EMERITUS CORP\WA\
FOURTH EXTENSTION OF ALI MGT. AGREEMENT
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<FILENAME>exhibit105215.txt
<DESCRIPTION>FOURTH EXTENSTION OF ALI MGT. AGREEMENT
<TEXT>


                    FOURTH AMENDMENT TO MANAGEMENT AGREEMENT
                    ----------------------------------------
                             WITH OPTION TO PURCHASE
                             -----------------------
                        (AL I - Emeritrust 25 Facilities)

     This Fourth Amendment to Management Agreement with Option to Purchase (this
"Amendment")  is  effective as of April 1, 2004 by and among Emeritus Management
LLC,  a  Washington  limited liability company ("Emeritus Management"), Emeritus
Management  I  LP,  a  Washington limited partnership ("Texas Manager;" together
with Emeritus Management referred to herein as "Manager"), Emeritus Corporation,
a  Washington  corporation  ("Emeritus),  AL  Investors  LLC, a Delaware limited
liability  company  ("AL  Investors"), for itself and as sole managing member or
sole managing member of the general partner of each of the Facility Entities set
forth  on  Exhibit  A  to  the  Management  Agreement  (as  hereinafter defined)
(individually  or  collectively  "Owner"  or  "Owners").


                                    Recitals
                                    --------

     A.     Emeritus  Management,  Texas Manager, Emeritus, AL Investors, ESC I,
L.P., a Washington limited partnership ("ESC"), and Emeritus Properties I, Inc.,
a  Washington corporation ("EPI") entered into that certain Management Agreement
with  Option  to  Purchase  (Emeritrust 25) dated December 30, 1998, pursuant to
which,  among  other  things,  AL  Investors  and  the Facility Entities engaged
Manager to manage certain Facilities described therein (as subsequently amended,
the "Management Agreement").  Pursuant to the terms of the Management Agreement,
ESC  and  EPI  have  ceased  to be Managers under the Management Agreement.  The
Management  Agreement  has  been  previously  amended  by (1) First Amendment to
Management  Agreement  with Option to Purchase, dated March 22, 2001 (the "First
Amendment"),  (2)  Second  Amendment  to  Management  Agreement  with  Option to
Purchase dated January 1, 2002 (the "Second Amendment"), (3) Waiver, Consent and
Amendment to Management Agreement dated May 1, 2002 ("Laurel Place Waiver"), (4)
Third  Amendment  to  Management  Agreement  dated  as  of June 30, 2003 ("Third
Amendment"),  (5)  Termination of Memorandum of Management Agreement With Option
to  Purchase  for  Laurel  Place  ("Park  Place  Waiver") and (6) Termination of
Memorandum  of  Management  Agreement  with  Option  to  Purchase (Madison Glen)
("Madison  Glen  Waiver").  Pursuant  to  the  Laurel Place Waiver, the Facility
known  as  Laurel  Place  was  sold  and  has  been  deleted from the Management
Agreement.  Pursuant  to the Park Place Waiver, the Facility known as Park Place
has  been  sold  and  deleted  from  the  Management Agreement.  Pursuant to the
Madison  Glen  Waiver,  the  Facility  known  as  Madison Glen has been sold and
deleted  from  the  Management  Agreement.

     B.     In  connection with an extension and modification of the Senior Loan
pursuant to Amended and Restated Loan Agreement dated on or about April 20, 2004
("Amended  Loan  Agreement"),  the  parties  now  desire to amend the Management
Agreement  to  provide for the extension of the Management Agreement until April
1,  2005,  and  if  extended for the Extension Period (as defined in the Amended
Loan  Agreement)  until  April  1,  2006.

     NOW,  THEREFORE, in consideration of Ten and No/100 Dollars, the agreements
contained  herein,  and  other  good and valuable consideration, the receipt and
sufficiency  of  which  is  hereby  acknowledged,  the  parties  hereby agree as
follows:

1.     Defined  Terms.  All  terms capitalized herein but not defined shall have
       --------------
the  meanings  given  them  in  the  Management  Agreement.

