of Emeritus
Properties  XI,  LLC,  the  managing member of Ridgeland Assisted Living, LLC, a
Washington  limited  liability  company,  on  behalf  of  the  limited liability
company.


  Notary  Public

My  Commission  Expires:  [SEAL]


THIS  INSTRUMENT  PREPARED  BY:

OKSANA  M.  LUDD,  ESQ.
SHUMAKER,  LOOP  &  KENDRICK,  LLP
1000  JACKSON  STREET
TOLEDO,  OHIO  43624-1573

<PAGE>


                       SCHEDULE 1:  INITIAL RENT SCHEDULE
EMERITUS  CORPORATION  -  RIDGELAND,  MS
----------------------------------------
HEALTH  CARE  REIT,  INC.

                                                     EFFECTIVE DATE     09/29/03
                                                  INITIAL TERM DATE     10/01/03
INITIAL  TERM     15     Yrs
                                       INITIAL TERM EXPIRATION DATE     09/30/18
                                         INITIAL INVESTMENT AMOUNT     8,200,000

                                                          RATE OF RETURN     N/A
(365/360  BASIS)
                                               INITIAL RATE OF RETURN     10.00%
                                                                          ------

INCREASER     (*)  ANNUAL  RENT  INCREASER IS EQUAL TO THE LESSER OF THREE TIMES
CPI OR 25 BASIS POINTS.  THIS SCHEDULE WAS PREPARED USING THE CPI FOR THE PERIOD
JULY,  2002  TO JULY, 2003 AND ASSUMED AS SUCH GOING FORWARD.  ACTUAL INCREASERS
WILL  BE  REVIEWED  ANNUALLY.

                                              INITIAL MONTHLY RENT     68,333.33

                                                ANNUAL INCREASER AMOUNT     0.00
   LEASE YEAR     DATES     ACTUAL CPI     INCREASER (BP) (LESSER OF 3 TIMES THE
     CPI INCREASE OVER PRIOR YEAR OR 25 BP)     BEGINNING RENT RATE OF RETURN
                   MONTHLY RENT AMOUNT     ANNUAL RENT AMOUNT
                                     FROM     TO

                         09/29/03     09/30/03               10.00%     4,493.15
          1     10/01/03     09/30/04     N/A     N/A     10.00%     68,333.33
                                                                      819,999.96
          2     10/01/04     09/30/05     2.10%     0.25%     10.25%   70,041.67
                                                                      840,500.00
          3     10/01/05     09/30/06     2.10%     0.25%     10.50%   71,750.00
                                                                      861,000.00
          4     10/01/06     09/30/07     2.10%     0.25%     10.75%   73,458.33
                                                                      881,500.00
          5     10/01/07     09/30/08     2.10%     0.25%     11.00%   75,166.67
                                                                      902,000.00
          6     10/01/08     09/30/09     2.10%     0.25%     11.25%   76,875.00
                                                                      922,500.00
          7     10/01/09     09/30/10     2.10%     0.25%     11.50%   78,583.33
                                                                      943,000.00
          8     10/01/10     09/30/11     2.10%     0.25%     11.75%   80,291.67
                                                                      963,500.00
          9     10/01/11     09/30/12     2.10%     0.25%     12.00%   82,000.00
                                                                      984,000.00
         10     10/01/12     09/30/13     2.10%     0.25%     12.25%   83,708.33
                                                                    1,004,500.00
         11     10/01/13     09/30/14     2.10%     0.25%     12.50%   85,416.67
                                                                    1,025,000.00
         12     10/01/14     09/30/15     2.10%     0.25%     12.75%   87,125.00
                                                                    1,045,500.00
         13     10/01/15     09/30/16     2.10%     0.25%     13.00%   88,833.33
                                                                    1,066,000.00
         14     10/01/16     09/30/17     2.10%     0.25%     13.25%   90,541.67
                                                                    1,086,500.00
         15     10/01/17     09/30/18     2.10%     0.25%     13.50%   92,250.00
                                                                    1,107,000.00



