EXHIBIT 10.1

 

SECOND AMENDED AND RESTATED CREDIT AGREEMENT

 

DATED AS OF JUNE 27, 2018,

 

AMONG

 

LTC PROPERTIES, INC.,

 

THE LENDERS FROM TIME TO TIME PARTIES HERETO,

 

BANK OF MONTREAL,

AS ADMINISTRATIVE AGENT AND L/C ISSUER,

 

KEYBANK NATIONAL ASSOCIATION,

AS SYNDICATION AGENT

 

AND

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

AS DOCUMENTATION AGENT

 

BMO CAPITAL MARKETS CORP., KEYBANK CAPITAL MARKETS INC., AND WELLS FARGO
SECURITIES, LLC,

AS CO-LEAD ARRANGERS AND JOINT BOOK RUNNERS

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS

 

SECTION

 

HEADING

 

PAGE

 

 

 

 

 

SECTION 1.

 

DEFINITIONS; INTERPRETATION

 

1

 

 

 

 

 

Section 1.1.

 

Definitions

 

1

Section 1.2.

 

Interpretation

 

28

Section 1.3.

 

Change in Accounting Principles

 

29

 

 

 

 

 

SECTION 2.

 

THE CREDIT FACILITY

 

29

 

 

 

 

 

Section 2.1.

 

Revolving Credit Commitments

 

29

Section 2.2.

 

Letters of Credit

 

29

Section 2.3.

 

Applicable Interest Rates

 

33

Section 2.4.

 

Minimum Borrowing Amounts; Maximum Eurodollar Loans

 

34

Section 2.5.

 

Manner of Borrowing Loans and Designating Applicable Interest Rates

 

34

Section 2.6.

 

Maturity of Loans

 

36

Section 2.7.

 

Prepayments

 

36

Section 2.8.

 

Default Rate

 

37

Section 2.9.

 

Evidence of Indebtedness

 

38

Section 2.10.

 

Funding Indemnity

 

39

Section 2.11.

 

Commitment Terminations

 

39

Section 2.12.

 

Substitution of Lenders

 

39

Section 2.13.

 

Increase in Revolving Credit Commitments

 

40

Section 2.14.

 

Defaulting Lenders

 

41

Section 2.15.

 

Cash Collateral for Fronting Exposure

 

43

Section 2.16.

 

Extension of the Stated Revolving Credit Termination Date

 

44

 

 

 

 

 

SECTION 3.

 

FEES

 

45

 

 

 

 

 

Section 3.1.

 

Fees

 

45

 

 

 

 

 

SECTION 4.

 

PLACE AND APPLICATION OF PAYMENTS

 

45

 

 

 

 

 

Section 4.1.

 

Place and Application of Payments

 

45

Section 4.2.

 

Account Debit

 

47

 

 

 

 

 

SECTION 5.

 

RESERVED

 

47

 

 

 

 

 

SECTION 6.

 

REPRESENTATIONS AND WARRANTIES

 

47

 

 

 

 

 

Section 6.1.

 

Organization and Qualification

 

47

Section 6.2.

 

Subsidiaries

 

47

Section 6.3.

 

Authority and Validity of Obligations

 

47

Section 6.4.

 

Use of Proceeds; Margin Stock

 

48

 

--------------------------------------------------------------------------------

 

Section 6.5.

 

Financial Reports

 

48

Section 6.6.

 

No Material Adverse Change

 

48

Section 6.7.

 

Full Disclosure

 

48

Section 6.8.

 

Trademarks, Franchises, and Licenses

 

49

Section 6.9.

 

Governmental Authority and Licensing

 

49

Section 6.10.

 

Good Title

 

49

Section 6.11.

 

Litigation and Other Controversies

 

49

Section 6.12.

 

Taxes

 

49

Section 6.13.

 

Approvals

 

50

Section 6.14.

 

Affiliate Transactions

 

50

Section 6.15.

 

Investment Company

 

50

Section 6.16.

 

ERISA

 

50

Section 6.17.

 

Compliance with Laws

 

50

Section 6.18.

 

Other Agreements

 

52

Section 6.19.

 

OFAC

 

52

Section 6.20.

 

No Default

 

52

Section 6.21.

 

Solvency

 

52

Section 6.22.

 

No Broker Fees

 

52

Section 6.23.

 

Stock of the Borrower

 

52

Section 6.24.

 

Condition of Property; Casualties; Condemnation

 

52

Section 6.25.

 

Legal Requirements, and Zoning

 

53

 

 

 

 

 

SECTION 7.

 

CONDITIONS PRECEDENT

 

53

 

 

 

 

 

Section 7.1.

 

All Credit Events

 

53

Section 7.2.

 

Initial Credit Event

 

54

 

 

 

 

 

SECTION 8.

 

COVENANTS

 

55

 

 

 

 

 

Section 8.1.

 

Maintenance of Business

 

55

Section 8.2.

 

Maintenance of Properties

 

55

Section 8.3.

 

Taxes and Assessments

 

55

Section 8.4.

 

Insurance

 

56

Section 8.5.

 

Financial Reports

 

56

Section 8.6.

 

Inspection

 

58

Section 8.7.

 

Office of Foreign Asset Control

 

58

Section 8.8.

 

Liens

 

59

Section 8.9.

 

Mergers, Consolidations and Sales

 

59

Section 8.10.

 

Maintenance of Unencumbered Asset Subsidiaries

 

60

Section 8.11.

 

ERISA

 

60

Section 8.12.

 

Compliance with Laws and Contractual Obligations

 

60

Section 8.13.

 

Burdensome Contracts With Affiliates

 

61

Section 8.14.

 

No Changes in Fiscal Year

 

61

Section 8.15.

 

Compliance with OFAC Sanctions Programs and Anti-Corruption Laws

 

61

Section 8.16.

 

Change in the Nature of Business

 

62

Section 8.17.

 

Use of Loan Proceeds

 

62

 

ii

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Section 8.18.

 

No Restrictions

 

62

Section 8.19.

 

Financial Covenants

 

63

Section 8.20.

 

Note Agreement Notices

 

63

Section 8.21.

 

Modification of Material Contracts

 

64

Section 8.22.

 

Limitations on Guaranties of Indebtedness

 

64

 

 

 

 

 

SECTION 9.

 

EVENTS OF DEFAULT AND REMEDIES

 

64

 

 

 

 

 

Section 9.1.

 

Events of Default

 

64

Section 9.2.

 

Non-Bankruptcy Defaults

 

66

Section 9.3.

 

Bankruptcy Defaults

 

67

Section 9.4.

 

Collateral for Undrawn Letters of Credit

 

68

Section 9.5.

 

Notice of Default

 

69

 

 

 

 

 

SECTION 10.

 

CHANGE IN CIRCUMSTANCES

 

69

 

 

 

 

 

Section 10.1.

 

Change of Law

 

69

Section 10.2.

 

Unavailability of Deposits or Inability to Ascertain, or Inadequacy of, LIBOR

 

69

Section 10.3.

 

Increased Cost and Reduced Return

 

70

Section 10.4.

 

Lending Offices

 

71

Section 10.5.

 

Discretion of Lender as to Manner of Funding

 

71

 

 

 

 

 

SECTION 11.

 

THE ADMINISTRATIVE AGENT

 

72

 

 

 

 

 

Section 11.1.

 

Appointment and Authority

 

72

Section 11.2.

 

Rights as a Lender

 

72

Section 11.3.

 

Action by Administrative Agent; Exculpatory Provisions

 

72

Section 11.4.

 

Reliance by Administrative Agent

 

74

Section 11.5.

 

Delegation of Duties

 

74

Section 11.6.

 

Resignation of Administrative Agent

 

74

Section 11.7.

 

Non-Reliance on Administrative Agent and Other Lenders

 

75

Section 11.8.

 

L/C Issuer

 

75

Section 11.9.

 

Designation of Additional Agents

 

76

Section 11.10.

 

Authorization of Administrative Agent to File Proofs of Claim

 

76

 

 

 

 

 

SECTION 12.

 

MISCELLANEOUS

 

77

 

 

 

 

 

Section 12.1.

 

Taxes

 

77

Section 12.2.

 

Other Taxes

 

81

Section 12.3.

 

No Waiver, Cumulative Remedies

 

81

Section 12.4.

 

Non-Business Days

 

81

Section 12.5.

 

Survival of Representations

 

81

Section 12.6.

 

Survival of Indemnities

 

81

Section 12.7.

 

Sharing of Payments by Lenders

 

82

Section 12.8.

 

Notices

 

82

 

iii

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Section 12.9.

 

Counterparts

 

84

Section 12.10.

 

Successors and Assigns

 

85

Section 12.11.

 

Amendments

 

89

Section 12.12.

 

Headings

 

90

Section 12.13.

 

Costs and Expenses; Indemnification

 

90

Section 12.14.

 

Set-off

 

91

Section 12.15.

 

Entire Agreement

 

92

Section 12.16.

 

Governing Law

 

92

Section 12.17.

 

Severability of Provisions

 

92

Section 12.18.

 

Excess Interest

 

92

Section 12.19.

 

Construction

 

93

Section 12.20.

 

Lender’s and L/C Issuer’s Obligations Several

 

93

Section 12.21.

 

No Advisory or Fiduciary Responsibility

 

93

Section 12.22.

 

Submission to Jurisdiction; Waiver of Jury Trial

 

94

Section 12.23.

 

USA Patriot Act

 

94

Section 12.24.

 

Confidentiality

 

94

Section 12.25.

 

Acknowledgement and Consent to Bail-In of EEA Financial Institutions

 

95

Section 12.26.

 

Amendment and Restatement; No Novation

 

96

 

 

 

 

 

Signature Page

 

 

 

1

 

EXHIBIT A

—

Notice of Payment Request

EXHIBIT B

—

Notice of Borrowing

EXHIBIT C

—

Notice of Continuation/Conversion

EXHIBIT D

—

Revolving Note

EXHIBIT E

—

Compliance Certificate

EXHIBIT F

—

Assignment and Assumption

EXHIBIT G

—

Commitment Amount Increase Request

EXHIBIT H-1

—

Form of U.S. Tax Compliance Certificate

EXHIBIT H-2

—

Form of U.S. Tax Compliance Certificate

EXHIBIT H-3

—

Form of U.S. Tax Compliance Certificate

EXHIBIT H-4

—

Form of U.S. Tax Compliance Certificate

SCHEDULE 1

—

Commitments

 

iv

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SECOND AMENDED AND RESTATED CREDIT AGREEMENT

 

This Second Amended and Restated Credit Agreement is entered into as of June 27,
2018, by and among LTC PROPERTIES, INC., a Maryland corporation (the
“Borrower”), the several financial institutions from time to time party to this
Agreement, as Lenders, and BANK OF MONTREAL, a Canadian chartered bank, as
Administrative Agent and L/C Issuer as provided herein.  All capitalized terms
used herein without definition shall have the same meanings herein as such terms
are defined in Section 1.1.

 

PRELIMINARY STATEMENT

 

WHEREAS, the Borrower, the financial institutions party thereto as “Lenders” and
Bank of Montreal, Chicago Branch, as Administrative Agent and the L/C Issuer,
previously entered into an Amended and Restated Credit Agreement dated as of
October 14, 2014 (as heretofore extended, renewed, amended, modified, amended
and restated or supplemented, the “Prior Credit Agreement”).

 

WHEREAS, the Borrower has requested that (i) the maturity date under the Prior
Credit Agreement be extended, (ii) the amount of the credit afforded to the
Borrower be increased, and (iii)  certain other amendments be made to the Prior
Credit Agreement, and the Administrative Agent, the L/C Issuer and the Lenders
have agreed to such requests on the terms and conditions set forth in this
Agreement, which, for the sake of clarity and convenience, amends and restates
the Prior Credit Agreement in its entirety.

 

NOW, THEREFORE, in consideration of their mutual agreements contained herein,
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby amend and restate the Prior
Credit Agreement in its entirety as follows:

 

SECTION 1.                                             DEFINITIONS;
INTERPRETATION.

 

Section 1.1.      Definitions.  The following terms when used herein shall have
the following meanings:

 

“Adjusted LIBOR” means, for any Borrowing of Eurodollar Loans, a rate per annum
determined in accordance with the following formula:

 

Adjusted LIBOR

=

LIBOR

 

 

1 - Eurodollar Reserve Percentage

 

“Administrative Agent” means Bank of Montreal, in its capacity as Administrative
Agent hereunder, and any successor in such capacity pursuant to Section 11.6.

 

“Administrative Questionnaire” means an Administrative Questionnaire by each
Lender in a form supplied by the Administrative Agent.

 

--------------------------------------------------------------------------------

 

“Affiliate” means any Person directly or indirectly controlling or controlled
by, or under direct or indirect common control with, another Person.  A Person
shall be deemed to control another Person for purposes of this definition if
such Person possesses, directly or indirectly, the power to direct, or cause the
direction of, the management and policies of the other Person, whether through
the ownership of voting securities, common directors, trustees or officers, by
contract or otherwise; provided that, in any event for purposes of this
definition, any Person that owns, directly or indirectly, 20% or more of the
securities having the ordinary voting power for the election of directors or
governing body of a corporation or 20% or more of the partnership or other
ownership interest of any other Person (other than as a limited partner of such
other Person) will be deemed to control such corporation or other Person.

 

“Agreement” means this Second Amended and Restated Credit Agreement, as the same
may be extended, renewed, amended, modified, amended and restated or
supplemented from time to time pursuant to the terms hereof.

 

“Anti-Corruption Law” means the FCPA and any law, rule or regulation of any
jurisdiction concerning or relating to bribery or corruption that are applicable
to the Borrower or any Subsidiary or Affiliate.

 

“Applicable Margin” means:

 

(a)           Prior to and on an Interest Rate Election Date (if any), with
respect to Revolving Loans, Reimbursement Obligations, and the Facility Fee and
letter of credit fees payable under Section 3.1, until the first Pricing Date,
the rates per annum shown opposite Level II below, and thereafter from one
Pricing Date to the next the Applicable Margin means the rates per annum
determined in accordance with the following schedule:

 

LEVEL

 

RATIO OF TOTAL
INDEBTEDNESS TO
TOTAL
ASSET VALUE FOR
SUCH
PRICING DATE

 

APPLICABLE
MARGIN
FOR BASE RATE
LOANS
AND
REIMBURSEMENT
OBLIGATIONS
SHALL BE:

 

APPLICABLE MARGIN
FOR
EURODOLLAR LOANS
AND
LETTER OF CREDIT
FEE SHALL BE:

 

APPLICABLE
MARGIN
FOR FACILITY FEE
SHALL BE:

 

VI

 

Greater than 0.55 to 1.0

 

0.55

%

1.55

%

0.35

%

V

 

Less than or equal to 0.55 to 1.0 but greater than 0.50 to 1.0

 

0.30

%

1.30

%

0.30

%

IV

 

Less than or equal to 0.50 to 1.0 but greater than 0.45 to 1.0

 

0.25

%

1.25

%

0.25

%

 

2

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LEVEL

 

RATIO OF TOTAL
INDEBTEDNESS TO
TOTAL
ASSET VALUE FOR
SUCH
PRICING DATE

 

APPLICABLE
MARGIN
FOR BASE RATE
LOANS
AND
REIMBURSEMENT
OBLIGATIONS
SHALL BE:

 

APPLICABLE MARGIN
FOR
EURODOLLAR LOANS
AND
LETTER OF CREDIT
FEE SHALL BE:

 

APPLICABLE
MARGIN
FOR FACILITY FEE
SHALL BE:

 

III

 

Less than or equal to 0.45 to 1.0 but greater than 0.40 to 1.0

 

0.20

%

1.20

%

0.20

%

II

 

Less than or equal to 0.40 to 1.0 but greater than 0.35 to 1.0

 

0.15

%

1.15

%

0.20

%

I

 

Less than or equal to 0.35 to 1.0

 

0.10

%

1.10

%

0.15

%

 

For purposes hereof, the term “Pricing Date” means, for any Fiscal Quarter of
the Borrower ending on or after June 30, 2018, the date on which the
Administrative Agent is in receipt of the Borrower’s most recent financial
statements and current Compliance Certificate (and, in the case of the year-end
financial statements, audit report) for the Fiscal Quarter then ended, pursuant
to Section 8.5 (for the sake of clarity, the financial statements and Compliance
Certificate for the Fiscal Quarter of the Borrower ending June 30, 2018 are
required to be delivered on or before August 15, 2018).  The Applicable Margin
shall be established based on the ratio of Total Indebtedness to Total Asset
Value for the most recently completed Fiscal Quarter and the Applicable Margin
established on a Pricing Date shall remain in effect until the next Pricing
Date.  If the Borrower has not delivered its financial statements, including a
Compliance Certificate, by the date such financial statements (and, in the case
of the year-end financial statements, audit report) are required to be delivered
under Section 8.5, until such financial statements and audit report are
delivered, the Applicable Margin shall be the highest Applicable Margin (i.e.,
Level VI shall apply).  If the Borrower subsequently delivers such financial
statements before the next Pricing Date, the Applicable Margin established by
such late delivered financial statements shall take effect from the date of
delivery until the next Pricing Date.  In all other circumstances, the
Applicable Margin established by such financial statements shall be in effect
from the Pricing Date that occurs immediately after the end of the Fiscal
Quarter covered by such financial statements until the next Pricing Date.  Each
determination of the Applicable Margin made by the Administrative Agent in
accordance with the foregoing shall be conclusive and binding on the Borrower
and the Lenders if reasonably determined.  The parties understand that the
Applicable Margin set forth herein may be determined and/or adjusted from time
to time based upon certain financial ratios and/or other information to be
provided or certified to the Administrative Agent, the Lenders and the L/C
Issuer by the Borrower (the “Borrower Information”).  If it is subsequently
determined that any such Borrower Information was incorrect (for whatever
reason, including, without limitation, because of a subsequent

 

3

--------------------------------------------------------------------------------

 

restatement of earnings by the Borrower) at the time it was delivered to the
Administrative Agent, the Lenders and the L/C Issuer, and if the applicable
interest rate or fees calculated for any period were lower than they should have
been had the correct information been timely provided, then, such Applicable
Margin for such period shall be automatically recalculated using correct
Borrower Information.  The Administrative Agent shall promptly notify the
Borrower in writing of any additional interest and fees due because of such
recalculation, and the Borrower shall pay within five (5) Business Days of
receipt of such written notice such additional interest or fees due to the
Administrative Agent, for the account of each Lender holding Revolving Credit
Commitments and Revolving Loans at the time the additional interest and fee
payment is received.  Any recalculation of the Applicable Margin required by
this provision shall survive for a period of two (2) months following the
termination of this Agreement, and this provision shall not in any way limit any
of the Administrative Agent’s, L/C Issuer’s or any Lender’s other rights under
this Agreement.

 

(b)           Commencing on the date after an Interest Rate Election Date (if
any), with respect to Revolving Loans, Reimbursement Obligations, and the
Facility Fee and letter of credit fees payable under Section 3.1, means the
rates per annum determined in accordance with the following schedule:

 

LEVEL

 

BORROWER’S CREDIT
RATING

 

APPLICABLE
MARGIN
FOR BASE
RATE LOANS
AND
REIMBURSEMENT
OBLIGATIONS
SHALL BE:

 

APPLICABLE
MARGIN FOR
EURODOLLAR LOANS
AND
LETTER OF CREDIT
FEE SHALL BE:

 

APPLICABLE
MARGIN
FOR FACILITY FEE
SHALL BE:

 

V

 

Lower than BBB-/Baa3

 

0.55

%

1.55

%

0.300

%

IV

 

BBB-/Baa3

 

0.20

%

1.20

%

0.250

%

III

 

BBB/Baa2

 

0.00

%

1.00

%

0.200

%

II

 

BBB+/Baa1

 

0.00

%

0.90

%

0.150

%

I

 

A-/A3 or better

 

0.00

%

0.825

%

0.125

%

 

During any period that the Borrower has two Credit Ratings that are not
equivalent, but are adjacent to each other in the immediately preceding pricing
grid, then the Applicable Margin will be determined based on the lowest rating. 
During any period that the Borrower has either (i) two Credit Ratings that are
not equivalent and are not adjacent to each other in the immediately preceding
pricing grid or (ii) three Credit Ratings that are each not equivalent to each
other, then the Applicable Margin will be determined based on the level that is
one level above the lowest of such Credit Ratings.  During any period after the
Interest Rate Election that the Borrower has fewer than two Credit Ratings, the
Applicable Margin will be determined based on Level V of

 

4

--------------------------------------------------------------------------------

 

the grid immediately above.  Any change in the Borrower’s Credit Rating which
would cause it to move to a different Level shall be effective five (5) Business
Days after (i) the Administrative Agent’s receipt of notice of any such change
in the Borrower’s Credit Rating from Borrower pursuant to Section 8.5 or
(ii) notwithstanding Section 8.5, any date Administrative Agent otherwise
obtains knowledge of any such change (provided that Administrative Agent shall
have no duty or obligation to any Person to ascertain or inquire into the
Borrower’s Credit Rating).  If it is subsequently determined that any change in
the Borrower’s Credit Rating was not disclosed to Administrative Agent in
accordance with Section 8.5, and if the applicable interest rate or fees
calculated for any period were lower than they should have been had the correct
information been timely provided in accordance with Section 8.5, then such
Applicable Margin for such period shall be automatically recalculated using the
Borrower’s correct Credit Rating.  The Administrative Agent shall promptly
notify the Borrower in writing of any additional interest and fees due because
of such recalculation, and the Borrower shall pay within five (5) Business Days
of receipt of such written notice such additional interest or fees due to the
Administrative Agent, for the account of each Lender holding Commitments and
Loans at the time the additional interest and fee payment is received.  Any
recalculation of the Applicable Margin required by this provision shall survive
for a period of two (2) months following the termination of this Agreement, and
this provision shall not in any way limit any of the Administrative Agent’s, L/C
Issuer’s or any Lender’s other rights under this Agreement.

 

“Application” is defined in Section 2.2(b).

 

“Approved Fund” means any Fund that has been approved by Borrower (such approval
not to be unreasonably withheld or delayed and such approval not to be required
if an Event of Default has occurred and is continuing) and is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.

 

“Assets Under Development” means any real property under construction other than
Redevelopment Assets.

 

“Assignment and Acceptance” means an assignment and acceptance entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is
required by Section 12.10), and accepted by the Administrative Agent, in
substantially the form of Exhibit F or any other form approved by the
Administrative Agent.

 

“Authorized Representative” means those persons shown on the list of officers
provided by the Borrower pursuant to Section 7.2 or on any update of any such
list provided by the Borrower to the Administrative Agent, or any further or
different officers of the Borrower so named by any Authorized Representative of
the Borrower in a written notice to the Administrative Agent.

 

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

 

5

--------------------------------------------------------------------------------

 

“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time which is described in the EU Bail-In Legislation Schedule.

 

“Base Rate” means, for any day, the rate per annum equal to the greatest of: 
(a) the rate of interest announced or otherwise established by the
Administrative Agent from time to time as its prime commercial rate as in effect
on such day, with any change in the Base Rate resulting from a change in said
prime commercial rate to be effective as of the date of the relevant change in
said prime commercial rate (it being acknowledged and agreed that such rate may
not be the Administrative Agent’s best or lowest rate), (b) the sum of (i) the
Federal Funds Rate for such day, plus (ii) 1/2 of 1%, and (c) the LIBOR Quoted
Rate for such day plus 1.00%.  As used herein, the term “LIBOR Quoted Rate”
means, for any day, the rate per annum equal to the quotient of (i) the rate per
annum (rounded upwards, if necessary, to the next higher one hundred-thousandth
of a percentage point) for deposits in U.S. Dollars for a one-month interest
period as reported on the applicable Bloomberg screen page (or such other
commercially available source providing such quotations as may be designated by
the Administrative Agent from time to time) as of 11:00 a.m. (London, England
time) on such day (or, if such day is not a Business Day, on the immediately
preceding Business Day) divided by (ii) one (1) minus the Eurodollar Reserve
Percentage, provided that in no event shall the “LIBOR Quoted Rate” be less than
0.00%.

 

“Base Rate Loan” means a Revolving Loan bearing interest at a rate specified in
Section 2.3(a).

 

“Beneficial Ownership Certification” means a certification regarding beneficial
ownership as required by the Beneficial Ownership Regulation.

 

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

 

“Borrower” is defined in the introductory paragraph of this Agreement.

 

“Borrowing” means the total of Revolving Loans of a single type advanced,
continued for an additional Interest Period, or converted from a different type
into such type on a single date and, in the case of Eurodollar Loans, for a
single Interest Period.  Borrowings of Revolving Loans are made and maintained
ratably from each of the Lenders according to their Revolver Percentages.  A
Borrowing is “advanced” on the day Lenders advance funds comprising such
Borrowing to the Borrower, is “continued” on the date a new Interest Period for
the same type of Revolving Loans commences for such Borrowing, and is
“converted” when such Borrowing is changed from one type of Revolving Loans to
the other, all as determined pursuant to Section 2.5.

 

“Business Day” means any day (other than a Saturday or Sunday) on which banks
are not authorized or required to close in Chicago, Illinois and, if the
applicable Business Day relates to the advance or continuation of, or conversion
into, or payment of a Eurodollar Loan, on which banks are dealing in U.S. Dollar
deposits in the interbank eurodollar market in London, England and Nassau,
Bahamas.

 

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“Capital Lease” means any Lease of Property which in accordance with GAAP is
required to be capitalized on the balance sheet of the lessee.

 

“Capitalization Rate” means (a) 8.0% for assisted living facilities, (b) 10.0%
for skilled nursing facilities (“SNF’s”), (c) 7.5% for Non-Government Reimbursed
Properties that are independent living facilities, (d) 10.0% for hospitals,
(e) 8.0% for Non-Government Reimbursed Properties that are not independent
living facilities, and (f) 10.0% for other Government Reimbursed Properties.

