**Exhibit
      10.67.08**




[Phoenix,
      Arizona]











**PURCHASE
        AND SALE AGREEMENT**
 **AND**
 **JOINT
        ESCROW INSTRUCTIONS**
 
 
 By
        and
        Between
 
 
 HEALTH
        CARE PROPERTY INVESTORS, INC.,
 a
        Maryland corporation
 
 as
        “Seller”
 
 
 and
 
 
 EMERITUS
        CORPORATION,
 a
        Washington corporation,
 
 as
        “Buyer”







**TABLE
        OF CONTENTS**
  Page1.
              DEFINITIONS
              12.
              SALE
                  OF THE PROPERTY
              43.
              ESCROW
              44.
              PURCHASE
                  PRICE; ALLOCATION OF PURCHASE PRICE
              55.
              CONDITIONS
                  TO CLOSING; AS IS PURCHASE
              56.
              CLOSING
                  OF ESCROW
              87.
              TERMINATION
              138.
              REPRESENTATIONS
                  AND WARRANTIES
              159.
              CERTAIN
                  EVENTS PRIOR TO CLOSING
              1710.
              POST-CLOSING
                  MATTERS
              1711.
              BROKERS
              1812.
              MISCELLANEOUS
                  PROVISIONS
              18
  EXHIBITSA
              Description
                  of Emeritus Master LeaseB
              Escrow
                  General ProvisionsC
              [RESERVED]D
              Form
                  of Quitclaim Bill of SaleE
              [RESERVED]F
              [RESERVED]G
              Nominee
                  and Property/FacilityH
              [Reserved]
  SCHEDULE1
              Related
                  Purchase Agreements
  
 **PURCHASE
          AND SALE AGREEMENT**
 **AND
          JOINT ESCROW INSTRUCTIONS**
  THIS
          PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this “Agreement”) is
          made and entered into as of July 31, 2007 to be effective as of June 14,
          2007
          (the “Effective Date”), by and among HEALTH CARE PROPERTY INVESTORS, INC., a
          Maryland corporation (“Seller”) and EMERITUS CORPORATION, a Washington
          corporation (“Buyer”), as follows:
  **RECITALS**
  A.              
          Seller is the owner of the Property (as defined below).
  B.           
              The Property is currently leased, together with certain other
          property, by Seller and/or certain Affiliates (as defined below) of Seller
          to
          Buyer and/or certain Affiliates of Buyer pursuant to the Emeritus Master
          Lease
          (as defined below).
  C.              
           Buyer desires to purchase the Property from Seller and Seller desires to
          sell the Property to Buyer on the terms and subject to the conditions set
          forth
          herein.
  **AGREEMENT**
  NOW,
          THEREFORE, for good and valuable consideration, the receipt and sufficiency
          of
          which are hereby acknowledged, Buyer and Seller agree as follows:
  **1.           DEFINITIONS**
  For
          all
          purposes of this Agreement, except as otherwise expressly provided herein
          or
          unless the context otherwise requires, (i) the terms defined in this Article
          have the meanings assigned to them in this Article and include the plural
          as
          well as the singular; (ii) all references in this Agreement to designated
          “Articles,” “Sections” and other subdivisions are to the designated Articles,
          Sections and other subdivisions of this Agreement; (iii) the word “including”
shall have the same meaning as the phrase “including, without limitation,” and
          other phrases of similar import; and (iv) the words “herein,” “hereof” and
“hereunder” and other words of similar import refer to this Agreement as a whole
          and not to any particular Article, Section or other subdivision.
  **1.1**            
           **1031 Exchange****:**  As
          defined in Section 6.8.
  **1.2**             
          **Additional
          Charges****:**“Additional Charges,” as
          defined in the Emeritus Master Lease and allocable to the Property.
  **1.3**             
          **Additional Rent****:**  “Additional
          Rent,” as defined in the Emeritus Master Lease (including “Percentage Rent” and
“CPI Rent,” as each are defined in the Emeritus Master Lease) and allocable to
          the Property.
  **1.4**             
          **Affiliate****:**  “Affiliate,” as
          defined in the Emeritus Master Lease.
  **1.5**             
          **Bill of Sale****:**  As defined in
          Section 6.2.2.
  
  **1.6**             **Close
          of Escrow, Closing Date and/or Closing**:  As defined in
          Section 6.1.
  **1.7**             **Closing
          Funds****:**As defined in Section
          4.4.
  **1.8**             **Condemnation****:**  “Condemnation,”
          as defined in the Emeritus Master Lease.
  **1.9**             **Condemnor****:**  “Condemnor,”
          as defined in the Emeritus Master Lease.
  **1.10**           **Deed****:**  As
          defined in Section 6.2.1.
  **1.11**           **Earnest
          Money Deposit****:**  As defined in the Master
          Purchase Agreement.
  **1.12**           **Effective
          Date****:**As defined in the preface to this
          Agreement.
  **1.13**           **Emeritus
          Master Lease****:**  That Amended and Restated
          Master Lease identified on **Exhibit “A”** attached hereto
          among Lessor and Lessee covering, among other properties, the Property,
          as more
          particularly described therein, as the same may have been amended or modified
          from time to time in accordance with the terms thereof.
  **1.14**           **Emeritus/Summerville
          Merger****:**  As defined in the Master
          Purchase Agreement.
  **1.15**           **Escrow
          Holder****:**  As defined in Section
          3.1.
  **1.16**           **Event
          of Default****:**“Event of Default,” as defined in the
          Emeritus Master Lease.
  **1.17**           **Funds****:**  Immediately
          available funds in the form of cash, wire transfer of funds, or a certified
          or
          bank cashier’s check drawn on a reputable financial institution acceptable to
          Escrow Holder.
  **1.18**           **Hazardous
          Substance****:**  “Hazardous Substance,” as
          defined in the Emeritus Master Lease.
  **1.19**           **HCP****:**Health
          Care Property Investors, Inc., a Maryland corporation.
  **1.20**           **Impositions****:**  “Impositions,”
          as defined in the Emeritus Master Lease with respect to the
          Property.
  **1.21**           **Laws****:**  All
          applicable governmental laws, codes, ordinances, regulations, judgments,
          permits, approvals or other requirements.
  **1.22**           **Lessee****:**  “Lessee,”
          as defined in the Emeritus Master Lease.
  **1.23**           **Lessor****:**  “Lessor,”
          as defined in the Emeritus Master Lease.
  **1.24**           **Liabilities****:**
          Any claim, liability, loss, cost, action, damage, expense or fees, including
          but
          not limited to reasonable attorney’s and paralegals’ fees and costs of defense
          (each, a “Liability”).
  **1.25**           **Master
          Purchase Agreement****:**  As defined in
**Schedule 1** hereto.
  2
  **1.26**           **Minimum
          Rent****:**“Minimum Rent,” as defined in the
          Emeritus Master Lease with respect to the Property.
  **1.27**           **Opening
          of Escrow****:**  As defined in Section
          3.3.
  **1.28**           **Organizational
          Documents****:**  Collectively, as applicable,
          the articles or certificate of incorporation, certificate of limited partnership
          or certificate of limited liability company, bylaws, partnership agreement,
          operating company agreement, trust agreement, statements of partnership,
          fictitious business name filings and all other organizational documents
          relating
          to the creation, formation and/or existence of a business entity, together
          with
          resolutions of the board of directors, partner or member consents, trustee
          certificates, incumbency certificates and all other documents or instruments
          approving or authorizing the transactions contemplated by this
          Agreement.
  **1.29**           **Outside
          Closing Date****:**  Subject to extension as
          provided Section 6.8 below, August 15, 2007.
  **1.30**           **Permitted
          Exceptions****:**As defined in Section
          6.2.1.
  **1.31**           **Person****:**Any
          individual, corporation, partnership, joint venture, limited liability
          partnership, limited liability company, association, joint stock company,
          trust,
          unincorporated organization, whether or not a legal entity, or other business
          or
          governmental entity or authority (or any department, agency, or political
          subdivision thereof).
  **1.32**           **Property****:**  The
          “Leased Property” (as defined in the Emeritus Master Lease) of the “Facility”
(as defined in the Emeritus Master Lease) listed on **Exhibit
          G** attached hereto, less any portion which has been taken by
          reason
          of any Condemnation or other exercise of the power of eminent
          domain.  The parties acknowledge that the Property for purposes of
          this Agreement includes only the “Leased Property” of the “Facility”
listed  on **Exhibit G** attached hereto, and that
          the balance of the “Leased Property” of each “Facility” covered by the Emeritus
          Master Lease, but not covered by this Agreement is being sold and conveyed
          to
          Buyer pursuant to the Master Purchase Agreement or another Related Purchase
          Agreement.  In other words, pursuant to this Agreement, the Master
          Purchase Agreement and the other Related Purchase Agreements Seller and/or
          its
          Affiliates are selling and Buyer is purchasing all of Seller’s and/or its
          Affiliates’ right, title and interest in and to the “Leased Property” of all of
          the “Facilities” covered by the Emeritus Master Lease upon the Closing hereunder
          and the Related Purchase Agreement Closing under each applicable Related
          Purchase Agreement, but this Agreement is intended to and only covers the
          “Leased Property” of the “Facility” listed  on **Exhibit
          G** attached hereto.
  **1.33**           **Purchase
          Price****:**  As defined in Section
          4.1.
  **1.34**           **Related
          Purchase Agreements**:  The agreements identified on
**Schedule 1** attached hereto between and/or
          among Seller
          or certain Affiliates of Seller, and Buyer, or certain Affiliates of Buyer,
          relating to certain purchase and sale transactions to be consummated
          concurrently with the Closing hereunder, if at all (each, a “Related Purchase
          Agreement”).
  **1.35**           **Related
          Purchase Agreement Closing**.  The “Closing,” as defined in
          each Related Purchase Agreement.