<PAGE>



                          EXHIBIT A:  LEGAL DESCRIPTION
A Lot or parcel of land lying and being situated in the County of Madison, State
of  Mississippi,  and  being  more  particularly  described  as follows, to wit:
Lots  7, 8, and 9 Orchard Park, a subdivision according to a map or plat thereof
which  is  on  file and of record in the office of the Chancery Clerk of Madison
County, Mississippi, in Plat Cabinet B at slot 67, reference to which is made in
aid  of  and  as  a  part  of  this  description.
Less  and  except  therefrom  a  portion  of  Lot 7, Orchard Park, a subdivision
according  to a map or plat thereof which is on file and of record in the office
of  the Chancery Clerk of Madison County, Mississippi, in Plat Cabinet B at slot
67,  reference  to  which  is  made in aid of and as a part of this description,
being  five  feet  (5')  off  the  Southwesterly  side  of  Lot 7 and being more
particularly  described  by  metes  and  bounds  as  follows,  to  wit:
Commencing  at  the Westernmost corner of said Lot 7 and run Southeasterly along
the  line  between Lots 6 and 7 a distance of 253.6 feet to the Southwest corner
of  said  Lot  7;  thence  North 89 degrees 48 minutes 21 seconds East along the
south  line  of  said  Lot  7  a  distance  of  6.38 feet; thence left through a
deflection angle of 128 degrees 22 minutes 41 seconds and run Northerly parallel
with  the common line between Lots 6 and 7 and 5 feet (5') Easterly thereof, for
a  distance  of  256.41  feet  to  a  point in the Western line of Lot 7 and the
Southerly right of way of Orchard Park; thence Westerly along the arc of a curve
bearing  to  the right having a 50 foot radius, and along the said Westerly line
of  Lot 7 for an arc distance of 5.13 feet to the Point of Beginning, containing
1,274.8  square  feet,  more  or  less.
The  entire  tract  herein  described  is  also  described  as  follows  (Survey
Description):
A  parcel  of  land  situated in the Southwest Quarter of Section 32, Township 7
North,  Range  2  East  of Madison County, Mississippi, being Lots 8 and 9 and a
part  of Lot 7 of Orchard Park, according to the plat of record in the office of
the Chancery Clerk of Madison County, Mississippi, in Plat Cabinet B at Slot 67,
and  being  more  particularly  described  as  follows:
Begin  at  an  iron  rod  marking the Northwest corner of said Lot No. 9 and run
thence  North 89 56'48" East along the North Line of Orchard Park for a distance
of  506.44 feet to an iron rod at the Northeast corner of said Lot No. 8; thence
South  00  02'35"  East  for  a  distance  of  292.57 feet to an iron pin at the
Southeast  corner of said Lot No. 8; thence North 89 33'14" West along the South
line  of said Lot No. 8 for a distance of 151.29 feet to the Northeast corner of
said Lot No. 7 for a distance of 128.27 feet to the Southwest corner of said Lot
No.  7;  thence South 00 11'06" East along the East line of said Lot No. 7 for a
distance  of 200.00 feet to the Southeast corner of said Lot No. 7; thence South
89  48'21"  West along the South line of said Lot No. 7 for a distance of 128.27
feet  to the southwest corner of said Lot No. 7; thence North 38 34'20" West for
a  distance  of  256.41  feet  to  an iron pin; thence along the right of way of
Orchard  Park  (cul-de-sac with 50.00 feet radius); following a counterclockwise
circular  curve for an arc distance of 184.56 feet, the curve having a radius of
50.00  feet  and a chord bearing and distance of North 44 17'44" West for 184.56
feet to the Southwest corner of said Lot No. 9; thence North 00 10'15" along the
West  line  of  said  Lot  No.  9  for a distance of 222.00 feet to the Point of
Beginning  at  the  Northwest  corner  of  said  Lot  No.  9.