 

“Capitalized Lease Obligation” means, for any Person, the amount of the
liability shown on the balance sheet of such Person in respect of a Capital
Lease determined in accordance with GAAP.

 

“Cash Collateralize” means, to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the L/C Issuer or Lenders, as
collateral for L/C Obligations or obligations of Lenders to fund participations
in respect of L/C Obligations, cash or deposit account balances subject to a
first priority perfected security interest in favor of the Administrative Agent
or, if the Administrative Agent and the L/C Issuer shall agree in their sole
discretion, other credit support, in each case pursuant to documentation in form
and substance reasonably satisfactory to the Administrative Agent and the L/C
Issuer.  “Cash Collateral” shall have a meaning correlative to the foregoing and
shall include the proceeds of such cash collateral and other credit support.

 

“Cash Equivalents” means (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case
maturing within one (1) year from the date of acquisition thereof,
(b) marketable direct obligations issued or fully guaranteed by any state of the
United States or any political subdivision of any such state or any public
instrumentality thereof maturing within one (1) year from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either S&P or Moody’s, (c) commercial paper
maturing within one (1) year from the date of creation thereof and, at the time
of acquisition, having a rating of at least A-1 from S&P or at least P-1 from
Moody’s, (d) certificates of deposit, time deposits, overnight bank deposits or
bankers’ acceptances maturing within one (1) year from the date of acquisition
thereof issued by any bank organized under the laws of the United States or any
state thereof or the District of Columbia having at the date of acquisition
thereof combined capital and surplus of not less than $250,000,000, (e) deposit
accounts maintained with (i) any bank that satisfies the criteria described in
clause (d) above, or (ii) any other bank organized under the laws of the United
States or any state thereof so long as the full amount maintained with any such
other bank is fully insured by the Federal Deposit Insurance Corporation,
(f) repurchase obligations of any commercial bank satisfying the requirements of
clause (d) of this definition or recognized securities dealer having combined
capital and surplus of not less than $250,000,000, having a term of not more
than seven (7) days, with respect to securities satisfying the criteria in

 

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clauses (a) or (d) above, provided all such agreements require physical delivery
of the securities securing such repurchase agreement, except those delivered
through the Federal Reserve Book Entry System, and (g) investments in money
market funds substantially all of whose assets are invested in the types of
assets described in clauses (a) through (f) above.

 

“CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. §§9601 et seq., and any future
amendments.

 

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following:  (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation, implementation or application thereof by
any Governmental Authority, or (c) the making or issuance of any request, rule,
guideline or directive (whether or not having the force of law) by any
Governmental Authority; provided that notwithstanding anything herein to the
contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, regulations, guidelines or directives thereunder or issued
in connection therewith and (y) all requests, rules, guidelines or directives
promulgated by the Bank for International Settlements, the Basel Committee on
Banking Supervision (or any successor or similar authority) or the United States
or foreign regulatory authorities, in each case pursuant to Basel III, shall in
each case be deemed to be a “Change in Law”, regardless of the date enacted,
adopted or issued.

 

“Change of Control” means any of (a) the acquisition by any “person” or “group”
(as such terms are used in sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended) at any time of beneficial ownership of 50% or more of
the outstanding capital stock or other equity interests of the Borrower on a
fully-diluted basis, (b) any “Change of Control” (or words of like import), as
defined in any agreement or indenture relating to any issue of Indebtedness for
Borrowed Money in excess of 5% of the Total Asset Value shall occur or
(c) during any twelve (12) month period on or after the date hereof, individuals
who at the beginning of such period constituted the Board of Directors of the
Borrower (together with any new directors whose election by the Board of
Directors or whose nomination for election by the shareholders of the Borrower
was approved by a vote of at least a majority of the members of the Board of
Directors then in office who either were members of the Board of Directors at
the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
members of the Board of Directors then in office.

 

“Closing Date” means the date of this Agreement or such later Business Day upon
which each condition described in Section 7.2 shall be satisfied or waived in a
manner acceptable to the Administrative Agent in its discretion.

 

“Code” means the Internal Revenue Code of 1986, as amended, and any successor
statute thereto.

 

“Collateral Account” is defined in Section 9.4.

 

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“Commitment Amount Increase” is defined in Section 2.13.

 

“Commonly Controlled Entity” means an entity, whether or not incorporated, that
is under common control with the Borrower within the meaning of Section 4001 of
ERISA or that is part of a group that includes the Borrower and is treated as a
single employer under Section 414(b), (c) or (m) of the Code.

 

“Compliance Certificate” is defined in Section 8.5(c).

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profit Taxes.

 

“Controlled Group” means all members of a controlled group of corporations and
all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower, are treated as a single employer under
Section 414 of the Code.

 

“Credit Event” means the advancing of any Revolving Loan, or the issuance of, or
extension of the expiration date or increase in the amount of, any Letter of
Credit.

 

“Credit Rating” means the rating assigned by a Rating Agency to the Borrower for
the senior, unsecured, non-credit enhanced long-term indebtedness of the
Borrower.

 

“Debt Service” means, for any period, the sum of (a) Interest Expense for such
period and (b) the greater of (i) zero or (ii) scheduled principal amortization
paid on Secured Debt (exclusive of any balloon payments or prepayments of
principal paid on such Secured Debt) for such period, less amortized principal
payments received on the Borrower’s and its Subsidiaries’ mortgage loans
receivable (exclusive of any balloon payments or prepayments of principal
received on the Borrower’s and its Subsidiaries’ mortgage loans receivable) for
such period.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United States of America,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect.

 

“Default” means any event or condition the occurrence of which would, with the
passage of time or the giving of notice, or both, constitute an Event of
Default.

 

“Defaulting Lender” means, subject to Section 2.14(b), any Lender that (a) has
failed to (i) fund all or any portion of its Revolving Loans within two
(2) Business Days of the date such Revolving Loans were required to be funded
hereunder unless such Lender notifies the Administrative Agent and the Borrower
in writing that such failure is the result of such Lender’s determination that
one or more conditions precedent to funding (each of which conditions precedent,
together with any applicable default, shall be specifically identified in such
writing) has not been satisfied, or (ii) pay to the Administrative Agent, the
L/C Issuer or any other Lender any other amount required to be paid by it
hereunder (including in respect of its participation in

 

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Letters of Credit) within two (2) Business Days of the date when due, (b) has
notified the Borrower, the Administrative Agent or the L/C Issuer in writing
that it does not intend to comply with its funding obligations hereunder, or has
made a public statement to that effect (unless such writing or public statement
relates to such Lender’s obligation to fund a Revolving Loan hereunder and
states that such position is based on such Lender’s determination that a
condition precedent to funding (which condition precedent, together with any
applicable default, shall be specifically identified in such writing or public
statement) cannot be satisfied), (c) has failed, within three (3) Business Days
after written request by the Administrative Agent or the Borrower, to confirm in
writing to the Administrative Agent and the Borrower that it will comply with
its prospective funding obligations hereunder (provided that such Lender shall
cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such
written confirmation by the Administrative Agent and the Borrower), or (d) has,
or has a direct or indirect parent company that has, (i) become the subject of a
proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver,
custodian, conservator, trustee, administrator, assignee for the benefit of
creditors or similar Person charged with reorganization or liquidation of its
business or assets, including the Federal Deposit Insurance Corporation or any
other state or federal regulatory authority acting in such a capacity, or
(iii) become the subject of a Bail-in Action; provided that a Lender shall not
be a Defaulting Lender solely by virtue of the ownership or acquisition of any
equity interest in that Lender or any direct or indirect parent company thereof
by a Governmental Authority so long as such ownership interest does not result
in or provide such Lender with immunity from the jurisdiction of courts within
the United States or from the enforcement of judgments or writs of attachment on
its assets or permit such Lender (or such Governmental Authority) to reject,
repudiate, disavow or disaffirm any contracts or agreements made with such
Lender.  Any determination by the Administrative Agent that a Lender is a
Defaulting Lender under any one or more of clauses (a) through (d) above shall
be conclusive and binding absent manifest error, and such Lender shall be deemed
to be a Defaulting Lender (subject to Section 2.14(b)) upon delivery of written
notice of such determination to the Borrower, the L/C Issuer and each Lender.

 

“Designated Disbursement Account” means the account of the Borrower maintained
with the Administrative Agent or its Affiliate and designated in writing to the
Administrative Agent as the Borrower’s Designated Disbursement Account (or such
other account as the Borrower and the Administrative Agent may otherwise agree).

 

“EBITDA” means, for any period, determined on a consolidated basis of the
Borrower and its Subsidiaries, in accordance with GAAP, the sum of net income
(or loss) for such period plus: (i) depreciation and amortization expense for
such period, (ii) interest expense for such period, (iii) income tax expense for
such period, (iv) extraordinary, unrealized or non-recurring losses, including
impairment charges and reserves for such period, minus:  (v) funds received by
the Borrower or a Subsidiary as rent but which are reserved for capital expenses
during such period; (vi) unrealized gains on the sale of assets during such
period; and (vii) income tax benefits for such period.

 

“EEA Financial Institution” means (a) any credit institution or investment firm
established in any EEA Member Country which is subject to the supervision of an
EEA Resolution Authority, (b) any entity established in an EEA Member Country
which is a parent of

 

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an institution described in clause (a) of this definition, or (c) any financial
institution established in an EEA Member Country which is a subsidiary of an
institution described in clauses (a) or (b) of this definition and is subject to
consolidated supervision with its parent.

 

“EEA Member Country” means any of the member states of the European
Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any
person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

 

“Eligible Assignee” means (a) a Lender, (b) an Affiliate of a Lender, (c) an
Approved Fund, and (d) any other Person (other than a natural person) approved
by (i) the Administrative Agent, (ii) the L/C Issuer, and (iii) unless an Event
of Default has occurred and is continuing, the Borrower (each such approval not
to be unreasonably withheld or delayed).

 

“Eligible Line of Business” means any business engaged in as of the date of this
Agreement by the Borrower or any of its Subsidiaries or any business reasonably
related thereto.

 

“Environmental Claim” means any investigation, notice, violation, demand,
allegation, action, suit, injunction, judgment, order, consent decree, penalty,
fine, lien, proceeding or claim (whether administrative, judicial or private in
nature) arising (a) pursuant to, or in connection with an actual or alleged
violation of, any Environmental Law, (b) in connection with any Hazardous
Material, (c) from any abatement, removal, remedial, corrective or response
action in connection with a Hazardous Material, Environmental Law or order of a
Governmental Authority or (d) from any actual or alleged damage, injury, threat
or harm to health, safety, natural resources or the environment.

 

“Environmental Law” means any current or future Legal Requirement pertaining to
(a) the protection of health, safety and the indoor or outdoor environment,
(b) the conservation, management or use of natural resources and wildlife,
(c) the protection or use of surface water or groundwater, (d) the management,
manufacture, possession, presence, use, generation, transportation, treatment,
storage, disposal, Release, threatened Release, abatement, removal, remediation
or handling of, or exposure to, any Hazardous Material or (e) pollution
(including any Release to air, land, surface water or groundwater), and any
amendment, rule, regulation, order or directive issued thereunder.

 

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
costs of compliance, penalties or indemnities), of the Borrower or any
Subsidiary directly or indirectly resulting from or based upon (a) any actual or
alleged violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials,
(c) exposure to any Hazardous Materials, (d) the Release or threatened Release
of any Hazardous Materials into the environment or (e) any contract, agreement
or other legally enforceable consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.

 

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“Equity Interests” means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
or any successor statute thereto.

 

“ERISA Affiliate” means any Person that for purposes of Title IV of ERISA is a
member of the Borrower’s Controlled Group, or is under common control with the
Borrower, within the meaning of Sections 414 and 4001 of the Code and the
regulations promulgated and rulings issued thereunder.

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor Person), as in effect
from time to time.

 

“Eurodollar Loan” means a Revolving Loan bearing interest at the rate specified
in Section 2.3(b).

 

“Eurodollar Reserve Percentage” means the maximum reserve percentage, expressed
as a decimal, at which reserves (including, without limitation, any emergency,
marginal, special, and supplemental reserves) are imposed by the Board of
Governors of the Federal Reserve System (or any successor) on “eurocurrency
liabilities”, as defined in such Board’s Regulation D (or any successor
thereto), subject to any amendments of such reserve requirement by such Board or
its successor, taking into account any transitional adjustments thereto.  For
purposes of this definition, the relevant Revolving Loans shall be deemed to be
“eurocurrency liabilities” as defined in Regulation D without benefit or credit
for any prorations, exemptions or offsets under Regulation D. The Eurodollar
Reserve Percentage shall be adjusted automatically on and as of the effective
date of any change in any such reserve percentage.

 

“Event of Default” means any event or condition identified as such in
Section 9.1.

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result
of such Recipient being organized under the laws of, or having its principal
office or, in the case of any Lender, its applicable lending office located in,
the jurisdiction imposing such Tax (or any political subdivision thereof) or
(ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal
withholding Taxes imposed on amounts payable to or for the account of such
Lender with respect to an applicable interest in a Revolving Loan or Revolving
Credit Commitment pursuant to a law in effect on the date on which (i) such
Lender acquires such interest in the Revolving Loan or Revolving Credit
Commitment (other than pursuant to an assignment request by the Borrower under
Section 2.12) or (ii) such Lender changes its lending office, except in each
case to the extent that, pursuant to Section 12.1 amounts with respect to such
Taxes were payable either to such Lender’s assignor immediately before such
Lender became a party hereto or to such Lender immediately before it changed its
lending office, (c) Taxes attributable to such Recipient’s failure to comply
with Section 12.1(g), and (d) any U.S. federal withholding Taxes imposed under
FATCA.

 

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“Extension Fee” means an extension fee payable by the Borrower for a one-year
extension pursuant to Section 2.16 in an amount equal to 0.10% of the aggregate
Revolving Credit Commitments then in effect.

 

“Facility Fee” is defined in Section 3.1(a).

 

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof, and any agreements entered into
pursuant to Section 1471(b)(1) of the Code.

 

“FCPA” means the Foreign Corrupt Practices Act, 15 U.S.C. §§78dd-1, et seq.

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System, as published by the Federal Reserve Bank
of New York on the Business Day next succeeding such day; provided that (a) if
such day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate (rounded upward, if necessary, to a whole multiple
of 1/100 of 1%) charged to the Administrative Agent on such day on such
transactions as determined by the Administrative Agent; provided that in no
event shall the Federal Funds Rate be less than 0.00%.

 

“Fiscal Quarter” means each of the three-month periods ending on March 31,
June 30, September 30 and December 31.

 

“Fiscal Year” means the twelve-month period ending on December 31.

 

“Fitch” means Fitch Ratings, or any successor thereto.

 

“Fixed Charges” means, for any period, Debt Service for such period, plus
Preferred Dividends for such period, plus $400 per bed per annum for any
Property on which the Lease of such Property does not require the tenant to pay
for all capital expenditures.

 

“Foreign Lender” means a Lender that is not a U.S. Person.

 

“Former Plan” means any employee benefit plan in respect of which the Borrower
or a Commonly Controlled Entity has engaged in a transaction described in
Section 4069 or Section 4212(c) of ERISA.

 

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“Fronting Exposure” means, at any time there is a Defaulting Lender, with
respect to the L/C Issuer, such Defaulting Lender’s Revolver Percentage of the
outstanding L/C Obligations with respect to Letters of Credit issued by the L/C
Issuer other than L/C Obligations as to which such Defaulting Lender’s
participation obligation has been reallocated to other Lenders or Cash
Collateralized in accordance with the terms hereof.

 

“Fund” means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.

 

“Funds Transfer and Deposit Account Liability” means the liability of the
Borrower or any Subsidiary owing to any of the Lenders, or any Affiliates of
such Lenders, arising out of (a) the execution or processing of electronic
transfers of funds by automatic clearing house transfer, wire transfer or
otherwise to or from deposit accounts of the Borrower and/or any Subsidiary now
or hereafter maintained with any of the Lenders or their Affiliates, (b) the
acceptance for deposit or the honoring for payment of any check, draft or other
item with respect to any such deposit accounts, and (c) any other deposit,
disbursement, and cash management services afforded to the Borrower or any
Subsidiary by any of such Lenders or their Affiliates.

 

“GAAP” means generally accepted accounting principles set forth from time to
time in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.

 

“Government Reimbursed Properties” means Senior Housing Assets (other than
hospitals) in respect of which 51% or more of revenues are generated from
reimbursements under Medicare, Medicaid and other government programs for
payment of services rendered by healthcare providers

 

“Governmental Authority” means the government of the United States of America or
any other nation, or of any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government (including any supra-national bodies such as the European Union or
the European Central Bank).

 

“Gross Book Value” means book value without giving effect to depreciation.

 

“Hazardous Material” means any substance, chemical, compound, product, solid,
gas, liquid, waste, byproduct, pollutant, contaminant or material which is
hazardous, toxic or a pollutant and includes, without limitation, (a) asbestos,
polychlorinated biphenyls and petroleum (including crude oil or any fraction
thereof) and (b) any material classified or regulated as “hazardous,” “toxic” or
“pollutant” or words of like import pursuant to an Environmental Law.

 

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“Hazardous Material Activity” means any activity, event or occurrence involving
a Hazardous Material, including, without limitation, the manufacture,
possession, presence, use, generation, transportation, treatment, storage,
disposal, Release, threatened Release, abatement, removal, remediation, handling
of or corrective or response action to any Hazardous Material.

 

“Hedging Liability” means the liability of the Borrower or any Subsidiary to any
of the Lenders, or any Affiliates of such Lenders, in respect of any interest
rate, foreign currency, and/or commodity swap, exchange, cap, collar, floor,
forward, future or option agreement, or any other similar interest rate,
currency or commodity hedging arrangement, as the Borrower or such Subsidiary,
as the case may be, may from time to time enter into with any one or more of the
Lenders party to this Agreement or their Affiliates.

 

“Hostile Acquisition” means the acquisition of the capital stock or other equity
interests of a Person through a tender offer or similar solicitation of the
owners of such capital stock or other equity interests which has not been
approved (prior to such acquisition) by resolutions of the Board of Directors of
such Person or by similar action if such Person is not a corporation, or as to
which such approval has been withdrawn.

 

“Indebtedness for Borrowed Money” means for any Person (without duplication)
(a) all indebtedness created, assumed or incurred in any manner by such Person
representing money borrowed (including by the issuance of debt securities),
(b) all indebtedness for the deferred purchase price of property or services
(other than trade accounts payable arising in the ordinary course of business
and contingent liabilities related to potential earn out payments which do not
meet the balance sheet recognition requirements of Accounting Standards
Codification No. 450 —Contingencies), (c) all indebtedness secured by any Lien
upon Property of such Person, whether or not such Person has assumed or become
liable for the payment of such indebtedness, (d) all Capitalized Lease
Obligations of such Person, and (e) all obligations of such Person on or with
respect to letters of credit, bankers’ acceptances and other extensions of
credit whether or not representing obligations for borrowed money.

 

“Indemnified Taxes” means (a) all Taxes other than Excluded Taxes, imposed on or
with respect to any payment made by or on account of any obligation of Borrower
under any Loan Document and (b) to the extent not otherwise described in (a),
Other Taxes.

 

“Insolvency” means, with respect to any Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of Section 4245 of ERISA.

 

“Interest Expense” means, with respect to a Person for any period, the interest
expense whether paid, accrued or capitalized (without deduction of consolidated
interest income) of such Person for such period.  Interest Expense shall exclude
any amortization of (i) deferred financing fees, including the write-off such
fees relating to the early retirement of such related Indebtedness for Borrowed
Money, and (ii) debt discounts (but only to the extent such discounts do not
exceed 3.0% of the initial face principal amount of such debt).

 

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“Interest Payment Date” means (a) with respect to any Eurodollar Loan, the last
day of each Interest Period with respect to such Eurodollar Loan and on the
maturity date and, if the applicable Interest Period is longer than three
(3) months, on each day occurring every three (3) months after the commencement
of such Interest Period and (b) with respect to any Base Rate Loan, the last day
of every Fiscal Quarter and on the maturity date.

 

“Interest Period” means the period commencing on the date a Borrowing of
Eurodollar Loans is advanced, continued, or created by conversion and ending 1,
2, 3, or 6 months thereafter, provided, however, that:

 

(i)                          no Interest Period shall extend beyond the
Revolving Credit Termination Date;

 

(ii)                          whenever the last day of any Interest Period would
otherwise be a day that is not a Business Day, the last day of such Interest
Period shall be extended to the next succeeding Business Day, provided that, if
such extension would cause the last day of an Interest Period for a Borrowing of
Eurodollar Loans to occur in the following calendar month, the last day of such
Interest Period shall be the immediately preceding Business Day; and

 

(iii)                           for purposes of determining an Interest Period
for a Borrowing of Eurodollar Loans, a month means a period starting on one day
in a calendar month and ending on the numerically corresponding day in the next
calendar month; provided, however, that if there is no numerically corresponding
day in the month in which such an Interest Period is to end or if such an
Interest Period begins on the last Business Day of a calendar month, then such
Interest Period shall end on the last Business Day of the calendar month in
which such Interest Period is to end.

 

“Interest Rate Election” is defined in Section 2.3(d).

 

“Interest Rate Election Date” is defined in Section 2.3(d).

 

“Investment” means (i) any investment, directly or indirectly (whether through
the purchase of stock or obligations or otherwise) in any Person, real property
or improvements on real property, or any loans, advances, lines of credit,
mortgage loans or other financings (including pursuant to sale/leaseback
transactions) to any other Person, or (ii) any acquisition of any real property,
improvements on real property or all or any substantial part of the assets or
business of any other Person or division thereof.

 

“Investment Grade Credit Rating” means, with respect to the Borrower, a Credit
Rating of either (a) (i) BBB- or higher by S&P or Baa3 or higher from Moody’s
and (ii) BBB- or higher by Fitch or (b) BBB- or higher by S&P and Baa3 or higher
by Moody’s, and in either case, such Credit Rating shall not be accompanied by
(x) in the case of S&P, a negative outlook, creditwatch negative or the
equivalent thereof, (y) in the case of Moody’s, a negative outlook, a review for
possible downgrade or the equivalent thereof or (z) in the case of Fitch, a
negative watch or the equivalent thereof.

 

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“L/C Issuer” means Bank of Montreal, in its capacity as the issuer of Letters of
Credit hereunder, and its successors in such capacity as provided in
Section 2.2(h).

 

“L/C Obligations” means the aggregate undrawn face amounts of all outstanding
Letters of Credit and all unpaid Reimbursement Obligations.

 

“L/C Participation Fee” is defined in Section 3.1(b).

 

“L/C Sublimit” means $10,000,000, as reduced pursuant to the terms hereof.

 

“Lease” means any lease, tenancy agreement, contract or other agreement for the
use or occupancy of a Property or any portion thereof.

 

“Legal Requirement” means any treaty, convention, statute, law, regulation,
ordinance, license, permit, governmental approval, injunction, judgment, order,
consent decree or other requirement of any Governmental Authority, whether
federal, state, or local.

 

“Lenders” means and includes Bank of Montreal and the other financial
institutions from time to time party to this Agreement, including any new Lender
pursuant to Section 2.13 and each assignee Lender pursuant to Section 12.10.

 

“Lending Office” is defined in Section 10.4.

 

“Letter of Credit” is defined in Section 2.2(a).

 

“Leverage Ratio Increase Period” is defined in Section 8.19.

 

“LIBOR” means, for an Interest Period for a Borrowing of Eurodollar Loans,
(a) the LIBOR Index Rate for such Interest Period, if such rate is available,
and (b) if the LIBOR Index Rate cannot be determined, the arithmetic average of
the rates of interest per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) at which deposits in U.S. Dollars in immediately available funds
are offered to the Administrative Agent at 11:00 a.m. (London, England time) two
(2) Business Days before the beginning of such Interest Period by three (3) or
more major banks in the interbank eurodollar market selected by the
Administrative Agent for delivery on the first day of and for a period equal to
such Interest Period and in an amount equal or comparable to the principal
amount of the Eurodollar Loan scheduled to be made as part of such Borrowing,
subject to Section 10.2 in the event that the Administrative Agent shall
conclude that it shall not be possible to determine such interpolated rate
(which conclusion shall be conclusive and binding absent manifest error);
provided that in no event shall “LIBOR” be less than 0.00%.

 

“LIBOR Index Rate” means, for any Interest Period, the rate per annum (rounded
upwards, if necessary, to the next higher one hundred-thousandth of a percentage
point) for deposits in U.S. Dollars for a period equal to such Interest Period,
as reported on the applicable Bloomberg screen page (or such other commercially
available source providing such quotations as may be designated by the
Administrative Agent from time to time) as of 11:00 a.m. (London, England time)
on the day two (2) Business Days before the commencement of such Interest
Period.

 

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“Lien” means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of a
vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.

 

“Loan Documents” means this Agreement, the Notes (if any), the Applications and
each other instrument or document to be delivered hereunder or thereunder or
otherwise in connection therewith.

 

“Material Acquisition” means any acquisition (or series of related acquisitions)
permitted by the Loan Documents and consummated in accordance with the terms of
the Loan Documents if the aggregate consideration paid in respect of such
acquisition (including any Indebtedness for Borrowed Money assumed in connection
therewith) exceeds $175,000,000.

 

“Material Adverse Effect” means a material and adverse effect on (a) the
business, condition (financial or otherwise), operations, performance or
properties of the Borrower and its Subsidiaries taken as a whole, (b) the
ability of the Borrower to perform its obligations under the Loan Documents to
which it is a party or (c) the validity or enforceability of any of the Loan
Documents or the rights or remedies of the Administrative Agent or the Lenders
thereunder; provided, however, that the sale of assets of one or more
Subsidiaries in accordance with the terms of this Agreement shall not be deemed
in and of itself to cause a Material Adverse Effect absent the presence of the
factors set forth above.