  3
  **1.36**           **Related
          Purchase Agreement Buyer Default**.  The occurrence of a
          default (i.e., after any applicable notice or cure period) by Buyer or
          any
          Affiliate of Buyer under any Related Purchase Agreement.
  **1.37**           **Related
          Purchase Agreement Seller Default****.**  The
          occurrence of a default (i.e., after any applicable notice or cure period)
          by
          Seller or any Affiliate of Seller under any Related Purchase
          Agreement.
  **1.38**           **Release
          of Claims:**  As defined in the Master Purchase
          Agreement.
  **1.39**           **Rent
          and Charges****:**  All accrued and unpaid
          Minimum Rent, Additional Rent, and any Additional Charges (whether or not
          billed) payable by the Lessee under the Emeritus Master Lease with respect
          to
          the Property, through and including the day prior to Closing Date (prorated
          to
          the extent applicable for the month during which the Closing
          occurs).
  **1.40**           **Summerville****:**  Summerville
          Senior Living, Inc., a Delaware corporation.
  **1.41**           **Summerville
          Master Lease****:**  As defined in the Master
          Purchase Agreement.
  **1.42**           **Title
          Company****:**Chicago Title Insurance
          Company, Attn: Angie Koetters, Escrow Officer, Fax
          No.:(312)223-5888.
  **1.43**           **Title
          Policy****:**As defined in Section
          6.4.
  **1.44**           **Title
          Endorsements****:**As defined in Section
          6.4.
  **1.45**           **Transaction
          Documents****:**  Collectively, this
          Agreement, the Deed, the Bill of Sale, each Related Purchase Agreement,
          and all
          other agreements, documents and/or instruments to be executed and/or delivered
          pursuant to and in connection with this Agreement, the Related Purchase
          Agreements and/or the Exhibits hereto or thereto.
  **1.46**           **Transaction
          Taxes**.  Any and all federal, state, municipal or other
          local Law documentary transfer, stamp, sales, use, excise, privilege or
          similar
          tax, fee or charge payable in connection with the delivery of any instrument
          or
          document provided in or contemplated by this Agreement, any Related Purchase
          Agreement or the Exhibits hereto and thereto together with interest and
          penalties, if any, thereon, including any sales or similar taxes payable
          in
          connection with the transfer of any personal property comprising a part
          of the
          Property.
  **2.           SALE
          OF THE PROPERTY**
  Buyer
          agrees to purchase and accept from Seller, and Seller agrees to sell, convey
          and
          assign to Buyer, the Property on the terms and subject to the conditions
          set
          forth herein.
  **3.           ESCROW**
  **3.1**           **General
          Instructions**.  Title Company is also hereby designated as
          escrow holder (sometimes herein referred to as “Escrow
          Holder”).  Escrow Holder’s Escrow number, Escrow Officer for the
          transactions contemplated hereby and under the Related Purchase Agreements,
          address for notices and wiring information is set forth below Title Company’s
          acceptance of this Escrow.  Escrow Holder’s general conditions or
          provisions, which are attached hereto as **Exhibit “B”** are
          incorporated by reference herein; provided, however, that in the event
          of any
          inconsistency between **Exhibit “B”** and any of the
          provisions of this Agreement or any Related Purchase Agreement, the provisions
          of this Agreement or the Related Purchase Agreement, as applicable, shall
          control, respectively.  Buyer and Seller shall each execute, deliver
          and be bound by such further escrow instructions or other instruments as
          may be
          reasonably requested by the other party or by Escrow Holder from time to
          time,
          so long as the same are consistent with this Agreement.  Escrow Holder
          shall not comply with the unilateral instructions of only one party without
          the
          consent of the other party hereto unless otherwise expressly required to
          do so
          in this Agreement or any Related Purchase Agreement.
  4
  **3.2**           **Tax
          Reporting Person**.  For purposes of complying with
          Internal Revenue Code § 6045(e), as amended effective January 1, 1991,
          Escrow Holder is hereby designated as the “person responsible for closing the
          transaction,” and also as the “reporting person” for purposes of filing any
          information returns with the Internal Revenue Service concerning this
          transaction, as required by law.
  **3.3**           **Opening
          of Escrow**.  Escrow shall be deemed open when not less
          than four (4) originals of this Agreement and each Related Agreement, fully
          signed by all parties hereto or thereto either together or in counterparts,
          are
          delivered to Escrow Holder (the “Opening of Escrow”), which shall occur within
          one (1) business day after execution of this Agreement by Buyer and Seller
          and
          each Related Purchase Agreement by the Parties thereto.  Escrow Holder
          shall immediately notify Buyer, Seller and their respective attorneys in
          writing
          of the official date of the Opening of Escrow.
  **4.           PURCHASE
          PRICE; ALLOCATION OF PURCHASE PRICE**
  **4.1**           **Purchase
          Price**.  The purchase price for the Property shall be
          Eight Million One Hundred Ninety-Five Thousand Four Hundred Forty-Five
          Dollars
          and 00/100ths ($8,195,445.00) (the “Purchase Price”).
  **4.2           [Intentionally
          Deleted.]**
  **4.3           [Intentionally
          Deleted.]**
  **4.4**           **Closing
          Funds**.  No later than 2:00 p.m., Pacific Standard Time,
          on the Closing Date, Escrow Holder shall calculate and Buyer shall wire
          Funds
          into Escrow (using wiring instructions reasonably satisfactory to Escrow
          Holder)
          in an amount which shall equal the Purchase Price plus any other sums payable
          by
          Buyer hereunder (the “Closing Funds”).
  **5.           CONDITIONS
          TO CLOSING; AS IS PURCHASE**
  **5.1**             **Buyer’s
          Conditions**. Provided that Buyer is not in breach or default of any
          provisions of this Agreement, the obligation of Buyer to purchase the Property
          shall be subject to satisfaction of each of the conditions set forth in
          this
          Section 5.1 on and as of the Closing Date.  Seller and Buyer expressly
          acknowledge and agree that each of the conditions set forth in this Section
          5.1
          is for the benefit of and may be waived only by Buyer as herein
          provided.
  5
  **5.1.1**          **Seller’s
          Representations and Warranties**.  The representations and
          warranties of Seller set forth in Section 8 below shall be true and correct
          in
          all material respects on the Closing Date as if made again on the Closing
          Date.
  **5.1.2**          **Seller’s
          Performance**.  Seller shall have performed all of its
          obligations under this Agreement which by the terms of this Agreement are
          required to be performed by Seller as of or prior to the Closing
          Date.
  **5.1.3**          **[Intentionally
          Omitted]**.
  **5.1.4**          **Occurrence
          of the Closing by the Outside Date**.  The Closing
          hereunder shall occur on or before the Outside Closing Date.
  **5.1.5**         
          **Related Purchase Agreements**.  The Related
          Purchase Agreement Closing under each Related Purchase Agreement shall
          occur
          simultaneous with the Closing.  In addition, no Related Purchase
          Agreement Seller Default under any Related Purchase Agreement shall have
          occurred and be continuing.
  **5.2**           **Buyer’s
          Approval, Disapproval or Waiver of
          Conditions****.**Prior to Closing Buyer
          shall notify Seller and Escrow Holder in writing in the event that as of
          the
          date of Closing, any of the conditions set forth in Section 5.1 have not
          been
          satisfied or waived by Buyer; provided, however, that if any of the conditions
          set forth in Sections 5.1.3, 5.1.4  or 5.1.5 have not been satisfied
          as a result of any act or omission of Buyer or any Affiliate of Buyer,
          then
          Buyer shall not be entitled to disapprove such condition, but rather the
          same
          shall, following any applicable notice and cure period pursuant to Section
          7.2
          below, constitute a default by Buyer hereunder.  In the event that
          Buyer is not entitled to disapprove a condition or Buyer fails to approve,
          disapprove or waive such condition, if applicable, within the time and
          in the
          manner herein specified, then such condition shall be deemed conclusively
          satisfied or waived by Buyer and thereafter shall not be a condition precedent
          to the performance by Buyer of its respective obligations
          hereunder.
  **5.3**           **“****AS
          IS” SALE**.  IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT
          BUYER IS ACQUIRING THE PROPERTY “AS IS,” IN ITS PRESENT STATE AND CONDITION,
          WITHOUT ANY REPRESENTATIONS OR WARRANTIES FROM SELLER OF ANY KIND WHATSOEVER,
          EITHER EXPRESS OR IMPLIED, EXCEPT AS EXPRESSLY SET FORTH IN SECTION 8
          BELOW.  IN PARTICULAR, EXCEPT AS EXPRESSLY SET FORTH IN SECTION 8
          BELOW, SELLER MAKES NO REPRESENTATION OR WARRANTY RESPECTING THE USE, CONDITION,
          TITLE, OPERATION OR MANAGEMENT OF THE PROPERTY, OR COMPLIANCE WITH ANY
          APPLICABLE LAWS RELATING TO ZONING, SUBDIVISION, PLANNING, BUILDINGS, FIRE,
          SAFETY, EARTHQUAKE, HEALTH OR ENVIRONMENTAL MATTERS, THE PRESENCE OR ABSENCE
          OF
          HAZARDOUS SUBSTANCES, OR COMPLIANCE WITH ANY OTHER COVENANTS, CONDITIONS
          AND
          RESTRICTIONS (WHETHER OR NOT OF RECORD).  Buyer represents that it is
          knowledgeable in real estate matters and is relying upon Buyer’s own
          investigation and analysis in purchasing the Property, as well as the fact
          that
          Buyer or its Affiliates originally sold to and/or developed on behalf of
          Seller
          the Property and at all times thereafter have leased and exclusively controlled
          the same.  Buyer further represents that it has had ample opportunity
          to inspect and has, in fact, made all of the investigations Buyer deems
          necessary in purchasing the Property.  As a result, Buyer hereby
          expressly waives any notice requirements which may be imposed upon Seller
          pursuant to § 25359.7 of the California Health & Safety Code or any other
          similar and applicable Laws.  If this Agreement is not terminated and
          Buyer acquires the Property as provided herein, Buyer shall have thereby
          approved all aspects of the Property and this transaction and thereby waives
          any
          claim or Liability against Seller.  In furtherance of the foregoing,
          at the Closing, Buyer shall and shall cause Lessee to execute and deliver
          to
          Seller the Release of Claims. The provisions of this Section 5.3 shall
          survive
          the Closing.
