LEASE TERMINATION AGREEMENT

THIS LEASE TERMINATION AGREEMENT (the “Termination”) is dated as of March ___, 2007, and is effective at the Effective Time (as defined in Section 1 hereof), and is by and among HR ACQUISITION I CORPORATION, a Maryland corporation, HR ACQUISITION OF PENNSYLVANIA, INC. , a Pennsylvania corporation (f/k/a Capstone Capital of Pennsylvania, Inc.), and HRT HOLDINGS, INC ., a Delaware corporation (collectively the “Landlord”), with an address of 3310 West End Avenue, Suite 700, Nashville, Tennessee 37203, and EMERITUS CORPORATION , a Washington corporation (the “Tenant”), with an address of 3131 Elliott Avenue, Suite 500, Seattle, Washington 98121.

A.   Pursuant to that certain Lease Agreement identified on Exhibit A attached hereto (the “Lease”), Tenant leased from Landlord the premises more particularly described as the “Leased Property” in the Lease (the “Premises”).

B.   In conjunction with the conveyance of the Premises by Landlord to Tenant, Landlord and Tenant wish to agree and consent to the termination of the Lease.

NOW, THEREFORE , in consideration of the sum of Ten and No/100 Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and the mutual promises contained in this Termination, the parties, intending to be legally bound, agree as follows:

1.   Landlord and Tenant hereby agree and consent to the termination of the Lease, effective as of ______ __.m. (Eastern Time) on the date hereof (the “Effective Time”); provided, however, that Tenant is not released from any liabilities, duties or obligations under the Lease that

arose or accrued prior to the Effective Time, including, without limitation, the obligation, responsibility or liability for the payment to Landlord or any other person or entity for any losses, liabilities, damages, injuries, penalties, fines, costs, expenses, claims and other amounts of any and every kind whatsoever (including, without limitation, reasonable attorneys’ fees and expenses) that relate to (a) the Lease; (b) Tenant’s occupancy of the Premises or the improvements thereon; (c) the use or enjoyment of any appurtenances, easements, rights and privileges belonging to the Premises by Tenant or its invitees, officers, contractors, subcontractors, agents, representatives or employees; or (d) causes of action, claims, suits, actions or other proceedings (i) pending at the Effective Time or (ii) filed or made at or after the Effective Time and relating to events occurring or liabilities or obligations arising or accruing prior to the Effective Time.

2.   Tenant hereby releases and forever discharges Landlord from all known or unknown causes of action, claims, suits, actions, demands or other proceedings of any kind that Tenant has as of the Effective Time or may have after the Effective Time on account of or in any way arising out of or related to the Lease or the Premises.

3.   This Termination shall be construed and interpreted in accordance with the laws of the State in which the Premises are located.

4.   This Termination shall inure to the benefit of the successors and assigns of the parties hereto.

5.   This Termination may be executed in any number of counterparts, each of which shall be deemed an original hereof and all of which together shall constitute but one Termination. In the event of any conflict between the terms of this Termination and the terms of the Lease, the terms of this Termination shall govern and shall be controlling.

IN WITNESS WHEREOF , the parties hereto have executed this instrument effective on the date set forth above.

LANDLORD:

On this the _14th_ day of March, 2007, before me, the undersigned officer, personally appeared John M. Bryant, Jr. who acknowledged himself to be the Senior Vice President and General Counsel of HR ACQUISITION I CORPORATION , a Maryland corporation, and that he as such officer, being authorized to do so, executed the foregoing instrument for the purposes contained therein on behalf of the said corporation.

On this the _14th day of March, 2007, before me, the undersigned officer, personally appeared John M. Bryant, Jr., who acknowledged themselves to be the Senior Vice President and General Counsel of HR ACQUISITION OF PENNSYLVANIA, INC ., a Pennsylvania corporation, and that he as such officer, being authorized to do so, executed the foregoing instrument for the purposes contained therein on behalf of the said corporation.