AGREEMENT TO PROVIDE ACCOUNTING
                      AND CONSULTING SERVICES TO CALIFORNIA
                            ASSISTED LIVING FACILITY

     This  Agreement  made  as of the 15th day of February, 2002, by and between
RAL,  Inc.,  an  Oregon  corporation  (hereinafter  referred  to as "Owner") and
Emeritus  Corporation,  a  Washington  corporation  (hereinafter  referred to as
"Emeritus").

          WHEREAS, Owner leases from Sacramento County Assisted, LLC (the "LLC")
the  assisted living facility commonly known as Willow Creek Assisted Living and
located  in  Folsom,  California  (the  "Facility");

     WHEREAS, Emeritus has agreed to manage the Facility on behalf of the LLC at
such  time  as  it  is  licensed  to  operate  the  Facility;

     WHEREAS, pending issuance of a license to Emeritus to operate the Facility,
Owner  is  interested  in  engaging  Emeritus  to  provide  certain  accounting,
reporting  and  consulting  services  to Owner with respect to the Facility; and

     WHEREAS,  Owner  and  Emeritus  are interested in documenting the terms and
conditions  under  which  such  services  will  be  provided.

     NOW,  THEREFORE,  in consideration of the foregoing premises and the mutual
covenants  herein  contained,  IT  IS  AGREED  AS  FOLLOWS:

     I.     Accounting  Services:
            --------------------

     (i)     Emeritus  shall,  at its expense, provide accounting support to the
Facility.  Owner  acknowledges and agrees that such accounting support shall not
include  the preparation of Owner's corporate financial statements or securities
filings,  but only the individual financial statements for the Facility, in each
case  meeting the requirements of Section II.  Emeritus shall not be required to
reflect  in  the  financial statements for the Facility any corporate accounting
adjustments  provided  to  Emeritus  by  Owner until such time as Emeritus fully
understands  the  rationale  for  such  adjustment.

(ii)     All  accounting  procedures  and  systems  utilized  in  providing said
support  shall  be  in  accordance  with the operating capital and cash programs
developed  by  Emeritus,  which  programs  shall  conform  to generally accepted
accounting  principles ("GAAP") and shall not materially distort income or loss;
provided,  however, Emeritus shall have no liability for errors in the financial
statements prepared during the term of this Agreement which arise from errors in
     starting  accounting  balances  provided  by  Owner to Emeritus pursuant to
Section  I(v).

(iii)     In  addition,  as  a  cost  of  operating the Facility, Emeritus shall
prepare  or  cause  to  be  prepared  all payroll tax returns, sales and use tax
returns,  real  and  personal  property  tax returns, informational tax returns,
Forms  5500 and local or state gross receipts and/or business and occupation tax
returns  and  Emeritus shall cause to be paid all of the taxes reflected on such
returns  as  being  due, which taxes shall be paid from the cash receipts of the
Facility  or  the  working capital provided under the terms of this Agreement by
the  LLC  on  behalf  of  Owner  pursuant  to  the  terms of the Working Capital
Agreement  of even date herewith between Owner and the LLC (the "Working Capital
Agreement").  All  other  tax returns, including Owner's local, state or federal
income  tax  returns  and  state corporate franchise tax returns and third party
payor cost reports, shall be prepared by Owner or its designee and the taxes and
     other  payments  due  thereunder shall be the sole responsibility of Owner.

     (iv)     Nothing  herein shall preclude Emeritus from delegating to a third
party a portion of the accounting duties provided for in this section; provided,
that  such delegation shall not relieve Emeritus from ultimate liability for the
timely  and  complete  performance of the obligations provided for herein or for
the  expense  thereof,  to  the  extent such expense is to be borne hereunder by
Emeritus.  Owner  acknowledges and agrees that in the event Emeritus retains one
or more third parties to review the real and/or personal property tax returns or
utility  bills  of  the  Facility  or  other third party charges in an effort to
effect  cost  savings  for  the  Facility,  the  fees and expenses of such third
parties  shall  be  paid  from  the cash receipts of the Facility or the working
capital provided by the LLC on behalf of Owner under the terms of this Agreement
and  the  Working  Capital  Agreement.

     (v)     In  order  to  enable  Emeritus  to  provide the accounting support
services  described  in  this Section, prior to the Commencement Date, Owner has
provided  to  Emeritus  the  information  and  has  taken the transition actions
described  in  Exhibit  A  hereto  (the  "Accounting  Transition  Services").