<PAGE>
                        EXHIBIT B:  PERMITTED EXCEPTIONS
1.     2003 ad valorem taxes for City of Ridgeland and Madison County, MS, which
became  a lien upon the above-described property on January 1, 2003, but are not
yet  due  and  payable;  and  taxes, special assessments, and other governmental
charges  not  shown  as  existing  liens  by  the  public  records.
2.     Title  to  all minerals within and underlying the premises, together with
all  mining rights and other rights, privileges and immunities relating thereto.
3.     Deed  of  Trust and Security Agreement between Ridgeland Assisted Living,
LLC, and Amresco Capital, LP, dated September 29, 1999, filed September 30, 1999
at  3:00  p.m.,  and  recorded  in  Book  1199  at page 160 in the office of the
Chancery  Clerk  of  Madison  County,  MS.
4.     Assignment  of  Leases  and Rents between Ridgeland Assisted Living, LLC,
and Amresco Capital, L.P., dated September 29, 1999, filed September 30, 1999 at
3:00  p.m.,  and recorded in Book 1199 at page 220 in the office of the Chancery
Clerk  of  Madison  County,  MS.
5.     Assignment of Mortgage and Assignment of Leases and Rents between Amresco
Capital  L.P.,  and  Credit  Suisse  First  Boston  Mortgage  Capital LLC, dated
September  29, 1999, filed September 30, 1999 at 3:00 p.m., and recorded in Book
1199  at  page  242  in  the office of the Chancery Clerk of Madison County, MS.
6.     UCC-1  Financing  Statement  No.  990414  executed  by Ridgeland Assisted
Living, LLC, to Amresco Capital, L.P., filed for record on September 30, 1999 at
3:00  p.m.,  and recorded in Book 1199 at page 234 in the office of the Chancery
Clerk  of  Madison  County,  MS.
7.     UCC-3  Assignment  of  Financing Statement executed by Ridgeland Assisted
Living, LLC, to Credit Suisse First Boston Mortgage Capital, filed for record on
May  11,  2001 at 9:00 a.m., and recorded in Book 1305 at page 256 in the office
of  the  Chancery  Clerk  of  Madison  County,  MS,  assigning UCC-1 No. 990414.
8.     That  certain  Disclaimer  and  Boundary  Line  Agreement  by and between
Countryside Associates, B. E. Hutto and John Howard Shows, of record in Book 196
at page 715 in the office of the Chancery Clerk of Madison County, MS, affecting
only  Lots 7 and 8, Orchard Park, per the plat thereof of record in Plat Cabinet
B  at Slot 67 in the office of the Chancery Clerk of Madison County, as shown on
survey  dated  November  24,  1998,  revised  December 11, 1998 and last revised
August  26,  1999,  prepared  by  Jack  N.  Starr,  R.P.S.  No.  2623.
9.     The  following  items  reflected  on the plat of survey of Jack N. Starr,
Registered Public Surveyor No. 2623, identified as Project No. 045-98-001, dated
November  24,  1998,  revised December 11, 1998, and last revised June 23, 2003:
A.     Five  (5)  foot  utility easement along the North line of Lots 8 and 9 as
shown  on  the  Subdivision  Plat of Orchard Park of record in Plat Cabinet B at
Slot  67  in  the  office  of  the  Chancery  Clerk  of  Madison  County,  MS.
B.     Fifteen  (15) foot utility easement along the South and East lines of Lot
7  shown  on the Subdivision Plat of Orchard Park of Record in Plat Cabinet B at
Slot  67  in  the  office  of  the  Chancery  Clerk  of  Madison  County,  MS.
C.     Ten  (10) foot utility easement along part of the North line of Lot 7 and
part  of  the  South  line  of  Lots 8 and 9 as shown on the Subdivision Plat of
Orchard  Park  of  record  in  Plat  Cabinet  B  at Slot 67 in the office of the
Chancery  Clerk  of  Madison  County,  MS,  a portion of which easement has been
closed and vacated pursuant to Ordinance recorded in Book 378 at Page 387 in the
office  of  the  Chancery  Clerk  aforesaid.
D.     Twenty  (20) foot utility easement along the South line of Lot 8 as shown
on  the  Subdivision Plat of Orchard Park of record in Plat Cabinet B at Slot 67
in  the  office  of  the  Chancery  Clerk  of  Madison  County,  MS.
E.     Five (5) utility easement along the front of Lots 7 and 9 as shown on the
Subdivision  Plat  of Orchard Park of record in Plat Cabinet B at Slot 67 in the
office  of  the  Chancery  Clerk  of  Madison  County,  MS.
F.     Encroachment  of  1.5  feet  of  retaining wall for subject property onto
adjoining  property to the North, located in the Northwest corner of the subject
property  as shown on Subdivision Plat of Orchard Park of Record in Plat Cabinet
B at Slot 67 in the office of the Chancery Clerk of Madison County, MS.  Company
insures  the  insured  against  loss  or damage which the insured may sustain by
reason  of  an  unappealable  final  decree by a court of competent jurisdiction
ordering  the  enforced  removable  of  said  encroachments.
G.     Drainage  ditch  in Southeast corner of Lot 8 as shown on the Subdivision
Plat of Orchard Park of record in Plat Cabinet B at Slot 67 in the office of the
Chancery  Clerk  of  Madison  County,  MS.
H.     Drainage  ditch  in Northeast corner of Lot 8 as shown on the Subdivision
Plat of Orchard Park of record in Plat Cabinet B at Slot 67 in the office of the
Chancery  Clerk  of  Madison  County,  MS.
I.     Setback  restrictions  around  the entire perimeter of property, being 10
feet  on  West,  North, most Southerly, and Southwest sides, 25 feet on the East
line,  and  30  feet  around the cul-de-sac, as shown on the Subdivision Plat of
Orchard  Park  of  record  in  Plat  Cabinet  B  at Slot 67 in the office of the
Chancery  Clerk  of  Madison  County,  MS.
J.     Utility  easement  through  Lot 7 of record in Book 378 at Page 86 in the
office  of  the  Chancery  Clerk  of  Madison  County,  MS.