 

“Minimum Collateral Amount” means, at any time, (a) with respect to Cash
Collateral consisting of cash or deposit account balances, an amount equal to
103% of the Fronting Exposure of the L/C Issuer with respect to Letters of
Credit issued and outstanding at such time and (b) otherwise, an amount
determined by the Administrative Agent and the L/C Issuer in their sole
discretion.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Multiemployer Plan” means a Plan that is a “multiemployer plan” as defined in
Section 4001(a)(3) of ERISA.

 

“Multiple Employer Plan” means a single employer plan, as defined in
Section 4001(a)(15) of ERISA and subject to Title IV thereof, that (a) is
maintained by the Borrower or an ERISA Affiliate and at least one Person other
than the Borrower and its ERISA Affiliates or (b) was so maintained previously,
but is not currently maintained by the Borrower or its ERISA Affiliates, and in
respect of which the Borrower or an ERISA Affiliate would still have liability
under Section 4063, 4064 or 4069 of ERISA in the event such plan has been or
were to be terminated.

 

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting
Lender at such time.

 

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“Non-Government Reimbursed Properties” means Senior Housing Assets (other than
hospitals) that are not Government Reimbursed Properties.

 

“Note” and “Notes” each is defined in Section 2.9.

 

“Note Purchase Agreement” means any of (i) the Note Purchase Agreement dated as
of July 19, 2012, as extended, renewed, amended, modified, amended and restated
or supplemented in its entirety, and any refinancing or replacement of any
series of notes issued and outstanding thereunder, (ii) the Third Amended and
Restated Note Purchase and Private Shelf Agreement dated as of April 28, 2015,
as extended, renewed, amended, modified, amended and restated or supplemented in
its entirety, and any refinancings or replacement of any series of notes issued
and outstanding thereunder, (iii) the Amended and Restated Note Purchase and
Private Shelf Agreement dated as of June 2, 2016, as extended, renewed, amended,
modified, amended and restated or supplemented in its entirety, and any
refinancings or replacement of any series of notes issued and outstanding
thereunder, (iv) the Note Purchase Agreement dated as of February 16, 2017, as
extended, renewed, amended, modified, amended and restated or supplemented in
its entirety, and any refinancings or replacement of any series of notes issued
and outstanding thereunder, and (v) any other agreement or instrument entered
into by the Borrower in connection with a financing, which constitutes unsecured
Indebtedness for Borrowed Money of the Borrower and ranks pari passu with the
Obligations.

 

“Noteholders” means the holders of any series of notes or other Indebtedness
issued under or in connection with a Note Purchase Agreement, including, without
limitation (i) the 5.74% Series A-2 Senior Notes Due January 14, 2019 in the
aggregate original principal amount of $25,000,000, (ii) the 4.80% Series B
Senior Notes due July 20, 2021 in the aggregate original principal amount of
$50,000,000, (iii) the 5.03% Senior Notes due July 19, 2024 in the aggregate
original principal amount of $85,800,000, (iv) the 3.99% Series C Senior Notes
due November 20, 2021 in the aggregate principal amount of $70,000,000, (v) the
4.50% Series D Senior Notes due July 31, 2026 in the aggregate original
principal amount of $30,000,000, (vi) the 4.50% Series E Senior Notes due
August 31, 2030 in the aggregate original principal amount of $100,000,000,
(vii) the 4.15% Series F Senior Notes due May 20, 2028 in the aggregate original
principal amount of $37,500,000, (viii) the 4.50% Series G Senior Notes due
February 16, 2032 in the aggregate original principal amount of $100,000,000,
(ix) the 4.26% Senior Notes due November 20, 2028 in the aggregate original
principal amount of $100,000,000, and (x) the 3.99% Senior Notes due July 20,
2031 in the aggregate original principal amount of $40,000,000.

 

“Obligations” means all obligations of the Borrower to pay principal and
interest on the Revolving Loans, all Reimbursement Obligations owing under the
Applications, all fees and charges payable hereunder, and all other payment
obligations of the Borrower or any of its Subsidiaries arising under or in
relation to any Loan Document, in each case whether now existing or hereafter
arising, due or to become due, direct or indirect, absolute or contingent, and
howsoever evidenced, held or acquired.

 

“OFAC” means the United States Department of Treasury Office of Foreign Assets
Control.

 

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“OFAC Event” means the event specified in Section 8.15.

 

“OFAC Sanctions Programs” means all laws, regulations, and Executive Orders
administered by OFAC, including without limitation, the Bank Secrecy Act,
anti-money laundering laws (including, without limitation, the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001, Pub. L. 107-56 (a/k/a the USA Patriot Act)), and
all economic and trade sanction programs administered by OFAC, any and all
similar United States federal laws, regulations or Executive Orders, and any
similar laws, regulators or orders adopted by any State within the United
States.

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned an interest in any Revolving Loan or Loan
Document).

 

“Other Investments” means any investment other than the following: (a) an
Investment in Cash Equivalents, (b) an investment by Borrower in its
Subsidiaries or by a Subsidiary in one or more of its Subsidiaries, (c) an
intercompany advance made from time to time among the Borrower and its
Subsidiaries in the ordinary course of business to finance working capital
needs, (d) an investment held by the Borrower and its Subsidiaries as of the
Closing Date, (e) an investment in Unconsolidated Affiliates, Assets Under
Development, or Redevelopment Assets, (f) an investment received in connection
with a workout of any obligation owed to Borrower or its Subsidiaries, or (g) an
investment or acquisition with respect to real property or improvements on real
property located in, or of a business with its primary operations in, the United
States of America, which, in each case, is in an Eligible Line of Business and
not a Hostile Acquisition (including, but not limited to, sale/leaseback
transactions, mortgage loans, lines of credit or other financings).

 

“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other
Connection Taxes imposed with respect to an assignment (other than an assignment
made pursuant to Section 2.12).

 

“Participating Interest” is defined in Section 2.2(e).

 

“Participating Lender” is defined in Section 2.2(e).

 

“PBGC” means the Pension Benefit Guaranty Corporation or any Person succeeding
to any or all of its functions under ERISA.

 

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“Permitted Lien” means such of the following as to which no enforcement,
collection, execution, levy or foreclosure proceeding has been commenced: 
(a) Liens for taxes, assessments and governmental charges or levies to the
extent not required to be paid under Section 8.3; (b) Liens imposed by law, such
as materialmen’s, mechanics’, carriers’, workmen’s and repairmen’s Liens and
other similar Liens arising in the ordinary course of business securing
obligations that are not overdue or that are being contested in good faith and
by proper proceedings and as to which appropriate reserves are being maintained;
(c) pledges or deposits to secure obligations under workers’ compensation laws
or similar legislation or to secure public or statutory obligations;
(d) easements, rights of way and other encumbrances on title to real property
that do not materially and adversely affect the value of such property or the
use of such property for its present purposes; (e) deposits to secure the
performance of bids, trade contracts (other than for borrowed money), leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of like nature incurred in the ordinary course of business;
(f) Liens in favor of the United States of America for amounts paid to the
Borrower or any Subsidiary as progress payments under government contracts
entered into by it; (g) attachment, judgment and other similar Liens arising in
connection with court, reference or arbitration proceedings, provided that the
same have been in existence less than 20 days, that the same have been
discharged or that execution or enforcement thereof has been stayed pending
appeal; and (h) Liens on Properties not constituting Unencumbered Assets.

 

“Person” means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization or any other entity or
organization, including a government or agency or political subdivision thereof.

 

“Plan” means any employee pension benefit plan covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Code that
either (a) is maintained by a member of the Controlled Group for employees of a
member of the Controlled Group or (b) is maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than one employer
makes contributions and to which a member of the Controlled Group is then making
or accruing an obligation to make contributions or has within the preceding five
plan years made contributions.

 

“Preferred Dividends” means any dividend paid (or payable) as the case may be,
in cash on any preferred equity security issued by the Borrower.

 

“Prior Credit Agreement” is defined in the Preliminary Statement of this
Agreement.

 

“Property” or “Properties” means, as to any Person, all types of real, personal,
tangible, intangible or mixed property owned by such Person whether or not
included in the most recent balance sheet of such Person and its subsidiaries
under GAAP.

 

“Property Expenses” means, with respect to any Unencumbered Asset, the costs
(including, but not limited to, payroll, taxes, assessments, insurance,
utilities, landscaping and other similar charges) of operating and maintaining
such Unencumbered Asset, which are the responsibility of the Borrower or the
applicable Subsidiary that are not paid directly by the tenant, but excluding
depreciation, amortization, interest costs and maintenance capital expenditures
to the extent such Unencumbered Asset is under a triple net lease.

 

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“Property Income” means, with respect to any Unencumbered Asset, cash rents
(excluding, as an abundance of caution, non-cash straight-line rent) and other
cash revenues received by the Borrower or a Subsidiary in the ordinary course of
business for such Unencumbered Asset, but excluding security deposits and
prepaid rent except to the extent applied in satisfaction of tenants’
obligations for rent.

 

“Property NOI” means, as of any date of determination and with respect to any
Unencumbered Asset, the aggregate amount of (i) Property Income for the Rolling
Period (without duplication) minus (ii) Property Expenses for the Rolling Period
(without duplication).

 

“Qualified Mortgage Loan” means, as of any date of determination, any mortgage
loan (i) on the Closing Date, listed on Exhibit A to Schedule I of the
Compliance Certificate and (ii) thereafter, listed on Exhibit A to Schedule I of
the Compliance Certificate after such mortgage loan’s designation by the
Borrower as a Qualified Mortgage Loan, so long as the Borrower shall fully
comply with the requirements of Section 8.5(c) with regards to reporting of such
Qualified Mortgage Loan, in each case that meets the following criteria:

 

(a)                        100% held or owned by the Borrower or a Subsidiary;

 

(b)                         Secured by a first or second mortgage or a first or
second deed of trust on Senior Housing Assets in favor of the Borrower or such
Subsidiary and such Senior Housing Asset is not subject to any other Lien or
negative pledge (other than Permitted Liens or, solely with respect to second
mortgages or second deeds of trust,  a first mortgage lien or first deed of
trust);

 

(c)                         The underlying Senior Housing Asset is currently in
service (not under development);

 

(d)                         The underlying Senior Housing Asset is located in
the United States and the loan documents pertaining to the mortgage or deed of
trust are governed by the law of a state of the United States;

 

(e)                         Neither the mortgage loan, nor the right to receive
payments thereunder, is subject to any Lien (other than Permitted Liens) or to
any negative pledge;

 

(f)                        If such mortgage loan is owned by a Subsidiary, none
of the Borrower’s beneficial ownership interest in such Subsidiary is subject to
any Lien (other than Permitted Liens or Liens in favor of the Borrower) or to
any negative pledge;

 

(g)                          The underlying Property, based on the Borrower or
its Subsidiary’s actual knowledge, is free of all material structural defects or
major architectural deficiencies, material title defects, material environmental
conditions or other adverse matters which, individually or collectively,
materially impair the value of such Property; and

 

(h)                         The mortgagor or grantor with respect to such
mortgage loan is not delinquent sixty (60) days or more in interest or principal
payments due thereunder.

 

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“Rating Agency” means Fitch, Moody’s, or S&P, as applicable.

 

“RCRA” means the Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976 and Hazardous and Solid Waste Amendments
of 1984, 42 U.S.C. §§6901 et seq., and any future amendments.

 

“Recipient” means (a) the Administrative Agent, (b) any Lender, and (c) the L/C
Issuer, as applicable.

 

“Redevelopment Assets” means any real estate under major redevelopment.

 

“Reimbursement Obligation” is defined in Section 2.2(c).

 

“REIT” means a real estate investment trust under Sections 856-860 of the Code.

 

“Related Parties” means, with respect to any Person, such Person’s Affiliates
and the partners, directors, officers, employees, agents, trustees,
administrators, managers, advisors and representatives of such Person and of
such Person’s Affiliates.

 

“Release” means any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, migration, dumping, or disposing
into the indoor or outdoor environment, including, without limitation, the
abandonment or discarding of barrels, drums, containers, tanks or other
receptacles containing or previously containing any Hazardous Material.

 

“Reorganization” means, with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.

 

“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the 30-day notice period is waived
under subsection .13, .14, .16, .18, .19 or .20 of PBGC Reg. §4043.

 

“Required Lenders” means, as of the date of determination thereof, Lenders whose
outstanding Revolving Loans and interests in Letters of Credit and Unused
Revolving Credit Commitments constitute more than 50% of the sum of the total
outstanding Revolving Loans, interests in Letters of Credit, and Unused
Revolving Credit Commitments of the Lenders.  The Unused Revolving Credit
Commitment, the aggregate principal amount of outstanding Revolving Loans and
the outstanding participation in L/C Obligations of each Defaulting Lender shall
be disregarded in determining Required Lenders at any time.

 

“Revolver Percentage” means, for each Lender, the percentage of the Revolving
Credit Commitments represented by such Lender’s Revolving Credit Commitment or,
if the Revolving Credit Commitments have been terminated, the percentage held by
such Lender (including through participation interests in Reimbursement
Obligations) of the aggregate principal amount of all Revolving Loans and
L/C Obligations then outstanding.

 

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“Revolving Credit” means the credit facility for making Revolving Loans and
issuing Letters of Credit described in Sections 2.1 and 2.2.

 

“Revolving Credit Commitment” means, as to any Lender, the obligation of such
Lender to make Revolving Loans and to participate in Letters of Credit issued
for the account of the Borrower hereunder in an aggregate principal or face
amount at any one time outstanding not to exceed the amount set forth opposite
such Lender’s name on Schedule 1, as the same may be reduced or modified at any
time or from time to time pursuant to the terms hereof.  The Borrower and the
Lenders acknowledge and agree that the Revolving Credit Commitments of the
Lenders aggregate $600,000,000 on the date hereof.

 

“Revolving Credit Termination Date” means the Stated Revolving Credit
Termination Date, as the same may be extended pursuant to Section 2.16, or such
earlier date on which the Revolving Credit Commitments are terminated in whole
pursuant to Section 2.11, 9.2 or 9.3.

 

“Revolving Loan” is defined in Section 2.1 and, as so defined, includes a Base
Rate Loan or a Eurodollar Loan, each of which is a “type” of Revolving Loan
hereunder.

 

“Rolling Period” means, as of any date of determination, the four Fiscal
Quarters ending on or immediately preceding such date.

 

“S&P” means Standard & Poor’s Ratings Services Group, a Standard & Poor’s
Financial Services LLC business.

 

“SEC” means the U.S. Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

 

“Secured Debt” means, as of any date of determination and without duplication,
the aggregate principal amount of all indebtedness outstanding of the Borrower
and its Subsidiaries, evidenced by notes, bonds debentures or similar
instruments and capital lease obligations that are secured by a Lien.

 

“Senior Housing Assets” means any Property on which the improvements consist
only of one or more of the following:  (a) senior apartments, (b) independent
living facilities, (c) congregate communities, (d) assisted living facilities,
(e) nursing homes, (f) hospitals, (g) memory care communities, (h) medical
office buildings, (i) life science properties, (j) surgical centers, (k) free
standing emergency facilities and (l) other Property primarily used for senior
citizen residences or health care services, together with other improvements
incidental thereto.

 

“Single Employer Plan” means any Plan that is covered by Title IV of ERISA but
is not a Multiemployer Plan.

 

“Stated Revolving Credit Termination Date” means June 27, 2022.

 

“Stock” means shares of capital stock, beneficial or partnership interests,
participations or other equivalents (regardless of how designated) of or in a
corporation or equivalent entity, whether voting or non-voting, and includes,
without limitation, common stock, but excluding any preferred stock or other
preferred equity security.

 

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“Stock Equivalents” means all securities (other than Stock) convertible into or
exchangeable for Stock at  the option of the holder, and all warrants, options
or other rights to purchase or subscribe for any stock, whether or not presently
convertible, exchangeable or exercisable.

 

“Subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or any other
entity of which more than 50% of the outstanding Voting Stock or, in the case of
a partnership, more than the 50% of the general partnership interests are at the
time directly or indirectly owned by such parent or by any one or more other
entities which are themselves subsidiaries of such parent.  Unless otherwise
expressly noted herein, the term “Subsidiary” means a Subsidiary of the Borrower
or of any of its direct or indirect Subsidiaries.

 

“Tangible Net Worth” means for each applicable period, total stockholders’
equity on the Borrower’s consolidated balance sheet as reported in its Form 10-K
or 10-Q less all amounts appearing on the assets side of its consolidated
balance sheet representing an intangible asset under GAAP.

 

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings (including backup withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax
or penalties applicable thereto.

 

“Total Asset Value” means, as of any date of determination, the Gross Book Value
of all assets of the Borrower and its Subsidiaries less all amounts appearing on
the assets side of its consolidated balance sheet separately identifiable as
intangible assets under GAAP; provided that (A) to the extent the amount of
Total Asset Value attributable to Assets Under Development exceeds 20% of Total
Asset Value, such excess shall be excluded; (B) to the extent the amount of
Total Asset Value attributable to Redevelopment Assets exceeds 20% of Total
Asset Value, such excess shall be excluded; (C) to the extent the amount of
Total Asset Value attributable to Unconsolidated Affiliates exceeds 15% of Total
Asset Value, such excess shall be excluded; (D) to the extent the amount of
Total Asset Value attributable to Other Investments exceeds 15% of Total Asset
Value, such excess shall be excluded; and (E) to the extent the amount of Total
Asset Value attributable to Assets Under Development, Redevelopment Assets,
Unconsolidated Affiliates, and Other Investments in the aggregate exceed 30% of
Total Asset Value, such excess shall be excluded.

 

“Total Indebtedness” means, as of any date of determination and without
duplication, all Indebtedness for Borrowed Money of the Borrower and its
consolidated Subsidiaries.

 

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“Unconsolidated Affiliates” means an Affiliate of the Borrower whose financial
statements are not required to be consolidated with the financial statements of
the Borrower in accordance with GAAP.

 

“Unencumbered Asset” means, as of any date of determination, any unencumbered
real Property (i) on the Closing Date, listed on Exhibit A to Schedule I of the
Compliance Certificate and  (ii) thereafter, listed on Exhibit A to Schedule I
of the Compliance Certificate after such Property’s designation by the Borrower
as an Unencumbered Asset, so long as the Borrower shall fully comply with the
requirements of Section 8.5(c) with regards to reporting of such Unencumbered
Asset, in each case that meets the following criteria:

 

(a)                        100% owned in fee simple by the Borrower or a
Subsidiary;

 

(b)                         Currently in service (not under development) and
generates cash rental income to the Borrower or such Subsidiary ;

 

(c)                         Senior Housing Asset located in the United States;

 

(d)                         If such Property is owned by the Borrower,
(i) neither the Borrower’s beneficial ownership interest in such Property nor
the Property is subject to any Lien (other than Permitted Liens and Liens in
favor of the Administrative Agent and the Noteholders (but only to the extent
the Obligations hereunder are simultaneously secured by such Liens on terms and
provisions, including an intercreditor agreement, satisfactory to the Required
Lenders)) or to any negative pledge, other than the negative pledge set forth
herein or in the Note Purchase Agreement and (ii) the Borrower has the
unilateral right to (x) sell, transfer or otherwise dispose of such Property and
(y) to create a Lien on such Property as security for indebtedness of the
Borrower (other than restrictions imposed by the negative pledge set forth
herein or in the Note Purchase Agreement);

 

(e)                         If such Property is owned by a Subsidiary, (i) none
of the Borrower’s beneficial ownership interest in such Subsidiary, the
Subsidiary’s beneficial ownership interest in such Property nor the Property is
subject to any Lien (other than Permitted Liens and Liens in favor of the
Borrower) or to any negative pledge, other than the negative pledge set forth
herein or in the Note Purchase Agreement and (ii) such Subsidiary has the
unilateral right to, and the Borrower has the unilateral right to cause such
Subsidiary to, (x) sell, transfer or otherwise dispose of such Property and
(y) create a Lien on such Property as security for indebtedness of the Borrower
or such Subsidiary (other than restrictions imposed by the negative pledge set
forth herein or in the Note Purchase Agreement);

 

(f)                        Such Property, based on Borrower’s or such
Subsidiary’s actual knowledge, is free of all material structural defects or
major architectural deficiencies, material title defects, material environmental
conditions or other adverse matters which, individually or collectively,
materially impair the value of such Property; and

 

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(g)                       The lessee of such Property under its Lease is not
more than 60 days past due with respect to any monthly minimum rent payment
obligations under such Lease.

 

“Unencumbered Asset Subsidiary” means any Subsidiary that owns an Unencumbered
Asset or a Qualified Mortgage Loan.

 

“Unencumbered Asset Value” means, as of any date of determination, an amount
equal to the sum of:

 

(a)                        for all Unencumbered Assets owned by the Borrower or
a Subsidiary for more than twenty-four months prior to the date of
determination, the Property NOI from such Unencumbered Assets divided by the
Capitalization Rate, plus

 

(b)                         for all Unencumbered Assets owned by the Borrower or
a Subsidiary for twenty-four months or less prior to the date of determination,
the Gross Book Value of such Unencumbered Assets; plus

 

(c)                         for all Qualified Mortgage Loans owned by the
Borrower or a Subsidiary, the book value of such Qualified Mortgage Loans;

 

provided, that to the extend the amount of Unencumbered Asset Value attributable
to Qualified Mortgage Loans under clause (c) hereof exceeds 30% of Unencumbered
Asset Value, such excess shall be excluded; provided further, that to the extent
the amount of Unencumbered Asset Value attributable to Qualified Mortgage Loans
that are second mortgages or second deeds of trust under clause (c) hereof
exceeds 5% of Unencumbered Asset Value, such excess shall be excluded. 
Unencumbered Asset Value attributable to any of the items listed above in this
definition owned by any non-Wholly-owned Subsidiary shall be adjusted to be
limited to (i) the percentage of Equity Interests in such non-Wholly-owned
Subsidiary owned by the Borrower as of such date multiplied by (ii) the
applicable Property NOI, Gross Book Value or book value.

 

“Unfunded Vested Liabilities” means, for any Plan at any time, the amount (if
any) by which the present value of all vested nonforfeitable accrued benefits
under such Plan exceeds the fair market value of all Plan assets allocable to
such benefits, all determined as of the then most recent valuation date for such
Plan, but only to the extent that such excess represents a potential liability
of a member of the Controlled Group to the PBGC or the Plan under Title IV of
ERISA.

 

“Unsecured Debt” means, as of any date of determination and without duplication,
the aggregate principal amount of all Total Indebtedness outstanding at such
date that is not Secured Debt.

 

“Unused Revolving Credit Commitments” means, at any time, the difference between
the Revolving Credit Commitments then in effect and the aggregate outstanding
principal amount of Revolving Loans and L/C Obligations.

 

“U.S. Dollars” and “$” each means the lawful currency of the United States of
America.

 

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“U.S. Person” means any Person that is a “United States Person” as defined in
Section 7701(a)(30) of the Code.

 

“Voting Stock” of any Person means capital stock or other equity interests of
any class or classes (however designated) having ordinary power for the election
of directors or other similar governing body of such Person, other than stock or
other equity interests having such power only by reason of the happening of a
contingency.

 

“Welfare Plan” means a “welfare plan” as defined in Section 3(1) of ERISA.

 

“Wholly-owned Subsidiary” means a Subsidiary of which all of the issued and
outstanding shares of capital stock (other than directors’ qualifying shares as
required by law) or other equity interests are owned by the Borrower and/or one
or more Wholly-owned Subsidiaries within the meaning of this definition.

 

“Withholding Agent” means the Borrower and the Administrative Agent.

 

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.

 

Section 1.2.                             Interpretation.   The foregoing
definitions are equally applicable to both the singular and plural forms of the
terms defined.  Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms.  The words “include,”
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation.”  The word “will” shall be construed to have the same meaning and
effect as the word “shall.”  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, (c) the words “herein,” “hereof” and
“hereunder,” and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement, (e) any reference to any law or regulation herein shall, unless
otherwise specified, refer to such law or regulation as amended, modified or
supplemented from time to time, and (f) the words “asset” and “property” shall
be construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.  All references to time of day herein are
references to Chicago, Illinois, time unless otherwise specifically provided. 
Where the character or amount of any asset or liability or item of income or
expense is required to be determined or any consolidation or other accounting
computation is required to be made for the purposes of this Agreement, it shall
be done in accordance with GAAP except where such principles are inconsistent
with the specific provisions of this Agreement.  The Borrower covenants and
agrees with the Lenders that whether

 

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or not the Borrower may at any time adopt Accounting Standards Codification 825
or account for assets and liabilities acquired in an acquisition on a fair value
basis pursuant to Accounting Standards Codification 805, all determinations of
compliance with the terms and conditions of this Agreement shall be made on the
basis that the Borrower has not adopted Accounting Standards Codification 825 or
Accounting Standards Codification 805.

 

Section 1.3.                             Change in Accounting Principles.  If,
after the date of this Agreement, there shall occur any change in GAAP from
those used in the preparation of the financial statements referred to in
Section 6.5 hereof and such change shall result in a change in the method of
calculation of any financial covenant, standard or term found in this Agreement,
either the Borrower or the Required Lenders may by notice to the Lenders and the
Borrower, respectively, require that the Lenders and the Borrower negotiate in
good faith to amend such covenants, standards, and terms so as equitably to
reflect such change in accounting principles, with the desired result being that
the criteria for evaluating the financial condition of the Borrower and its
Subsidiaries shall be the same as if such change had not been made.  No delay by
the Borrower or the Required Lenders in requiring such negotiation shall limit
their right to so require such a negotiation at any time after such a change in
accounting principles.  Until any such covenant, standard, or term is amended in
accordance with this Section 1.3, financial covenants shall be computed and
determined in accordance with GAAP in effect prior to such change in accounting
principles.  Without limiting the generality of the foregoing, the Borrower
shall neither be deemed to be in compliance with any financial covenant
hereunder nor out of compliance with any financial covenant hereunder if such
state of compliance or noncompliance, as the case may be, would not exist but
for the occurrence of a change in accounting principles after the date hereof.

 

SECTION 2.                                             THE CREDIT FACILITY.