     II.     Reports:  Emeritus  shall  prepare  and  provide  to  Owner  any
             -------
reasonable  operational  information with respect to the Facility which may from
time  to  time  be  specifically  requested  by Owner, including any information
needed to assist Owner in completing the tax returns for which it is responsible
under  Section  I , in complying with any reporting obligations imposed on Owner
under  its  lease  or  on  Owner's  parent  as  a publicly traded company and in
complying with the reporting obligations described in Exhibit B. In addition, by
no  later  than  thirty (30) days after the end of each calendar month, Emeritus
shall  provide  Owner with an unaudited balance sheet of the Facility, dated the
last  day  of  such month, and an unaudited statement of income and expenses for
such  month  and  for  the  fiscal year to date relating to the operation of the
Facility  showing the variance between the actual and budgeted operating results
of  the Facility for said month and in the form attached hereto as Exhibit C and
with  a  census report for the month indicating the number of units occupied and
the  number  of units vacant.   Upon request Emeritus shall cooperate with Owner
or  Owner's  certified  public  accountant  in  the  event  Owner  elects, or is
required,  to  have  audited annual financial statements prepared. The financial
statements  prepared  by Emeritus shall be prepared in accordance with (i) GAAP,
consistently  applied,  (ii)  this  Agreement,  and  (iii)  the  procedures  and
practices  provided  for  in  this  Agreement.

     III.     Bank  Accounts:
              --------------

     (i)     With  respect  to  the Facility, Emeritus has established and shall
maintain  a  checking  account  for  the  Facility  in  the  name of Owner  (the
"Depository  Account")  and  shall deposit therein all money received during the
term  of this Agreement in the course of the operation of the Facility including
any  money  received  upon  the  collection  of  accounts  receivable  which are
outstanding  as  of the Commencement Date for goods sold or services rendered at
the Facility prior to the Commencement Date and shall pay therefrom the expenses
incurred  in the operation of the Facility during the Term of, and in accordance
with  the  terms  of,  this  Agreement.

     (ii)     During  the  Term  hereof,  withdrawals  and  payments  from  the
Depository  Account  shall  be made only on checks signed by a person or persons
designated by Emeritus but Emeritus shall have no ownership interest in or other
rights  to  the  Depository  Account  other  than  the right to make withdrawals
therefrom  and  to make deposits thereto; and provided, further that Owner shall
be  given  notice  as  to  the  identity  of  said  authorized  signatories.

     (iii)     Withdrawals  from  the  Depository Account shall be made first to
pay  the expenses of operating the Facility, including payroll and related state
and  federal  payroll  tax obligations (the "Daily Operating Expenses") and rent
payments due to the LLC (the "Property Expenses").  The Daily Operating Expenses
and the Property Expenses shall be paid by Emeritus in such order of priority as
Emeritus  deems  appropriate from time to time to the operation of the Facility,
provided  however,  Daily  Operating Expenses and the Property Expenses shall be
paid by no later than their due date or, if applicable, before the expiration of
any applicable grace period in which payment may be made prior to the occurrence
of  a default under the terms of the applicable lease, loan agreement, contract,
agreement  or purchasing arrangement, unless resulting from the failure of Owner
or  the  LLC on behalf of Owner to provide the Working Capital Funds (as defined
in Section III(v) below) as and when due in accordance with Section II(v) below.
Upon request, Emeritus shall make any rent payments which are made by it by wire
transfer  in  accordance with wiring instructions provided by Owner to Emeritus.

     (iv)     Any  excess  funds in the Depository Account for a Facility, after
establishing  the working capital reserves required by Section II(vii), shall be
distributed  by Emeritus to the LLC in accordance with the terms of Section 1(b)
of  the  Working  Capital  Agreement.

(v)     In  the  event  at  any  time Emeritus determines in the exercise of its
reasonable  judgment that there are insufficient funds in the Depository Account
to  maintain the minimum bank balance required by Section II(vii) and to pay all
Daily  Operating Expenses and Property Expenses due and payable in the following
thirty  (30)  day  period  (the "Working Capital Funds"), no less than three (3)
days  prior  to the date on which Emeritus determines that Working Capital Funds
are  required,  Emeritus  shall  provide  Owner and the LLC with a verbal demand
therefor  followed  by  a  written  confirmation  of  such demand, which written
confirmation shall specify in reasonable detail the amount needed and the reason
     therefor  and, Owner shall, within five (5) business days of its receipt of
such  written demand by Emeritus, cause the LLC on behalf of Owner to deposit in
the  applicable Depository Account the amount so demanded by Emeritus; provided,
however,  Owner  shall not be in default hereunder in the event the LLC fails to
provide  the Working Capital Funds after a demand therefor by Emeritus or Owner,
it  being  understood  and  agreed that in such instance Emeritus' sole recourse
shall  be  to  the  LLC and that Owner does hereby assign to Emeritus its rights
under  the  Working  Capital  Agreement  to  enforce  the obligations of the LLC
thereunder.  Owner  acknowledges  and  agrees that (i) in no event will Emeritus
have  any  obligation  to  pay any Daily Operating Expenses or Property Expenses
other  than  from  funds  available  in  the applicable Depository Account or to
provide  its  own  funds to satisfy or support in any manner the working capital
needs  of  the  Facility  or  to  pay  its own Service Fee and (ii) such working
capital  is  to be provided solely from the cash receipt of the Facility and the
working  capital  provided  by  the  LLC on behalf of the Owner pursuant to this
Section  III(v)  and the Working Capital Agreement and Emeritus acknowledges and
agrees  that Owner shall not be in default of its obligations under this Section
III(v)  in the event the LLC fails or refuses, whether with or without cause, to
provide  the  Working  Capital  Funds.