2.     Term.  The  text  of  Section 2.3 is deleted in its entirety and replaced
       ----
with  the  following:

The  Term of the Management Agreement as defined in the Third Amendment has been
extended  to  April  1,  2004.  The  Term  of the Management Agreement is hereby
extended  to April 1, 2005, and for the Extension Period, if Owner so elects and
is  entitled  to  so  extend,  subject to sooner termination as provided herein.
Notwithstanding  anything  to  the contrary herein, either Manager or Owners may
terminate  this  Agreement  without  cause  upon  ninety (90) days prior written
notice  to  the  other as more particularly provided in Section 9.1 and 9.2.  If
the  Management  Agreement  is terminated because Owner fails to qualify for the
Extension  Period,  then  Manager  at  Owner's  request  agrees  to  manage  the
Facilities  for  a  period  of  up  to ninety (90) days upon the terms set forth
herein.

3.     Financial  Covenant.   The  following  is  added  as  Section  4.5:
       -------------------

So  long  as  any  part  of  the Senior Loan remains outstanding, Emeritus shall
maintain  Liquidity (defined below) of at least $2,000,000 as of the last day of
each  March,  June,  September  and December; and shall provide evidence thereof
satisfactory  to  Senior  Lender upon request of Senior Lender.  As used in this
paragraph,  Liquidity means unrestricted and unencumbered cash, cash equivalents
including  commercial  paper with maturities of less than 90 days and marketable
securities  that  are  owned,  directly  or  indirectly,  by  Emeritus.

4.     Insurance.   The  following  is  added  as  Section  5.3:
       ---------

Notwithstanding  anything  contained in this agreement, Owners will not exercise
their  remedies  with  respect  to any breach by Emeritus or the Managers of the
insurance  requirements  set  forth  in  Section  5  that  is  the  subject of a
forbearance  letter  issued  by  Senior  Lender  so  long as Emeritus and/or the
Managers  comply  in  all respects with the requirements of Senior Lender as set
forth  in  such forbearance letter.  In the event that Senior Lender revokes its
forbearance  letter  and  requires compliance with the insurance requirements of
the Senior Loan Documents, then Emeritus and the Managers shall comply with such
requirements  of  Senior  Lender.  The  cost  of  such  compliance  shall  be an
Operating  Expense.

5.     Indemnity.   The  third  to  last  sentence of Section 6.1 is deleted and
       ---------
replaced  with  the  following:

All  costs  and  expenses  of  Manager  pursuant  to  this indemnity shall be an
Operating  Expense  so  long as (a) Manager was not in breach of this Agreement,
and  (b)  was  not  negligent.

6.     Management  Fees.  Section  7.1 and 7.2 are deleted and replaced with the
       ----------------
following:

     7.1     Base  Management Fee.  Manager shall be entitled to pay itself from
the  Agency  Account  on the 4th day of each month a management fee of 5% of the
Total  Revenues  from  all  Facilities  in  the  aggregate  then subject to this
Agreement  ("Base  Management  Fee").

     7.2     No  Accruals  of  Prior  Management Fees.  All accruals of the Base
Management  Fee,  Additional  Management Fee or any other Management Fee accrued
for all periods prior to April 1, 2004 are terminated and written off.  The Base
Management  Fee shall be Manager's sole management fee and all references to any
Additional  Management  Fee  are  deleted.

     Section  7.3 is deleted.  All references to reimbursement of Loan Extension
Closing Costs or Pooled Expenses are deleted and Owner acknowledges such amounts
have  been  paid  for  all  prior  Senior  Loan extensions.  With respect to the
Amended  Loan  Agreement,  AL  Investors  has  agreed  to pay from funds held by
Emeritus on behalf of AL Investors (a) all fees as defined in Section 2.6 of the
Amended  Loan  Agreement;  (b)  all closing costs in connection with the Amended
Loan Agreement, including without limitation, all costs and fees which Owners as
borrowers are obligated to reimburse to Senior Lender, title insurance fees, UCC
search  costs,  attorneys'  fees  and  costs  of AL Investors and Senior Housing
Partners  I,  L.P. and any other reasonable out-of-pocket costs and expenses and
(c) all extension fees for the Extension Period.  Provided, however, if Emeritus
does  not  have sufficient funds held for the account of AL Investors to pay the
foregoing  amounts,  Daniel  R.  Baty  shall  pay  such  amounts.