  6
  **5.4**           **Seller’s
          Conditions**.  Provided that Seller is not in breach or
          default of any provision of this Agreement, the obligation of Seller to
          sell the
          Property shall be subject to satisfaction of each of the conditions set
          forth in
          this Section 5.4.  Seller and Buyer expressly acknowledge and agree
          that each of the conditions set forth in this Section 5.4 is for the benefit
          of
          and may be waived only by Seller in writing.
  **5.4.1**          **No
          Default Under Emeritus Master Lease**.  Prior to the
          Closing, (a) no Event of Default, or event which with notice and/or passage
          of time would constitute an Event of Default by Lessee under the Emeritus
          Master
          Lease shall have occurred and be continuing and (b) all Rent and Charges
          shall be paid as and when due under the Emeritus Master Lease, through but not
          including the Closing Date.
  **5.4.2**           **[Intentionally
          Omitted]**.
  **5.4.3**          **Occurrence
          of Closing by the Outside Closing Date**.  The Closing
          shall occur on or before the Outside Closing Date.
  **5.4.4**          **Related
          Purchase Agreements**.  The Related Purchase Agreement
          Closing under each Related Purchase Agreement shall occur simultaneous
          with the
          Closing.  In addition, no Related Purchase Agreement Buyer Default
          under any Related Purchase Agreement shall have occurred and be
          continuing.
  **5.4.5**           **Buyer’s
          Representations and Warranties**.  Buyer’s representations
          and warranties set forth in Section 8 below shall be true and correct in
          all
          material respects on the Closing Date as if made again on the Closing
          Date.
  **5.4.6**           **Buyer’s
          Performance**.  Buyer shall have performed all of its
          obligations under this Agreement which by the terms of the Agreement are
          required to be performed by Buyer as of or prior to the Closing
          Date.
  **5.5**           **Seller’s
          Approval, Disapproval or Waiver of Conditions****.**
          Prior to the Closing, Seller shall notify Buyer and Escrow Holder in writing
          in
          the event that as of the date of Closing, any of the conditions set forth
          in
          Section 5.4 have not been satisfied or waived by Seller; provided, however,
          that
          if any of the conditions set forth in Sections 5.4.2 , 5.4.3 or 5.4.4 have
          not
          been satisfied as a result of any act or omission of Seller or any Affiliate
          of
          Seller, then Seller shall not be entitled to disapprove such condition,
          but
          rather the same shall, following any applicable notice and cure period
          pursuant
          to Section 7.2 below, constitute a default by Seller hereunder.  In
          the event that Seller is not entitled to disapprove a condition or Seller
          fails
          to approve, disapprove or waive such condition, if applicable, prior to
          the
          Closing, then such condition shall be deemed conclusively satisfied or
          waived by
          Seller and thereafter shall not be a condition precedent to the performance
          by
          Seller of its obligations hereunder.
  7
  **6.           CLOSING
          OF ESCROW**
  **6.1**           **Closing
          Date**.  Subject to extension in order to implement the
          provisions of Section 6.8, and unless this Agreement has been earlier terminated
          in accordance with the applicable provisions of Section 7 below, Escrow
          shall
          close on the Outside Closing Date; provided, however, that subject to
          satisfaction or waiver of each of the conditions set forth in Sections
          5.1 and
          5.4, Buyer shall be entitled to close Escrow prior to the Outside Closing
          Date
          upon not less than five (5) days’ notice to Seller and Escrow Holder; provided
          further, however, that in no event shall the closing occur prior to July
          31,
          2007.  The terms “Close of Escrow” and/or “Closing” are used in this
          Agreement to mean the time and date the transactions contemplated hereby
          are
          closed and the Deed or other applicable conveyance instrument has been
          delivered
          to Buyer through Escrow, regardless whether the Deed or other conveyance
          instrument is actually recorded in the land records in which the Property
          is
          situated.  The term “Closing Date” as used in this Agreement means the
          date that the Closing occurs.
  **6.2**           **Deposits
          by Seller**.  At or before 5:00 p.m., local time in Los
          Angeles, California, on that date which is not less than one (1) business
          day
          before the Close of Escrow, Seller shall deliver or cause to be delivered
          to
          Escrow Holder the following items for handling as described below; provided,
          however, that Escrow need not be concerned with the form or content but
          only
          with manual delivery of all of the following other than item 6.2.1:
  **6.2.1**           **Deed**.  A
          duly executed and acknowledged grant deed, special warranty deed or equivalent
          thereof in the State (a “Deed”) conveying the Property to Buyer, subject to
          (collectively the “Permitted Exceptions”): (i) all Impositions, whether past due
          or delinquent, and (ii) all covenants, conditions, restrictions, rights
          of way,
          easements and other matters of record or which would be disclosed by an
          accurate
          survey or physical inspection of the Property;
  **6.2.2**          **Bill
          of Sale**.  A duly executed and acknowledged quit claim
          bill of sale conveying any right, title and interest of Seller in and to
          any
          tangible personal property located on or within the Property to Buyer,
          without
          warranty except as expressly set forth therein, in the form attached hereto
          as
**Exhibit “D”** or such other form as reasonably acceptable
          to Seller and Buyer.
  **6.2.3**          **[Intentionally
          Deleted]**;
  **6.2.4**          **[Intentionally
          Deleted]**;
  **6.2.5**          **Seller’s
          Certificate****.**  If any express
          representation or warranty of Seller set forth in Section 8 hereof needs
          to be
          modified due to changes since the Effective Date, a certificate of Seller,
          dated
          as of the Closing Date and executed on behalf of Seller by a duly authorized
          representative thereof, identifying any such representation or warranty
          which is
          not, or no longer is, true and correct and explaining the state of facts
          giving
          rise to the change.  In no event shall Seller have any Liability to
          Buyer for, or be deemed to be in default hereunder by reason of any breach
          of a
          representation or warranty set forth in Section 8 hereof which results
          from any
          change that (i) occurs between the Effective Date and the Closing Date,
          and (ii)
          is either expressly permitted under the terms of this Agreement or beyond
          the
          reasonable control of Seller to prevent.  The occurrence of a change
          in a representation or warranty which is permitted hereunder or is beyond
          the
          reasonable control of Seller to prevent shall, if materially adverse to
          Buyer,
          constitute the non-fulfillment of the conditions set forth in Section 5.1.1
          hereof.  If, despite changes or other matters described in such
          certificate, the Closing occurs, Seller’s representations and warranties set
          forth in this Agreement shall be deemed to have been modified by all statements
          made in any certificate of Seller delivered pursuant to this Section
          6.2.4;
  8
  **6.2.6**           **Evidence
          of Authority**.  Such certificates or documents as may be
          reasonably required by Escrow Holder in order to cause any Title Policy
          requested by Buyer as provided in Section 6.4 below to be issued and the
          Close
          of Escrow to occur; provided, however, that in no event shall Seller be
          required
          to execute and deliver a so-called owner’s or ALTA affidavit or indemnity or a
          mechanics’ lien indemnity with respect to the Property, except in form and
          substance acceptable to Seller in its sole, but reasonable discretion,
          and in
          any event any such affidavit shall be limited to (a) the actual knowledge
          of
          Seller (without investigation or the duty to investigate) and (b) the direct
          actions of Seller;
  **6.2.7**          **Closing
          Statement**.  A duly executed and acknowledged counterpart
          of a joint buyer/seller estimated closing statement to be prepared by Escrow
          Holder and delivered to Seller and Buyer (the “Closing Statement”);
          and
  **6.2.8**           **Additional
          Items**.  Any additional funds and/or instruments, signed
          and properly acknowledged by Seller, if appropriate, as may be necessary
          to
          comply with Seller’s obligations under this Agreement.
  **6.3**           **Deposits
          by Buyer**.  At or before 1:00 p.m., local time in Los
          Angeles, California, on the date of the Close of Escrow, Buyer shall deliver
          or
          cause to be delivered to Escrow Holder:
  **6.3.1**          **Funds**.  Immediately
          available Closing Funds by wire transfer into Escrow Holder’s depository bank
          account in an amount which shall equal the Purchase Price plus all Closing
          costs, charges or prorations payable by Buyer hereunder, as the same shall
          be
          more particularly set forth on the Closing Statement;
  **6.3.2**          **[Intentionally
          Deleted]**;
  **6.3.3**          **[Intentionally
          Deleted]**; .
  **6.3.4**          **[Intentionally
          Deleted]**;
  **6.3.5**          **[Intentionally
          Deleted]**;
  **6.3.6**          **Buyer’s
          Certificate****.**  If any representation or
          warranty of Buyer set forth in Section 8 hereof needs to be modified due
          to
          changes since the Effective Date, a certificate of Buyer addressed to Seller,
          dated as of the Closing Date and executed on behalf of Buyer by a duly
          authorized representative thereof, identifying any such representation
          or
          warranty which is not, or no longer is, true and correct and explaining
          the
          state of facts giving rise to the change.  In no event shall Buyer
          have any Liability to Seller for, or be deemed to be in default hereunder
          by
          reason of any breach of a representation or warranty set forth in Section
          8
          hereof which results from any change that (i) occurs between the Effective
          Date
          and the Closing Date and (ii) is either expressly permitted under the terms
          of
          this Agreement or is beyond the reasonable control of Buyer to
          prevent.  The occurrence of a change in a representation or warranty
          which is permitted hereunder or is beyond the reasonable control of Buyer
          to
          prevent shall, if materially adverse to Seller, constitute the non-fulfillment
          of the conditions set forth in Section 5.4.5 hereof.  If, despite
          changes or other matters described in such certificate, the Closing occurs,
          Buyer’s representations and warranties set forth in this Agreement shall be
          deemed to have been modified by all statements made in such
          certificate;
  9
  **6.3.7**         
          **Evidence of Authority**.  Such certificates or
          documents as may be reasonably required by Escrow Holder in order to cause
          the
          Title Policy to be issued and the Close of Escrow to occur;
  **6.3.8**          **Closing
          Statement**.  A duly executed and acknowledged counterpart
          of the Closing Statement; and
  **6.3.9**          **Additional
          Items**.  Any additional Funds and/or instruments, signed
          and properly acknowledged by Buyer, if appropriate, as may be necessary
          to
          comply with Buyer’s obligations under this Agreement.