     (vi)     Owner  acknowledges and agrees that in the course of providing the
consulting  services  described  in  this  Agreement  Emeritus  may incur common
expenses  benefiting  all  of  the facilities owned and/or operated by Emeritus,
including  the  Facility (the "Common Expenses").  Such Common Expenses shall be
included  in  the  Daily Operating Expenses of the Facility and may be paid from
the  cash in the Depository Account if (i) the same relate to the direct cost of
corporate, regional or divisional meetings or training sessions held by Emeritus
and  in  which  the  administrative  personnel of the Facility have participated
("Meeting  and Training Common Expenses"), (ii) the same are included within the
approved  annual  capital  or  operating budgets ("Budgeted Common Expenses") or
(iii)  the  same are not Meeting and Training Common Expenses or Budgeted Common
Expenses  (the  "Other  Common  Expenses")  but  are  approved by the LLC, which
approval  shall not be unreasonably withheld, after Emeritus has provided  Owner
and  the  LLC with a specification setting forth in reasonable detail the nature
of  such  Other  Common  Expenses.

     (vii)     During the Term hereof, Owner and Emeritus shall attempt to agree
on the necessary minimum cash balance to be maintained in the Depository Account
for  the  Facility  but if they are unable to so agree such minimum cash balance
shall upon demand of Emeritus be required to be equal to $30,000 and Owner shall
upon  demand in accordance with Section III(v) cause the LLC to provide Emeritus
with any working capital which may be needed to enable Emeritus to maintain such
minimum  cash  balances;  provided,  however,  Owner  shall  not  be  in default
hereunder  in  the  event  the LLC fails to provide such working capital after a
demand  therefor  by  Emeritus  or Owner, it being understood and agreed that in
such  instance  Emeritus'  sole recourse shall be to the LLC and that Owner does
hereby  assign  to  Emeritus  its  rights under the Working Capital Agreement to
enforce  the  obligations  of  the  LLC  thereunder.

     IV.  Consulting Services. During the term of this Agreement, Emeritus shall
          -------------------
provide  consulting  services  to  the  Facility  on  the  following  terms  and
conditions:

     (i)  Supervise  the day to day operation and management of the Facility. In
furtherance of the foregoing, utilizing the resources provided or made available
by  Owner  in  accordance  with  the  terms of this Agreement, Emeritus shall be
responsible for the supervision and management of the operation of the Facility,
in accordance with applicable laws and regulations, including the supervision of
employees,  hiring  and  discharge  of  employees  in  consultation  with Owner,
billings  and  collection,  and regulatory compliance, including compliance with
the  State  Agreements  (as  hereinafter  defined).  In  furtherance  and not in
limitation  of  the  foregoing,  prior  to  the  Commencement Date, Emeritus has
designated  an  individual currently in its employ who has been hired/engaged by
Owner  to act as the training officer required by the terms of Paragraph 6(O) of
the  2000  Order  (as  defined  below)  (the  "Training  Officer").

(ii)     Employ  and  lease to Owner such individuals as may be deemed necessary
by  Emeritus  for  the  operation the Facility in accordance with all applicable
legal  requirements; provided, however, in no event shall the community director
be  an employee of Emeritus but instead he or she is and shall remain throughout
the  term  of  this  Agreement  an  employee of Owner.  In consideration for the
leasing  of  such  employees by Emeritus to Owner, all of the wages and benefits
due  from  Emeritus  to  such  leased  employees  shall be included in the Daily
Operating  Expenses of the Facility and shall be paid either to the employees or
to  Emeritus, if previously paid by Emeritus to the employees, from the funds in
the  Depository  Account.

     (iii)     Emeritus, as agent for the Owner and at the sole cost and expense
of  the LLC on behalf of Owner under the terms of the Working Capital Agreement,
shall  obtain  and  keep  in  force  adequate  insurance  as  outlined  below:

          A.  All  Risk,  or  other  broad  form  coverage  property  insurance,
insuring  full  replacement value. Such insurance shall also include, but not be
limited  to,  business  interruption and extra expense coverage, for a period of
not  less than six months.    Emeritus shall also maintain flood hazard coverage
at  an  amount  equal  to  full  replacement  cost  of  the  Facility.