7.     Expenditures.  To be consistent with the revisions to Section 7.1 and 7.2
       ------------
     above,  Section  8.2  is  deleted  and  replaced  with  the  following:

     8.2     Expenditures.  In  accordance  with  the  Annual  Plan,  except  as
otherwise  approved  by  Owners, Managers as agent for the Facility Entities are
hereby  authorized and directed to pay from the Agency Account for each Facility
in  the  following  order  of  priority  such  amounts  and at such times as are
required  to  pay  the  following  expenditures:

     (a)     The  Operating  Expenses;

     (b)     The  Fixed  Operating  Expenses,  including  Capital  Expenditures,
except  for  such  items  as  Owner  has  elected  to  pay  directly;

     (c)     The  cost  of  Capital  Improvements  approved  by  Owner;

     (d)     The  Base  Management  Fee;

     (e)     Any  remaining  Cash  Available  for  Distribution shall be paid to
Owner.

     Any  amounts  due  Owner shall be paid over to Owners as directed by Owners
within  twenty (20) days after the end of each calendar month during the term of
this Agreement.  Funds in the Agency Account shall not be utilized for any other
purpose.

8.     Deficit  Contributions.  Section  8.3  is  deleted  in  its  entirety and
       ----------------------
replaced  with  the  following:

a.     Deficit  Contributions.  All Operating Deficits during the Term remaining
after  Owner  has  funded  the  full amount of the Owner's Deficit Contribution,
i.e.,  $4,500,000,  (which  Owners  and  Manager acknowledge has been previously
funded)  shall  be  funded  absolutely  and  unconditionally  by  Daniel R. Baty
("Baty")  into the Agency Account or otherwise as directed by Owners as and when
necessary  to  pay,  but  in any event no later than ten (10) days after written
notice  from Owners, all Operating Deficits during any calendar month during the
Term  and by his execution hereof Baty agrees to do so.  Neither Owners, Manager
     or  Emeritus  shall  have  any  obligation to fund Operating Deficits or to
reimburse  Baty  for  any  Operating  Deficit  payments  or  contributions.  All
references  in  the  Agreement  to  any obligation of Emeritus to fund Operating
Deficits, e.g., Section 1.4, are hereby deleted.  Notwithstanding the foregoing,
Emeritus  shall  continue to pay Owners any amount owing to Owners for Operating
Deficits  that  accrued  prior  to  October  1,  2003.

9.     Termination.  Section  9.1  is  deleted  and replaced with the following:
       -----------

     9.1  Managers.  The  Managers may terminate this Agreement, with respect to
all  (but not less than all) of the Facilities by reason of any of the following
("Event  of  Default"):  (i)  the  Owner breaches or fails to perform a material
term  of this Agreement, which breach or failure is not cured within thirty (30)
days  after  written  notice  of  said breach is provided to Owner, or (ii) Baty
fails to fund Operating Deficits in accordance with Section 8.3.  In addition to
the  foregoing  right  to terminate for Owners' or Baty's default, Manager, upon
ninety  (90) days prior written notice, may terminate this Agreement at any time
at  its  sole election.  With respect to an Event of Default under (ii) the sole
remedy of Managers, notwithstanding anything to the contrary herein, shall be to
terminate  this  Agreement.

Section  9.2  is  deleted  and  replaced  with  the  following:

     9.2     Owner.  The  Owner may terminate this Agreement with respect to any
one  or  all of the Facilities by reason of any of the following (each an "Event
of  Default"):  (i)  Baty  fails to fund any Operating Deficit under Section 8.3
within  fifteen  (15)  days after written notice from Owner that payment has not
been  paid  when due; (ii) Managers or any of them or Emeritus breaches or fails
to  perform a material term of this Agreement as to any or all Facilities, which
breach  or  failure is not cured within thirty (30) days after written notice of
said  breach is provided to the Managers; (iii) Daniel Baty fails to comply with
the  liquidity and reporting requirements of the Senior Loan (which is not cured
within  any  applicable  cure  period set forth therein); (iv) either Manager or
Emeritus  suffers  a  Bankruptcy Event; or (v) Emeritus fails to comply with the
liquidity  and  reporting requirements set forth in Section 4.5 and such failure
is  not  cured  within  thirty  (30) days after written notice of such breach is
provided  to  Emeritus.  In  addition  to  the foregoing rights to terminate for
Manager's  or  Baty's  default,  Owners may, upon ninety (90) days prior written
notice,  terminate  this  Agreement  at  any  time  at  its  sole  election.