 

Section 2.1.                   Revolving Credit Commitments.  Subject to the
terms and conditions hereof, each Lender, by its acceptance hereof, severally
agrees to make a loan or loans (individually a “Revolving Loan” and collectively
for all the Lenders, the “Revolving Loans”) in U.S. Dollars to the Borrower from
time to time on a revolving basis up to the amount of such Lender’s Revolving
Credit Commitment, subject to any reductions thereof pursuant to the terms
hereof, before the Revolving Credit Termination Date.  The sum of the aggregate
principal amount of Revolving Loans and L/C Obligations at any time outstanding
shall not exceed the Revolving Credit Commitments in effect at such time.  Each
Borrowing of Revolving Loans shall be made ratably by the Lenders in proportion
to their respective Revolver Percentages.  As provided in Section 2.5, the
Borrower may elect that each Borrowing of Revolving Loans be either Base Rate
Loans or Eurodollar Loans.  Revolving Loans may be repaid and the principal
amount thereof reborrowed before the Revolving Credit Termination Date, subject
to the terms and conditions hereof.

 

Section 2.2.                   Letters of Credit.  (a) General Terms.  Subject
to the terms and conditions hereof, as part of the Revolving Credit, the L/C
Issuer shall issue standby and commercial letters of credit (each a “Letter of
Credit”) for the account of the Borrower or for the account of the Borrower and
one or more of its Subsidiaries in an aggregate undrawn face amount up to the
L/C Sublimit.  The sum of the aggregate principal amount of Revolving Loans and

 

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L/C Obligations at any time outstanding shall not exceed the Revolving Credit
Commitments in effect at such time.  Each Letter of Credit shall be issued by
the L/C Issuer, but each Lender shall be obligated to reimburse the L/C Issuer
for such Lender’s Revolver Percentage of the amount of each drawing thereunder
and, accordingly, each Letter of Credit shall constitute usage of the Revolving
Credit Commitment of each Lender pro rata in an amount equal to its Revolver
Percentage of the L/C Obligations then outstanding.

 

(b)                                  Applications.  At any time before the
Revolving Credit Termination Date, the L/C Issuer shall, at the request of the
Borrower, issue one or more Letters of Credit in U.S. Dollars, in a form
satisfactory to the L/C Issuer, with expiration dates no later than the earlier
of 12 months from the date of issuance (or which are cancelable not later than
12 months from the date of issuance and each renewal) or 30 days prior to the
Revolving Credit Termination Date, in an aggregate face amount as set forth
above, upon the receipt of an application duly executed by the Borrower and, if
such Letter of Credit is for the account of one of its Subsidiaries, such
Subsidiary for the relevant Letter of Credit in the form then customarily
prescribed by the L/C Issuer for the Letter of Credit requested (each an
“Application”).  The Borrower agrees that if on the date 30 days prior to the
Revolving Credit Termination Date any Letters of Credit remain outstanding the
Borrower shall then deliver to the Administrative Agent, without notice or
demand, Cash Collateral in an amount equal to 103% of the aggregate amount of
each Letter of Credit then outstanding (which shall be held by the
Administrative Agent pursuant to the terms of Section 9.4).  Notwithstanding
anything contained in any Application to the contrary:  (i) the Borrower shall
pay fees in connection with each Letter of Credit as set forth in Section 3.1,
(ii) except as otherwise provided herein or in Section 2.7, Section 2.14 or
Section 2.15, unless an Event of Default exists, the L/C Issuer will not call
for the funding by the Borrower of any amount under a Letter of Credit before
being presented with a drawing thereunder, and (iii) if the L/C Issuer is not
timely reimbursed for the amount of any drawing under a Letter of Credit on the
date such drawing is paid, the Borrower’s obligation to reimburse the L/C Issuer
for the amount of such drawing shall bear interest (which the Borrower hereby
promises to pay) from and after the date such drawing is paid at a rate per
annum equal to the sum of the Applicable Margin plus the Base Rate from time to
time in effect (computed on the basis of a year of 365 or 366 days, as the case
may be, and the actual number of days elapsed).  If the L/C Issuer issues any
Letter of Credit with an expiration date that is automatically extended unless
the L/C Issuer gives notice that the expiration date will not so extend beyond
its then scheduled expiration date, unless the Administrative Agent or the
Required Lenders instruct the L/C Issuer otherwise, the L/C Issuer will give
such notice of non-renewal before the time necessary to prevent such automatic
extension if before such required notice date:  (i) the expiration date of such
Letter of Credit if so extended would be after the Revolving Credit Termination
Date, (ii) the Revolving Credit Commitments have been terminated, or (iii) a
Default or an Event of Default exists and either the Administrative Agent or the
Required Lenders (with notice to the Administrative Agent) have given the L/C
Issuer instructions not to so permit the extension of the expiration date of
such Letter of Credit.  The L/C Issuer agrees to issue amendments to the
Letter(s) of Credit increasing the amount, or extending the expiration date,
thereof at the request of the Borrower subject to the conditions of Section 7
and the other terms of this Section 2.2. Notwithstanding anything contained
herein to the contrary, the L/C Issuer shall be under no obligation to issue,
extend or amend any Letter of Credit if a default of any Lender’s obligations to
fund under Section 2.2(c) exists or any Lender is at such time a Defaulting
Lender hereunder, unless the L/C Issuer has entered into arrangements with
Borrower or such Lender satisfactory to the L/C Issuer to eliminate the L/C
Issuer’s risk with respect to such Lender.

 

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(c)                                   The Reimbursement Obligations.  Subject to
Section 2.2(b), the obligation of the Borrower to reimburse the L/C Issuer for
all drawings under a Letter of Credit (a “Reimbursement Obligation”) shall be
governed by the Application related to such Letter of Credit, except that
reimbursement shall be made by no later than 2:00 p.m. (Chicago time) on the
date when each drawing is to be paid if the Borrower has been informed of such
drawing by the L/C Issuer on or before 11:30 a.m. (Chicago time) on the date
when such drawing is to be paid or, if notice of such drawing is given to the
Borrower after 11:30 a.m. (Chicago time) on the date when such drawing is to be
paid, by no later than 12:00 Noon (Chicago time) on the following Business Day,
in immediately available funds at the Administrative Agent’s principal office in
Chicago, Illinois or such other office as the Administrative Agent may designate
in writing to the Borrower (who shall thereafter cause to be distributed to the
L/C Issuer such amount(s) in like funds).  If the Borrower does not make any
such reimbursement payment on the date due and the Participating Lenders fund
their participations therein in the manner set forth in Section 2.2(e) below,
then all payments thereafter received by the Administrative Agent in discharge
of any of the relevant Reimbursement Obligations shall be distributed in
accordance with Section 2.2(e) below.

 

(d)                                  Obligations Absolute.  The Borrower’s
obligation to reimburse L/C Obligations as provided in subsection (c) of this
Section shall be absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Agreement and the relevant
Application under any and all circumstances whatsoever and irrespective of
(i) any lack of validity or enforceability of any Letter of Credit or this
Agreement, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by the L/C Issuer under a Letter of Credit against
presentation of a draft or other document that does not strictly comply with the
terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower’s obligations hereunder. None of
the Administrative Agent, the Lenders, or the L/C Issuer shall have any
liability or responsibility by reason of or in connection with the issuance or
transfer of any Letter of Credit or any payment or failure to make any payment
thereunder (irrespective of any of the circumstances referred to in the
preceding sentence), or any error, omission, interruption, loss or delay in
transmission or delivery of any draft, notice or other communication under or
relating to any Letter of Credit (including any document required to make a
drawing thereunder), any error in interpretation of technical terms or any
consequence arising from causes beyond the control of the L/C Issuer; provided
that the foregoing shall not be construed to excuse the L/C Issuer from
liability to the Borrower to the extent of any direct damages (as opposed to
consequential damages, claims in respect of which are hereby waived by the
Borrower to the extent permitted by applicable law) suffered by the Borrower
that are caused by the L/C Issuer’s failure to exercise care when determining
whether drafts and other documents presented under a Letter of Credit comply
with the terms thereof.  The parties hereto expressly agree that, in the absence
of gross negligence or willful misconduct on the part of the L/C Issuer (as
determined by a court of competent

 

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jurisdiction by final and nonappealable judgment), the L/C Issuer shall be
deemed to have exercised care in each such determination.  In furtherance of the
foregoing and without limiting the generality thereof, the parties agree that,
with respect to documents presented which appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the L/C Issuer may,
in its sole discretion, either accept and make payment upon such documents
without responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.

 

(e)                                   The Participating Interests.  Each Lender
(other than the Lender acting as the L/C Issuer in issuing the relevant Letter
of Credit), by its acceptance hereof, severally agrees to purchase from the L/C
Issuer, and the L/C Issuer hereby agrees to sell to each such Lender (a
“Participating Lender”), an undivided percentage participating interest (a
“Participating Interest”), to the extent of its Revolver Percentage, in each
Letter of Credit issued by, and each Reimbursement Obligation owed to, the L/C
Issuer.  Upon any failure by the Borrower to pay any Reimbursement Obligation at
the time required on the date the related drawing is to be paid, as set forth in
Section 2.2(c) above, or if the L/C Issuer is required at any time to return to
the Borrower or to a trustee, receiver, liquidator, custodian or other Person
any portion of any payment of any Reimbursement Obligation, each Participating
Lender shall, not later than the Business Day it receives a certificate in the
form of Exhibit A hereto from the L/C Issuer (with a copy to the Administrative
Agent) to such effect, if such certificate is received before 1:00 p.m. (Chicago
time), or not later than 1:00 p.m. (Chicago time) the following Business Day, if
such certificate is received after such time, pay to the Administrative Agent
for the account of the L/C Issuer an amount equal to such Participating Lender’s
Revolver Percentage of such unpaid or recaptured Reimbursement Obligation
together with interest on such amount accrued from the date the related payment
was made by the L/C Issuer to the date of such payment by such Participating
Lender at a rate per annum equal to:  (i) from the date the related payment was
made by the L/C Issuer to the date two (2) Business Days after payment by such
Participating Lender is due hereunder, the Federal Funds Rate for each such day
and (ii) from the date two (2) Business Days after the date such payment is due
from such Participating Lender to the date such payment is made by such
Participating Lender, the Base Rate in effect for each such day.  Each such
Participating Lender shall thereafter be entitled to receive its Revolver
Percentage of each payment received in respect of the relevant Reimbursement
Obligation and of interest paid thereon, with the L/C Issuer retaining its
Revolver Percentage thereof as a Lender hereunder.  The several obligations of
the Participating Lenders to the L/C Issuer under this Section 2.2 shall be
absolute, irrevocable, and unconditional under any and all circumstances
whatsoever and shall not be subject to any set-off, counterclaim or defense to
payment which any Participating Lender may have or have had against the
Borrower, the L/C Issuer, the Administrative Agent, any Lender or any other
Person whatsoever.  Without limiting the generality of the foregoing, such
obligations shall not be affected by any Default or Event of Default or by any
reduction or termination of any Revolving Credit Commitment of any Lender, and
each payment by a Participating Lender under this Section 2.2 shall be made
without any offset, abatement, withholding or reduction whatsoever.

 

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(f)                                  Indemnification.  The Participating Lenders
shall, to the extent of their respective Revolver Percentages, indemnify the L/C
Issuer (to the extent not reimbursed by the Borrower) against any cost, expense
(including reasonable counsel fees and disbursements), claim, demand, action,
loss or liability (except such as result from the L/C Issuer’s gross negligence
or willful misconduct as determined by a court of competent jurisdiction by
final and nonappealable judgment) that the L/C Issuer may suffer or incur in
connection with any Letter of Credit issued by it.  The obligations of the
Participating Lenders under this Section 2.2(f) and all other parts of this
Section 2.2 shall survive termination of this Agreement and of all Applications,
Letters of Credit, and all drafts and other documents presented in connection
with drawings thereunder.

 

(g)                                   Manner of Requesting a Letter of Credit. 
The Borrower shall provide at least five (5) Business Days’ advance written
notice to the Administrative Agent of each request for the issuance of a Letter
of Credit, such notice in each case to be accompanied by an Application for such
Letter of Credit properly completed and executed by the Borrower and, in the
case of an extension or amendment or an increase in the amount of a Letter of
Credit, a written request therefor, in a form acceptable to the Administrative
Agent and the L/C Issuer, in each case, together with the fees called for by
this Agreement.  The Administrative Agent shall promptly notify the L/C Issuer
of the Administrative Agent’s receipt of each such notice (and the L/C Issuer
shall be entitled to assume that the conditions precedent to any such issuance,
extension, amendment or increase have been satisfied unless notified to the
contrary by the Administrative Agent or the Required Lenders) and the L/C Issuer
shall promptly notify the Administrative Agent and the Lenders of the issuance
of the Letter of Credit so requested.

 

(h)                                  Replacement of the L/C Issuer.  The L/C
Issuer may be replaced at any time by written agreement among the Borrower, the
Administrative Agent, the replaced L/C Issuer and the successor L/C Issuer.  The
Administrative Agent shall notify the Lenders of any such replacement of the L/C
Issuer.  At the time any such replacement shall become effective, the Borrower
shall pay all unpaid fees accrued for the account of the replaced L/C Issuer. 
From and after the effective date of any such replacement (i) the successor
L/C Issuer shall have all the rights and obligations of the L/C Issuer under
this Agreement with respect to Letters of Credit to be issued thereafter and
(ii) references herein to the term “L/C Issuer” shall be deemed to refer to such
successor or to any previous L/C Issuer, or to such successor and all previous
L/C Issuers, as the context shall require.  After the replacement of a
L/C Issuer hereunder, the replaced L/C Issuer shall remain a party hereto and
shall continue to have all the rights and obligations of a L/C Issuer under this
Agreement with respect to Letters of Credit issued by it prior to such
replacement, but shall not be required to issue additional Letters of Credit.

 

Section 2.3.                              Applicable Interest Rates.  (a) Base
Rate Loans.  Each Base Rate Loan made or maintained by a Lender shall bear
interest (computed on the basis of a year of 365 or 366 days, as the case may
be, and the actual days elapsed) on the unpaid principal amount thereof from the
date such Revolving Loan is advanced, or created by conversion from a Eurodollar
Loan, until maturity (whether by acceleration or otherwise) at a rate per annum
equal to the sum of the Applicable Margin plus the Base Rate from time to time
in effect, payable by the Borrower on each Interest Payment Date and at maturity
(whether by acceleration or otherwise).

 

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(b)                                  Eurodollar Loans.  Each Eurodollar Loan
made or maintained by a Lender shall bear interest during each Interest Period
it is outstanding (computed on the basis of a year of 360 days and actual days
elapsed) on the unpaid principal amount thereof from the date such Revolving
Loan is advanced or continued, or created by conversion from a Base Rate Loan,
until maturity (whether by acceleration or otherwise) at a rate per annum equal
to the sum of the Applicable Margin plus the Adjusted LIBOR applicable for such
Interest Period, payable by the Borrower on each Interest Payment Date and at
maturity (whether by acceleration or otherwise).

 

(c)                                   Rate Determinations.  The Administrative
Agent shall determine each interest rate applicable to the Revolving Loans and
the Reimbursement Obligations hereunder, and its determination thereof shall be
conclusive and binding except in the case of manifest error.

 

(d)                                  Investment Grade Credit Rating Interest
Rate Election.  At any time after the Borrower receives an Investment Grade
Credit Rating, the Borrower may, so long as no Default then exists and is
continuing, irrevocably elect (an “Interest Rate Election”) by written notice to
the Administrative Agent, accompanied by reasonable evidence of the Borrower’s
Credit Ratings, that the interest rate and fee margins set forth in clause
(b) of the definition of “Applicable Margin” herein shall at all times
thereafter be applicable to all credit extensions under this Agreement.  The
Administrative Agent shall provide the Lenders and the L/C Issuer with prompt
notice of its receipt of any Interest Rate Election.  On the day after the date
of the Administrative Agent’s receipt of any Interest Rate Election (the date of
the Administrative Agent’s receipt of such election is the “Interest Rate
Election Date”), the margins set forth in clause (a) of the definition of
“Applicable Margin” herein shall no longer apply.

 

Section 2.4.                              Minimum Borrowing Amounts; Maximum
Eurodollar Loans.  Each Borrowing of Base Rate Loans advanced under the
Revolving Credit shall be in an amount not less than $100,000.  Each Borrowing
of Eurodollar Loans advanced, continued or converted under the Revolving Credit
shall be in an amount equal to $1,000,000 or such greater amount which is an
integral multiple of $500,000.  Without the Administrative Agent’s consent,
there shall not be more than five (5) Borrowings of Eurodollar Loans outstanding
hereunder at any one time.

 

Section 2.5.                              Manner of Borrowing Loans and
Designating Applicable Interest Rates.  (a) Notice to the Administrative Agent. 
The Borrower shall give notice to the Administrative Agent by no later than
11:00 a.m. (Chicago time):  (i) at least three (3) Business Days before the date
on which the Borrower requests the Lenders to advance a Borrowing of Eurodollar
Loans and (ii) on the date the Borrower requests the Lenders to advance a
Borrowing of Base Rate Loans.  The Revolving Loans included in each Borrowing
shall bear interest initially at the type of rate specified in such notice of a
new Borrowing.  Thereafter, subject to the terms and conditions hereof, the
Borrower may from time to time elect to change or continue the type of interest
rate borne by each Borrowing or, subject to the minimum amount requirement for
each outstanding Borrowing set forth in Section 2.4, a portion thereof, as
follows:  (i) if such Borrowing is of Eurodollar Loans, on the last day of the
Interest Period applicable thereto, the Borrower may continue part or all of
such Borrowing as Eurodollar Loans or convert part or all of such Borrowing into
Base Rate Loans or (ii) if such Borrowing is of Base Rate Loans, on any Business
Day, the Borrower may convert all or part of such Borrowing into Eurodollar
Loans for an Interest Period or Interest Periods specified by the Borrower.  The
Borrower shall give all such notices requesting the advance, continuation or
conversion of a Borrowing to the

 

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Administrative Agent by telephone, telecopy, or other telecommunication device
acceptable to the Administrative Agent (which notice shall be irrevocable once
given and, if by telephone, shall be promptly confirmed in writing in a manner
acceptable to the Administrative Agent), substantially in the form attached
hereto as Exhibit B (Notice of Borrowing) or Exhibit C (Notice of
Continuation/Conversion), as applicable, or in such other form acceptable to the
Administrative Agent.  Notice of the continuation of a Borrowing of Eurodollar
Loans for an additional Interest Period or of the conversion of part or all of a
Borrowing of Base Rate Loans into Eurodollar Loans must be given by no later
than 11:00 a.m. (Chicago time) at least three (3) Business Days before the date
of the requested continuation or conversion.  All such notices concerning the
advance, continuation or conversion of a Borrowing shall specify the date of the
requested advance, continuation or conversion of a Borrowing (which shall be a
Business Day), the amount of the requested Borrowing to be advanced, continued
or converted, the type of Revolving Loans to comprise such new, continued or
converted Borrowing and, if such Borrowing is to be comprised of Eurodollar
Loans, the Interest Period applicable thereto.  No Borrowing of Eurodollar Loans
shall be advanced, continued, or created by conversion if any Default or Event
of Default then exists.  The Borrower agrees that the Administrative Agent may
rely on any such telephonic, telecopy or other telecommunication notice given by
any person the Administrative Agent in good faith believes is an Authorized
Representative without the necessity of independent investigation, and in the
event any such notice by telephone conflicts with any written confirmation such
telephonic notice shall govern if the Administrative Agent has acted in reliance
thereon.

 

(b)                                  Notice to the Lenders.  The Administrative
Agent shall give prompt telephonic, telecopy or other telecommunication notice
to each Lender of any notice from the Borrower received pursuant to
Section 2.5(a) above and, if such notice requests the Lenders to make Eurodollar
Loans, the Administrative Agent shall give notice to the Borrower and each
Lender by like means of the interest rate applicable thereto promptly after the
Administrative Agent has made such determination.

 

(c)                                   Borrower’s Failure to Notify.  If the
Borrower fails to give notice pursuant to Section 2.5(a) above of the
continuation or conversion of any outstanding principal amount of a Borrowing of
Eurodollar Loans before the last day of its then current Interest Period within
the period required by Section 2.5(a) and such Borrowing is not prepaid in
accordance with Section 2.7, such Borrowing shall automatically be converted
into a Borrowing of Base Rate Loans.  In the event the Borrower fails to give
notice pursuant to Section 2.5(a) above of a Borrowing equal to the amount of a
Reimbursement Obligation and has not notified the Administrative Agent by
12:00 noon (Chicago time) on the day such Reimbursement Obligation becomes due
that it intends to repay such Reimbursement Obligation through funds not
borrowed under this Agreement, the Borrower shall be deemed to have requested a
Borrowing of Base Rate Loans under the Revolving Credit on such day in the
amount of the Reimbursement Obligation then due, which Borrowing shall be
applied to pay the Reimbursement Obligation then due.

 

(d)                                  Disbursement of Loans.  Not later than
1:00 p.m. (Chicago time) on the date of any requested advance of a new
Borrowing, subject to Section 7, each Lender shall make available its Revolving
Loan comprising part of such Borrowing in funds immediately available at the

 

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principal office of the Administrative Agent in Chicago, Illinois (or at such
other location in the United States as the Administrative Agent shall designate
in writing to the Borrower).  The Administrative Agent shall make the proceeds
of each new Borrowing available to the Borrower at the Administrative Agent’s
principal office in Chicago, Illinois (or at such other location in the United
States as the Administrative Agent shall designate in writing to the Borrower),
by depositing or wire transferring such proceeds to the credit of the Borrower’s
Designated Disbursement Account or as the Borrower and the Administrative Agent
may otherwise agree.

 

(e)                                   Administrative Agent Reliance on Lender
Funding.  Unless the Administrative Agent shall have been notified by a Lender
prior to (or, in the case of a Borrowing of Base Rate Loans, by
1:00 p.m. (Chicago time) on) the date on which such Lender is scheduled to make
payment to the Administrative Agent of the proceeds of a Revolving Loan (which
notice shall be effective upon receipt) that such Lender does not intend to make
such payment, the Administrative Agent may assume that such Lender has made such
payment when due and the Administrative Agent may in reliance upon such
assumption (but shall not be required to) make available to the Borrower the
proceeds of the Revolving Loan to be made by such Lender and, if any Lender has
not in fact made such payment to the Administrative Agent, such Lender shall, on
demand, pay to the Administrative Agent the amount made available to the
Borrower attributable to such Lender together with interest thereon in respect
of each day during the period commencing on the date such amount was made
available to the Borrower and ending on (but excluding) the date such Lender
pays such amount to the Administrative Agent at a rate per annum equal to: 
(i) from the date the related advance was made by the Administrative Agent to
the date two (2) Business Days after payment by such Lender is due hereunder,
the Federal Funds Rate for each such day and (ii) from the date two (2) Business
Days after the date such payment is due from such Lender to the date such
payment is made by such Lender, the Base Rate in effect for each such day.  If
such amount is not received from such Lender by the Administrative Agent
immediately upon demand, the Borrower will, on demand, repay to the
Administrative Agent the proceeds of the Revolving Loan attributable to such
Lender with interest thereon at a rate per annum equal to the interest rate
applicable to the relevant Revolving Loan, but without such payment being
considered a payment or prepayment of a Revolving Loan under Section 2.10 so
that the Borrower will have no liability under such Section with respect to such
payment.

 

Section 2.6.                              Maturity of Loans.  Each Revolving
Loan, both for principal and interest not sooner paid, shall mature and be due
and payable by the Borrower on the Revolving Credit Termination Date.

 

Section 2.7.                              Prepayments.  (a) Optional.  The
Borrower may prepay at any time or from time to time in whole or in part (but,
if in part, then:  (i) if such Borrowing is of Base Rate Loans, in an amount not
less than $100,000, (ii) if such Borrowing is of Eurodollar Loans, in an amount
not less than $500,000, and (iii) in each case, in an amount such that the
minimum amount required for a Borrowing pursuant to Section 2.4 remains
outstanding) without premium or penalty (subject to Section 2.10) any Borrowing
of Eurodollar Loans at any time upon three (3) Business Days prior notice by the
Borrower to the Administrative Agent or, in the case of a Borrowing of Base Rate
Loans, notice delivered by the Borrower to the Administrative Agent no later
than 10:00 a.m. (Chicago time) on the date of prepayment (or, in any case, such
shorter

 

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period of time then agreed to by the Administrative Agent), such prepayment to
be made by the payment of the principal amount to be prepaid and, in the case of
any Eurodollar Loans, accrued interest thereon to the date fixed for prepayment
plus any amounts due the Lenders under Section 2.10.

 

(b)                                  Mandatory.  (i) The Borrower shall, on each
date the Revolving Credit Commitments are reduced pursuant to Section 2.11,
prepay the Revolving Loans and, if necessary, Cash Collateralize the
L/C Obligations by the amount, if any, necessary to reduce the sum of the
aggregate principal amount of Revolving Loans and L/C Obligations then
outstanding to the amount to which the Revolving Credit Commitments have been so
reduced.

 

(ii)                                   Unless the Borrower otherwise directs,
prepayments of Revolving Loans under this Section 2.7(b) shall be applied first
to Borrowings of Base Rate Loans until payment in full thereof with any balance
applied to Borrowings of Eurodollar Loans in the order in which their Interest
Periods expire.  Each prepayment of Revolving Loans under this
Section 2.7(b) shall be made by the payment of the principal amount to be
prepaid and, in the case of any Eurodollar Loans, accrued interest thereon to
the date of prepayment together with any amounts due the Lenders under
Section 2.10.  Each Cash Collateralization of L/C Obligations shall be held by
the Administrative Agent in accordance with Section 9.4.

 

(c)                                   Any amount of Revolving Loans paid or
prepaid before the Revolving Credit Termination Date may, subject to the terms
and conditions of this Agreement, be borrowed, repaid and borrowed again.