          B.  Commercial  general  liability  insurance, against any third party
claims  for bodily injury or property damage.  Such insurance shall also include
coverage  for  contractual liability as respects this Agreement.  Limits of such
coverage  should  not  be less than $1,000,000 per occurrence, with a minimum of
$2,000,000  per  location  aggregate.

          C.    Professional  Liability  Insurance  with limits of such coverage
that  are  not less than $1,000,000 per occurrence, with a minimum of $2,000,000
per  location  aggregate.

          D.    Business  Auto  Liability  for  third  party  bodily  injury  or
property  damage for facility vehicles including owned, hired and non-owned auto
liability  for  $1,000,000 combined single limit.  Coverage shall be extended to
cover  physical  damage  to  facility  vehicles.

E.      Umbrella/Excess  Commercial  General Liability and Professional Services
Liability  in  the  amount  of  $10,000,000  per  occurrence.

          F.  Workers'  Compensation  coverage  with  statutory  limits  and
Employers'  Liability  insurance  coverage with minimum limits of $1,000,000 per
occurrence.

          G.    Crime insurance to cover employee dishonesty, theft of money and
security  loss  in  limits  of  not  less  than  $1,000,000

     For  all  such  insurance  as  deemed  necessary  above,  it  is agreed and
understood  that  Emeritus shall continuously maintain the same at the sole cost
and expense of the LLC on behalf of Owner under the terms of the Working Capital
Agreement,  and that all premiums, deductibles and uninsured losses with respect
to such policies shall be deemed to be included in the Daily Operating Expenses.
Emeritus  shall  provide  Owner with evidence of all insurance, naming Owner and
the  LLC  as an additional insured on policies B, C, D, and E above, and subject
to  the  requirements  of  the LLC, loss payee as respect the property policies.
Such  evidence  of  insurance  shall  give Owner at least thirty (30) days prior
notice  of  cancellation  or  any  material  change  to  policies.

     Emeritus  shall also assist Owner to procure such other insurance coverages
as may be required by the LLC for the Facility. Emeritus shall, at its sole cost
and expense, maintain commercial general liability insurance for its operations.
Emeritus  agrees to furnish Owner and the LLC with evidence of such insurance or
with  duplicate  copies  of  such  policies.

(iv)     Emeritus  shall  have  no  authority  to  commit the expenditure of the
Facility's  funds  or  the  funds  of  Owner  or the LLC during the term of this
Agreement  unless  it  has  secured  the  prior  written  consent  of  the LLC's
Representative  and the LLC's Representative shall have no obligation to approve
any  non-routine  expenditures of the Facility's funds or the LLC's funds during
the  term  of  this  Agreement.

(v)     For  purposes  hereof,  the  State  Agreement  shall  be defined as that
Stipulation,  Waiver  and  Order  dated  May  25,  2000  entered  in  Case  No.
7099344003-C  (the  "2000  Order"), a true and correct copy of which is attached
hereto  as  Exhibit  D.

          V.  Emeritus' and Owner's and the LLC Representative:  Emeritus hereby
              ------------------------------------------------
appoints  Frank Ruffo (the "Emeritus' Representative") as the person employed by
Emeritus  with whom Owner shall interact and upon whose decisions Owner shall be
authorized  to  rely,  and  Owner  hereby  appoints  Walt  Bowen  (the  "Owner's
Representative")  as  the  person  employed  by  Owner  with whom Emeritus shall
interact  and  upon  whose  decisions Emeritus shall be authorized to rely, with
respect  to  the  performance  by Emeritus of its duties hereunder. Emeritus and
Owner  acknowledge and agree that they have been advised by the LLC that the LLC
has  appointed Ruth Verhoff (the "LLC Representative") as the person employed by
the  LLC  with  whom  Owner and Emeritus shall interact and upon whose decisions
Owner  and  Emeritus  shall be authorized to rely. Emeritus shall have the right
from  time  to  time  during the term of this Agreement to replace the Emeritus'
Representative  upon  written  notice  to  Owner  designating  the  replacement
Emeritus' Representative and Owner shall have the right from time to time during
the  term  of  this Agreement to replace the Owner's Representative upon written
notice  to Emeritus designating the replacement Owner's Representative.  Nothing
herein  shall  be  construed as imposing any personal liability on the Emeritus'
Representative  or  Owner's Representative with respect to the acts or omissions
of  Emeritus  or  Owner,  respectively,  under  this  Agreement.