Section  9.3  is  deleted  and  replaced  with  the  following:

     9.3     Curing  Defaults.  Any  default  by  Managers  or  Owner  under the
provisions  of Section 9.1 and 9.2, except for defaults involving the payment of
money  which  must  be  cured  within  the  applicable  cure  period,  shall not
constitute  an Event of Default if the nature of such default will not permit it
to  be  cured  within the cure period allotted, provided that either Managers or
Owner promptly shall commence to cure such default and shall proceed to complete
the  same  with  diligence  but in no event later than sixty (60) days after the
written  notice  of  default  has  been  given.

The  last sentence of Section 9.4 is deleted, and Sections 9.8, 9.9 and 9.10 are
deleted.

10.     Emeritus  Option  to  Purchase.  Section  13  and  all references to any
        ------------------------------
option  that  Managers  or  Emeritus  may  have  to  purchase the Facilities are
deleted.

11.     Emeritus  Right  of First Refusal.  Section 14 and all references to any
        ---------------------------------
rights  of  first  refusal  that  Managers  or Emeritus may have to purchase the
Facilities  are  deleted.

12.     Exhibits.  Exhibit  A  is  hereby  revised  as  follows:
        --------

a.     Senior  Loan - the definition of Senior Loan is deleted and replaced with
the  following:

Senior  Loan:  any  indebtedness  incurred  by  Owners  which  is secured by any
mortgage,  deed  of  trust  and related security instruments against a Facility.
Initially the Senior Loan is evidenced by that certain Loan Agreement between AL
Investors  (and  the Facility Entities) and GMAC Commercial Mortgage Corporation
dated  on  or about December 30, 1998, as amended by the First, Second and Third
Amendments  to  Loan  Agreement,  including,  without  limitation,  all interest
increases  and modifications contained therein (the "Initial Senior Loan").  The
Senior  Loan  includes  any refinance, modification, or extension of the Initial
Senior  Loan,  including, without limitation, the extension and modification set
forth  in  the  Amended  Loan  Agreement.

b.     Deemed  Senior  Loan  -  the definition of Deemed Senior Loan is deleted.

c.     Fixed  Operating Expenses - the definition of Fixed Operating Expenses is
deleted  in  its  entirety  and  replaced  with  the  following:

     Fixed  Operating Expenses:  for any period, all fixed costs and expenses of
owning,  and  operating  the  Facilities  in  the  aggregate,  except  where the
Agreement  expressly  provides that Fixed Operating Expenses shall be determined
for  each  Facility,  to  the extent such costs and expenses are not included in
Operating Expenses, including but not limited to (a) all amounts to be paid into
any  reserve  account  and  the  cost of Capital Improvements approved by Owners
including those funded from any reserve account; (b) the debt service on account
of the then Senior Loan; (c) the real and personal property ad valorem taxes and
assessments;  (d) the Base Management Fee; and (e) all costs and expenses of all
property  and casualty insurance on or in respect of the Facilities provided for
herein  and  the  amount  of  all  self-insured  losses  or  deductibles.  Fixed
Operating  Expenses  shall  not  include  the  Excluded  Expenses.

d.     Facility  or  Facilities - Laurel Place, Park Place, and Madison Glen are
deleted.

          e.     Management  Fee  -  Revised  to  mean  the Base Management Fee.

13.     Guaranty  of Management Agreement and Shortfall Funding Agreement.  That
        -----------------------------------------------------------------
certain  Guaranty  of Management Agreement and Shortfall Funding Agreement dated
December  30,  1998 and executed by Emeritus Corporation ("Guaranty") is amended
as  follows:

Section  1.2  of  the  Guaranty  and all references to Operating Deficits or any
obligation  of  Emeritus  to  fund  Operating  Deficits are hereby deleted.  The
Guaranteed  Obligations  as  referenced  in Section 1.1 are limited to Manager's
obligations  under  the Management Agreement, as amended, and do not include any
obligation  to  fund  Operating  Deficits.