  **6.4**           **Title
          Policies**.  At the Close of Escrow, but not as a condition
          thereto, Buyer shall be entitled to request and obtain from Title Company
          if so
          requested by Buyer, with a copy to be delivered to Seller, a policy of
          title
          insurance with respect to the Property, insuring good and indefeasible
          title to
          the Property vested in Buyer as of the Closing Date in the amount of the
          Purchase Price, subject to such matters of record or apparent as Buyer
          and Title
          Company may agree (a “Title Policy”) and including such endorsements thereto as
          Buyer may request and Title Company agrees to issue (the “Title
          Endorsements”).  The cost of any Title Policy and all Title
          Endorsements thereto shall be borne by the parties as provided in Section
          6.6
          below.
  **6.5**           **Prorations**.
  **6.5.1**          **Impositions
          and Other Expenses**.  Buyer and Seller acknowledge and
          agree that the Emeritus Master Lease is absolutely net to Lessor, and that
          Lessee is solely responsible for any and all Impositions, insurance premiums,
          utility charges and other expenses incurred in connection with the operation,
          maintenance and use of the Property.  Accordingly, Buyer and/or Lessee
          shall be solely responsible for all such amounts whether accruing prior
          to or
          after the Closing and there shall be no prorations on account thereof between
          Buyer and Seller hereunder.  Any adjustments or prorations of such
          amounts between Buyer and Lessee shall be solely between such parties and
          neither Seller nor Escrow Holder shall be concerned therewith.
  (a)           **Rents**.  Notwithstanding
          anything to the contrary herein, all Rents and Charges shall belong to
          and be
          paid over to Lessor by Lessee on the Closing Date. All Minimum Rent and
          Additional Rent payable by Lessee to Lessor shall be prorated pursuant
          to the
          terms of the Master Purchase Agreement, but such prorations shall nevertheless
          be reflected on the Closing Statement executed and delivered
          hereunder.
  10
  **6.6**           **Closing
          and Transaction Costs**.
  **6.6.1**           Seller
          and Buyer shall execute such returns, questionnaires and other documents
          as
          shall be required with regard to all applicable Transaction Taxes imposed
          by
          applicable federal, state or local Law.
  **6.6.2**          Upon
          the Closing, Buyer shall be responsible for:
  (a)           any
          Transaction Taxes in excess of the portion thereof that is the responsibility
          of
          Seller as provided in Section 6.6.3 below;
  (b)           all
          expenses of or related to the issuance of any Title Policy (including the
          costs
          of any survey required by Buyer and/or the Title Company), any Title
          Endorsements and chain of title reports, and all fees and charges of Escrow
          Holder hereunder in excess of the applicable portion thereof that is the
          responsibility of Seller as provided in Section 6.6.3 below;
  (c)           the
          charges for or in connection with the recording and/or filing of any instrument
          or document provided herein or contemplated by this Agreement, the Related
          Purchase Agreements or any agreement or document described or referred
          to herein
          or therein;
  (d)           all
          reports or studies obtained by or at the direction of Buyer, including
          all
          appraisal, environmental, engineering or other third party reports and
          the fees
          or costs incurred in connection therewith;
  (e)           Buyer’s
          legal, accounting and other professional fees and expenses incurred in
          connection with the transactions contemplated hereby, the Related Purchase
          Agreements and the Exhibits hereto and thereto; and
  (f)           all
          other costs and expenses incurred in connection with the transactions
          contemplated hereunder, under the Related Purchase Agreements and the Exhibits
          hereto and thereto that are not the responsibility of Seller as provided
          in
          Section 6.6.3 below.
  **6.6.3**         
          Upon the Closing, Seller shall be responsible for:
  (a)           Twenty-Seven
          Percent (27%) of the sum of (i) any Transaction Taxes, and (ii) the cost
          of the
          Title Policy and Title Endorsements, provided, however, that neither Seller
          nor
          its Affiliates shall be responsible for (i) any Transaction Taxes or (ii)
          the
          cost of any Title Policies and Title Endorsements, in either case, pursuant
          to
          this Agreement or the Related Purchase Agreements in excess of One Million
          Dollars and 00/100ths ($1,000,000.00), in the aggregate; and
  11
  (b)           Seller’s
          legal, accounting and other professional fees and expenses incurred in
          connection with the transactions contemplated hereby and the Exhibits
          hereto.
  **6.6.4**          Any
          personal property conveyed to Buyer as part of the Property is included
          in this
          sale as part of the Purchase Price for the Property and without additional
          charge therefore.
  **6.6.5**           If
          the Closing does not occur for any reason other than Seller’s default hereunder,
          Buyer shall pay all title and Escrow cancellation charges and
          expenses.  If the Closing does not occur by reason of Seller’s default
          hereunder, then in such event Seller shall be responsible for any title
          and
          Escrow cancellation charges and expenses.  The provisions of this
          Section 6.6.5 shall survive any early termination of this Agreement prior
          to
          Closing.
  **6.7**           **Completion
          and Distribution of Documents**.  Escrow Holder shall also
          undertake the following at or promptly after the Close of Escrow:
  **6.7.1**           If
          necessary, Escrow Holder is authorized and instructed to insert the Closing
          Date
          as the date of any documents conveying or terminating interests herein
          or to
          become operative as of the Closing Date.
  **6.7.2**          Cause
          the Deed and any other recordable instrument which the parties so direct
          to be
          recorded in the appropriate land records office where the Property is
          located.  If permitted by applicable law, Escrow Holder is hereby
          instructed not to affix the amount of any Transaction Tax on the face of
          the
          Deed but to pay on the basis of a separate affidavit signed by either Seller
          or
          Buyer, as applicable, and not made a part of the public record; and
  **6.7.3**           Cause
          each non-recorded document to be delivered to the party acquiring rights
          thereunder, or for whose benefit such document was obtained.
  **6.8**           **Seller’s
          Election of 1031 Exchange**.  Seller may elect to sell the
          Property to Buyer in the form of a tax-deferred exchange pursuant to Section
          1031 of the Internal Revenue Code of 1986, as amended (“1031 Exchange”);
          provided, however, such 1031 Exchange shall not be a condition to Seller’s
          obligation to close the transactions contemplated by this Agreement; provided
          further, however, that Seller shall be entitled, in its sole discretion,
          to
          extend the Closing Date (including the Outside Closing Date) for up to
          ten (10)
          days by written notice delivered to Buyer and Escrow Holder no less than
three (3) days prior to the
          scheduled Closing Date in order to accommodate such a 1031
          Exchange.  In the event that Seller shall so elect a 1031 Exchange,
          Seller shall give written notice to Buyer and Escrow Holder of such
          election.  Buyer shall fully cooperate with any such 1031 Exchange,
          including with respect to the following as may be requested or approved
          by
          Seller:
  **6.8.1**           executing
          and delivering amendments to this Agreement and/or amendments and restatements
          of this Agreement so that the transactions contemplated hereby are incorporated
          into one or more cross-contingent agreements;
  **6.8.2**          executing
          and delivering one or more assignments of this Agreement or any of any
          of
          agreements described in Section 6.8.1 above from Buyer to an Affiliate
          of Buyer
          or by Seller to any Affiliate of Seller or to a qualified exchange accommodator
          of Seller or such Affiliate; and
  12
  **6.8.3**           such
          other additional documents;
  provided,
          however, that Buyer shall not be required to incur any additional Liabilities
          or
          financial obligations as a consequence of any of the foregoing exchange
          transactions.  Seller hereby indemnifies and holds Buyer harmless from
          any Liabilities to which Buyer may be exposed due to any participation
          by Buyer
          in such a 1031 Exchange transaction.  The provisions of this Section
          6.8 shall survive the Closing.
  **7.           TERMINATION**
  **7.1**           **Early
          Termination for Failure of
          Conditions****.**
  **7.1.1**           **Termination
          by Buyer**. If Buyer is entitled to and in fact disapproves any of
          the conditions set forth in Sections 5.1.1 through 5.1.5, inclusive, then
          Escrow
          and this Agreement shall automatically terminate upon receipt by Seller
          and
          Escrow Holder of Buyer’s written notice of disapproval of such condition within
          the time and in the manner provided in Section 5.2; provided, however,
          that if
          there is a failure of (a) any of the conditions set forth in Section 5.1.1
          or
          5.1.2 or (b) any of the conditions set forth in Section 5.1.4 or 5.1.5
          that
          results from a breach or default by Seller or any Affiliate of Seller of
          their
          respective obligations under this Agreement or under any Related Purchase
          Agreement, then in any such event in lieu of terminating this Agreement
          and
          Escrow pursuant to this Section 7.1, Buyer shall be entitled to exercise
          its
          rights pursuant to Section 7.2 below.  In addition, without limiting
          the foregoing, the parties acknowledge and agree that the occurrence of
          any
          event of the type described in the second sentence of Section 5.1.5 above
          that
          results in the failure of the conditions set forth therein shall also constitute
          and be deemed a default by Seller under this Agreement entitling Buyer
          to
          exercise its remedies pursuant to Section 7.2 below.