<PAGE>



                        EXHIBIT C:  FACILITY INFORMATION
                    STREET ADDRESS     FACILITY TYPE (PER LICENSE)
          FACILITY NAME     COUNTY     BEDS/UNITS     INVESTMENT AMOUNT
                                      Assisted Living
                        410 Orchard Park     ___ licensed beds
                     Ridgeland, MS  39157     ___ operating beds
               Ridgeland Pointe     County:  Madison     75 units     $8,200,000
               ----------------     ----------------     --------     ----------


<PAGE>

                    EXHIBIT D:  LANDLORD'S PERSONAL PROPERTY
                               [Tenant to provide]


<PAGE>

                      EXHIBIT E:  DOCUMENTS TO BE DELIVERED


          Tenant  shall  deliver  each of the following documents to Landlord no
later  than  the  date  specified  for  each  document:
1.     Annual Financial Statement of Tenant (audited) - within 90 days after the
     end  of  each  fiscal  year.
2.     Annual  Company  Budget  not later than 60 days prior to the beginning of
the  next  fiscal  year.
3.     Quarterly  Variance Report for the Facility, including occupancy, census,
capital  expenditures  and  operating  revenues and expenses by line item with a
detailed  explanation  of  the  cause  of all material variances from the Annual
Company  Budget  (i.e.,  more  than 10% for that line item) and a description of
Tenant's plans for eliminating all material variances - within 45 days after the
     end  of  each  quarter.
4.     Quarterly  Update to Annual Company Budget (on a 12-month rolling forward
period)  -  within  45  days  after  the  end  of  each  quarter.
5.     Quarterly  Healthcare  Integrity  and Protection Data Bank (HIPDB) Report
(dated  not  earlier than the end of the quarter) - within 45 days after the end
of  each  quarter.
6.     Quarterly  Updates  to  Operator Profile of Tenant, including a review of
the  Profile  prepared  by  Landlord  and  identification  of all changes to the
Profile  to reflect the current situation - within 45 days after the end of each
quarter.
7.     Monthly  Facility  Financial  Statement - within 30 days after the end of
each  month.
8.     Tenant's  Certificate  and  Annual or Quarterly Facility Financial Report
(Exhibit  F)  -  with  each  delivery  of  Tenant's  financial  statements.
9.     Annual  Facility Financial Report (based upon internal financial records)
-  within  60  days  after  the  end  of  each  fiscal  year.
10.     Annual Financial Statement (audited) of Guarantor - within 90 days after
     the  end  of  each  fiscal  year.
11.     Periodic Financial Statement of Guarantor - within 45 days after the end
     of  each  quarter.
12.     Guarantor's  certificate  -  with each delivery of Guarantor's financial
statements.
13.     Federal  tax returns of Guarantor, which shall include on a consolidated
basis,  Tenant  -  within 15 days after the filing of the return.  If the filing
date  is  extended,  also  provide a copy of the extension application within 15
days  after  filing.
14.     If applicable, Medicaid cost reports for the Facility - within five days
     after  filing  of  the  report  with  the  State  agency.
15.     State  and  federal health care survey and inspection reports, inspector
exit  interview  notes and report (if delivered to Tenant), plans of correction,
re-survey  reports,  evidence  of  annual  license  renewal within 30 days after
receipt  by  Tenant,  HIPDB  adverse action report, notice of any investigation,
inspection  or survey by licensing authorities, notice of licensure deficiencies
or commencement of licensure revocation or decertification proceeding, notice of
     admissions  ban,  issuance  of  a  provisional or temporary license and all
correspondence  regarding  any  of  the foregoing for the Facility - within five
days  after  receipt  by  Tenant.
16.     Real  estate  taxes
(a)     Copy  of  invoice  and  check - within five days after the due date; and
(b)     Copy  of  official  receipt  or other satisfactory evidence of payment -
within  30  days  after  the  due  date.
17.     Certificate of insurance renewal, current Certificate of Compliance from
     insurance agent and evidence of payment of premium - at least 30 days prior
to  the  expiration  of  each  policy.
18.     Facility information:  [i] a security deposit report, including resident
     name, date of move-in, security deposit, and corresponding security deposit
bank  account  balance,  with  a  monthly  update  of any changes; [ii] a report
accounting  for  all  resident  trust  funds, including corresponding trust fund
deposit  bank  accounts; [iii] a schedule and copies of any equipment leases and
financings,  including vendor, equipment descriptions, monthly payment, rate and
maturity,  with  a monthly update of any changes and the required nondisturbance
agreement  if  the  original  cost  of  the equipment exceeds $50,000.00; [iv] a
schedule  of  all utility providers and utility deposits; [v] a list of all rent
concessions, including, but not limited to, free rent, rent reduction, community
fee  waivers, rate locks, rate guaranties and waivers of security deposits; [vi]
a  copy  of  each  private pay resident's occupancy agreement and the Facility's
form  of agreement; [vii] a schedule of all employee vacation and sick days; and
[viii]  employee policies and procedures handbook, including employee benefits -
current  and annually updated reports, schedules and copies to be delivered upon
request.