          VI.     Term  of  Agreement  and  Termination  Payments:
                  -----------------------------------------------

(i)     The  Term  of this Agreement shall commence on the date on which the LLC
acquires  title  to the Facility (the "Commencement Date").  On the Commencement
Date,  Emeritus and Regent shall sign this Agreement and insert the Commencement
Date  in  the  space  provided  below:

Commencement  Date:     __________________,  2002

     (ii)     The Term of this Agreement shall terminate upon the first to occur
of  the  following:

(A)     the  occurrence  of  an  Event  of Default hereunder and the exercise by
Emeritus  or Owner, as applicable, of its right to terminate this Agreement as a
result  thereof;  or

(B)     on  receipt  by  Emeritus  of  licensure  approval  from  the  State  of
California,  in which case Emeritus shall commence management of the Facility in
accordance  with  the  terms  of  the  Agreement  to Provide Management Services
between  the  LLC  and  Emeritus  of  even  date  herewith;  or

(C)     termination  of  the  Lease between Owner and the LLC in accordance with
the  terms  thereof.

     (iii)     In  the  event  of  the termination of this Agreement by Owner or
Emeritus  in  accordance with the terms of clauses (A) or (C) above, (A) no such
termination shall be effective until all amounts due and owing from one party to
the other in accordance with the terms of this Agreement, including the monetary
damages  specifically  provided for in Sections VII(a) and (b), but specifically
excluding any other damages alleged to have been suffered by a party as a result
of  the  termination  of  this  Agreement  after  the  occurrence of an Event of
Default,  have  been paid in full and (B) Emeritus shall cooperate with Owner or
its  designee,  at no cost to Emeritus and without the assumption of any further
liability  by  Emeritus  other than the liability imposed on Emeritus under this
Agreement,  in  an  orderly  transition  of  accounting  responsibility  for the
Facility  to  Owner  or  its  designee.

     VII.     Default:  Either  party may terminate this Agreement, as specified
              -------
in  this  Section V, in the event of a default ("Event of Default") by the other
party.

          (a)     With  respect  to  Emeritus, it shall be an "Event of Default"
hereunder:

     (i)     If  Emeritus  shall  fail  to keep, observe or perform any material
agreement,  term or provision of this Agreement, and such default shall continue
for  a  period  of forty five (45) days (subject to the force majeure provisions
below)  after  notice  thereof shall have been given to Emeritus by Owner, which
notice  shall specify in detail the event or events constituting the default; or

     (ii)     If Emeritus shall (A) apply for or consent to the appointment of a
receiver,  trustee or liquidator of Emeritus of all or a substantial part of its
assets,  (B)  file  a  voluntary petition in bankruptcy, or admit in writing its
inability to pay its debts as they become due, (C) make a general assignment for
the  benefit  of  creditors,  or  (D)  file  a  petition  or  an  answer seeking
reorganization  or  arrangement  with  creditors  or  taking  advantage  of  any
insolvency law, or if an order judgment or decree shall be entered by a court of
competent jurisdiction, on the application of a creditor, adjudicating Emeritus,
a  bankrupt  or  insolvent  or  approving  a  petition seeking reorganization of
Emeritus, or appointing a receiver, trustee or liquidator of Emeritus, of all or
a  substantial  part  of  its  assets.

          (b)     With  respect  to  Owner,  it  shall  be  an  Event of Default
hereunder:

     (i)     If  Owner  shall  fail  to  make or cause to be made any payment to
Emeritus  required  to  be  made  hereunder  (other  than  its  working  capital
obligation  which  is addressed in clause (iii)) and such failure shall continue
for  a  period  of thirty (30) days after notice, which notice shall specify the
payment  or  payments  which  Owner  has  failed  to  make;

     (ii)     If  Owner  shall  fail  to  keep,  observe or perform any material
agreement,  term  or provision of this Agreement and such default shall continue
for  a period of forty five (45) days after notice (subject to the force majeure
provisions  below),  which  notice  shall  specify in detail the event or events
constituting  the  default  thereof  by  Emeritus  to  Owner;

     (iii)     If Owner shall fail to cause the LLC to provide necessary working
capital  upon  demand  by  Emeritus  with  respect  to  the payment of the Daily
Operating  Expenses  or  the  Property  Expenses due to Emeritus within the time
provided  in  Section  III(v),  and  such failure continues uncured for five (5)
business  days  after  Emeritus  gives  Owner  notice of such failure; provided,
however,  Owner  shall not be in default hereunder in the event the LLC fails to
provide  such  working  capital after a demand therefor by Emeritus or Owner, it
being  understood and agreed that in such instance Emeritus' sole recourse shall
be to the LLC and that Owner does hereby assign to Emeritus its rights under the
Working  Capital  Agreement  to  enforce  the obligations of the LLC thereunder.