  **7.1.2**          **Termination
          by Seller**.  If Seller disapproves any of the conditions
          set forth in Section 5.4 above, then Escrow and this Agreement shall
          automatically terminate upon receipt by Buyer and Escrow Holder of Seller’s
          written notice of disapproval thereof at any time prior to the Closing;
          provided, however, that if there is a failure of (a) any of the conditions
          set
          forth in Sections 5.4.5 or 5.4.6 or (b) any of the conditions set forth
          in
          Sections 5.4.3, or 5.4.4 that results from a breach or a default by Buyer
          or any
          Affiliate of Buyer of its respective obligations under this Agreement or
          under
          any Related Purchase Agreement, then in any such event in lieu of terminating
          this Agreement and Escrow pursuant to this Section 7.1.2, Seller shall
          be
          entitled to exercise its remedies pursuant to Section 7.2 below.  In
          addition, without limiting the foregoing, the parties acknowledge and agree
          that
          the occurrence of any event of the type described in Section 5.4.1(a) or
          in the
          second sentence of Section 5.4.4 above that results in the failure of the
          conditions set forth therein shall also constitute and be deemed a default
          by
          Buyer under this Agreement entitling Seller to exercise its remedies pursuant
          to
          Section 7.2 below.
  **7.1.3**          **Rights
          and Obligations Upon Termination for Failure of
          Conditions**.  If Escrow and this Agreement are terminated
          in the manner and within the applicable time period(s) provided pursuant
          to
          either Section 7.1.1 or Section 7.1.2 above, (a) all instruments in Escrow
          shall
          be returned to the party depositing the same, (b) Buyer shall return all
          items
          previously delivered by Seller to Buyer, (c) the provisions of Section
          6.6.5
          above shall apply and the Earnest Money Deposit shall be disbursed in accordance
          with the terms of the Master Purchase Agreement, and (d) neither party
          shall
          have any further rights, obligations or Liabilities whatsoever to the other
          party concerning the purchase and sale of the Property pursuant to this
          Agreement, except for those Liabilities which are expressly stated in this
          Agreement to survive termination.
  13
  **7.2**           **Termination
          by Reason of Default**.  If the Closing fails to occur when
          and as provided in Section 6 above by reason of a breach or default (or
          deemed
          default as provided in the last sentence of either of Section 7.1.1 or
          Section
          7.1.2 above) of either party of any of its duties, obligations, representations
          or warranties under this Agreement, then the non-defaulting party may elect,
          by
          written notice to the defaulting party and to Escrow Holder, to terminate
          Escrow
          and this Agreement, and the Master Purchase Agreement shall govern the
          disbursement of the Earnest Money Deposit as provided therein.  Such
          termination shall be effective five (5) days after delivery of such notice
          (the
“Effective Termination Date”); provided, that (i) the non-defaulting
          party has performed or is in a position to perform all obligations on its
          part
          to be performed as of the Effective Termination Date other than those
          obligations which the non-defaulting party is prevented from having performed
          by
          reason of the defaulting party’s breach or default; and (ii) the defaulting
          party has not cured the default and the non-defaulting party has not waived
          such
          default by the Effective Termination Date.  Except as otherwise
          provided below in this Section 7.2 and Section 6.6.5 above and in the Master
          Purchase Agreement, Escrow Holder and the parties shall, upon such termination,
          return all of the other party’s funds and documents then held by them to the
          party depositing or delivering the same.  Thereafter, each of the
          parties shall be discharged and released from all obligations and Liabilities
          except as otherwise provided in this Section 7.2 and Section 6.6.5 above
          and in
          the Master Purchase Agreement and except for those obligations and Liabilities
          which are expressly intended to survive the termination of this Agreement,
          including those Liabilities set forth in Section 12.2 below.
  **7.2.1**          **Seller’s
          Damages**.  If the Closing fails to occur by reason of a
          breach or default of this Agreement by Buyer, then Seller may terminate
          this
          Agreement as of the Effective Termination Date as provided in Section 7.2
          above,
          in which case Buyer shall be Liable for the cancellation and other charges
          and
          expenses as provided for in Section 6.6.5 and the Master Purchase Agreement
          shall govern the disbursement of the Earnest Money Deposit as provided
          therein.
  **7.2.2**           **Buyer’s
          Remedies****.** If the Closing fails to occur by reason
          of a breach or default of this Agreement by Seller, then Buyer may either
          (a)
          terminate this Agreement as of the Effective Termination Date as provided
          in
          Section 7.2 above, in which case the Master Purchase Agreement shall govern
          the
          disbursement of the Earnest Money Deposit as provided therein, and Seller
          shall
          be liable for the cancellation and other charges and expenses provided
          for in
          Section 6.6.5, or (b) enforce specific performance of the obligations of
          Seller
          here­under; provided, however, that any action by Buyer to seek such
          specific performance must be commenced within thirty (30) calendar days
          of the
          occurrence of the alleged default by Seller; provided further, however,
          that,
          except as provided in Section 6.6.5, in no event whatsoever shall Seller
          ever
          have any Liability (whether in law or equity) for damages as a result of
          a
          default by Seller under this Agreement.
  14
  **7.3**           **Relationship
          to Emeritus Master
          Lease****.**Notwithstanding anything to the
          contrary in this Agreement, no termination of this Agreement and Escrow
          by
          Seller or Buyer regardless of the reason therefor shall affect the rights
          or
          obligations of Lessor or Lessee under the Emeritus Master Lease, which
          Emeritus
          Master Lease shall remain in full force and effect following any such
          termination of this Agreement prior to the Closing.
  **8.           REPRESENTATIONS
          AND WARRANTIES**
  **8.1**           **In
          General**.  In addition to any express agreements of either
          party contained herein, the following constitute representations and warranties
          by Seller to Buyer, and by Buyer to Seller, which shall be true and correct
          as
          of the date hereof, and the truth and accuracy of such representations
          and
          warranties as of the Close of Escrow by each party shall also constitute
          a
          condition to the Close of Escrow for the benefit of the party to whom such
          representations and warranties were made.
  **8.2**           **By
          Each Party**.  Seller represents and warrants to Buyer, and
          Buyer hereby represents and warrants to Seller, as follows:
  **8.2.1**          **Authority**.  Such
          party has full power and authority to enter into and comply with the terms
          of
          this Agreement, and the individuals executing this Agreement on behalf
          of such
          party have actual right and authority to bind that party to the terms of
          this
          Agreement.
  **8.2.2**           **Binding
          Effect**.  No action or consent which has not been obtained
          is necessary to make this Agreement, and this Agreement and all documents
          to be
          executed hereunder are or will be when executed the valid and legally binding
          obligations of such party, enforceable in accordance with their respective
          terms, except as such enforceability may be limited by creditors’ rights laws
          and general principles of equity.
  **8.2.3**           **No
          Conflict**.  The execution and delivery of this Agreement
          and all other documents to be executed by such party hereunder, compliance
          with
          the provisions thereof and hereof and the consummation of the transactions
          contemplated hereunder and thereunder will not result in (a) a breach or
          violation of (i) any Laws applicable to such party now in effect, (ii)
          the
          Organizational Documents of such party, (iii) any judgment, order or decree
          of
          any governmental authority with jurisdiction binding on such party or (iv)
          subject to the Permitted Exceptions, any other material agreement or instrument
          to which such party is a party or by which it is bound.   Buyer
          shall be solely responsible for obtaining any consents, approvals or waivers
          required under any Permitted Exceptions with respect to the Property in
          connection with the transactions contemplated hereby or under the Related
          Purchase Agreements.  Seller hereby agrees to reasonably cooperate
          with Buyer, without any out-of-pocket cost or expense to Seller, in seeking
          any
          such required consents, approval or waivers.
  15
  **8.2.4**          **Patriot
          Act****.**To the actual knowledge of such
          party, such party and its respective Affiliates are****in
          compliance with the requirements of Executive Order No. 13224, 66 Fed.
          Reg.
          49079 (Sept. 25, 2001) (the “Order”) and other similar requirements contained in
          the rules and regulations of the Office of Foreign Assets Control, Department
          of
          Treasury (“OFAC”) and in any enabling legislation or other Executive Orders or
          regulations in respect thereof (the Order and such other rules, regulations,
          legislation or orders collecting called the “Orders”).  Neither such
          party nor any of their Affiliates (A) is listed on the Specially Designated
          Nationals and Blocked Person List maintained by OFAC pursuant to the Order
          and/or on any other list of terrorists or terrorist organizations maintained
          pursuant to any of the rules and regulations of OFAC or pursuant to any
          other
          applicable Orders (such lists are collectively referred to as the “Lists”), (B)
          is a Person (as defined in the Order) who has been determined by competent
          authority to be subject to the prohibitions contained in the Orders; or
          (C) to
          the actual knowledge of such party, is owned or controlled by (including
          without
          limitation by virtue of such person being a director or owning voting shares
          or
          interests), or acts for or on behalf of, any person on the Lists or any
          other
          person who has been determined by competent authority to be subject to
          the
          prohibitions contained in the Orders.  As used herein, the term
“actual knowledge” as it relates to Seller shall mean the actual knowledge
          (without investigation or the duty to conduct investigation) of Paul Gallagher
          and Brian J. Maas and as it relates to Buyer shall mean the actual knowledge
          (without investigation or the duty to conduct investigation) of Eric
          Mendelsohn.
  **8.3**           **By
          Seller Only**.  Seller represents and warrants to Buyer as
          follows:
  **8.3.1          [Intentionally
          Deleted.]**
  **8.3.2**           **No
          Tax Withholding**.  In accordance with Section 1445 of
          the Internal Revenue Code and the applicable provisions of the California
          Revenue and Taxation Code or other similar laws, (a) Seller is not now,
          and at
          Closing will not be, a “foreign person,” and (b) Buyer need not withhold tax at
          the Closing as a result of the transactions contemplated
          hereby.  Seller shall deliver a separate nonforeign/residency
          affidavit, executed by Seller, if reasonably required to do so by Escrow
          Holder.