<PAGE>


                        EXHIBIT F:  TENANT'S CERTIFICATE
                         AND FACILITY FINANCIAL REPORTS


Report  Period:     Commencing  _______________  and  ending  _______________

Lease:     Lease  made  by HCRI Ridgeland Pointe Properties, LLC ("Landlord") to
Ridgeland  Assisted  Living,  LLC  ("Tenant")


          Tenant  hereby  certifies  to Landlord to the best of its knowledge as
follows:

1.     The  attached  [specify audited or unaudited and annual or quarterly, and
                               -------    ---------     ------    ---------
if consolidated, so state] financial statements of Tenant [i] have been prepared
   ------------
     in  accordance  with  generally accepted accounting principles consistently
applied; [ii] have been prepared in a manner substantially consistent with prior
financial  statements  submitted  to  Landlord;  and  [iii]  fairly  present the
financial  condition  and  performance  of  Tenant  in  all  material  respects.
2.     The attached [Annual or Quarterly] Facility Financial Report and Facility
     Accounts  Receivable  Aging  Report for the Report Period is complete, true
and  accurate  and  has  been prepared in a manner substantially consistent with
prior  schedules  submitted  to  Landlord.  As  set  forth  in  the  [Annual  or
Quarterly]  Facility  Financial  Report,  Tenant  has  maintained  the  Facility
Coverage Ratio [*IF APPLICABLE:  and the Current Ratio/Debt to Equity Ratio] for
the  Report  Period  as  required  under  the Lease between Tenant and Landlord.
3.     To  the  best  of its knowledge, Tenant was in compliance with all of the
provisions of the Lease and all other documents executed by Tenant in connection
     with  the  Lease  at all times during the Report Period, and no default, or
any  event  which with the passage of time or the giving of notice or both would
constitute  a  default,  has  occurred  under  the  Lease.
          Executed  this  ___  day  of  _______________,  _____.




Name:

Title:

<PAGE>
                        ANNUAL FACILITY FINANCIAL REPORT

FACILITY  NAME:
FACILITY  ADDRESS:


REPORT  PERIOD:     Twelve  (12)  months  beginning  _______________  and ending
_______________.  All  information  reported  should  be  for  this period only.