     (iv)     If  Owner  shall be dissolved or shall apply for or consent to the
appointment  of  a  receiver,  trustee  or  liquidator  of  Owner or of all or a
substantial  part  of  its  assets,  file a voluntary petition in bankruptcy, or
admit  in  writing  its  inability  to  pay its debts as they become due, make a
general  assignment  for  the benefit of creditors, file a petition or an answer
seeking  reorganization of arrangement with creditors or taking advantage of any
insolvency  law,  or if an order, judgment or decree shall be entered by a court
of  competent jurisdiction, on the application of a creditor, adjudicating Owner
a  bankrupt or insolvent or approving a petition seeking reorganization of Owner
or appointing a receiver, trustee or liquidator of Owner of all or a substantial
part  of  its  assets;  or

     (v)      If  Owner or any of its principal officers is convicted or a crime
that  materially  affects  the  operation  or  regulation  of  the  Facility.

     VIII.     Remedies  and  Obligations  Upon  Default:
               -----------------------------------------

     (i)     If  any  Event  of  Default  by Owner shall occur, Emeritus may, in
addition to any other remedy available to it in law or equity on account of such
Event  of  Default,  forthwith terminate this Agreement, and neither party shall
have  any  further  obligations  whatsoever  under  this  Agreement  except  for
Emeritus' right to receive damages from Owner in the amount specified in Section
IV  and except any settlement and payment obligations and other obligations that
by  their  nature  survive  termination  of  this  Agreement.

     (ii)     If  any  Event  of  Default by Emeritus shall occur, Owner may, in
addition to any other remedy available to it in law or equity on account of such
Event  of Default, forthwith terminate this Agreement and the exclusive right to
possession  of  the  Facility  granted  to Emeritus hereunder, and neither party
shall  have  any  further obligation whatsoever under this Agreement; except for
Owner's  right  to  receive  payment  of  liquidated damages from Emeritus in an
amount  specified  in  Section  IV.

     IX.     Accounting  and  Consulting  Fee:
             --------------------------------

     (i)     In  consideration for the provision of the services contemplated in
this Agreement and the provision of the Training Officer, Emeritus shall receive
a  fee  equal  to 5% of the gross revenues of the Facility (the "Services Fee").
For  purposes hereof, the gross revenues of the Facility shall be defined as all
revenues  generated  by  the  operation  of  the Facility, but shall not include
proceeds  from  the sale of Facility equipment or the Facility, any insurance or
condemnation  proceeds  or  any  other  proceeds  from  a  capital  event.

     (ii)     If the services of Emeritus commence or terminate (for any reason,
including  those  set  forth  in Paragraph V) other than on the first day of the
month,  the  revenues  upon  which  the  fee  is calculated shall be prorated in
proportion  to  the  number  of  days  for which services are actually rendered.

     (iii)     The  Services  Fee  provided  for  herein  shall  be disbursed by
Emeritus  to  itself  out  of  the  Depository  Account  in  accordance with the
provisions  of  Section  III.

     (iv)     Any  amounts  due  from  Owner  to  Emeritus  or Emeritus to Owner
pursuant  to  this Section IX which are not paid when due shall bear interest at
the  annual rate equal to the Prime Rate as set forth in the Money Rates Section
of  The  Wall  Street Journal (as the same may change from time to time) plus 5%
from  the  date  due  to  the  date  paid  in  full.

     X.     Assignment:  This  Agreement  shall  not be assigned by either party
            ----------
without  the  prior  written  consent  of  the  other  party; provided, however,
Emeritus  shall  have  the  right to assign this Agreement to an entity which is
owned  or  controlled  by Emeritus or its principal shareholder, Daniel R. Baty,
without  the  prior  written  consent  of  Owner.

     XI.     Notices:  All  notices  required  or  permitted  hereunder shall be
             -------
given  in  writing  by  hand  delivery, by registered or certified mail, postage
prepaid,  by  overnight  delivery  or  by  facsimile  transmission (with receipt
confirmed  with  the  recipient).  Notice  shall  be  delivered or mailed to the
parties at the following addresses or at such other places as either party shall
designate  in  writing.  All notices shall be deemed duly given when delivery is
received  or  refused  by  a party if delivered by hand, three (3) business days
after  being  deposited in the mails if sent by registered or certified mail, on
the next business day if sent by overnight delivery and on confirmed receipt, if
sent  by  facsimile  transmission.

          To  Emeritus:     Emeritus  Corporation
                    3131  Elliott  Avenue
                    Suite  500
                    Seattle,  WA  98121
                    Facsimile:     206-301-4500
                    Attn:          Raymond  R.  Brandstrom,  Vice  President
-Finance

          To  Owner:     RAL,  Inc.
                    Bank  of  America  Building
                    121  SW  Morrison
                    Suite  100
                    Portland,  OR  97201
                    Facsimile:     503-274-4685
                    Attn:          Walt  Bowen,  President


     XII.     Relationship  of  the  Parties:  The  relationship  of the parties
              ------------------------------
shall  be that of principal and independent contractor and all acts performed by
Emeritus  during the term hereof with respect to the Facility shall be deemed to
be performed in its capacity as an independent contractor.  Nothing contained in
this  Agreement is intended to or shall be construed to give rise to or create a
partnership  or joint venture or lease between Owner, its successors and assigns
on  the  one  hand,  and Emeritus, its successors and assigns on the other hand.
Notwithstanding  the  foregoing, Emeritus shall be authorized to execute certain
documents in the course of the day to day operation of the Facility as the agent
of  Owner, such as credit applications for supplies, banking resolutions for the
Depository  Account,  utility  deposit  forms,  etc.