  **8.3.3**          **Litigation,
          Etc.**  To the actual knowledge of Seller (without
          investigation and without the duty to conduct any investigation), there
          are no
          actions, proceedings or investigations pending or threatened against or
          affecting Seller seeking to enjoin, challenge or collect damages in connection
          with the transactions contemplated by this Agreement or which would reasonably
          be expected to materially and adversely affect the ability of Seller to
          carry
          out the transactions contemplated by this Agreement or which in any way
          challenge or affect Seller’s ownership of the Property.
  **8.4**           **By
          Buyer Only****.**  Buyer represents and
          warrants to Seller as follows:
  **8.4.1          [Intentionally
          Deleted.]**
  **8.4.2**          **Litigation,
          Etc.**  To the actual knowledge of Buyer (without
          investigation and without the duty to conduct any investigation), there
          are no
          actions, proceedings or investigations pending or to the knowledge of Buyer
          threatened against or affecting Buyer, Summerville or Lessee  seeking
          to enjoin, challenge or collect damages in connection with the transactions
          contemplated by this Agreement or which would reasonably be expected to
          materially and adversely affect the ability of Buyer, Summerville, or Lessee
          to
          carry out the transactions contemplated herein.
  16
  **9.           CERTAIN
          EVENTS PRIOR TO CLOSING**
  **9.1**           **Loss**.  In
          the event of loss (including a loss due to a Condemnation) or damage to
          the
          Property or any portion thereof and which occurs prior to the Closing,
          this
          Agreement shall remain in full force and effect, Buyer shall nonetheless
          proceed
          to purchase the Property and consummate this Agreement in accordance with
          the
          terms hereof and all insurance proceeds or Condemnation awards payable
          by reason
          thereof shall belong to Buyer.
  **9.2**           **Prompt
          Notices****.**  Seller shall give prompt
          notice to Buyer, and Buyer shall give prompt notice to Seller, of (i) the
          occurrence, or failure to occur, of any event which occurrence or failure
          would
          be likely to cause (A) any representation or warranty of such party
          contained in this Agreement to be untrue or inaccurate in any material
          respect
          or (B) any covenant, condition or agreement of such party contained in this
          Agreement to be complied with or satisfied in all material respects and
          (ii) any failure of Seller or Buyer, as the case may be, to comply with or
          satisfy any covenant, condition or agreement to be complied with or satisfied
          under this Agreement.
  **9.3**           **No
          Agreements; Release of
          Mortgages****.**  Except for this Agreement
          and matters expressly contemplated hereunder or under the Related Purchase
          Agreements, from and after the Effective Date, Seller shall not enter into
          any
          new contracts or other agreements, either written or oral, with respect
          to the
          Property that shall survive the Closing, or become a Liability of
          Buyer.  Seller shall cause any mortgages, deeds of trust or other
          security interests of record, caused,  created or assumed in writing
          by Seller, to be satisfied in full on or before the Closing.
  **9.4**           **Satisfaction
          of Conditions****.**  From and after the
          Effective Date, each party covenants and agrees with the other to use good
          faith, commercially reasonable efforts to satisfy or cause to be satisfied
          all
          conditions precedent to such party’s obligations hereunder which are in such
          party’s control or over which such party exercises control.
  **10.           POST-CLOSING
          MATTERS**
  **10.1**        
           **Confidentiality and Public
          Disclosure**.  Each party shall hold in strict confidence
          all information received from the other party concerning this transaction
          and
          shall not release any such information to third parties (other than attorneys,
          accountants or other professional consultants, or lenders of the parties)
          without the prior written consent of the other party unless otherwise required
          by Law, which approval shall not be unreasonably withheld; provided that
          Buyer
          shall be entitled to disclose information concerning this transaction in
          connection with a secondary stock offering and as required by any applicable
          securities Law.  Except as provided above, any and all releases of
          information to the public relating to the sale of the Property and the
          transactions contemplated hereby and under the Related Purchase Agreements
          by
          any party shall be subject to the review and approval by the other party,
          which
          approval shall not be unreasonably withheld.  Each party will
          undertake to consult with the other prior to responding to any inquiries
          made by
          any third party respecting the transactions contemplated by this
          Agreement.  The provisions of this Section 10.1 shall survive the
          execution and delivery of this Agreement and the occurrence of the
          Closing.
  17
  **10.2**          **Indemnification
          by Buyer**.  In addition to the other indemnities of Buyer
          contained herein or in any of the other Transaction Documents, Buyer shall
          protect, indemnify, save harmless and defend Seller and each of its respective
          partners, predecessors, successors and assigns, and their respective past,
          present and future officers, directors, employees, agents, representatives,
          attorneys and all Persons acting by, through, under or in concert with
          any of
          the foregoing, from and against all Liabilities, based upon, relating or
          arising
          out of the Property, whether accruing before or after the Closing Date,
          including any Liabilities relating to the presence or existence of Hazardous
          Substances of any kind, on, under or about the Property or on adjoining
          or
          neighboring property, or arising from any use of the Property; provided,
          however, the foregoing indemnity shall not extend to any Liabilities which
          are
          solely and proximately caused by the gross negligence or willful misconduct
          of
          Seller.  Payment shall not be a condition precedent to enforcement of
          the foregoing indemnification.  The provisions of this Section 10.2
          shall specifically survive the execution and delivery of this Agreement
          and the
          occurrence of the Closing.
  **11.           BROKERS**
  Seller,
          on the one hand, and Buyer, on the other hand, agrees to indemnify, defend,
          protect and hold the other party(ies) and the Property harmless against
          any
          Liabilities for any broker’s commission or finder’s fee for which it is
          responsible or which is asserted as a result of its own act or omission
          in
          connection with this transaction.
  **12.           MISCELLANEOUS
          PROVISIONS**
  **12.1**           **Assignment;
          Binding on Successors**.  This Agreement shall be binding
          upon and shall inure to the benefit of Buyer and Seller and their respective
          representatives, successors and assigns; provided, however, that Buyer
          shall not
          have the right to assign this Agreement or any interest or right under
          this
          Agreement or under the Escrow or to appoint a nominee to act as Buyer under
          this
          Agreement without obtaining the prior written consent of Seller, which
          consent
          may be given or withheld in the sole and absolute discretion of Seller;
          provided, however, that without in any way relieving Buyer of any of its
          duties,
          covenants or obligations hereunder, upon written notice to Seller given
          not less
          than ten (10) business days prior to the scheduled Closing Date, Buyer
          may,
          without the consent of Seller, either (a) assign its rights and obligations
          hereunder with respect to the Property to one or more Affiliates of Buyer
          or Dan
          Baty, an individual, or (b) appoint one or more Affiliates of Buyer or
          Dan Baty
          as a nominee to take title to the Property or any portion thereof; provided,
          however, that any such (i) assignment shall be pursuant to a written assignment
          and assumption agreement reasonably satisfactory to Seller and (ii) any
          such
          Affiliate-assignee or nominee shall join in the execution and delivery
          of the
          Release of Claims at Closing with Buyer.  Any attempted assignment in
          violation of this provision shall be null and void.
  By
          Buyer’s execution and delivery hereof, Buyer hereby appoints the Person
          identified on **Exhibit G** attached hereto as its nominee
          to take title to the Property.
  18
  **12.2**           **Attorneys’
          Fees**.  In any dispute or action between the parties
          arising out of this Agreement or the Escrow, or in connection with the
          Property,
          the prevailing party shall be entitled to have and recover from the other
          party
          its costs and attorneys’ and paralegals’ fees related thereto, whether by final
          judgment or by out of court settlement.  The provisions of this
          Section 12.2 shall survive the Closing or any earlier termination of this
          Agreement.
  **12.3**           **Notices**.
          Any notice, consent, approval, demand or other communication required or
          permitted to be given hereunder (a “notice”) must be in writing and may be
          served personally or by U.S. Mail.  If served by U.S. Mail, it shall
          be addressed as follows:
  If
                    to Seller:
                c/o
                    Health Care Property Investors, Inc.3760
                    Kilroy Airport Way, Suite 300Long
                    Beach, California 90806Attn:  Legal
                    DepartmentFax:  (562)
                    733-5200with
                    a copy to:
                Latham
                    & Watkins LLP650
                    Town Center Drive, Suite 2000Costa
                    Mesa, California 92626-1925Attn:  David
                    C. Meckler, Esq.Fax:  (714)
                    755-8290If
                    to Buyer:
                Emeritus
                    Corporation3131
                    Elliott Avenue, Suite 500Seattle,
                    Washington  98121Phone:  (206)
                    301-4493Fax:  (206)
                    301-4500Attn:  Eric
                    Mendelsohnwith
                  a copy to:
                Pircher,
                    Nichols & Meeks900
                    North Michigan Avenue, Suite 1050Chicago,
                    Illinois 60611Attention:  Real
                    Estate Notices (JDL/MJK)Phone:  (312)
                    915-3112Fax:
                    (312) 915-3348
  Any
          notice which is personally served shall be effective upon the date of service;
          any notice given by U.S. Mail shall be deemed effectively given, if deposited
          in
          the United States Mail, registered or certified with return receipt requested,
          postage prepaid and addressed as provided above, on the date of receipt,
          refusal
          or non-delivery indicated on the return receipt.  In addition, either
          party may send notices by facsimile or by a nationally recognized overnight
          courier service which provides written proof of delivery (such as U.P.S.
          or
          Federal Express).  Any notice sent by facsimile shall be effective
          upon confirmation of receipt in legible form, and any notice sent by a
          nationally recognized overnight courier shall be effective on the date
          of
          delivery to the party at its address specified above as set forth in the
          courier's delivery receipt.  Any party may, by notice to the other
          from time to time in the manner herein provided, specify a different address
          for
          notice purposes.