                                           % RESIDENT
           OCCUPANCY DATA          CENSUS DATA     DAYS     % REVENUES
           --------------          -----------     ----     ----------
           Total Beds/Units:     _______     Medicaid:     _______%     _______%
           -----------------     -------     ---------     --------     --------
       Total Available Days:     _______     Medicare:     _______%     _______%
       Total Occupied Days:     _______     Private and Other:     _______%
                                                                        _______%
         Occupancy Percentage:     _______%     Total:     _______%     _______%


                                 OPERATING DATA

1.     Gross  Revenues     $

2.     Contractual  Allowances     $

3.     Net  Revenues     $

4.     Operating  Expenses(before  interest,  lease/rent,  depreciation,
amortization  and  management  fees)     $
                                          ---

5.     Net  Operating  Income     $

6.     Interest  Expense     $

7.     Lease/Rent  Expense     $

8.     Depreciation  Expense     $

9.     Amortization  Expense     $

10.     Management  Fees     $

11.     Management  Fees  (as  a  percent  of  Gross  Revenues)          %

12.     Overhead  Allocation  (if  applicable)     $

13.     Other  (identify)     $

14.     Income  Taxes     $

15.     Net  Income  (amount  should  agree  with  the  facility's  financial
statements)     $

<PAGE>
                                 FINANCING DATA
               (Note:  This data breaks out Items 6 and 7 above.)


              Related to HCN     All Other Leases and/or Debt     Total
Lease  Payments      _________      _________      ________
                    -----------     -----------     ----------
Interest  Payments      _________      _________      ________
Principal  Payments  (if  any)      _________      _________      ________
      $      $      $
       =       =       =
                                 COVERAGE RATIO

1.     Net  Operating  Income     $______________
2.     Less  Imputed  Management  Fee
       (  _____%  of  gross  revenues)     (______________)
3.     Less  Imputed  Replacement  Reserve  for  period
       ($_________  per  bed  [or  unit]  per  year)     (______________)
4.     Adjusted  Net  Operating  Income     $______________
5.     Loan/Lease  Payments  to  HCN     $______________
6.     Actual  Coverage  Ratio  (Line  4  Line  5)     ______________
7.     Minimum  Coverage  Ratio  (per  Lease  Agreement)     ______________

                                  CURRENT RATIO
                           [*DELETE IF NOT APPLICABLE]

1.     Current  Assets     $______________
2.     Current  Liabilities     $______________
3.     Actual  Current  Ratio  (Line  1  Line  2)     ______________
4.     Minimum  Current  Ratio  (per  Lease  Agreement)     ______________


I  certify  that  the  foregoing  is  true  and  accurate.

          Date:

Name:          Phone  Number:

     Title:


<PAGE>
                       QUARTERLY FACILITY FINANCIAL REPORT

FACILITY  NAME:
FACILITY  ADDRESS:


REPORT  PERIOD:     Three  (3)  months  beginning  _______________  and  ending
_______________.  All  information  reported  should  be  for  this period only.

                                           % RESIDENT
           OCCUPANCY DATA          CENSUS DATA     DAYS     % REVENUES
                                                            ----------
           Total Beds/Units:     _______     Medicaid:     _______%     _______%
           -----------------     -------     ---------     --------     --------
       Total Available Days:     _______     Medicare:     _______%     _______%
 Total Occupied Days:     _______     Private & Other:     _______%     _______%
         Occupancy Percentage:     _______%     Total:     _______%     _______%


                                 OPERATING DATA

1.     Gross  Revenues     $

2.     Contractual  Allowances     $

3.     Net  Revenues     $

4.     Operating  Expenses  (before  interest,  lease/rent,  depreciation,
 amortization  and  management  fees)     $
                                           ---

5.     Net  Operating  Income     $

6.     Interest  Expense     $

7.     Lease/Rent  Expense     $

8.     Depreciation  Expense     $

9.     Amortization  Expense     $

10.     Management  Fees     $

11.     Management  Fees  (as  a  percent  of  Gross  Revenues)          %

12.     Overhead  Allocation  (if  applicable)     $

13.     Other  (identify)     $

14.     Income  Taxes     $

       15.     Net Income (amount should agree with the facility's financial
                               statements)     $

<PAGE>
                                     ------
                                 FINANCING DATA
               (Note:  This data breaks out Items 6 and 7 above.)


              Related to HCN     All Other Leases and/or Debt     Total
Lease  Payments      _________      _________      ________
                    -----------     -----------     ----------
Interest  Payments      _________      _________      ________
Principal  Payments  (if  any)      _________      _________      ________
      $      $      $
       =       =       =
                                 COVERAGE RATIO

1.     Net  Operating  Income     $______________
2.     Less  Imputed  Management  Fee
       (  _____%  of  gross  revenues)     (______________)
3.     Less  Imputed  Replacement  Reserve  for  period
       ($_________  per  bed  [or  unit]  per  year)     (______________)
4.     Adjusted  Net  Operating  Income     $______________
5.     Loan/Lease  Payments  to  HCN     $______________
6.     Actual  Coverage  Ratio  (Line  4  Line  5)     ______________
7.     Minimum  Coverage  Ratio  (per  Lease  Agreement)     ______________

                                  CURRENT RATIO
                           [*DELETE IF NOT APPLICABLE]

1.     Current  Assets     $______________
2.     Current  Liabilities     $______________
3.     Actual  Current  Ratio  (Line  1  Line  2)     ______________
4.     Minimum  Current  Ratio  (per  Lease  Agreement)     ______________


I  certify  that  the  foregoing  is  true  and  accurate.