14.     Ratification.  The  Management  Agreement, as amended by this Agreement,
        ------------
is  hereby  ratified  and  confirmed.  In the event of any inconsistency between
this  Amendment  and  the  Management  Agreement,  this Amendment shall control.

15.     Understandings  and  Agreements.  This  Amendment,  together  with  the
        -------------------------------
Management  Agreement,  constitutes  all  of  the  understandings and agreements
between  the  parties  with  respect  to  the  management  of  the  Facilities.

16.     Headings.  The  headings  contained  herein  are  for  convenience  of
        --------
reference  only  and  are not intended to define, limit or describe the scope or
intent  of  any  provision  of  this  Agreement.

17.     Applicable  Law.  This  Agreement shall be construed and interpreted and
        ---------------
be  governed  by  the  laws  of  the  State  of  Washington.

18.     Counterparts.  This  Agreement may be executed and delivered in multiple
        ------------
counterparts  with  the  same  effect  as  if  all parties had executed the same
original,  and  all such counterparts, when taken together, shall constitute one
and  the  same  instrument.

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

         [Remainder of page intentionally left blank; signatures follow]
<PAGE>

50400533.06
           Signature Page for Fourth Amendment to Management Agreement


EMERITUS  MANAGEMENT
--------------------

EMERITUS  MANAGEMENT  LLC,  a  Washington  limited  liability  company

By:     Emeritus  Corporation,  a  Washington  corporation


By:  /s/  William  M.  Shorten
     -------------------------
Name:   William  M.  Shorten
        --------------------
Title:  Director  of  Real  Estate  Finance
        -----------------------------------


EMERITUS  MANAGEMENT  I  LP
---------------------------

EMERITUS  MANAGEMENT  I  LP,  a  Washington  limited  partnership

By:     EM  I,  LLC,  a  Washington  limited  liability  company

By:     Emeritus  Corporation,  a  Washington  corporation


By:  /s/  William  M.  Shorten
     -------------------------
Name:   William  M.  Shorten
        --------------------
Title:  Director  of  Real  Estate  Finance
        -----------------------------------


EMERITUS
--------

EMERITUS  CORPORATION,  a  Washington  corporation


By:  /s/  William  M.  Shorten
     -------------------------
Name:   William  M.  Shorten
        --------------------
Title:  Director  of  Real  Estate  Finance
        -----------------------------------


<PAGE>
           Signature Page for Fourth Amendment to Management Agreement


AL  INVESTORS
-------------

AL  INVESTORS  LLC, a Delaware limited liability company, for itself and as sole
managing  member on behalf of each of the Owners, or in the case where the Owner
is  a  limited  partnership,  as  sole  managing member on behalf of the general
partner  thereof


By:   /s/  Norman  L.  Brenden
Norman  L.  Brenden,  Manager



                              /s/  Daniel  R.  Baty
Daniel  R.  Baty  for  purposes  of  unconditionally  agreeing to fund Operating
Deficits  as  provided  in  Section  8.3 and the costs and expenses set forth in
Section  7

The  undersigned  lenders in connection with the Senior Loan and the Junior Loan
have executed this Agreement for the sole purpose of consenting to the foregoing
Amendment.

GMAC  Commercial  Mortgage  Corporation,  a  California  corporation


By:       /s/  Lisa  M.  Lautner
Name:  Lisa  M.  Lautner
     -------------------
Title:  Senior  Vice  President
        -----------------------


Senior  Housing  Partners  I,  L.P.,  a  Delaware  limited  partnership

By:     Senior  Housing  Partners  I,  L.L.C.,  its  general  partner

     By:     Prudential  Life  Insurance Company of America, its managing member


By:     /s/  Noah  R.  Levy
        -------------------
          Noah  R.  Levy,  Vice  President
          --------------------------------




</TEXT>
</DOCUMENT>