  19
  **12.4**           **Governing
          Law; Jurisdiction**.  THIS AGREEMENT WAS NEGOTIATED IN THE
          STATE OF CALIFORNIA, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL
          RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED
          HEREBY.  ACCORDINGLY, EXCEPT WHERE FEDERAL LAW IS APPLICABLE AND
          UNLESS OTHERWISE EXPRESSLY PROVIDED HEREIN OR REQUIRED BY ANY APPLICABLE
          LAW,
          THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
          THE LAWS
          OF THE STATE OF CALIFORNIA (WITHOUT REGARD OF PRINCIPLES OR CONFLICTS OF
          LAW).  EACH OF BUYER AND SELLER HEREBY IRREVOCABLY SUBMIT TO THE
          JURISDICTION OF THE STATE AND FEDERAL COURTS OF THE STATE OF CALIFORNIA
          AND
          CONSENT TO SERVICE OF PROCESS IN ANY LEGAL PROCEEDING ARISING OUT OF, OR
          IN
          CONNECTION WITH, THIS AGREEMENT, BY ANY MEANS AUTHORIZED BY CALIFORNIA
          LAW.
  **12.5**           **Interpretation**.  All
          provisions herein shall be construed in all cases as a whole according
          to its
          fair meaning, neither strictly for nor against either Buyer or Seller and
          without regard for the identity of the party initially preparing this
          Agreement.  Titles and captions are inserted for convenience only and
          shall not define, limit or construe in any way the scope or intent of this
          Agreement.  References to Sections are to Sections as numbered in this
          Agreement unless expressly stated otherwise.
  **12.6**           **Gender;
          Joint Obligations**.  As used in this Agreement, the
          masculine, feminine or neuter gender and the singular or plural number
          shall
          each be deemed to include the others where and when the context so
          dictates.  If more than one party, trust or other entity is the Buyer
          hereunder, the obligations of all such parties shall be joint and
          several.
  **12.7**           **No
          Waiver**.  A waiver by any party of a breach of any of the
          covenants, conditions or agreements to be performed by the other parties
          shall
          be in writing to be effective and no such written waiver shall be construed
          as a
          waiver of any succeeding breach of the same or other covenants, conditions
          or
          Agreements.
  **12.8**           **Modifications**.  Any
          alteration, change or modification of or to this Agreement, in order to
          become
          effective, must be made in writing and in each instance signed on behalf
          of each
          party to be charged.
  **12.9**           **Severability**.  If
          any term, provision, condition or covenant of this Agreement or its application
          to any party or circumstances shall be held, to any extent, invalid or
          unenforceable, the remainder of this Agreement, or the application of the
          term,
          provision, condition or covenant to persons or circumstances other than
          those as
          to whom or which it is held invalid or unenforceable, shall not be affected,
          and
          shall be valid and enforceable to the fullest extent permitted by
          law.
  **12.10**         **Survival**.  The
          conveyance of the Property to Buyer shall constitute full performance and
          discharge of every representation, warranty and covenant and agreement
          of Seller
          to be performed hereunder by the Closing, notwithstanding anything herein
          to the
          contrary.  Thereupon, all representations or warranties, covenants or
          agreements by either Buyer or Seller contained in this Agreement will terminate
          and will not survive the Closing, except for the representations and agreements
          that contemplate performance after Closing such as the proration matters
          set
          forth in Section 6.2, the post-closing matters set forth in Section 10,
          payment
          of brokerage fees set forth in Section 11, all matters set forth in this
          Section
          12.10 and the Release of Claims to be executed and delivered by Buyer,
          Lessee,
          and any nominees of Buyer hereunder or under any Related Purchase Agreement
          in
          favor of Seller at the Closing, and any other matter or provision hereof
          that is
          expressly stated in this Agreement to survive the Closing.
  20
  **12.11**         **Merger
          of Prior Agreements**.  This Agreement and the other
          Transaction Documents contain the entire understanding between the parties
          relating to the transactions contemplated by this Agreement and under the
          Related Purchase Agreements.  All prior or contemporaneous agreements,
          understandings, representations and statements, whether direct or indirect,
          oral
          or written, are merged into and superseded by this Agreement and the other
          Transaction Documents, and shall be of no further force or effect.
  **12.12**         **Time
          of Essence**.  Time is of the essence of this
          Agreement.
  **12.13**        
          **Counterparts**.  This Agreement may be signed in
          multiple counterparts which, when duly delivered and taken together, shall
          constitute a binding Agreement between all parties.
  **12.14**         **Exhibits
          and Addendum**.  All exhibits and the addendum attached to
          this Agreement are incorporated herein by reference.
  **12.15**         **Cooperation
          of Parties**.  Each party agrees to sign any other and
          further instruments and documents and take such other actions as may be
          reasonably necessary or proper in order to accomplish the intent of this
          Agreement.
  **12.16**         **No
          Third Party Beneficiaries**.  Except as otherwise expressly
          provided herein, the provisions of this Agreement are intended to be solely
          for
          the benefit of the parties hereto, and the execution and delivery of this
          Agreement shall not be deemed to confer any rights upon, nor obligate any
          of the
          parties hereunder, to any person or entity other than the parties to this
          Agreement.
  **12.17**         **Dates**.  If,
          pursuant to this Agreement, any date indicated herein falls on an official
          United States holiday, or a Saturday or Sunday, the date so indicated shall
          mean
          the next business day following such date.
  **12.18**         **Waiver
          of Trial by Jury****.** BUYER AND SELLER EACH
          ACKNOWLEDGE THAT IT HAS HAD THE ADVICE OF COUNSEL OF ITS CHOICE WITH RESPECT
          TO
          ITS RIGHTS TO TRIAL BY JURY UNDER THE CONSTITUTION OF THE UNITED STATES
          AND THE
          STATE OF CALIFORNIA AND THE STATE IN WHICH THE PROPERTY IS
          LOCATED.  BUYER AND SELLER EACH HEREBY EXPRESSLY WAIVES ANY RIGHT TO
          TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (i) ARISING
          UNDER
          THIS AGREEMENT (OR ANY AGREEMENT FORMED PURSUANT TO THE TERMS HEREOF) OR
          (ii) IN
          ANY MANNER CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF BUYER
          AND
          SELLER WITH RESPECT TO THIS AGREEMENT (OR ANY AGREEMENT FORMED PURSUANT
          TO THE
          TERMS HEREOF) OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR
          DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR
          THERETO,
          IN EACH CASE WHETHER NOW EXISTING OR HEREINAFTER ARISING, AND WHETHER SOUNDING
          IN CONTRACT OR TORT OR OTHERWISE; BUYER AND SELLER EACH HEREBY AGREES AND
          CONSENTS THAT, SUBJECT TO SECTION 12.19, ANY SUCH CLAIM, DEMAND, ACTION
          OR CAUSE
          OF ACTION SHALL BE DECIDED BY A COURT TRIAL WITHOUT A JURY, AND THAT EITHER
          PARTY MAY FILE A COPY OF THIS SECTION WITH ANY COURT AS CONCLUSIVE EVIDENCE
          OF
          THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY
          JURY.