          Date:

Name:          Phone  Number:

     Title:


<PAGE>
------


               QUARTERLY FACILITY ACCOUNTS RECEIVABLE AGING REPORT
     FACILITY  NAME:
     FACILITY  ADDRESS:



ACCOUNTS  RECEIVABLE  AGING  AS  OF  ____________  (MOST  RECENT  QUARTER ENDED)

PAYOR     0-30  DAYS  %     31-60  DAYS  %     61-90 DAYS  %     OVER 90 DAYS  %
TOTALS  %
Medicaid     $__________  ____%     $__________  ____%     $__________  ____%
$__________  ____%     $__________  ____%
Medicare     $__________  ____%     $__________  ____%     $__________  ____%
$__________  ____%     $__________  ____%
Commercial  Insurance     $__________  ____%     $__________  ____%
$__________  ____%     $__________  ____%     $__________  ____%
Other  -_____________     $__________  ____%     $__________  ____%
$__________  ____%     $__________  ____%     $__________  ____%
TOTALS     $__________  100%     $__________  100%     $__________  100%
$__________  100%     $__________  100%

         % OF TOTALS $     ___________%     ___________%     ___________%
                              ___________%     100%

ACCOUNTS  RECEIVABLE  AGING  AS  OF  ____________  (2ND  RECENT  QUARTER  ENDED)

PAYOR     0-30  DAYS  %     31-60  DAYS  %     61-90 DAYS  %     OVER 90 DAYS  %
TOTALS  %
Medicaid     $__________  ____%     $__________  ____%     $__________  ____%
$__________  ____%     $__________  ____%
Medicare     $__________  ____%     $__________  ____%     $__________  ____%
$__________  ____%     $__________  ____%
Commercial  Insurance     $__________  ____%     $__________  ____%
$__________  ____%     $__________  ____%     $__________  ____%
Other  -_____________     $__________  ____%     $__________  ____%
$__________  ____%     $__________  ____%     $__________  ____%
TOTALS     $__________  100%     $__________  100%     $__________  100%
$__________  100%     $__________  100%

         % OF TOTALS $     ___________%     ___________%     ___________%
                              ___________%     100%


<PAGE>


                      EXHIBIT G:  GOVERNMENT AUTHORIZATIONS
                         TO BE OBTAINED; ZONING PERMITS
The  letter  dated  May  16,  2003  from  Jonathon  Smith, City Planner, City of
Ridgeland,  Community  Development  Department,  304  Highway  51, P.O. Box 217,
Ridgeland,  Mississippi  39158  addressed  to  Health  Care  REIT,  Inc.;  HCRI
Massachusetts  Properties  Trust  II; and HCRI Mississippi Properties, Inc., One
SeaGate,  Suite  1500,  P.O. Box 1475, Toledo, Ohio  43603-1475 regarding Zoning
Certificate  for  Ridgeland  Pointe,  410  Orchard  Park, Ridgeland, Mississippi
39157,  describes  any  and  all  special  use permits, conditional use permits,
variances  and  exceptions  which  have been granted or are needed in connection
with  the  use  of  Ridgeland  Pointe.


<PAGE>
                         EXHIBIT H:  PENDING LITIGATION


                                      NONE


<PAGE>
                    EXHIBIT I:  LIST OF LEASES AND CONTRACTS
1.     Schindler  Elevator  Corporation  Elevator  Maintenance  Agreement;
2.     Simplex  Emergency  Call  Monitoring  Service  Agreement;
3.     Smith's  Lawn  Service  (invoice  no  contract);
4.     Dependable  Pest  Service;
5.     Beauty  Salon  Agreement  with  Brenda  Steele;  and
6.     Therapy  Services  Agreement  with  the  Weston  Group,  Inc.