 

Section 2.8.                              Default Rate.  Notwithstanding
anything to the contrary contained herein, while any Event of Default exists or
after acceleration, the Borrower shall pay interest (after as well as before
entry of judgment thereon to the extent permitted by law) on the principal
amount of all Revolving Loans and Reimbursement Obligations, and letter of
credit fees at a rate per annum equal to:

 

(a)                       for any Base Rate Loan, the sum of 2.0% plus the
Applicable Margin plus the Base Rate from time to time in effect;

 

(b)                         for any Eurodollar Loan, the sum of 2.0% plus the
rate of interest in effect thereon at the time of such default until the end of
the Interest Period applicable thereto and, thereafter, at a rate per annum
equal to the sum of 2.0% plus the Applicable Margin for Base Rate Loans plus the
Base Rate from time to time in effect;

 

(c)                        for any Reimbursement Obligation, the sum of 2.0%
plus the amounts due under Section 2.2 with respect to such Reimbursement
Obligation; and

 

(d)                         for any Letter of Credit, the sum of 2.0% plus the
letter of credit fee due under Section 3.1 with respect to such Letter of
Credit; and

 

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(e)                        for any other amount owing hereunder not covered by
clauses (a) through (d) above, the sum of 2% plus the Applicable Margin for Base
Rate Loans plus the Base Rate from time to time in effect;

 

provided, however, that in the absence of acceleration, any adjustments pursuant
to this Section shall be made at the election of the Administrative Agent,
acting at the request or with the consent of the Required Lenders, with written
notice to the Borrower.  While any Event of Default exists or after
acceleration, interest shall be paid on demand of the Administrative Agent at
the request or with the consent of the Required Lenders.

 

Section 2.9.                              Evidence of Indebtedness.  (a) Each
Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the indebtedness of the Borrower to such Lender resulting
from each Revolving Loan made by such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time hereunder.

 

(b)                                  The Administrative Agent shall also
maintain accounts in which it will record (i) the amount of each Revolving Loan
made hereunder and the Interest Period with respect thereto, (ii) the amount of
any principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder from the Borrower and each Lender’s share
thereof.

 

(c)                                   The entries maintained in the accounts
maintained pursuant to paragraphs (a) and (b) above shall be prima facie
evidence of the existence and amounts of the Obligations therein recorded;
provided, however, that the failure of the Administrative Agent or any Lender to
maintain such accounts or any error therein shall not in any manner affect the
obligation of the Borrower to repay the Obligations in accordance with their
terms.

 

(d)                                  Any Lender may request that its Revolving
Loans be evidenced by a promissory note in the form of Exhibit D (collectively,
the “Notes” and individually as a “Note”).  In such event, the Borrower shall
prepare, execute and deliver to such Lender a Note payable to such Lender or its
registered assigns in the amount of its Revolving Credit Commitment. 
Thereafter, the Revolving Loans evidenced by such Note or Notes and interest
thereon shall at all times (including after any assignment pursuant to
Section 12.10) be represented by one or more Notes payable to the order of the
payee named therein or any assignee pursuant to Section 12.10, except to the
extent that any such Lender or assignee subsequently returns any such Note for
cancellation and requests that such Revolving Loans once again be evidenced as
described in subsections (a) and (b) above.

 

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Section 2.10.                             Funding Indemnity.  If any Lender
shall incur any loss, cost or expense (including, without limitation, any loss,
cost or expense incurred by reason of the liquidation or re-employment of
deposits or other funds acquired by such Lender to fund or maintain any
Eurodollar Loan or the relending or reinvesting of such deposits or amounts paid
or prepaid to such Lender) as a result of:

 

(a)                       any payment, prepayment or conversion of a Eurodollar
Loan on a date other than the last day of its Interest Period,

 

(b)                         any failure (because of a failure to meet the
conditions of Section 7 or otherwise) by the Borrower to borrow or continue a
Eurodollar Loan, or to convert a Base Rate Loan into a Eurodollar Loan, on the
date specified in a notice given pursuant to Section 2.5(a),

 

(c)                        any failure by the Borrower to make any payment of
principal on any Eurodollar Loan when due (whether by acceleration or
otherwise), or

 

(d)                         any acceleration of the maturity of a Eurodollar
Loan as a result of the occurrence of any Event of Default hereunder,

 

then, upon the demand of such Lender, the Borrower shall pay to such Lender such
amount as will reimburse such Lender for such loss, cost or expense.  If any
Lender makes such a claim for compensation, it shall provide to the Borrower,
with a copy to the Administrative Agent, a certificate setting forth the amount
of such loss, cost or expense in reasonable detail (including an explanation of
the basis for and the computation of such loss, cost or expense) and the amounts
shown on such certificate shall be deemed prime facie correct.

 

Section 2.11.                             Commitment Terminations.  (a) Optional
Revolving Credit Terminations.  The Borrower shall have the right at any time
and from time to time, upon five (5) Business Days prior written notice to the
Administrative Agent (or such shorter period of time agreed to by the
Administrative Agent), to terminate the Revolving Credit Commitments without
premium or penalty and in whole or in part, any partial termination to be (i) in
an amount not less than $1,000,000 and (ii) allocated ratably among the Lenders
in proportion to their respective Revolver Percentages, provided that the
Revolving Credit Commitments may not be reduced to an amount less than the sum
of the aggregate principal amount of Revolving Loans and L/C Obligations then
outstanding.  Any termination of the Revolving Credit Commitments below the
L/C Sublimit then in effect shall reduce the L/C Sublimit by a like amount.  The
Administrative Agent shall give prompt notice to each Lender of any such
termination of the Revolving Credit Commitments.

 

(b)                                  Any termination of the Revolving Credit
Commitments pursuant to this Section may not be reinstated.

 

Section 2.12.                             Substitution of Lenders.  In the event
(a) the Borrower receives a claim from any Lender for compensation under
Section 10.3 or 12.1, (b) the Borrower receives notice from any Lender of any
illegality pursuant to Section 10.1, (c) any Lender is then a Defaulting Lender

 

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or such Lender is a Subsidiary or Affiliate of a Person who has been deemed
insolvent or becomes the subject of a bankruptcy or insolvency proceeding or a
receiver or conservator has been appointed for any such Person, or (d) a Lender
fails to consent to an amendment or waiver requested under Section 12.11 at a
time when the Required Lenders have approved such amendment or waiver (any such
Lender referred to in clause (a), (b), (c), or (d) above being hereinafter
referred to as an “Affected Lender”), the Borrower may, in addition to any other
rights the Borrower may have hereunder or under applicable law, require, at its
expense, any such Affected Lender to assign, at par, without recourse, all of
its interest, rights, and obligations hereunder (including all of its Revolving
Credit Commitments and the Revolving Loans and participation interests in
Letters of Credit and other amounts at any time owing to it hereunder and the
other Loan Documents) to an Eligible Assignee specified by the Borrower,
provided that (i) such assignment shall not conflict with or violate any law,
rule or regulation or order of any court or other Governmental Authority,
(ii) the Borrower shall have paid to the Affected Lender all monies (together
with amounts due such Affected Lender under Section 2.10 as if the Revolving
Loans owing to it were prepaid rather than assigned) other than such principal
owing to it hereunder, and (iii) the assignment is entered into in accordance
with, and subject to the consents required by, Section 12.10 (provided any
assignment fees and reimbursable expenses due thereunder shall be paid by the
Borrower).

 

Section 2.13.                             Increase in Revolving Credit
Commitments.  The Borrower may, on any Business Day prior to the Revolving
Credit Termination Date, with the written consent of the Administrative Agent
(which consent shall not be unreasonably withheld or delayed), increase the
aggregate amount of the Revolving Credit Commitments by delivering a Commitment
Amount Increase Request substantially in the form attached hereto as Exhibit G
or in such other form acceptable to the Administrative Agent (the “Commitment
Amount Increase”) at least five (5) Business Days prior to the desired effective
date of such increase identifying one or more additional Lenders (or additional
Revolving Credit Commitments for existing Lender(s)) and the amount of its
Revolving Credit Commitment (or additional amount of its Revolving Credit
Commitment(s)); provided, however, that (i) any increase of the aggregate amount
of the Revolving Credit Commitments shall not cause the aggregate amount of the
Revolving Credit Commitments to exceed $1,000,000,000, unless otherwise approved
by the Required Lenders, (ii) any increase of the aggregate amount of the
Revolving Credit Commitments shall be in an amount not less than $5,000,000,
(iii) no Default or Event of Default shall have occurred and be continuing at
the time of the request or the effective date of the Commitment Amount Increase
and (iv) all representations and warranties contained in Section 6 shall be true
and correct at the time of such request and on the effective date of such
Commitment Amount Increase.  The effective date of the Commitment Amount
Increase shall be agreed upon by the Borrower and the Administrative Agent. 
Each existing or new Lender consenting to make available the additional
Revolving Credit Commitments contemplated by the Commitment Amount Increase
shall notify the Administrative Agent of such consent at any time prior to the
desired effective date of such Commitment Amount Increase.  Upon the
effectiveness thereof, (i) the new Lender(s) (or, if applicable, existing
Lender(s)) shall advance Revolving Loans in an amount sufficient such that after
giving effect to its advance each Lender shall have outstanding its Revolver
Percentage of Revolving Loans and (ii) each Lender shall be deemed to have a
Participating Interest, based on the then current Revolver Percentages, in each
Letter of Credit issued by, and each Reimbursement Obligation owed to, the L/C
Issuer.  It shall be a condition to

 

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such effectiveness that (i) if any Eurodollar Loans are outstanding under the
Revolving Credit on the date of such effectiveness, such Eurodollar Loans shall
be deemed to be prepaid on such date and the Borrower shall pay any amounts
owing to the Lenders pursuant to Section 2.10 and (ii) the Borrower shall not
have terminated any portion of the Revolving Credit Commitments pursuant to
Section 2.11.  The Borrower agrees to pay any reasonable expenses of the
Administrative Agent relating to any Commitment Amount Increase. 
Notwithstanding anything herein to the contrary, (i) no Lender shall have any
obligation to increase its Revolving Credit Commitment and no Lender’s Revolving
Credit Commitment shall be increased without its consent thereto, and each
Lender may at its option, unconditionally and without cause, decline to increase
its Revolving Credit Commitment and (ii) this Section shall supersede any
provisions in Sections 12.7 and 12.11 to the contrary.

 

Section 2.14.                             Defaulting Lenders.

 

(a)                                  Defaulting Lender Adjustments. 
Notwithstanding anything to the contrary contained in this Agreement, if any
Lender becomes a Defaulting Lender, then, until such time as such Lender is no
longer a Defaulting Lender, to the extent permitted by applicable law:

 

(i)                         Waivers and Amendments.  Such Defaulting Lender’s
right to approve or disapprove any amendment, waiver or consent with respect to
this Agreement shall be restricted as set forth in the definition of Required
Lenders.

 

(ii)                          Defaulting Lender Waterfall. Any payment of
principal, interest, fees or other amounts received by the Administrative Agent
for the account of such Defaulting Lender (whether voluntary or mandatory, at
maturity, pursuant to Section 9 or otherwise) or received by the Administrative
Agent from a Defaulting Lender pursuant to Section 12.14 shall be applied at
such time or times as may be determined by the Administrative Agent as follows:
first, to the payment of any amounts owing by such Defaulting Lender to the
Administrative Agent hereunder; second, to the payment on a pro rata basis of
any amounts owing by such Defaulting Lender to the L/C Issuer hereunder; third,
to Cash Collateralize the L/C Issuer’s Fronting Exposure with respect to such
Defaulting Lender in accordance with Section 2.15; fourth, as the Borrower may
request (so long as no Default or Event of Default exists), to the funding of
any Revolving Loan in respect of which such Defaulting Lender has failed to fund
its portion thereof as required by this Agreement, as determined by the
Administrative Agent; fifth, if so determined by the Administrative Agent and
the Borrower, to be held in a deposit account and released pro rata in order to
(x) satisfy such Defaulting Lender’s potential future funding obligations with
respect to Revolving Loans under this Agreement and (y) Cash Collateralize the
L/C Issuer’s future Fronting Exposure with respect to such Defaulting Lender
with respect to future Letters of Credit issued under this Agreement, in
accordance with Section 2.15; sixth, to the payment of any amounts owing to the
Lenders or the L/C Issuer as a result of any judgment of a court of competent
jurisdiction obtained by any Lender or the L/C Issuer against such Defaulting

 

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Lender as a result of such Defaulting Lender’s breach of its obligations under
this Agreement; seventh, so long as no Default or Event of Default exists, to
the payment of any amounts owing to the Borrower as a result of any judgment of
a court of competent jurisdiction obtained by the Borrower against such
Defaulting Lender as a result of such Defaulting Lender’s breach of its
obligations under this Agreement; and eighth, to such Defaulting Lender or as
otherwise directed by a court of competent jurisdiction; provided that if
(x) such payment is a payment of the principal amount of any Revolving Loans or
L/C Obligations in respect of which such Defaulting Lender has not fully funded
its appropriate share, and (y) such Revolving Loans were made or the related
Letters of Credit were issued at a time when the conditions set forth in
Section 7.1 were satisfied or waived, such payment shall be applied solely to
pay the Revolving Loans of, and L/C Obligations owed to, all Non-Defaulting
Lenders on a pro rata basis prior to being applied to the payment of any
Revolving Loans of, or L/C Obligations owed to, such Defaulting Lender until
such time as all Revolving Loans and funded and unfunded participations in L/C
Obligations are held by the Lenders pro rata in accordance with the Revolving
Credit Commitments under the Revolving Credit without giving effect to
Section 2.14(a)(iv) below.  Any payments, prepayments or other amounts paid or
payable to a Defaulting Lender that are applied (or held) to pay amounts owed by
a Defaulting Lender or to post Cash Collateral pursuant to this
Section 2.14(a)(ii) shall be deemed paid to and redirected by such Defaulting
Lender, and each Lender irrevocably consents hereto.

 

(iii)                               Certain Fees.

 

(A)                          Each Defaulting Lender shall be entitled to receive
a facility fee for any period during which that Lender is a Defaulting Lender
only to extent allocable to the sum of (1) the outstanding principal amount of
the Revolving Loans funded by it, and (2) its Revolver Percentage of the stated
amount of Letters of Credit for which it has provided Cash Collateral pursuant
to Section 2.15.

 

(B)                         Each Defaulting Lender shall be entitled to receive
L/C Participation Fees for any period during which that Lender is a Defaulting
Lender only to the extent allocable to its Revolver Percentage of the stated
amount of Letters of Credit for which it has provided Cash Collateral pursuant
to Section 2.15.

 

(C)                         With respect to any facility fee or L/C
Participation Fee not required to be paid to any Defaulting Lender pursuant to
clause (A) or (B) above, the Borrower shall (x) pay to each Non-Defaulting
Lender that portion of any such fee otherwise payable to such Defaulting Lender
with respect to such Defaulting Lender’s participation in L/C Obligations that
has been reallocated to such Non-Defaulting Lender pursuant to clause
(iv) below, (y) pay to the L/C Issuer the amount of any such fee otherwise
payable to such Defaulting Lender to the extent allocable to the L/C Issuer’s
Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the
remaining amount of any such fee.

 

(iv)                         Reallocation of Participations to Reduce Fronting
Exposure.  All or any part of such Defaulting Lender’s participation in L/C
Obligations shall be reallocated among the Non-Defaulting Lenders in accordance
with their respective Revolver

 

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Percentages (calculated without regard to such Defaulting Lender’s  Revolving
Credit Commitment) but only to the extent that such reallocation does not cause
the aggregate Revolving Credit exposure of any Non-Defaulting Lender to exceed
such Non-Defaulting Lender’s Revolving Credit Commitment.  No reallocation
hereunder shall constitute a waiver or release of any claim of any party
hereunder against a Defaulting Lender arising from that Lender having become a
Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of
such Non-Defaulting Lender’s increased exposure following such reallocation.

 

(v)                         Cash Collateral.  If the reallocation described in
clause (iv) above cannot, or can only partially, be effected, the Borrower
shall, without prejudice to any right or remedy available to it hereunder or
under law, Cash Collateralize the L/C Issuer’s Fronting Exposure in accordance
with the procedures set forth in Section 2.15.

 

(b)                                  Defaulting Lender Cure.  If the Borrower,
the Administrative Agent and the L/C Issuer agree in writing that a Lender is no
longer a Defaulting Lender, the Administrative Agent will so notify the parties
hereto, whereupon as of the effective date specified in such notice and subject
to any conditions set forth therein (which may include arrangements with respect
to any Cash Collateral), that Lender will, to the extent applicable, purchase at
par that portion of outstanding Revolving Loans of the other Lenders or take
such other actions as the Administrative Agent may determine to be necessary to
cause the Revolving Loans and funded and unfunded participations in Letters of
Credit to be held pro rata by the Lenders in accordance with the Revolving
Credit Commitments under the Revolving Credit (without giving effect to
Section 2.14(a)(iv)), whereupon such Lender will cease to be a Defaulting
Lender; provided that no adjustments will be made retroactively with respect to
fees accrued or payments made by or on behalf of the Borrower while that Lender
was a Defaulting Lender; and provided, further, that except to the extent
otherwise expressly agreed by the affected parties, no change hereunder from
Defaulting Lender to Lender will constitute a waiver or release of any claim of
any party hereunder arising from that Lender’s having been a Defaulting Lender.

 

(c)                                   New Letters of Credit.  So long as any
Lender is a Defaulting Lender, the L/C Issuer shall not be required to issue,
extend, renew or increase any Letter of Credit unless it is satisfied that it
will have no Fronting Exposure after giving effect thereto.

 

Section 2.15.                             Cash Collateral for Fronting Exposure.
At any time that there shall exist a Defaulting Lender, within one (1) Business
Day following the written request of the Administrative Agent or the L/C Issuer
(with a copy to the Administrative Agent) the Borrower shall Cash Collateralize
the L/C Issuer’s Fronting Exposure with respect to such Defaulting Lender
(determined after giving effect to Section 2.14(a)(iv) and any Cash Collateral
provided by such Defaulting Lender) in an amount not less than the Minimum
Collateral Amount.

 

(a)                                  Grant of Security Interest.  The Borrower,
and to the extent provided by any Defaulting Lender, such Defaulting Lender,
hereby grants to the Administrative Agent, for the benefit of the L/C Issuer,
and agrees to maintain, a first priority security interest in all such Cash
Collateral as security for the Defaulting Lenders’ obligation to fund
participations in respect of L/C Obligations, to be applied pursuant to clause
(b) below.  If at any time the Administrative

 

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Agent determines that Cash Collateral is subject to any right or claim of any
Person other than the Administrative Agent and the L/C Issuer as herein
provided, or that the total amount of such Cash Collateral is less than the
Minimum Collateral Amount, the Borrower will, promptly upon demand by the
Administrative Agent, pay or provide to the Administrative Agent additional Cash
Collateral in an amount sufficient to eliminate such deficiency (after giving
effect to any Cash Collateral provided by the Defaulting Lender).

 

(b)                                  Application.  Notwithstanding anything to
the contrary contained in this Agreement, Cash Collateral provided under this
Section 2.15 or Section 2.14 in respect of Letters of Credit shall be applied to
the satisfaction of the Defaulting Lender’s obligation to fund participations in
respect of L/C Obligations (including, as to Cash Collateral provided by a
Defaulting Lender, any interest accrued on such obligation) for which the Cash
Collateral was so provided, prior to any other application of such property as
may otherwise be provided for herein.

 

(c)                                   Termination of Requirement.  Cash
Collateral (or the appropriate portion thereof) provided to reduce the L/C
Issuer’s Fronting Exposure shall no longer be required to be held as Cash
Collateral pursuant to this Section 2.15(c) following (i) the elimination of the
applicable Fronting Exposure (including by the termination of Defaulting Lender
status of the applicable Lender), or (ii) the determination by the
Administrative Agent and the L/C Issuer that there exists excess Cash
Collateral; provided that, subject to Section 2.14, the Person providing Cash
Collateral and the L/C Issuer may agree that Cash Collateral shall be held to
support future anticipated Fronting Exposure or other obligation.

 

Section 2.16                             Extension of the Stated Revolving
Credit Termination Date. Borrower may, by notice to Administrative Agent (which
shall promptly deliver a copy to each of the Lenders) given not more than one
hundred twenty (120) days and not less than sixty (60) days prior to the Stated
Revolving Credit Termination Date, request that Lenders extend the Stated
Revolving Credit Termination Date for one additional one-year period.  If
(w) Borrower timely delivers such notice to Administrative Agent, (x) no Default
or Event of Default has occurred and is continuing, (y) all representations and
warranties contained in Section 6 are true and correct in all material respects
(except in the case of a representation or warranty qualified by materiality or
material adverse effect, in which case such representation or warranty shall be
true and correct in all respects) on the date the notice is delivered and on the
Stated Revolving Credit Termination Date except for representations and
warranties that relate to a prior date, which shall have been true and correct
in all material respects (except in the case of a representation or warranty
qualified by materiality or material adverse effect in which case such
representation or warranty shall be true and correct in all respects) as of the
applicable date on which they were made, and (z) the Administrative Agent
receives for the benefit of the Lenders (to be allocated pro rata based on each
Lender’s Revolving Credit Commitments of the date of the Stated Revolving Credit
Terminated Date extension) the Extension Fee, then the Stated Revolving Credit
Termination Date shall be extended to the first anniversary of the Stated
Revolving Credit Termination Date.  Should the Stated Revolving Credit
Termination Date be extended in accordance with the terms and conditions of the
preceding sentence, the terms and conditions of this Agreement will apply during
any such extension period. Notwithstanding anything herein to the contrary, this
Section shall supersede any provisions in Sections 12.7 and 12.11 to the
contrary.

 

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SECTION 3.                                             FEES.

 

Section 3.1.                             Fees.  (a) Revolving Credit Facility
Fee.  The Borrower shall pay to the Administrative Agent for the ratable account
of the Lenders in accordance with their Revolver Percentages a facility fee (the
“Facility Fee”) at the rate per annum equal to the Applicable Margin (computed
on the basis of a year of 360 days and the actual number of days elapsed) equal
to the average daily aggregate amount of the Revolving Credit Commitment,
whether or not in use.  Such Facility Fee shall be payable quarterly in arrears
on the last day of each March, June, September, and December in each year
(commencing on the first such date occurring after the Closing Date) and on the
Revolving Credit Termination Date, unless the Revolving Credit Commitments are
terminated in whole on an earlier date, in which event the Facility Fee for the
period to the date of such termination in whole shall be paid on the date of
such termination.

 

(b)                                  Letter of Credit Fees.  On the date of
issuance or extension, or increase in the amount, of any Letter of Credit
pursuant to Section 2.2, the Borrower shall pay to the L/C Issuer for its own
account a fronting fee equal to 0.125% of the face amount of (or of the increase
in the face amount of) such Letter of Credit.  Quarterly in arrears, on the last
day of each March, June, September, and December, commencing on the first such
date occurring after the Closing Date, the Borrower shall pay to the
Administrative Agent, for the ratable benefit of the Lenders in accordance with
their Revolver Percentages, a letter of credit fee (the “L/C Participation Fee”)
at a rate per annum equal to the Applicable Margin (computed on the basis of a
year of 360 days and the actual number of days elapsed) in effect during each
day of such quarter applied to the daily average face amount of Letters of
Credit outstanding during such quarter.  In addition, the Borrower shall pay to
the L/C Issuer for its own account the L/C Issuer’s standard issuance, drawing,
negotiation, amendment, assignment, cancellation, transfer and other
administrative fees for each Letter of Credit as established by the L/C Issuer
from time to time.

 

(c)                                   Administrative Agent Fees.  The Borrower
shall pay to the Administrative Agent, for its own use and benefit, the fees
agreed to between the Administrative Agent and the Borrower in a fee letter
dated May 15, 2018, or as otherwise agreed to in writing between them.

 

SECTION 4.                                             PLACE AND APPLICATION OF
PAYMENTS.

 

Section 4.1.                             Place and Application of Payments.  All
payments of principal of and interest on the Revolving Loans and the
Reimbursement Obligations, and of all other Obligations payable by the Borrower
under this Agreement and the other Loan Documents, shall be made by the Borrower
to the Administrative Agent by no later than 12:00 Noon (Chicago time) on the
due date thereof at the office of the Administrative Agent in Chicago, Illinois
(or such other location in the United States as the Administrative Agent may
designate in writing to the Borrower) for the benefit of the Lender(s) or the
L/C Issuer entitled thereto.  Any payments received after such time shall be
deemed to have been received by the Administrative Agent on the next Business
Day.  All such payments shall be made in U.S. Dollars, in immediately available
funds at the place of payment, in each case without set-off or counterclaim. 
The Administrative Agent will promptly thereafter cause to be distributed like
funds relating to the payment of principal or interest on Revolving Loans and on
Reimbursement Obligations in which the Lenders have purchased Participating
Interests ratably to the Lenders and like funds relating to the payment of

 

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any other amount payable to any Lender to such Lender, in each case to be
applied in accordance with the terms of this Agreement.  If the Administrative
Agent causes amounts to be distributed to the Lenders in reliance upon the
assumption that the Borrower will make a scheduled payment and such scheduled
payment is not so made, each Lender shall, on demand, repay to the
Administrative Agent the amount distributed to such Lender together with
interest thereon in respect of each day during the period commencing on the date
such amount was distributed to such Lender and ending on (but excluding) the
date such Lender repays such amount to the Administrative Agent, at a rate per
annum equal to:  (i) from the date the distribution was made to the date two
(2) Business Days after payment by such Lender is due hereunder, the Federal
Funds Rate for each such day and (ii) from the date two (2) Business Days after
the date such payment is due from such Lender to the date such payment is made
by such Lender, the Base Rate in effect for each such day.