  BUYER’S
                    INITIALS:
                /s/
                    EMSELLER’S
                    INITIALS:
                /s/
                    BM
  21
  **12.19         Arbitration
          of Disputes.**
  (a)           EXCEPT
          AS PROVIDED IN SECTION 12.19(b) BELOW, ANY CONTROVERSY, DISPUTE OR CLAIM
          OF
          WHATSOEVER NATURE ARISING OUT OF, IN CONNECTION WITH, OR IN RELATION TO
          THE
          INTERPRETATION, PERFORMANCE OR BREACH OF THIS AGREEMENT, INCLUDING ANY
          CLAIM
          BASED ON CONTRACT, TORT OR STATUTE, SHALL BE DETERMINED BY FINAL AND BINDING,
          CONFIDENTIAL ARBITRATION ADMINISTERED BY THE AMERICAN ARBITRATION ASSOCIATION
          (“AAA”) IN ACCORDANCE WITH ITS THEN-EXISTING REAL ESTATE INDUSTRY ARBITRATION
          RULES, EXCEPT AS MODIFIED BY EXPRESS PROVISIONS HEREIN.  THE
          ARBITRATION SHALL BE CONDUCTED BY A SINGLE ARBITRATOR WHO SHALL BE A RETIRED
          JUDGE OF THE COURT SELECTED BY MUTUAL AGREEMENT OF THE PARTIES, AND IF
          THEY
          CANNOT SO AGREE WITHIN FIFTEEN (15) DAYS AFTER THE CLAIM DATE, THE ARBITRATOR
          SHALL BE A RETIRED JUDGE OF THE COURT SELECTED UNDER THE AAA
          RULES.  ANY ARBITRATION HEREUNDER SHALL BE GOVERNED BY THE UNITED
          STATES ARBITRATION ACT, 9 U.S.C. 1-16 (OR ANY SUCCESSOR LEGISLATION THERETO),
          AND JUDGMENT UPON THE AWARD RENDERED BY THE ARBITRATOR MAY BE ENTERED BY
          ANY
          STATE OR FEDERAL COURT HAVING JURISDICTION THEREOF.  NEITHER BUYER,
          SELLER NOR THE ARBITRATOR SHALL DISCLOSE THE EXISTENCE, CONTENT OR RESULTS
          OF
          ANY ARBITRATION HEREUNDER WITHOUT THE PRIOR WRITTEN CONSENT OF ALL PARTIES;
          PROVIDED, HOWEVER, THAT EITHER PARTY MAY DISCLOSE THE EXISTENCE, CONTENT
          OR
          RESULTS OF ANY SUCH ARBITRATION TO ITS PARTNERS, OFFICERS, DIRECTORS, EMPLOYEES,
          AGENTS, ATTORNEYS AND ACCOUNTANTS AND TO ANY OTHER PERSON TO WHOM DISCLOSURE
          IS
          REQUIRED BY APPLICABLE GOVERNMENTAL REQUIREMENTS, INCLUDING PURSUANT TO
          AN ORDER
          OF A COURT OF COMPETENT JURISDICTION.  UNLESS OTHERWISE AGREED BY THE
          PARTIES, ANY ARBITRATION HEREUNDER SHALL BE HELD AT A NEUTRAL LOCATION
          SELECTED
          BY THE ARBITRATOR IN LOS ANGELES, CALIFORNIA.  THE COST OF THE
          ARBITRATOR AND THE EXPENSES RELATING TO THE ARBITRATION (EXCLUSIVE OF LEGAL
          FEES) SHALL BE BORNE EQUALLY BY BUYER AND SELLER UNLESS OTHERWISE SPECIFIED
          IN
          THE AWARD OF THE ARBITRATOR.  SUCH FEES AND COSTS PAID OR PAYABLE TO
          THE ARBITRATOR SHALL BE INCLUDED IN “COSTS AND ATTORNEYS’ AND PARALEGALS’ FEES”
FOR PURPOSES OF SECTION 12.2 AND THE ARBITRATOR SHALL SPECIFICALLY HAVE THE
          POWER TO AWARD TO THE PREVAILING PARTY PURSUANT TO SUCH SECTION 12.2 SUCH
          PARTY’S COSTS AND EXPENSES INCURRED IN SUCH ARBITRATION, INCLUDING FEES AND
          COSTS PAID TO THE ARBITRATOR.  DISCOVERY SHALL BE LIMITED TO REQUESTS
          FOR PRODUCTION OR INSPECTION OF DOCUMENTS AND THINGS, REQUESTS FOR ADMISSIONS
          AND DEPOSITIONS, UNDER THE CALIFORNIA DISCOVERY ACT, AS INCORPORATED INTO
          THE
          CODE OF CIVIL PROCEDURE.  ALL SUCH DISCOVERY SHALL BE COMPLETED NO
          LATER THAN TEN (10) DAYS BEFORE THE FIRST HEARING DATE ESTABLISHED BY THE
          ARBITRATOR.  THE ARBITRATOR MAY EXTEND SUCH PERIOD IN THE EVENT OF A
          PARTY’S FAILURE OR REFUSAL TO PROVIDE IN COMPLIANCE WITH THE CODE OF CIVIL
          PROCEDURE EXCEPT FOR THE TIME PROVISIONS, REQUESTED DISCOVERY AUTHORIZED
          BY
          THESE ARBITRATION PROVISIONS FOR ANY REASON WHATSOEVER, INCLUDING, WITHOUT
          LIMITATION, OBJECTIONS RAISED TO SUCH DISCOVERY OR UNAVAILABILITY OF A
          WITNESS
          DUE TO ABSENCE OR ILLNESS.  NO PARTY SHALL BE ENTITLED TO “PRIORITY”
IN CONDUCTING DISCOVERY.  THE ARBITRATOR SHALL DETERMINE THE MANNER IN
          WHICH THE ARBITRATION HEARING IS CONDUCTED INCLUDING THE TIMING AND PRESENTATION
          OF EVIDENCE AND ARGUMENT, AND ALL OTHER QUESTIONS THAT MAY ARISE WITH RESPECT
          TO
          THE ARBITRATION PROCEEDINGS.  THE ARBITRATOR SHALL BE REQUIRED TO
          DETERMINE ALL ISSUES IN ACCORDANCE WITH EXISTING CASE AND STATUTORY LAWS
          OF
          CALIFORNIA.  THE RULES OF EVIDENCE APPLICABLE TO CIVIL TRIALS IN
          CALIFORNIA SHALL BE APPLICABLE TO THE ARBITRATION PROCEEDING.  THE
          ARBITRATOR SHALL BE EMPOWERED TO ENTER EQUITABLE AS WELL AS LEGAL RELIEF
          AS IS
          EXPRESSLY PROVIDED BY THIS AGREEMENT.  THE ARBITRATOR SHALL ISSUE AN
          AWARD AT THE CLOSE OF THE ARBITRATION PROCEEDING THAT SHALL DISPOSE OF
          ALL OF
          THE CONTROVERSIES, DISPUTES AND CLAIMS OF THE PARTIES THAT ARE THE SUBJECT
          OF
          THE ARBITRATION.
  22
  (b)           THE
          PROVISIONS OF THIS SECTION 12.19 SHALL NOT APPLY TO ANY REQUEST OR APPLICATION
          FOR AN ORDER OR DECREE GRANTING ANY PROVISIONAL OR ANCILLARY REMEDY (SUCH
          AS A
          TEMPORARY RESTRAINING ORDER OR INJUNCTION) WITH RESPECT TO ANY RIGHT OR
          OBLIGATION OF EITHER PARTY TO THIS AGREEMENT, AND ANY PRELIMINARY DETERMINATION
          OF THE UNDERLYING CONTROVERSY, DISPUTE, QUESTION OR ISSUE AS IS REQUIRED
          TO
          DETERMINE WHETHER OR NOT TO GRANT SUCH RELIEF.  A FINAL AND BINDING
          DETERMINATION OF SUCH UNDERLYING CONTROVERSY, DISPUTE, QUESTION OR ISSUE
          SHALL
          BE MADE BY AN ARBITRATION CONDUCTED PURSUANT TO THIS SECTION 12.19 AFTER
          AN
          APPROPRIATE TRANSFER OR REFERENCE TO THE ARBITRATOR SELECTED PURSUANT TO
          THIS
          SECTION 12.19 UPON MOTION OR APPLICATION OF EITHER PARTY HERETO.  ANY
          ANCILLARY OR PROVISIONAL RELIEF WHICH IS GRANTED PURSUANT TO THIS SECTION
          12.19(b) SHALL CONTINUE IN EFFECT PENDING AN ARBITRATION DETERMINATION
          AND ENTRY
          OF JUDGMENT THEREON PURSUANT TO THIS SECTION 12.19.
  NOTICE:  BY
          INITIALING IN THE SPACE BELOW YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING
          OUT
          OF THE MATTERS INCLUDED IN THE “ARBITRATION OF DISPUTES” PROVISION DECIDED BY
          NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP
          ANY
          RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY
          TRIAL.  BY INITIALING IN THE SPACE BELOW YOU ARE GIVING UP YOUR
          JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS THOSE RIGHTS ARE SPECIFICALLY
          INCLUDED IN THE “ARBITRATION OF DISPUTES” PROVISION.  IF YOU REFUSE TO
          SUBMIT TO ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED
          TO
          ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL
          PROCEDURE.  YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS
          VOLUNTARY.
  WE
          HAVE
          READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES ARISING
          OUT OF
          THE MATTERS INCLUDED IN THE “ARBITRATION OF DISPUTES” PROVISION TO NEUTRAL
          ARBITRATION.
  BUYER’S
                    INITIALS:
                /s/
                    EMSELLER’S
                    INITIALS:
                /s/
                    BM
  **12.20                      [Intentionally
          Omitted].**
  **12.21**                      **No
          Consent or Waiver Relating to Emeritus/Summerville Merger
          Transaction**.  Nothing contained herein or in any of the
          other Transaction Documents (except as expressly provided therein) shall
          be
          deemed or construed to be the consent or approval by or waiver of any rights
          by
          HCP or any Affiliate of HCP to the proposed Emeritus/Summerville
          Merger.
  **12.22**                      **Property
          Disclosures Generally**.  Buyer hereby waives the right to
          receive and any obligation of Seller to deliver any disclosures applicable
          to
          the Property and required by Law; provided, however, if such waiver is
          not
          permitted by applicable Law, then Buyer shall promptly notify Seller in
          writing
          thereof and Seller shall provide, at Buyer’s expense, any such required
          disclosures as soon as practicable following Seller’s receipt of Buyer’s notice.
          The provisions of this Section 12.22 shall survive the Closing or any earlier
          termination of this Agreement.
  [Signature
          Page Follows]
  23
  IN
          WITNESS WHEREOF, the parties hereto have executed this Agreement as of
          the date
          first above written.
  SELLER:
                HEALTH
                    CARE PROPERTY INVESTORS, INC.,a
                    Maryland corporationBy:
                    /s/ Brian J. MaasBrian
                    J. MaasIts:
                    Senior Vice President
 
 [Signature
          Page Continues on Following Page]
  1
 BUYER:
                EMERITUS
                    CORPORATION,a
                    Washington corporationBy:
                /s/
                    Eric MendelsohnEric
                    MendelsohnDirector
                    of Real Estate and Legal Affairs
 
 2
  **ACCEPTANCE
          BY TITLE COMPANY**
  Title
          Company hereby agrees to establish an Escrow and act as the “Escrow Holder” in
          accordance with the provisions of the Agreement.  Title Company
          further agrees to deliver immediately to Buyer and Seller fully executed
          copies
          of the Agreement.  Title Company’s Escrow Number and Escrow Officer
          for the transaction contemplated hereby, address for notices for this Escrow,
          Escrow Account No. and wiring information is set forth below.


CHICAGO
                    TITLE INSURANCE COMPANYBy:
                /s/
                  Angie KoettersIts:
                Escrow
                  OfficerDate:  August
                    ___, 2007Escrow
                    No.:
                27061889Escrow
                    Officer:
                Angie
                    KoettersTelephone
                    No.:
                (312)
                    223-2718Fax
                    No.:
                (312)
                    223-5888Address
                    for Notices:
                Chicago
                    Title and Trust Company171
                    North ClarkChicago,
                    IL  60601Wiring
                    Information:Bank:
                LaSalle
                    National Bank135
                    S. LaSalle StreetChicago,
                    IL  60603ABA
                    No.:Credit
                    to:
                Chicago
                    Title and Trust Company, LoopAccount
                    No.:Reference:
                Escrow
                      No. D1 027047813Escrow
                    Officer:
                Angie
                    KoettersClosing
                    Division: D1Re:  HCP/Emeritus
  3