<PAGE>
                     EXHIBIT J:  WIRE TRANSFER INSTRUCTIONS
                             HEALTH CARE REIT, INC.
                           WIRE TRANSFER INSTRUCTIONS
                                       KeyBank
BANK:     Cleveland,  Ohio

ABA  NUMBER:     041001039

ACCOUNT  NAME:     Health  Care  REIT,  Inc.

ACCOUNT  NUMBER:     353321001011

NOTIFY:     Michael  A.  Crabtree

PHONE:     (419)  247-2800


<PAGE>
                             EXHIBIT K:  BASE PRICE
(A)     The  base price ("Base Price") for the Leased Property will be an amount
equal  to  the  greater of [i] the Investment Amount; or [ii] the sum of [a] the
Investment  Amount  plus [b] 50% of the difference between the Fair Market Value
at the time of the acquisition and the sum of [I] the Investment Amount and [II]
$1,100,000.00.
(B)     Fair  Market  Value.  The fair market value (the "Fair Market Value") of
        -------------------
the  Leased  Property  shall  be  determined  as  follows:
     The  parties  shall  attempt  to  determine the Fair Market Value by mutual
agreement  within  15 days after giving the Termination Notice (the "Negotiation
Period").  However,  if the parties do not agree on the Fair Market Value during
the  Negotiation  Period,  the  following  provisions  shall  apply:
     Landlord  and  Tenant shall each give the other party notice of the name of
an  acceptable  appraiser  five  Business  Days after the end of the Negotiation
Period.  The  two  appraisers  will  then  select  a  third  appraiser within an
additional  five  days.  Each  appraiser  must  demonstrate  to  the  reasonable
satisfaction  of  both Landlord and Tenant that it has significant experience in
appraising  properties  similar  to the Leased Property.  Within five days after
designation, each appraiser shall submit a resume to Landlord and Tenant setting
forth  such  appraiser's qualifications, including education and experience with
similar  properties.  A  notice  of  objections  to  the  qualifications  of any
appraiser  shall  be  given  within  10 days after receipt of such resume.  If a
party  fails  to  timely  object to the qualifications of an appraiser, then the
appraiser  shall be conclusively deemed satisfactory.  If a party gives a timely
notice of objection to the qualifications of an appraiser, then the disqualified
appraiser shall be replaced by an appraiser selected by the qualified appraisers
or,  if  all  appraisers  are  disqualified,  then by an appraiser selected by a
commercial  arbitrator  acceptable  to  Landlord  and  Tenant.
     The  Fair Market Value shall be determined by the appraisers within 60 days
thereafter as follows.  Each of the appraisers shall be instructed to prepare an
appraisal  of the Leased Property in accordance with the following instructions:
     The  Leased Property is to be valued upon the three conventional approaches
to  estimate  value  known  as the Income, Sales Comparison and Cost Approaches.
Once  the  approaches  are  completed,  the  appraiser correlates the individual
approaches  into  a  final  value  conclusion.
     The  three  approaches  to  estimate  value  are  summarized  as  follows:
INCOME  APPROACH:  This  valuation  approach  recognizes  that  the value of the
operating  tangible  and  intangible  assets  can be represented by the expected
economic  viability  of  the  business  giving  returns  on  and  of the assets.
SALES  COMPARISON APPROACH:  This valuation approach is based upon the principle
of  substitution.  When  a  facility  is  replaceable  in the market, the market
approach assumes that value tends to be set at the price of acquiring an equally
desirable  substitute  facility.  Since  healthcare market conditions change and
frequently  are  subject  to  regulatory and financing environments, adjustments
need  to  be  considered.  These  adjustments  also  consider  the  operating
differences  such  as  services  and  demographics.
COST  APPROACH:  This  valuation  approach  estimates  the value of the tangible
assets  only.  Value  is  represented  by  the market value of the land plus the
depreciated  reproduction  cost  of  all  improvements  and  equipment.
In  general,  the Income and Sales Comparison Approaches are considered the best
representation  of value because they cover both tangible and intangible assets,
consider  the  operating  characteristics  of  the  business  and  have the most
significant  influence  on  attracting  potential  investors.
The  appraised  values  submitted  by  the three appraisers shall be ranked from
highest  value  to middle value to lowest value, the appraised value (highest or
lowest)  which  is  furthest from the middle appraised value shall be discarded,
and  the  remaining two appraised values shall be averaged to arrive at the Fair
Market  Value.