 

Anything contained herein to the contrary notwithstanding (including, without
limitation, Section 2.7(b)), all payments and collections received in respect of
the Obligations by the Administrative Agent or any of the Lenders after
acceleration or the final maturity of the Obligations or termination of the
Revolving Credit Commitments as a result of an Event of Default shall be
remitted to the Administrative Agent and distributed as follows:

 

(a)                        first, to the payment of any outstanding costs and
expenses incurred by the Administrative Agent in protecting, preserving or
enforcing rights under the Loan Documents, and in any event including all costs
and expenses of a character which the Borrower has agreed to pay the
Administrative Agent under Section 12.13 (such funds to be retained by the
Administrative Agent for its own account unless it has previously been
reimbursed for such costs and expenses by the Lenders, in which event such
amounts shall be remitted to the Lenders to reimburse them for payments
theretofore made to the Administrative Agent);

 

(b)                         second, to the payment of any outstanding interest
and fees due under the Loan Documents to be allocated pro rata in accordance
with the aggregate unpaid amounts owing to each holder thereof;

 

(c)                         third, to the payment of principal on the Revolving
Loans, unpaid Reimbursement Obligations, together with amounts to be held by the
Administrative Agent as collateral security for any outstanding L/C Obligations
pursuant to Section 9.4 hereof (until the Administrative Agent is holding an
amount of cash equal to the then outstanding amount of all such
L/C Obligations), and Hedging Liability, the aggregate amount paid to, or held
as collateral security for, the Lenders and the L/C Issuer and, in the case of
Hedging Liability, their Affiliates to be allocated pro rata in accordance with
the aggregate unpaid amounts owing to each holder thereof;

 

(d)                         fourth, to the payment of all other unpaid
Obligations and all other indebtedness, obligations, and liabilities of the
Borrower and its Subsidiaries evidenced by the Loan Documents (including,
without limitation, Funds Transfer and Deposit Account Liability) to be
allocated pro rata in accordance with the aggregate unpaid amounts owing to each
holder thereof; and

 

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(e)                         finally, to the Borrower or whoever else may be
lawfully entitled thereto.

 

Section 4.2.                             Account Debit.  The Borrower hereby
irrevocably authorizes the Administrative Agent to charge any of the Borrower’s
deposit accounts maintained with the Administrative Agent or any of its
Affiliates for the amounts from time to time necessary to pay any then due
Obligations; provided that the Borrower acknowledges and agrees that the
Administrative Agent shall not be under an obligation to do so and the
Administrative Agent shall not incur any liability to the Borrower or any other
Person for the Administrative Agent’s failure to do so.

 

SECTION 5.                                             RESERVED.

 

SECTION 6.                                             REPRESENTATIONS AND
WARRANTIES.

 

The Borrower represents and warrants to the Administrative Agent, the Lenders,
and the L/C Issuer as follows:

 

Section 6.1.                             Organization and Qualification.  The
Borrower is duly organized, validly existing, and in good standing as a
corporation under the laws of the State of Maryland, has full and adequate power
to own its Property and conduct its business as now conducted, and is duly
licensed or qualified and in good standing in each jurisdiction in which the
nature of the business conducted by it or the nature of the Property owned or
leased by it requires such licensing or qualifying.

 

Section 6.2.                             Subsidiaries.  Each Subsidiary is duly
organized, validly existing, and in good standing under the laws of the
jurisdiction in which it is organized, has full and adequate power to own its
Property and conduct its business as now conducted, and is duly licensed or
qualified and in good standing in each jurisdiction in which the nature of the
business conducted by it or the nature of the Property owned or leased by it
requires such licensing or qualifying.  All of the outstanding shares of capital
stock and other equity interests of each Subsidiary are validly issued and
outstanding and fully paid and nonassessable and all such shares and other
equity interests owned by the Borrower or another Subsidiary are owned,
beneficially and of record, by the Borrower or such Subsidiary free and clear of
all Liens.  Neither the Borrower nor any of its Subsidiaries has committed or is
obligated to issue Stock Equivalents in any of the Borrower’s Subsidiaries to
any Person not owned by the Borrower or its Subsidiaries.

 

Section 6.3.                             Authority and Validity of Obligations. 
The Borrower has full right and authority to enter into this Agreement and the
other Loan Documents executed by it, to make the borrowings herein provided for,
to issue its Notes in evidence thereof, and to perform all of its obligations
hereunder and under the other Loan Documents executed by it.  The Loan Documents
delivered by the Borrower have been duly authorized, executed, and delivered by
the Borrower and constitute valid and binding obligations of the Borrower
enforceable against it in accordance with their terms, except as enforceability
may be limited by bankruptcy, insolvency, fraudulent conveyance or similar laws
affecting creditors’ rights generally and general principles

 

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of equity (regardless of whether the application of such principles is
considered in a proceeding in equity or at law); and this Agreement and the
other Loan Documents do not, nor does the performance or observance by the
Borrower or any Unencumbered Asset Subsidiary of any of the matters and things
herein or therein provided for, (a) contravene or constitute a default under any
provision of law or any judgment, injunction, order or decree binding upon the
Borrower or any Unencumbered Asset Subsidiary or any provision of the
organizational documents (e.g., charter, certificate or articles of
incorporation and by-laws, certificate or articles of association and operating
agreement, partnership agreement, or other similar organizational documents) of
the Borrower or any Unencumbered Asset Subsidiary, (b) contravene or constitute
a default under any covenant, indenture or agreement of or affecting the
Borrower or any Unencumbered Asset Subsidiary or any of its Property, or
(c) result in the creation or imposition of any Lien on any Property of the
Borrower or any Unencumbered Asset Subsidiary.

 

Section 6.4.                             Use of Proceeds; Margin Stock.  The
Borrower shall use the proceeds of the Revolving Credit for refinancing its
existing indebtedness, for its general working capital purposes and for such
other legal and proper purposes as are consistent with all applicable laws.  The
Borrower is not engaged in the business of extending credit for the purpose of
purchasing or carrying margin stock (within the meaning of Regulation U of the
Board of Governors of the Federal Reserve System), and no part of the proceeds
of any Revolving Loan or any other extension of credit made hereunder will be
used to purchase or carry any such margin stock or to extend credit to others
for the purpose of purchasing or carrying any such margin stock.  Margin stock
(as hereinabove defined) constitutes less than 25% of the assets of the Borrower
which are subject to any limitation on sale, pledge or other restriction
hereunder.

 

Section 6.5.                             Financial Reports.  The consolidated
balance sheet of the Borrower and its Subsidiaries as at December 31, 2017, and
the related consolidated statements of income, retained earnings and cash flows
of the Borrower and its Subsidiaries for the Fiscal Year then ended, and
accompanying notes thereto, which financial statements are accompanied by the
audit report of Ernst & Young, LLP, independent public accountants, and the
unaudited interim consolidated balance sheet of the Borrower and its
Subsidiaries as at March 31, 2018, and the related consolidated statements of
income, retained earnings and cash flows of the Borrower and its Subsidiaries
for the 3 months then ended, heretofore furnished to the Administrative Agent
and the Lenders, fairly present the consolidated financial condition of the
Borrower and its Subsidiaries as at said dates and the consolidated results of
their operations and cash flows for the periods then ended in conformity with
GAAP applied on a consistent basis.  Neither the Borrower nor any Subsidiary has
contingent liabilities which are material to it other than as indicated on such
financial statements or, with respect to future periods, on the financial
statements furnished pursuant to Section 8.5.

 

Section 6.6.                             No Material Adverse Change.  Since
December 31, 2017, there has been no event which could reasonably be expected to
have a Material Adverse Effect on the Borrower or its Subsidiaries, taken as a
whole.

 

Section 6.7.                             Full Disclosure.  The statements and
information furnished to the Administrative Agent and the Lenders in connection
with the negotiation of this Agreement and the other Loan Documents and the
commitments by the Lenders to provide all or part of the

 

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financing contemplated hereby do not contain any untrue statements of a material
fact or omit a material fact necessary to make the material statements contained
herein or therein not misleading, the Administrative Agent and the Lenders
acknowledging that as to any projections furnished to the Administrative Agent
and the Lenders, the Borrower only represents that the same were prepared in
good faith on the basis of information and estimates the Borrower believed to be
reasonable at the time.  As of the Closing Date, the information included in the
Beneficial Ownership Certification is true and correct in all respects.

 

Section 6.8.                             Trademarks, Franchises, and Licenses. 
The Borrower and its Subsidiaries own, possess, or have the right to use all
necessary patents, licenses, franchises, trademarks, trade names, trade styles,
copyrights, trade secrets, know how, and confidential commercial and proprietary
information to conduct their businesses as now conducted, without known conflict
with any patent, license, franchise, trademark, trade name, trade style,
copyright or other proprietary right of any other Person.

 

Section 6.9.                             Governmental Authority and Licensing. 
The Borrower and its Subsidiaries have received all licenses, permits, and
approvals of all Governmental Authorities, if any, necessary to conduct their
businesses, in each case where the failure to obtain or maintain the same could
reasonably be expected to have a Material Adverse Effect.  No investigation or
proceeding which, if adversely determined, could reasonably be expected to
result in revocation or denial of any material license, permit or approval is
pending or, to the knowledge of the Borrower, threatened.

 

Section 6.10.                             Good Title.  The Borrower and its
Subsidiaries have good and defensible title (or valid leasehold interests) to
their assets as reflected on the most recent consolidated balance sheet  of the
Borrower and its Subsidiaries furnished to the Administrative Agent and the
Lenders (except for sales of assets permitted by Section 8.9), subject to no
Liens other than such thereof as are permitted by Section 8.8.

 

Section 6.11.                             Litigation and Other Controversies. 
There is no litigation or governmental or arbitration proceeding or labor
controversy pending, nor to the knowledge of the Borrower threatened, against
the Borrower or any Subsidiary or any of their Property which, individually or
in the aggregate, could reasonably be expected to have a Material Adverse
Effect.

 

Section 6.12.                             Taxes.  All Tax returns required to be
filed by the Borrower or any Subsidiary in any jurisdiction have, in fact, been
filed, and all Taxes upon the Borrower or any Subsidiary or upon any of its
Property, income or franchises, which are shown to be due and payable in such
returns, have been paid, except such Taxes, if any, as are being contested in
good faith and by appropriate proceedings which prevent enforcement of the
matter under contest and as to which adequate reserves established in accordance
with GAAP have been provided or where the failure to so file or pay would not
cause a Material Adverse Effect on the Borrower and its Subsidiaries taken as a
whole.  The Borrower does not know of any proposed additional Tax assessment
against it or its Subsidiaries for which adequate provisions in accordance with
GAAP have not been made on their accounts.  Adequate provisions in accordance
with GAAP for Taxes on the books of the Borrower and each Subsidiary have been
made for all open years, and for its current fiscal period.

 

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Section 6.13.                             Approvals.  No authorization, consent,
license or exemption from, or filing or registration with, any court or
governmental department, agency or instrumentality, nor any approval or consent
of any other Person, is or will be necessary to the valid execution, delivery or
performance by the Borrower or any Subsidiary of any Loan Document, except for
such approvals which have been obtained prior to the date of this Agreement and
remain in full force and effect.

 

Section 6.14.                             Affiliate Transactions.  Neither the
Borrower nor any Subsidiary is a party to any contracts or agreements with any
of its Affiliates (other than with Wholly-owned Subsidiaries) on terms and
conditions which are less favorable to the Borrower or such Subsidiary than
would be usual and customary in similar contracts or agreements between Persons
not affiliated with each other.

 

Section 6.15.                             Investment Company.  Neither the
Borrower nor any Subsidiary is an “investment company” or a company “controlled”
by an “investment company” within the meaning of the Investment Company Act of
1940, as amended.

 

Section 6.16.                             ERISA.  During the 5-year period
before each date as of which this representation is made or deemed made with
respect to any Plan (or, with respect to (f) and (h) below, as of the date on
which such representation is made or deemed made), none of the following events
or conditions, either individually or in the aggregate, has occurred and could
reasonably be expected to have a Material Adverse Effect:  (a) a Reportable
Event; (b) an “accumulated funding deficiency” (within the meaning of
Section 412 of the Code or Section 302 of ERISA); (c) noncompliance with the
applicable provisions of ERISA or the Code; (d) termination of a Single Employer
Plan; (e) a Lien on the property of the Borrower or any Subsidiary in favor of
the PBGC or a Plan; (f) a complete or partial withdrawal from a Multiemployer
Plan by the Borrower or any Commonly Controlled Entity; (g) a liability of the
Borrower or a Commonly Controlled Entity under ERISA if the Borrower or such
Commonly Controlled Entity were to withdraw completely from all Multiemployer
Plans as of the annual valuation date most closely preceding the date on which
this representation is made or deemed made; (h) the Reorganization or Insolvency
of any Multiemployer Plan; and (i) an event or condition with respect to which
the Borrower or any Commonly Controlled Entity could reasonably be expected to
incur any liability in respect of a Former Plan.  Neither the Borrower nor any
Subsidiary maintains or participates in any Defined Benefit Plan or Multiple
Employer Plan.

 

Section 6.17.                             Compliance with Laws.  (a) The
Borrower and its Subsidiaries are in compliance with all Legal Requirements
applicable to or pertaining to their Property or business operations (including,
without limitation, the Occupational Safety and Health Act of 1970, the
Americans with Disabilities Act of 1990, and laws and regulations establishing
quality criteria and standards for air, water, land and toxic or hazardous
wastes and substances), where any such non-compliance, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

 

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(b)                                  Without limiting the representations and
warranties set forth in Section 6.17(a) above, except for such matters,
individually or in the aggregate, which could not reasonably be expected to
result in a Material Adverse Effect, the Borrower represents and warrants that
to the actual knowledge of each respectively that the Borrower and its
Subsidiaries, and each of the Properties owned by them: (i) comply in all
material respects with all applicable Environmental Laws; (ii) the tenants of
the Borrower and its Subsidiaries have obtained all governmental approvals
required for the operation of the Properties under any applicable Environmental
Law; (iii) the Borrower and its Subsidiaries have no actual knowledge of any
other Person who has, caused any Release, threatened Release or disposal of any
Hazardous Material at, on, about, or off any of the Properties in any material
quantity and, to the actual the knowledge of the Borrower, none of the
Properties are adversely affected by any Release, threatened Release or disposal
of a Hazardous Material originating or emanating from any other property;
(iv) none of the Properties contain or have contained any:  (1) underground
storage tanks in which any Hazardous Material is being or has been treated,
stored or disposed of on any Property owned by the Borrower or any Subsidiary,
in each case in any manner not in compliance in all material respects with all
applicable Environmental Laws, (2) material amounts of asbestos containing
building material, (3) landfills or dumps, (4) hazardous waste management
facility as defined pursuant to any Environmental Law, or (5) site on or
nominated for the National Priority List promulgated pursuant to CERCLA or any
state remedial priority list promulgated or published pursuant to any comparable
state law; (v) the Borrower and its Subsidiaries have not used a material
quantity of any Hazardous Material and have conducted no Hazardous Material
Activity at any of the Properties; (vi) the Borrower and its Subsidiaries have
no material liability for response or corrective action, natural resource damage
or other harm pursuant to CERCLA, RCRA or any comparable state law; (vii) the
Borrower and its Subsidiaries are not subject to, have no notice or actual
knowledge of and are not required to give any notice of any Environmental Claim
involving the Borrower or any Subsidiary or any of their Properties, and there
are no conditions or occurrences at any of their Properties which could
reasonably be anticipated to form the basis for an Environmental Claim against
the Borrower or any Subsidiary or such Property; (viii) none of the Properties
are subject to any, and the Borrower has no actual knowledge of any imminent
restriction on the ownership, occupancy, use or transferability of their
Properties in connection with any (1) Environmental Law or (2) Release,
threatened Release or disposal of a Hazardous Material; and (ix) there are no
conditions or circumstances at any of their Properties which pose an
unreasonable risk to the environment or the health or safety of Persons.

 

(c)                                   The Borrower and each of its Subsidiaries
is in material compliance with all Anti-Corruption Laws.  The Borrower and each
of its Subsidiaries has implemented and maintains in effect policies and
procedures designed to ensure compliance by the Borrower, its Subsidiaries and
their respective directors, officers, employees and agents with Anti-Corruption
Laws.  Neither the Borrower nor any Subsidiary has made a payment, offering, or
promise to pay, or authorized the payment of, money or anything of value (a) in
order to assist in obtaining or retaining business for or with, or directing
business to, any foreign official, foreign political party, party official or
candidate for foreign political office, (b) to a foreign official, foreign
political party or party official or any candidate for foreign political office,
and (c) with the intent to induce the recipient to misuse his or her official
position to direct business wrongfully to the Borrower or such Subsidiary or to
any other Person, in violation of any Anti-Corruption Laws.

 

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Section 6.18.                             Other Agreements.  Neither the
Borrower nor any Subsidiary is in default under the terms of any covenant,
indenture or agreement of or affecting such Person or any of its Property, which
default if uncured could reasonably be expected to have a Material Adverse
Effect.

 

Section 6.19.                             OFAC.  (a) The Borrower is in
compliance with the requirements of all OFAC Sanctions Programs applicable to
it, (b) each Subsidiary of the Borrower is in compliance with the requirements
of all OFAC Sanctions Programs applicable to such Subsidiary, (c) the Borrower
has provided to the Administrative Agent, the L/C Issuer, and the Lenders all
information regarding the Borrower and its Affiliates and Subsidiaries necessary
for the Administrative Agent, the L/C Issuer, and the Lenders to comply with all
applicable OFAC Sanctions Programs, and (d) neither the Borrower nor any of its
Subsidiaries nor, to the knowledge of the Borrower or any Subsidiary, any
officer, director or Affiliate of the Borrower or any of its Subsidiaries, is a
Person, that is, or is owned or controlled by Persons that are, (i) the target
of any OFAC Sanctions Programs or (ii) located, organized or resident in a
country or territory that is, or whose government is, the subject of any OFAC
Sanctions Programs.

 

Section 6.20.                             No Default.  No Default or Event of
Default has occurred and is continuing.

 

Section 6.21.                             Solvency.  The Borrower and its
Subsidiaries are solvent, able to pay their debts as they become due, and have
sufficient capital to carry on their business as currently conducted.

 

Section 6.22.                             No Broker Fees.  No broker’s or
finder’s fee or commission will be payable with respect hereto or any of the
transactions contemplated hereby.

 

Section 6.23.                             Stock of the Borrower.  As of the
Closing Date, the entire authorized capital stock of the Borrower consists of
Common Stock, 39,634,980 shares; all of which are duly and validly issued and
outstanding, fully paid and nonassessable as of the Closing Date.  The issuance
and sale of such Stock of the Borrower of the Borrower either (i) has been
registered under applicable federal and state securities laws or (ii) was issued
pursuant to an exemption therefrom.  The Borrower meets the requirements for
taxation as a REIT under the Code.

 

Section 6.24.                             Condition of Property; Casualties;
Condemnation.  As of the Closing Date, to the actual knowledge of the Borrower
or its Unencumbered Asset Subsidiaries, each Property owned by them, in all
material respects (a) is in good repair, working order and condition, normal
wear and tear excepted, (b) is free of structural defects, (c) is not subject to
material deferred maintenance and (d) has and will have all building systems
contained therein in good repair, working order and condition, normal wear and
tear excepted.  To the actual knowledge of the Borrower or of any of its
Unencumbered Asset Subsidiaries, none of the Properties owned by them is
currently materially and adversely affected as a result of any fire, explosion,
earthquake, flood, drought, windstorm, accident, strike or other labor
disturbance, embargo, requisition or taking of property or cancellation of
contracts, permits or concessions by a Governmental Authority, riot, activities
of armed forces or acts of God or of any public enemy.  No condemnation or other
like proceedings that has had, or could reasonably be expected to result in, a
Material Adverse Effect, are pending and served nor, to the actual knowledge of
the

 

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Borrower, threatened against any Property owned by it in any manner whatsoever. 
No casualty has occurred to any such Property that could reasonably be expected
to have a Material Adverse Effect.

 

Section 6.25.                             Legal Requirements and Zoning.  To the
actual knowledge of the Borrower and its Subsidiaries, the use and operation of
each Property owned by the Borrower and its Subsidiaries constitutes a legal use
under applicable zoning regulations (as the same may be modified by special use
permits or the granting of variances) and complies in all material respects with
all Legal Requirements, and does not violate in any material respect any
material approvals, material restrictions of record or any material agreement
affecting any such Property (or any portion thereof).

 

SECTION 7.                                             CONDITIONS PRECEDENT.

 

Section 7.1.                             All Credit Events.  At the time of each
Credit Event hereunder:

 

(a)                        each of the representations and warranties set forth
herein and in the other Loan Documents shall be and remain true and correct in
all material respects (except in the case of a representation or warranty
qualified by materiality, in which case such representation or warranty shall be
true and correct in all respects) as of said time, except to the extent the same
expressly relate to an earlier date (in which case the same shall be true and
correct as of such earlier date);

 

(b)                         the Borrower shall be in compliance with all of the
terms and conditions hereof and of the other Loan Documents, and no Default or
Event of Default shall have occurred and be continuing or would occur as a
result of such Credit Event;

 

(c)                         in the case of a Borrowing the Administrative Agent
shall have received the notice required by Section 2.5, in the case of the
issuance of any Letter of Credit the L/C Issuer shall have received a duly
completed Application for such Letter of Credit together with any fees called
for by Section 3.1, and, in the case of an extension or increase in the amount
of a Letter of Credit, a written request therefor in a form acceptable to the
L/C Issuer together with fees called for by Section 3.1; and

 

(d)                         such Credit Event shall not violate any order,
judgment or decree of any court or other authority or any provision of law or
regulation applicable to the Administrative Agent, the L/C Issuer, or any Lender
(including, without limitation, Regulation U of the Board of Governors of the
Federal Reserve System) as then in effect.

 

Each request for a Borrowing hereunder and each request for the issuance of,
increase in the amount of, or extension of the expiration date of, a Letter of
Credit shall be deemed to be a representation and warranty by the Borrower on
the date of such Credit Event as to the facts specified in
subsections (a) through (c), both inclusive, of this Section; provided, however,
that the Lenders may continue to make advances under the Revolving Credit, in
the sole discretion of the Lenders with Revolving Credit Commitments,
notwithstanding the failure of the Borrower to satisfy one or more of the
conditions set forth above and any such advances so made shall not be deemed a
waiver of any Default or Event of Default or other condition set forth above
that may then exist.

 

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Section 7.2.                             Initial Credit Event.  Before or
concurrently with the initial Credit Event:

 

(a)                        the Administrative Agent shall have received this
Agreement duly executed by the Borrower and the Lenders;

 

(b)                         if requested by any Lender, the Administrative Agent
shall have received for such Lender such Lender’s duly executed Note of the
Borrower dated the date hereof and otherwise in compliance with the provisions
of Section 2.9;

 

(c)                         the Administrative Agent shall have received
evidence of insurance required to be maintained under the Loan Documents;

 

(d)                         the Administrative Agent shall have received copies
of the Borrower’s articles of incorporation and bylaws (or comparable
organizational documents) and any amendments thereto, certified in each instance
by its Secretary or Assistant Secretary;

 

(e)                         the Administrative Agent shall have received copies
of resolutions of the Borrower’s Board of Directors authorizing the execution,
delivery and performance of this Agreement and the other Loan Documents to which
it is a party and the consummation of the transactions contemplated hereby and
thereby, together with specimen signatures of the persons authorized to execute
such documents on the Borrower’s behalf, all certified in each instance by its
Secretary or Assistant Secretary;

 

(f)                        the Administrative Agent shall have received copies
of the certificates of good standing for the Borrower (dated no earlier than
30 days prior to the date hereof) from the office of the secretary of the state
of its incorporation or organization and of each state in which it is qualified
to do business as a foreign corporation or organization;

 

(g)                       the Administrative Agent shall have received a list of
the Borrower’s Authorized Representatives;

 

(h)                         the Administrative Agent shall have received for
itself and for the Lenders the initial fees called for by Section 3.1;

 

(i)                         the Administrative Agent shall have received
UCC searches with respect to Borrower, as debtor, and UCC termination statements
for any existing UCC financing statements that are not Permitted Liens;

 

(j)                        the Administrative Agent shall have received the
favorable written opinion of counsel to the Borrower, in form and substance
reasonably satisfactory to the Administrative Agent;

 

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(k)                         each of the Lenders shall have received,
sufficiently in advance of the Closing Date, all documentation and other
information requested by any such Lender required by bank regulatory authorities
under applicable “know your customer” and anti-money laundering rules and
regulations, including without limitation, the United States Patriot Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)) including,
without limitation, the information described in Section 12.23; and the
Administrative Agent shall have received a fully executed Internal Revenue
Service Form W-9 (or its equivalent) for the Borrower and its Subsidiaries;

 

(l)                         at least five days prior to the Closing Date, if the
Borrower qualifies as a “legal entity customer” under the Beneficial Ownership
Regulation, it shall deliver a Beneficial Ownership Certification in relation to
it; and

 

(m)                        the Administrative Agent shall have received such
other agreements, instruments, documents, certificates, and opinions as the
Administrative Agent may reasonably request.

 

SECTION 8.                                             COVENANTS.

 

The Borrower agrees that, so long as any credit is available to or in use by the
Borrower hereunder, except to the extent compliance in any case or cases is
waived in writing pursuant to the terms of Section 12.11:

 

Section 8.1.                             Maintenance of Business.  (i) The
Borrower shall, and shall cause each Unencumbered Asset Subsidiary to, preserve
and maintain its existence, except as otherwise provided in Section 8.9.  The
Borrower shall, and shall cause each Unencumbered Asset Subsidiary to, preserve
and keep in force and effect all licenses, permits, franchises, approvals,
patents, trademarks, trade names, trade styles, copyrights, and other
proprietary rights necessary to the proper conduct of its business.

 

(ii)                               (a) The Common Stock of the Borrower shall at
all times be duly listed on the New York Stock Exchange, Inc., the American
Stock Exchange or the National Association of Securities Dealers Automated
Quotation and (b) the Borrower shall timely file all reports required to be
filed by it with the New York Stock Exchange, Inc., the American Stock Exchange
or the National Association of Securities Dealers Automated Quotation and the
Securities and Exchange Commission.