     XIII.     Indemnification:  Emeritus  shall  indemnify,  defend  and  hold
               ---------------
harmless  Owner  and/or  the LLC from any loss incurred by or damage to Owner or
the  LLC  where  such  loss or damage results from (A) the negligence or willful
misconduct of Emeritus in performing its obligations under this Agreement, (B) a
breach  of  this  Agreement  by  Emeritus  or (C) any and all claims, penalties,
liabilities  and expenses of whatsoever kind and nature which may be asserted by
any governmental body or by any person claiming to be aggrieved by reason of any
act  or  failure  to  act  by Emeritus in accordance with or in violation of any
federal,  state,  county,  municipal  and  other  governmental laws, ordinances,
regulations  and  orders  having  to  do  with  anti-discrimination,  workmen's
compensation,  employer's  liability  insurance,  social  security, unemployment
insurance,  hours of labor, wages, working conditions, immigration and all other
employer-employee  related  subjects  (including  without  limitation,  tax
withholding  and  information  reporting  requirements),  so long as such act or
failure to act is not caused or directed by Owner or the LLC; provided, however,
Owner  specifically  acknowledges  and  agrees that nothing in this Section XIII
shall  be  construed  as  imposing  any  liability on Emeritus for any insurance
deductibles  for  which  the LLC on behalf of Owner shall be solely responsible.
Owner  shall indemnify, defend and hold Emeritus harmless from any loss incurred
by  or  damage to Emeritus where such loss or damage results from the negligence
or willful misconduct of Owner in performing its obligations under the Agreement
or  from  a  breach  of  this  Agreement  by  Owner.

     XIV.     Entire  Agreement:  This  Agreement  contains the entire agreement
              -----------------
between  the  parties  relating  to  the  operation of the Facility and shall be
binding  upon  and  inure  to the benefit of their successors and assigns.  This
Agreement  may not be modified or amended except by written instrument signed by
both  of  the  parties  hereto.

     XV     Captions:  The captions used herein are for convenience of reference
            --------
only  and  shall  not  be  construed in any manner to limit or modify any of the
terms  hereof.

     XVI.     Arbitration:  In  the  event  of  any  dispute  among  the parties
              -----------
regarding  the  Facility or this Agreement, the parties agree to submit the same
to  resolution  before an arbitrator, in the case of disputes alleged to involve
less  than  $250,000,  and  before  a panel of three arbitrators, in the case of
disputes  alleged  to  involve $250,000 or more, selected by mutual agreement of
the  parties or, if the parties are unable to agree on an arbitrator or panel of
arbitrators  within  a  period  of  twenty  (20)  days,  selected  by a court of
competent  jurisdiction.  Such  arbitration shall be held in accordance with the
rules of the American Arbitration Association and the decision of the arbitrator
shall  be  final  and  binding  on the parties and may be enforced by a court of
competent  jurisdiction.  The party requesting arbitration shall do so by giving
notice  to  that  effect  to the other party, specifying in reasonable detail in
said  notice  the  nature  of  the dispute; provided, however, in the event that
notwithstanding  the  terms  hereof, a party commences legal proceedings, rather
than  arbitration  proceedings,  before  a  court of competent jurisdiction, the
other  party  shall  be  deemed to have forfeited its right to have such dispute
determined  by  binding  arbitration  in accordance with this Section XVI unless
within thirty (30) days after being served with the first pleading in such legal
proceedings,  it  files a motion to dismiss such legal proceedings and serves on
the  other party notice of its intent to submit such dispute to arbitration. Any
party  who  fails  to submit to binding arbitration following a lawful demand by
the  other  party  shall  bear  all  costs  and  expenses,  including reasonable
attorneys  fees  (including  those incurred in any trial, bankruptcy proceeding,
appeal or review) incurred by the other party in obtaining a stay of any pending
judicial  proceeding  concerning  a dispute which by the terms of this Agreement
has  been  properly  submitted  to  mandatory  arbitration  and/or in compelling
arbitration  of  any  dispute.  All  disputes  under  this  Section XVI shall be
determined  in  the City of Portland, Oregon, if the arbitration is initiated by
Owner and in the City of Seattle, Washington, if the arbitration is initiated by
Emeritus, by a single arbitrator.  All arbitrators shall be a licensed attorneys
having  at  least  ten  (10)  years  experience,  with  at  least five (5) years
experience with assisted living facility sale, lease or management transactions.
The award in such arbitration may be enforced on the application of either party
by  the  order of judgment of a court of competent jurisdiction.  The prevailing
party  shall  be  entitled  to  recover  the reasonable fees and expenses of its
attorneys  and  experts.  The  arbitrator(s)  shall  resolve  all  disputes  in
accordance  with  the substantive law of the state of Oregon.  The arbitrator(s)
shall  have  no  authority  or  jurisdiction  to  award any damages or any other
remedies  beyond  those  which  could have been awarded in a court of law if the
parties had litigated the claims instead of arbitrating them.  The parties shall
not assert any claim for punitive damages.  The Federal Arbitration Act, Title 9
of  the  United  States  Code,  is  applicable  to this transaction and shall be
controlling  in  any  judicial  proceedings  and in the arbitration itself as to
issues  of  arbitrability  and procedure.  Nothing herein shall preclude a party
from  curing  either their own or the other party's alleged default which is, or
could  be,  the  subject  of an arbitration proceeding under this Section XVI or
from  seeking  equitable  relief which the arbitrator or panel of arbitrators is
not  empowered  to  award,  such  as  an injunction, receivership, attachment or
garnishment.