 

Section 8.2.                             Maintenance of Properties.  The
Borrower and each Unencumbered Asset Subsidiary shall cause each of its tenants
to, maintain, preserve, and keep all of the Borrower’s and each Unencumbered
Asset Subsidiaries’ Property in working order and condition (ordinary wear and
tear excepted) and to maintain the value of such Property in all material
respects, except to the extent that, in the reasonable business judgment of such
Person, any such Property is no longer necessary for the proper conduct of the
business of such Person.

 

Section 8.3.                             Taxes and Assessments.  The Borrower
and each Unencumbered Asset Subsidiary shall, and shall cause its tenants to,
duly pay and discharge, all Taxes upon or against the Borrower, Unencumbered
Asset Subsidiary or tenant or the Borrower’s or Unencumbered Asset Subsidiaries’
Property, to the extent that individually or collectively would materially
impair the value of such Property, and in each case before the same become
delinquent and before penalties accrue thereon, unless and to the extent that
the same are being contested in good faith and by appropriate proceedings which
prevent enforcement of the matter under contest and adequate reserves are
provided therefor.

 

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Section 8.4.                             Insurance.  The Borrower and each
Unencumbered Asset Subsidiary shall maintain, or cause its tenants to maintain,
insurance with responsible and reputable insurance companies or associations in
such amounts and covering such risks as is usually carried by Persons similarly
situated and operating like Properties.  The Borrower shall, upon the request of
the Administrative Agent, furnish to the Administrative Agent and the Lenders
certificates of insurance setting forth in summary form the nature and extent of
the insurance maintained on the Properties.

 

Section 8.5.                             Financial Reports.  The Borrower shall,
and shall cause each consolidated Subsidiary to, maintain a standard system of
accounting in accordance with GAAP and shall furnish to the Administrative
Agent, each Lender, the L/C Issuer and each of their duly authorized
representatives such information respecting the business and financial condition
of the Borrower and each consolidated Subsidiary as the Administrative Agent or
such Lender may reasonably request; and without any request, shall furnish to
the Administrative Agent, the Lenders and the L/C Issuer the following:

 

(a)                        as soon as available, and in any event within 45 days
after the close of each of the first three (3) Fiscal Quarters of each Fiscal
Year of the Borrower a copy of the consolidated balance sheet of the Borrower
and its consolidated Subsidiaries as of the last day of such Fiscal Quarter and
the consolidated statements of income, and cash flows of the Borrower and its
consolidated Subsidiaries for the Fiscal Quarter and for the fiscal year-to-date
period then ended, each in reasonable detail showing in comparative form the
figures for the corresponding date and period in the previous Fiscal Year,
prepared by the Borrower in accordance with GAAP and certified to by its chief
financial officer or another officer of the Borrower acceptable to the
Administrative Agent (the delivery of the Borrower’s Form 10-Q shall satisfy
this requirement);

 

(b)                         as soon as available, and in any event within
90 days after the close of each Fiscal Year of the Borrower, a copy of the
consolidated balance sheet of the Borrower and its consolidated Subsidiaries as
of the last day of the Fiscal Year then ended and the consolidated statements of
income, retained earnings, and cash flows of the Borrower and its consolidated
Subsidiaries for the Fiscal Year then ended, and accompanying notes thereto,
each in reasonable detail showing in comparative form the figures for the
previous Fiscal Year, accompanied in the case of the consolidated financial
statements by an unqualified opinion of Ernst & Young, LLP or another firm of
independent public accountants of recognized national standing, selected by the
Borrower and reasonably satisfactory to the Administrative Agent and the
Required Lenders, to the effect that the consolidated financial statements have
been prepared in accordance with GAAP and present fairly in accordance with GAAP
the consolidated financial condition

 

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of the Borrower and its consolidated Subsidiaries as of the close of such Fiscal
Year and the results of their operations and cash flows for the Fiscal Year then
ended and that an examination of such accounts in connection with such financial
statements has been made in accordance with generally accepted auditing
standards and, accordingly, such examination included such tests of the
accounting records and such other auditing procedures as were considered
necessary in the circumstances (the delivery of the Borrower’s Form 10-K shall
satisfy this requirement);

 

(c)                         with each of the financial statements furnished to
the Lenders pursuant to subsections (a) and (b) hereof, a written certificate (a
“Compliance Certificate”) in the form attached hereto as Exhibit E signed by the
chief financial officer of the Borrower or another officer of the Borrower
acceptable to the Administrative Agent to the effect that to the best of such
officer’s knowledge and belief no Default or Event of Default has occurred
during the period covered by such statements or, if any such Default or Event of
Default has occurred during such period, setting forth a description of such
Default or Event of Default and specifying the action, if any, taken by the
Borrower or any Subsidiary to remedy the same.  Such certificate shall also set
forth the calculations supporting such statements in respect of Section 8.19;

 

(d)                         promptly after receipt thereof, any additional
written reports, management letters or other detailed information contained in
writing concerning significant aspects of the Borrower’s or any consolidated
Subsidiary’s operations and financial affairs given to it by its independent
public accountants;

 

(e)                         promptly after the sending or filing thereof, copies
of each financial statement, report, notice or proxy statement sent by the
Borrower or any Subsidiary to its stockholders or other equity holders, and
copies of each regular, periodic or special report, registration statement or
prospectus (including all Form 10-K, Form 10-Q and Form 8-K reports) filed by
the Borrower or any Subsidiary with any securities exchange or the Securities
and Exchange Commission or any successor agency;

 

(f)                        as soon as available, and in any event within 90 days
after  the end of each Fiscal Year of the Borrower, a copy of the Borrower’s
consolidated projections for the then current Fiscal Year of revenues, expenses
and balance sheet on a quarter-by-quarter basis, with such projections in
reasonable detail prepared by the Borrower and in form satisfactory to the
Administrative Agent (which shall include a summary of all significant
assumptions made in preparing such business plan);

 

(g)                         notice of any Change of Control of the Borrower;

 

(h)                        promptly after knowledge thereof shall have come to
the attention of any responsible officer of the Borrower, written notice of
(i) any threatened or pending litigation or governmental or arbitration
proceeding or labor controversy against the Borrower or any Subsidiary or any of
their Property which could reasonably be expected to have a Material Adverse
Effect or (ii) the occurrence of any Default or Event of Default hereunder;

 

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(i)                          as soon as available, and in any event within
90 days after the close of each Fiscal Year of the Borrower, a list that
identifies each Subsidiary as of the date thereof, whether such Subsidiary is an
Unencumbered Asset Subsidiary, the jurisdiction of its organization, the
percentage of issued and outstanding shares of each class of its capital stock
or other equity interests owned by the Borrower and the other Subsidiaries and,
if such percentage is not 100% (excluding directors’ qualifying shares as
required by law), a description of each class of its authorized capital stock
and other equity interests and the number of shares of each class issued and
outstanding;

 

(j)                         promptly and in any event within 5 Business Days
after knowledge thereof, a written notice of any change of the Borrower’s Credit
Rating from any Rating Agency;

 

(k)                        any change in the information provided in the
Beneficial Ownership Certification that would result in a change to the list of
beneficial owners identified in parts (c) or (d) of such certification; and

 

(l)                          if any investment or acquisition together with any
other investments or acquisitions made during any Fiscal Quarter have an
aggregate cost exceeding 20% of the Total Asset Value of the Borrower and its
Subsidiaries as of the last day of the most recently ended Fiscal Quarter for
which financial statements have been delivered pursuant to this Section 8.5,
then for such investment or acquisition, a Compliance Certificate showing
Borrower’s pro forma compliance with the covenants contained in Section 8.19
after giving effect to the proposed investment or acquisition, including giving
effect in terms of additional asset value, liabilities incurred, if any,
additional revenues and expenses associated therewith which have been
contemplated and have been projected into the expected operating results and
financial position of the Borrower for the Fiscal Quarter in which the
investment or acquisition occurs.

 

Unless otherwise expressly requested by a Lender, documents required to be
delivered pursuant to this Section 8.5 may be delivered via electronic
communication to any Lender.

 

Section 8.6.                   Inspection.  The Borrower shall, and shall cause
each consolidated Subsidiary to, permit the Administrative Agent, each Lender,
the L/C Issuer and each of their duly authorized representatives and agents to
visit and inspect any of its Property, corporate books, and financial records,
to examine and make copies of its books of accounts and other financial records,
and to discuss its affairs, finances, and accounts with, and to be advised as to
the same by, its officers, employees and independent public accountants (and by
this provision the Borrower hereby authorizes such accountants to discuss with
the Administrative Agent, such Lenders and the L/C Issuer the finances and
affairs of the Borrower and its consolidated Subsidiaries) at such reasonable
times and intervals as the Administrative Agent or any such Lender or the L/C
Issuer may designate and, so long as no Default or Event of Default exists, with
reasonable prior notice to the Borrower.

 

Section 8.7.                   Office of Foreign Asset Control.  Neither
Borrower nor any Subsidiary is (or will be) a Person with whom a Lender is
restricted from doing business under regulations of OFAC (including, those
Persons named on OFAC’s Specially Designated and Blocked Persons list) or under
any statute, executive order (including, the September 24, 2001 Executive Order
Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten
to Commit, or Support Terrorism), or other governmental action and is not and
shall not engage in any dealings or transactions or otherwise be associated with
such Persons.  In addition, Borrower hereby agrees to provide to any Lender with
any additional information that the Lender deems necessary from time to time in
order to ensure compliance with all applicable laws concerning money laundering
and similar activities.

 

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Section 8.8.                   Liens.  The Borrower shall not, nor shall it
permit any Subsidiary to, create, incur or permit to exist any Lien of any kind
on any Property owned by any such Person; provided, however, that the foregoing
shall not apply to nor operate to prevent any Permitted Liens.

 

Section 8.9.                   Mergers, Consolidations and Sales.  The Borrower
will not merge or consolidate with or into, or convey, transfer or otherwise
dispose of (whether in one transaction or a series of transactions) any of its
Property (whether now owned or hereafter acquired) to, or acquire all or
substantially all of the assets of, any Person, or permit any Subsidiary to do
so; provided, however, that the Borrower may merge or consolidate with another
Person, including a Subsidiary, if (A) the Borrower is the surviving
corporation, (B) the Borrower will be in pro forma compliance with all
provisions of this Agreement upon and after such merger or consolidation and
(C) the Borrower will not engage in any material line of business substantially
different from that engaged in on the Closing Date and; provided, further, that
so long as no Default or Event of Default exists this Section shall not apply to
nor operate to prevent:

 

(a)                        the sale, transfer or other disposition of Property
of the Borrower and its Subsidiaries to one another in the ordinary course of
its business;

 

(b)                        sales of shares of capital stock or other equity
interests by Borrower or, to the extent permitted by Section 8.10, its
Subsidiaries;

 

(c)                         the sale, transfer or other disposition of any
tangible personal property that, in the reasonable business judgment of the
Borrower or its Subsidiary, has become obsolete or worn out, and which is
disposed of in the ordinary course of business; and

 

(d)                        the sale, transfer or other disposition of Property
of the Borrower or any Subsidiary (including any disposition of Property as part
of a sale and leaseback transaction); provided however, that if the Gross Book
Value of such sale, transfer or disposition during any Fiscal Quarter exceeds
$10,000,000 and together with any other sales, transfers or dispositions made
during such Fiscal Quarter in the aggregate exceed $100,000,000, then for such
sales, transfers or dispositions, the Borrower shall provide to the
Administrative Agent a Compliance Certificate with covenant calculations for the
covenants contained in Section 8.19 showing that after giving effect to such
sales, transfers or dispositions the Borrower shall be in pro forma compliance
with such covenants for the Fiscal Quarter in which the sale, transfer or
disposition occurs.

 

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Section 8.10.                   Maintenance of Unencumbered Asset Subsidiaries. 
The Borrower shall not assign, sell or transfer, nor shall it permit any
Unencumbered Asset Subsidiary to issue, assign, sell or transfer, any shares of
capital stock or other equity interests of such Unencumbered Asset Subsidiary;
provided, however, that the foregoing shall not operate to prevent (a) Liens on
the capital stock or other equity interests of Unencumbered Asset Subsidiaries
granted to the Administrative Agent, (b) the issuance, sale, and transfer to any
person of any shares of capital stock of a Subsidiary solely for the purpose of
qualifying, and to the extent legally necessary to qualify, such person as a
director of such Unencumbered Asset Subsidiary, (c) any transaction permitted by
Section 8.9, and (d) an Unencumbered Asset Subsidiary from permitting any of its
minority owners from assigning, selling or transferring its Equity Interests in
such Unencumbered Asset Subsidiary.

 

Section 8.11.                   ERISA.  The Borrower shall, and shall cause each
Subsidiary to, promptly pay and discharge all obligations and liabilities
arising under ERISA of a character which if unpaid or unperformed could
reasonably be expected to result in the imposition of a Lien against any of its
Property.  The Borrower shall, and shall cause each Subsidiary to, promptly
notify the Administrative Agent and each Lender of:  (a) the occurrence of any
Reportable Event with respect to a Plan, (b) receipt of any notice from the PBGC
of its intention to seek termination of any Plan or appointment of a trustee
therefor, (c) its intention to terminate or withdraw from any Plan, and (d) the
occurrence of any event with respect to any Plan which would result in the
incurrence by the Borrower or any Subsidiary of any material liability, fine or
penalty, or any material increase in the contingent liability of the Borrower or
any Subsidiary with respect to any post-retirement Welfare Plan benefit.

 

Section 8.12.                   Compliance with Laws and Contractual
Obligations.  (a) The Borrower shall, and shall cause each Subsidiary to, comply
in all respects with (i) the Legal Requirements applicable to or pertaining to
its Property or business operations and (ii) all contractual obligations,
except, in each case where any such non-compliance, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect or
result in a Lien upon any of its Property.

 

(b)                     Without limiting the agreements set forth in
Section 8.12(a) above, for each of its owned Properties, respectively, the
Borrower shall, and shall cause each Subsidiary to require that each tenant and
subtenant, if any, of any of the Properties or any part thereof, at all times,
do the following to the extent the failure to do so, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect:
(i) comply in all material respects with all applicable Environmental Laws;
(ii) obtain and maintain in full force and effect all material governmental
approvals required by any applicable Environmental Law for operations at each of
the Properties; (iii) cause to be cured any material violation by it or at any
of the Properties of applicable Environmental Laws; (iv) not allow the presence
or operation at any of the Properties of any (1) landfill or dump or
(2) hazardous waste management facility or solid waste disposal facility as
defined pursuant to applicable Environmental Law; (v) not manufacture, use,
generate, transport, treat, store, Release, dispose or handle any Hazardous
Material at any of the Properties

 

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except in the ordinary course of its business and in de minimis amounts;
(vi) within ten (10) Business Days notify the Administrative Agent in writing of
and provide any reasonably requested documents upon learning of any of the
following in connection with the Borrower or any Subsidiary or any of the
Properties:  (1) any material Environmental Liability; (2) any material
Environmental Claim; (3) any material violation of an Environmental Law or
material Release, threatened Release or disposal of a Hazardous Material;
(4) any restriction on the ownership, occupancy, use or transferability arising
pursuant to any (x) Release, threatened Release or disposal of a Hazardous
Material or (y) Environmental Law; or (5) any environmental, natural resource,
health or safety condition, which could reasonably be expected to have a
Material Adverse Effect; (vii) conduct at its expense any investigation, study,
sampling, testing, abatement, cleanup, removal, remediation or other response
action necessary to remove, remediate, clean up or abate any material Release,
threatened Release or disposal of a Hazardous Material as required by any
applicable Environmental Law, (viii) abide by and observe any restrictions on
the use of the Properties imposed by any Governmental Authority as set forth in
a deed or other instrument affecting the Borrower’s or any Subsidiary’s interest
therein; (ix) promptly provide or otherwise make available to the Administrative
Agent any reasonably requested environmental record concerning the Properties
which the Borrower or any Subsidiary possesses or can reasonably obtain; and
(x) perform, satisfy, and implement any operation or maintenance actions
required by any Governmental Authority or Environmental Law, or included in any
no further action letter or covenant not to sue issued by any Governmental
Authority under any Environmental Law.

 

Section 8.13.                   Burdensome Contracts With Affiliates.  The
Borrower shall not, nor shall it permit any Subsidiary to, enter into any
contract, agreement or business arrangement with any of its Affiliates (other
than with Wholly-owned Subsidiaries) on terms and conditions which are less
favorable to the Borrower or such Subsidiary than would be usual and customary
in similar contracts, agreements or business arrangements between Persons not
affiliated with each other.

 

Section 8.14.                   No Changes in Fiscal Year.  The Fiscal Year of
the Borrower and its consolidated Subsidiaries ends on December 31st of each
year; and the Borrower shall not, nor shall it permit any consolidated
Subsidiary to, change its Fiscal Year from its present basis.

 

Section 8.15.                   Compliance with OFAC Sanctions Programs and
Anti-Corruption Laws.  (a) The Borrower shall at all times comply with the
requirements of all OFAC Sanctions Programs applicable to the Borrower and shall
cause each of its Subsidiaries to comply with the requirements of all OFAC
Sanctions Programs applicable to such Subsidiary.

 

(b)                                  The Borrower shall provide the
Administrative Agent, the L/C Issuer, and the Lenders any information regarding
the Borrower, its Affiliates, and its Subsidiaries necessary for the
Administrative Agent, the L/C Issuer, and the Lenders to comply with all
applicable OFAC Sanctions Programs; subject however, in the case of Affiliates,
to the Borrower’s ability to provide information applicable to them.

 

(c)                                   If the Borrower obtains actual knowledge
or receives any written notice that the Borrower, any Affiliate, any Subsidiary
or any officer, director of the Borrower or any Subsidiary or that any Person
that owns or controls any such Person is the target of any OFAC

 

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Sanctions Programs or is located, organized or resident in a country or
territory that is, or whose government is, the subject of any OFAC Sanctions
Programs (such occurrence, an “OFAC Event”), the Borrower shall promptly
(i) give written notice to the Administrative Agent, the L/C Issuer, and the
Lenders of such OFAC Event, and (ii) comply with all applicable laws with
respect to such OFAC Event (regardless of whether the target Person is located
within the jurisdiction of the United States of America), including the OFAC
Sanctions Programs, and the Borrower hereby authorizes and consents to the
Administrative Agent, the L/C Issuer, and the Lenders taking any and all steps
the Administrative Agent, the L/C Issuer, or the Lenders deem necessary, in
their sole but reasonable discretion, to avoid violation of all applicable laws
with respect to any such OFAC Event, including the requirements of the OFAC
Sanctions Programs (including the freezing and/or blocking of assets and
reporting such action to OFAC).

 

(d)                     Neither the Borrower or any Subsidiary will, directly
or, to the Borrower’s or such Subsidiary’s knowledge, indirectly, use the
proceeds of the Revolving Credit, or lend, contribute or otherwise make
available such proceeds to any other Person, (i) to fund any activities or
business of or with any Person or in any country or territory, that, at the time
of such funding, is, or whose government is, the subject of any OFAC Sanctions
Programs, or (ii) in any other manner that would result in a violation of OFAC
Sanctions Programs or Anti-Corruption Laws by any Person (including any Person
participating in the Revolving Credit, whether as underwriter, lender, advisor,
investor, or otherwise).

 

(e)                      The Borrower will not, nor will it permit any
Subsidiary to, violate any Anti-Corruption Law in any material respect.

 

(f)                     The Borrower will maintain in effect policies and
procedures designed to ensure compliance by the Borrower, its Subsidiaries, and
their respective directors, officers, employees, and agents with applicable
Anti-Corruption Laws.

 

Section 8.16.                   Change in the Nature of Business.  The Borrower
shall not, nor shall it permit any Subsidiary to, engage in any business or
activity if as a result the general nature of the business of the Borrower and
its Subsidiaries would be changed in any material respect from the general
nature of the business engaged in by it as of the Closing Date.  As of the
Closing Date, the general nature of the business of the Borrower and its
Subsidiaries is primarily the business of the acquisition, financing and
ownership of Senior Housing Assets and other business activities incidental
thereto.

 

Section 8.17.                   Use of Loan Proceeds.  The Borrower shall use
the credit extended under this Agreement solely for the purposes set forth in,
or otherwise permitted by, Section 6.4.

 

Section 8.18.                   No Restrictions.  Except as provided herein, the
Borrower shall not, nor shall it permit any Subsidiary (except for bankruptcy
remote subsidiaries established in connection with (i) any securitization or
participation transaction or with any Permitted Lien or (ii) any ownership of
fee simple real estate Properties not exceeding $200,000,000 individually or in
the aggregate) to, directly or indirectly create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of the Borrower or any Subsidiary to:  (a) pay dividends or make
any other distributions on any

 

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Subsidiary’s capital stock or other equity interests owned by the Borrower or
any other Subsidiary, (b) pay any indebtedness owed to the Borrower or any other
Subsidiary, (c) make loans or advances to the Borrower or any other Subsidiary,
(d) transfer any of its Property to the Borrower or any other Subsidiary,
provided, however, that the foregoing does not apply to any limitation on
transfers of property that is subject to a Permitted Lien or (e)  guarantee the
Obligations, Hedging Liability, and Funds Transfer and Deposit Account Liability
and/or grant Liens on its assets to the Administrative Agent as required by the
Loan Documents.

 

Section 8.19.                   Financial Covenants.  (a) Maximum Total
Indebtedness to Total Asset Value Ratio.  As of the last day of each Fiscal
Quarter of the Borrower, the Borrower shall not permit the ratio of Total
Indebtedness to Total Asset Value to be greater than 0.60 to 1.00.

 

(b)                     Maximum Secured Debt to Total Asset Value Ratio.  As of
the last day of each Fiscal Quarter of the Borrower, the Borrower shall not
permit the ratio of Secured Debt to Total Asset Value to be greater than 0.35 to
1.00.

 

(c)                      Maximum Unsecured Debt to Unencumbered Asset Value.  As
of the last day of each Fiscal Quarter of the Borrower, the Borrower shall not
permit the ratio of Unsecured Debt to Unencumbered Asset Value to be greater
than 0.60 to 1.00.

 

(d)                     Minimum EBITDA to Fixed Charges Ratio.  As of the last
day of each Rolling Period of the Borrower, the Borrower shall not permit the
ratio of EBITDA for such Rolling Period to Fixed Charges for such Rolling Period
to be less than 1.50 to 1.00.

 

(e)                      Maintenance of Net Worth.  The Borrower shall at all
times maintain a Tangible Net Worth of not less than the sum of (a) $565,000,000
plus (b) 75% of the aggregate net proceeds received by the Borrower or any of
its Subsidiaries after December 31, 2017 in connection with any offering of
Stock or Stock Equivalents of the Borrower or the Subsidiaries that results in
an increase of Tangible Net Worth, to the extent such Stock or Stock Equivalents
are included in stockholders’ equity on the Borrower’s consolidated balance
sheet (but excluding such offerings or issuances used to repay existing forms of
Stock and Stock Equivalents).

 

Notwithstanding the foregoing, the Borrower may elect upon delivering written
notice to the Administrative Agent, concurrently with or prior to the delivery
of a Compliance Certificate for any Fiscal Quarter during which the Borrower
shall have completed a Material Acquisition, and provided that no Default or
Event of Default has occurred and is continuing that for purposes of clause
(a) and (c) above the Borrower may exceed a ratio of 0.60 to 1.00, but shall in
no event exceed a ratio of 0.65 to 1.00 for such Fiscal Quarter in which such
Material Acquisition occurred and the next succeeding Fiscal Quarter (the
“Leverage Ratio Increase Period”); provided that (i) the Borrower may not elect
more than two Leverage Ratio Increase Periods during the term of this Agreement
and (ii) any such Leverage Ratio Increase Periods shall be non-consecutive.

 

Section 8.20.                   Note Agreement Notices.  On or before the date
20 calendar days after the Closing Date, the Borrower shall cause to be
delivered to the Administrative Agent a certified copy of a notice to each
Noteholder which, to the Administrative Agent’s reasonable satisfaction,
notifies each Noteholder of the provisions of the financial covenants and the
definitions set forth in Sections 1.1 and 8.19.

 

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Section 8.21.                   Modification of Material Contracts.  Neither
Borrower nor any Subsidiary shall enter into an amendment or modification of any
contract or agreement which could reasonably be expected to have a Material
Adverse Effect.

 

Section 8.22.                   Limitations on Guaranties of Indebtedness. 
Concurrent with any Person becoming a guarantor or other obligor under any
Indebtedness for Borrowed Money of the Borrower, the Borrower shall cause such
Person to execute and deliver to the Administrative Agent, for the benefit of
the Lenders, a guaranty of the Obligations, Hedging Liability and Funds Transfer
and Deposit Account Liability hereunder, together with such other instruments,
documents, certificates, and opinions reasonably required by the Administrative
Agent in connection therewith, each of the above being in form and substance
customary and appropriate for financings of this type so that after giving
effect thereto, the Obligations, Hedging Liability and Funds Transfer and
Deposit Account Liability hereunder rank at least pari passu in payment priority
with all other unsecured Indebtedness for Borrowed Money.

 

SECTION 9.                                             EVENTS OF DEFAULT AND
REMEDIES.