     XVII.     Severability:  In  the  event  one  or  more  of  the  provisions
               ------------
contained in this Agreement is deemed to be invalid, illegal or unenforceable in
any  respect  under applicable law, the validity, legality and enforceability of
the  remaining  provisions  hereof  shall  not  in  any way be impaired thereby.

     XVIII.     Cumulative; No Waiver:  No right or remedy herein conferred upon
                ---------------------
or  reserved  to either of the parties hereto is intended to be exclusive of any
other  right  or remedy, and each and every right and remedy shall be cumulative
and  in  addition  to  any  other  right  or  remedy  given hereunder, or now or
hereafter legally existing upon the occurrence of an Event of Default hereunder.
The  failure  of  either  party  hereto  to  insist  at any time upon the strict
observance  or  performance  of  any  of  the provisions of this Agreement or to
exercise  any right or remedy as provided in this Agreement shall not impair any
such  right or remedy or be construed as a waiver or relinquishment thereof with
respect  to subsequent defaults.  Every right and remedy given by this Agreement
to  the parties hereof may be exercised from time to time and as often as may be
deemed  expedient  by  the  parties  thereto,  as  the  case  may  be.

     XIX.     Authorization  for  Agreement:  The  execution  and performance of
              -----------------------------
this  Agreement by Owner and Emeritus have been duly authorized by all necessary
laws,  resolutions or corporate action, and this Agreement constitutes the valid
and  enforceable obligations of Owner and Emeritus in accordance with its terms.

     XX.     Counterparts:  This  Agreement  may  be  executed  in any number of
             ------------
counterparts,  each  of  which  shall  be an original, and each such counterpart
shall  together  constitute  but  one  and  the  same  Agreement.

     XXI.     Confidentiality:  Throughout  the Term of this Agreement and for a
              ----------------
period  of  one  (1)  year  after  the expiration or earlier termination of this
Agreement,  each of Emeritus and Owner agrees to maintain the confidentiality of
any  proprietary  information concerning the other or the Facility to which they
may  gain  access  during the term of this Agreement and shall only disclose the
same  with  the consent of the other party or as required by an order of a court
of  competent  jurisdiction.

     XXII.  Construction:  Each  of  the parties acknowledges and agrees that it
            -------------
has  participated  in  the  drafting  and  negotiation  of  this  Agreement.
Accordingly,  in  the  event  of a dispute with respect to the interpretation or
enforcement  of the terms hereof, no provision shall be construed so as to favor
or  disfavor  either  party  hereto.

     XXIII.     Third  Party  Beneficiary:  The  LLC  is an intended third party
                --------------------------
beneficiary  of  this  Agreement.
<PAGE>

          IN  WITNESS  WHEREOF, the parties have hereto caused this Agreement to
be  duly  executed,  as  of  the  day  and  year  first  above  written.

                    RAL,  INC.

                    By:     /s/    Walt  Bowen
                         Walt  Bowen
                    Its:     _____________________________________


                    EMERITUS  CORPORATION

                    By:     /s/    Raymond  R.  Brandstrom
                         Raymond  R.  Brandstrom
                    Its:     _____________________________________

<PAGE>


                                    EXHIBIT A
                         ACCOUNTING TRANSITION SERVICES

<PAGE>
                                    EXHIBIT B
               ADDITIONAL FACILITY SPECIFIC REPORTING OBLIGATIONS

<PAGE>
                                    EXHIBIT C
                          FORM OF FINANCIAL STATEMENTS

<PAGE>
                                    EXHIBIT D
                                   2000 ORDER


<PAGE>