 

Section 9.1.                   Events of Default.  Any one or more of the
following shall constitute an “Event of Default” hereunder:

 

(a)                        default in the payment when due of all or any part of
the principal on any Revolving Loan (whether at the stated maturity thereof or
at any other time provided for in this Agreement) or of any Reimbursement
Obligation payable hereunder or under any other Loan Document;

 

(b)                        default within three (3) Business Days of when due in
the payment of all or any part of the interest on any Revolving Loan (whether at
the stated maturity thereof or at any other time provided for in this Agreement)
or of any fee or other Obligation payable hereunder or under any other Loan
Document;

 

(c)                         default in the observance or performance of any
covenant set forth in Sections 8.1, 8.8, 8.9, 8.10, 8.19, 8.20, 8.21 or 8.22;

 

(d)                        default in the observance or performance of any other
provision hereof or of any other Loan Document which is not remedied within
30 days after the earlier of (i) the date on which such failure shall first
become known to any officer of the Borrower or (ii) written notice thereof is
given to the Borrower by the Administrative Agent;

 

(e)                         any representation or warranty made herein or in any
other Loan Document or in any certificate furnished to the Administrative Agent
or the Lenders pursuant hereto or thereto or in connection with any transaction
contemplated hereby or thereby proves untrue in any material respect as of the
date of the issuance or making or deemed making thereof;

 

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(f)                        any event occurs or condition exists (other than
those described in subsections (a) through (e) above) which is specified as an
event of default under any of the other Loan Documents, or any of the Loan
Documents shall for any reason not be or shall cease to be in full force and
effect or is declared to be null and void;

 

(g)                         default shall occur under any Indebtedness for
Borrowed Money issued, assumed or guaranteed by the Borrower or any Subsidiary
aggregating in excess of 3% of the Total Asset Value or under any indenture,
agreement or other instrument under which the same may be issued, and such
default shall continue for a period of time sufficient to permit the
acceleration of the maturity of any such Indebtedness for Borrowed Money
(whether or not such maturity is in fact accelerated); provided that if such
default results solely from a payment not paid when due, there shall be a five
(5) day cure period so long as the maturity date with respect to the subject
Indebtedness for Borrowed Money has not been accelerated;

 

(h)                        any judgment or judgments, writ or writs or warrant
or warrants of attachment, or any similar process or processes, shall be entered
or filed against the Borrower or any Subsidiary, or against any of its Property,
in an aggregate amount in excess of $25,000,000 (except to the extent fully
covered by insurance pursuant to which the insurer has accepted liability
therefor in writing), and which remains undischarged, unvacated, unbonded or
unstayed for a period of 30 days;

 

(i)                          the Borrower or any Subsidiary, or any member of
its Controlled Group, shall fail to pay when due an amount or amounts
aggregating in excess of $25,000,000 which it shall have become liable to pay to
the PBGC or to a Plan under Title IV of ERISA; or notice of intent to terminate
a Plan or Plans having aggregate Unfunded Vested Liabilities in excess of
$25,000,000 (collectively, a “Material Plan”) shall be filed under Title IV of
ERISA by the Borrower or any Subsidiary, or any other member of its Controlled
Group, any plan administrator or any combination of the foregoing; or the PBGC
shall institute proceedings under Title IV of ERISA to terminate or to cause a
trustee to be appointed to administer any Material Plan or a proceeding shall be
instituted by a fiduciary of any Material Plan against the Borrower or any
Subsidiary, or any member of its Controlled Group, to enforce Section 515 or
4219(c)(5) of ERISA and such proceeding shall not have been dismissed within
30 days thereafter; or a condition shall exist by reason of which the PBGC would
be entitled to obtain a decree adjudicating that any Material Plan must be
terminated;

 

(j)                         any Change of Control in respect of the Borrower
shall occur;

 

(k)                        the Borrower or any Unencumbered Asset Subsidiary
shall (i) have entered involuntarily against it an order for relief under the
United States Bankruptcy Code, as amended, (ii) not pay, or admit in writing its
inability to pay, its debts generally as they become due, (iii) make an
assignment for the benefit of creditors, (iv) apply for, seek, consent to or
acquiesce in, the appointment of a receiver, custodian, trustee, examiner,
liquidator or similar official for it or any substantial part of its Property,
(v) institute any proceeding seeking to have entered against it an order for
relief under the

 

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United States Bankruptcy Code, as amended, to adjudicate it insolvent, or
seeking dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors or fail to file an
answer or other pleading denying the material allegations of any such proceeding
filed against it, (vi) take any corporate action in furtherance of any matter
described in parts (i) through (v) above, or (vii) fail to contest in good faith
any appointment or proceeding described in Section 9.1(l);

 

(l)                          a custodian, receiver, trustee, examiner,
liquidator or similar official shall be appointed for the Borrower or any
Unencumbered Asset Subsidiary, or any substantial part of any of its Property,
or a proceeding described in Section 9.1(k)(v) shall be instituted against the
Borrower or any Unencumbered Asset Subsidiary, and such appointment continues
undischarged or such proceeding continues undismissed or unstayed for a period
of 60 days;

 

(m)                        there shall be a determination from the applicable
Governmental Authority from which no appeal can be taken that the Borrower’s tax
status as a REIT has been lost; or

 

(n)                        the Borrower at any time hereafter fails to cause the
Common Stock of the Borrower to be duly listed on the New York Stock
Exchange, Inc., the American Stock Exchange or the National Association of
Securities Dealers Automated Quotation.

 

Section 9.2.                   Non-Bankruptcy Defaults.  When any Event of
Default other than those described in subsection (k) or (l) of Section 9.1 has
occurred and is continuing, the Administrative Agent shall, by written notice to
the Borrower:  (a) if so directed by the Required Lenders, terminate the
remaining Revolving Credit Commitments and all other obligations of the Lenders
hereunder on the date stated in such notice (which may be the date thereof);
(b) if so directed by the Required Lenders declare the principal of and the
accrued interest on all outstanding Revolving Loans to be forthwith due and
payable and thereupon all outstanding Revolving Loans, including both principal
and interest thereon, shall be and become immediately due and payable together
with all other amounts payable under the Loan Documents without further demand,
presentment, protest or notice of any kind; and (c) if so directed by the
Required Lenders, demand that the Borrower deliver to the Administrative Agent
Cash Collateral in an amount equal to 103% of the aggregate amount of each
Letter of Credit then outstanding, and the Borrower agrees to immediately
provide such Cash Collateral and acknowledges and agrees that the Lenders would
not have an adequate remedy at law for failure by the Borrower to honor any such
demand and that the Administrative Agent, for the benefit of the Lenders, shall
have the right to require the Borrower to specifically perform such undertaking
whether or not any drawings or other demands for payment have been made under
any Letter of Credit.  The Administrative Agent, after giving notice to the
Borrower pursuant to Section 9.1(d) or this Section 9.2, shall also promptly
send a copy of such notice to the other Lenders, but the failure to do so shall
not impair or annul the effect of such notice.

 

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Section 9.3.                   Bankruptcy Defaults.  (a)  When any Event of
Default described in subsections (k) or (l) of Section 9.1 with respect to the
Borrower has occurred and is continuing, then all outstanding Revolving Loans
shall immediately become due and payable together with all other amounts payable
under the Loan Documents without presentment, demand, protest or notice of any
kind, the obligation of the Lenders to extend further credit pursuant to any of
the terms hereof shall immediately terminate and the Borrower shall immediately
deliver to the Administrative Agent Cash Collateral in an amount equal to 103%
of the aggregate amount of each Letter of Credit then outstanding, the Borrower
acknowledging and agreeing that the Lenders would not have an adequate remedy at
law for failure by the Borrower to honor any such demand and that the Lenders,
and the Administrative Agent on their behalf, shall have the right to require
the Borrower to specifically perform such undertaking whether or not any draws
or other demands for payment have been made under any of the Letters of Credit. 
In addition, the Administrative Agent may exercise on behalf of itself, the
Lenders and the L/C Issuer all rights and remedies available to it, the Lenders
and the L/C Issuer under the Loan Documents or under applicable law or in equity
when any such Event of Default has occurred and is continuing.

 

(b)                     At any time that there shall exist a Defaulting Lender,
within one Business Day following the written request of the Administrative
Agent or the L/C Issuer (with a copy to the Administrative Agent) the Borrower
shall Cash Collateralize the L/C Issuer’s Fronting Exposure with respect to such
Defaulting Lender (determined after giving effect to Section 2.14(a)(iv) and any
Cash Collateral provided by such Defaulting Lender) in an amount not less than
the Minimum Collateral Amount.

 

(i)                          Grant of Security Interest.  The Borrower, and to
the extent provided by any Defaulting Lender, such Defaulting Lender, hereby
grant to the Administrative Agent, for the benefit of the L/C Issuer, and agree
to maintain, a first priority security interest in all such Cash Collateral as
security for such Defaulting Lender’s obligation to fund participations in
respect of L/C Obligations, to be applied pursuant to clause (ii) below.  If at
any time the Administrative Agent determines that Cash Collateral is subject to
any right or claim of any Person other than the Administrative Agent and the L/C
Issuer as herein provided (other than Permitted Liens), or that the total amount
of such Cash Collateral is less than the Minimum Collateral Amount, the Borrower
shall, promptly upon demand by the Administrative Agent, pay or provide to the
Administrative Agent additional Cash Collateral in an amount sufficient to
eliminate such deficiency (after giving effect to any Cash Collateral provided
by the Defaulting Lender).

 

(ii)                          Application.  Notwithstanding anything to the
contrary contained in this Agreement, Cash Collateral provided under this
Section 9.3 or Section 2.15 in respect of Letters of Credit shall be applied to
the satisfaction of the Defaulting Lender’s obligation to fund participations in
respect of L/C Obligations (including, as to Cash Collateral provided by a
Defaulting Lender, any interest accrued on such obligation) for which the Cash
Collateral was so provided, prior to any other application of such property as
may otherwise be provided for herein.

 

(iii)                           Termination of Requirement.  Cash Collateral (or
the appropriate portion thereof) provided to reduce the L/C Issuer’s Fronting
Exposure shall no longer be required to be held as Cash Collateral pursuant to
this Section 9.3(b) following (A) the

 

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elimination of the applicable Fronting Exposure (including by the termination of
Defaulting Lender status of the applicable Lender), or (B) the determination by
the Administrative Agent and the L/C Issuer that there exists excess Cash
Collateral; provided that, subject to Section 2.15 the Person providing Cash
Collateral and the L/C Issuer may agree that Cash Collateral shall be held to
support future anticipated Fronting Exposure or other obligations and provided
further that to the extent that such Cash Collateral was provided by the
Borrower, such Cash Collateral shall remain subject to the security interest
granted pursuant to the Loan Documents.

 

Section 9.4.                   Collateral for Undrawn Letters of Credit.  (a) If
the provision of any Cash Collateral in respect of any or all outstanding
Letters of Credit is required under Section 2.7(b), Section 2.14, Section 2.15,
Section 9.2 or Section 9.3 above, the Borrower shall forthwith provide such Cash
Collateral, to be held by the Administrative Agent as provided in
subsection (b) below.

 

(b)                     All Cash Collateral delivered pursuant to
subsection (a) above shall be held by the Administrative Agent in one or more
separate collateral accounts (each such account, and the credit balances,
properties, and any investments from time to time held therein, and any
substitutions for such account, any certificate of deposit or other instrument
evidencing any of the foregoing and all proceeds of and earnings on any of the
foregoing being collectively called the “Collateral Account”) as security for,
and for application by the Administrative Agent (to the extent available) to,
the reimbursement of any payment under any Letter of Credit then or thereafter
made by the L/C Issuer, and to the payment of the unpaid balance of all other
Obligations (and to all Hedging Liability and Funds Transfer and Deposit Account
Liability).  The Collateral Account shall be held in the name of and subject to
the exclusive dominion and control of the Administrative Agent for the benefit
of the Administrative Agent, the Lenders, and the L/C Issuer.  If and when
requested by the Borrower, the Administrative Agent shall invest funds held in
the Collateral Account from time to time in direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America with a remaining maturity of one
year or less, provided that the Administrative Agent is irrevocably authorized
to sell investments held in the Collateral Account when and as required to make
payments out of the Collateral Account for application to amounts due and owing
from the Borrower to the L/C Issuer, the Administrative Agent or the Lenders;
provided, however, that, subject to the terms of Sections 2.14 and 2.15, (i) if
the Borrower shall have made payment of all obligations referred to in
subsection (a) above required under Section 2.7(b), if any, at the request of
the Borrower the Administrative Agent shall release to the Borrower amounts held
in the Collateral Account so long as at the time of the release and after giving
effect thereto no Default or Event of Default exists, and (ii) if the Borrower
shall have made payment of all obligations referred to in subsection (a) above
required under Section 9.2 or 9.3, so long as no Letters of Credit, Revolving
Credit Commitments, Revolving Loans or other Obligations, Hedging Liability, or
Funds Transfer and Deposit Account Liability remain outstanding, at the request
of the Borrower, the Administrative Agent shall release to the Borrower any
remaining amounts held in the Collateral Account.

 

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Section 9.5.                   Notice of Default.  The Administrative Agent
shall give notice to the Borrower under Section 9.1(d) promptly upon being
requested to do so by any Lender and shall thereupon notify all the Lenders
thereof.

 

SECTION 10.                                      CHANGE IN CIRCUMSTANCES.

 

Section 10.1.                   Change of Law.  Notwithstanding any other
provisions of this Agreement or any other Loan Document, if at any time any
Change in Law makes it unlawful for any Lender to make or continue to maintain
any Eurodollar Loans or to perform its obligations as contemplated hereby, such
Lender shall promptly give notice thereof to the Borrower and such Lender’s
obligations to make or maintain Eurodollar Loans under this Agreement shall be
suspended until it is no longer unlawful for such Lender to make or maintain
Eurodollar Loans.  The Borrower shall prepay on demand the outstanding principal
amount of any such affected Eurodollar Loans, together with all interest accrued
thereon and all other amounts then due and payable to such Lender under this
Agreement; provided, however, subject to all of the terms and conditions of this
Agreement, the Borrower may then elect to borrow the principal amount of the
affected Eurodollar Loans from such Lender by means of Base Rate Loans from such
Lender, which Base Rate Loans shall not be made ratably by the Lenders but only
from such affected Lender.

 

Section 10.2.                   Unavailability of Deposits or Inability to
Ascertain, or Inadequacy of, LIBOR.  If on or prior to the first day of any
Interest Period for any Borrowing of Eurodollar Loans:

 

(a)                        the Administrative Agent determines that deposits in
U.S. Dollars (in the applicable amounts) are not being offered to it in the
interbank eurodollar market for such Interest Period, or that by reason of
circumstances affecting the interbank eurodollar market adequate and reasonable
means do not exist for ascertaining the applicable LIBOR, or

 

(b)                        the Required Lenders advise the Administrative Agent
that (i) LIBOR as determined by the Administrative Agent will not adequately and
fairly reflect the cost to such Lenders of funding their Eurodollar Loans for
such Interest Period or (ii) that the making or funding of Eurodollar Loans
become impracticable,

 

then the Administrative Agent shall forthwith give notice thereof to the
Borrower and the Lenders, whereupon until the Administrative Agent notifies the
Borrower that the circumstances giving rise to such suspension no longer exist,
the obligations of the Lenders to make Eurodollar Loans shall be suspended.

 

If at any time the Administrative Agent determines (which determination shall be
conclusive absent manifest error) that (i) the circumstances set forth in clause
(a) above have arisen and such circumstances are unlikely to be temporary or
(ii) the circumstances set forth in clause (a) have not arisen but the
supervisor for the administrator of the LIBOR Index Rate or a Governmental
Authority having jurisdiction over the Administrative Agent has made a public
statement identifying a specific date after which the LIBOR Index Rate shall no
longer be used for determining interest rates for loans, then the Administrative
Agent and the Borrower shall

 

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endeavor to establish an alternate rate of interest to LIBOR that gives due
consideration to the then prevailing market convention for determining a rate of
interest for syndicated loans in the United States at such time, and shall enter
into an amendment to this Agreement to reflect such alternate rate of interest
and such other related changes to this Agreement as may be applicable. 
Notwithstanding anything to the contrary in Section 12.11, such amendment shall
become effective without any further action or consent of any other party to
this Agreement so long as the Administrative Agent shall not have received,
within five Business Days of the date notice of such alternate rate of interest
is provided to the Lenders, a written notice from the Required Lenders stating
that such Required Lenders object to such amendment.  Until an alternate rate of
interest shall be determined in accordance with this section, (x) any borrowing
request that requests the conversion of any Borrowing to, or continuation of any
Borrowing as, Eurodollar Loans shall be ineffective, and (y) any borrowing
request that requests a Borrowing of Eurodollar Loans, shall be made as a
Borrowing of Base Rate Loans; provided that, if such alternate rate of interest
shall be less than zero, such rate shall be deemed to be zero for the purposes
of this Agreement.

 

Section 10.3.                   Increased Cost and Reduced Return.   
(a) Increased Costs Generally.  If any Change in Law shall:

 

(i)                          impose, modify or deem applicable any reserve,
special deposit, compulsory loan, insurance charge or similar requirement
against assets of, deposits with or for the account of, or credit extended or
participated in by, any Lender (except any reserve requirement reflected in the
Adjusted LIBOR) or the L/C Issuer;

 

(ii)                          subject any Recipient to any Taxes (other than
(A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the
definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan
principal, letters of credit, commitments, or other obligations, or its
deposits, reserves, other liabilities or capital attributable thereto; or

 

(iii)                           impose on any Lender or the L/C Issuer or the
London interbank market any other condition, cost or expense (other than Taxes)
affecting this Agreement or Revolving Loans made by such Lender or any Letter of
Credit or participation therein;

 

and the result of any of the foregoing shall be to increase the cost to such
Lender or such other Recipient of making, converting to, continuing or
maintaining any Revolving Loan or of maintaining its obligation to make any such
Revolving Loan, or to increase the cost to such Lender, the L/C Issuer or such
other Recipient of participating in, issuing or maintaining any Letter of Credit
(or of maintaining its obligation to participate in or to issue any Letter of
Credit), or to reduce the amount of any sum received or receivable by such
Lender, the L/C Issuer or other Recipient hereunder (whether of principal,
interest or any other amount) then, upon request of such Lender, the L/C Issuer
or other Recipient, the Borrower will pay to such Lender, the L/C Issuer or
other Recipient, as the case may be, such additional amount or amounts as will
compensate such Lender, the L/C Issuer or other Recipient, as the case may be,
for such additional costs incurred or reduction suffered.

 

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(b)                     Capital Requirements.  If any Lender or the L/C Issuer
determines that any Change in Law affecting such Lender or the L/C Issuer or any
lending office of such Lender or such Lender’s or the L/C Issuer’s holding
company, if any, regarding capital or liquidity requirements, has or would have
the effect of reducing the rate of return on such Lender’s or the L/C Issuer’s
capital or on the capital of such Lender’s or the L/C Issuer’s holding company,
if any, as a consequence of this Agreement, the Revolving Credit Commitments of
such Lender or the Revolving Loans made by, or participations in Letters of
Credit held by, such Lender, or the Letters of Credit issued by the L/C Issuer,
to a level below that which such Lender or the L/C Issuer or such Lender’s or
the L/C Issuer’s holding company could have achieved but for such Change in Law
(taking into consideration such Lender’s or the L/C Issuer’s policies and the
policies of such Lender’s or the L/C Issuer’s holding company with respect to
capital adequacy), then from time to time, within 15 days after demand by such
Lender or the L/C Issuer (with a copy to the Administrative Agent), the Borrower
will pay to such Lender or the L/C Issuer, as the case may be, such additional
amount or amounts as will compensate such Lender or the L/C Issuer or such
Lender’s or the L/C Issuer’s holding company for any such reduction suffered.

 

(c)                      Certificates for Reimbursement.  A certificate of a
Lender or the L/C Issuer setting forth the amount or amounts necessary to
compensate such Lender or the L/C Issuer or its holding company, as the case may
be, as specified in subsection (a) or (b) of this Section and delivered to the
Borrower, shall be conclusive absent manifest error.  The Borrower shall pay
such Lender or the L/C Issuer, as the case may be, the amount shown as due on
any such certificate within ten (10) days after receipt thereof.

 

(d)                     Delay in Requests.  Failure or delay on the part of any
Lender or the L/C Issuer to demand compensation pursuant to this Section shall
not constitute a waiver of such Lender’s or the L/C Issuer’s right to demand
such compensation; provided that the Borrower shall not be required to
compensate a Lender or the L/C Issuer pursuant to this Section for any increased
costs incurred or reductions suffered more than nine (9) months prior to the
date that such Lender or the L/C Issuer, as the case may be, notifies the
Borrower of the Change in Law giving rise to such increased costs or reductions,
and of such Lender’s or the L/C Issuer’s intention to claim compensation
therefor (except that, if the Change in Law giving rise to such increased costs
or reductions is retroactive, then the nine-month period referred to above shall
be extended to include the period of retroactive effect thereof).

 

Section 10.4.                   Lending Offices.  Each Lender may, at its
option, elect to make its Revolving Loans hereunder at the branch, office or
Affiliate specified on the appropriate signature page hereof (each a “Lending
Office”) for each type of Revolving Loan available hereunder or at such other of
its branches, offices or affiliates as it may from time to time elect and
designate in a written notice to the Borrower and the Administrative Agent.  To
the extent reasonably possible, a Lender shall designate an alternative branch
or funding office with respect to its Eurodollar Loans to reduce any liability
of the Borrower to such Lender under Section 10.3 or to avoid the unavailability
of Eurodollar Loans under Section 10.2, so long as such designation is not
otherwise disadvantageous to the Lender.

 

Section 10.5.                   Discretion of Lender as to Manner of Funding. 
Notwithstanding any other provision of this Agreement, each Lender shall be
entitled to fund and maintain its funding of all or any part of its Revolving
Loans in any manner it sees fit, it being understood, however, that for the
purposes of this Agreement all determinations hereunder with respect to
Eurodollar Loans shall be made as if each Lender had actually funded and
maintained each Eurodollar Loan through the purchase of deposits in the
interbank eurodollar market having a maturity corresponding to such Revolving
Loan’s Interest Period, and bearing an interest rate equal to LIBOR for such
Interest Period.

 

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SECTION 11.                                      THE ADMINISTRATIVE AGENT.

 

Section 11.1.                   Appointment and Authority.  Each of the Lenders
and the L/C Issuer hereby irrevocably appoints Bank of Montreal to act on its
behalf as the Administrative Agent hereunder and under the other Loan Documents
and authorizes the Administrative Agent to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such actions and powers as are reasonably
incidental thereto.  The provisions of this Section 11 are solely for the
benefit of the Administrative Agent, the Lenders and the L/C Issuer, and the
Borrower shall not have rights as a third-party beneficiary of any of such
provisions.  It is understood and agreed that the use of the term “agent” herein
or in any other Loan Documents (or any other similar term) with reference to the
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law. 
Instead such term is used as a matter of market custom, and is intended to
create or reflect only an administrative relationship between contracting
parties.

 

Section 11.2.                   Rights as a Lender.  The Person serving as the
Administrative Agent hereunder shall have the same rights and powers in its
capacity as a Lender as any other Lender and may exercise the same as though it
were not the Administrative Agent, and the term “Lender” or “Lenders” shall,
unless otherwise expressly indicated or unless the context otherwise requires,
include the Person serving as the Administrative Agent hereunder in its
individual capacity.  Such Person and its Affiliates may accept deposits from,
lend money to, own securities of, act as the financial advisor or in any other
advisory capacity for, and generally engage in any kind of business with, the
Borrower or any Subsidiary or other Affiliate thereof as if such Person were not
the Administrative Agent hereunder and without any duty to account therefor to
the Lenders.

 

Section 11.3.                   Action by Administrative Agent; Exculpatory
Provisions; . (a) The Administrative Agent shall not have any duties or
obligations except those expressly set forth herein and in the other Loan
Documents, and its duties hereunder shall be administrative in nature.  Without
limiting the generality of the foregoing, the Administrative Agent and its
Related Parties:

 

(i)                          shall not be subject to any fiduciary or other
implied duties, regardless of whether a Default has occurred and is continuing;

 

(ii)                          shall not have any duty to take any discretionary
action or exercise any discretionary powers, except discretionary rights and
powers expressly contemplated hereby or by the other Loan Documents that the
Administrative Agent is required to

 

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exercise as directed in writing by the Required Lenders (or such other number or
percentage of the Lenders as shall be expressly provided for herein or in the
other Loan Documents), provided that the Administrative Agent shall not be
required to take any action that, in its opinion or the opinion of its counsel,
may expose the Administrative Agent to liability or that is contrary to any Loan
Document or applicable law, including for the avoidance of doubt any action that
may be in violation of the automatic stay under any Debtor Relief Law or that
may effect a forfeiture, modification or termination of property of a Defaulting
Lender in violation of any Debtor Relief Law.  The Administrative Agent shall in
all cases be fully justified in failing or refusing to act hereunder or under
any other Loan Document unless it first receives any further assurances of its
indemnification from the Lenders that it may require, including prepayment of
any related expenses and any other protection it requires against any and all
costs, expense, and liability which may be incurred by it by reason of taking or
continuing to take any such action; and

 

(iii)                           shall not, except as expressly set forth herein
and in the other Loan Documents, have any duty or responsibility to disclose,
and shall not be liable for the failure to disclose, any information relating to
the Borrower or any of its Affiliates that is communicated to or obtained by the
Person serving as the Administrative Agent or any of its Affiliates in any
capacity.

 

(b)                     Neither the Administrative Agent nor any of its Related
Parties shall be liable for any action taken or not taken by the Administrative
Agent under or in connection with this Agreement or any other Loan Document or
the transactions contemplated hereby or thereby  (i) with the consent or at the
request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in
good faith shall be necessary, under the circumstances as provided in
Sections 9.2, 9.3, 9.4 and 12.11), or (ii) in the absence of its own gross
negligence or willful misconduct as determined by a court of competent
jurisdiction by final and nonappealable judgment.  Any such action taken or
failure to act pursuant to the foregoing shall be binding on all Lenders.  The
Administrative Agent shall be deemed not to have knowledge of any Default unless
and until notice describing such Default is given to the Administrative Agent in
writing by the Borrower, a Lender, or the L/C Issuer.

 

(c)                      Neither the Administrative Agent nor any of its Related
Parties shall be responsible for or have any duty or obligation to any Lender or
the L/C Issuer or participant or any other Person to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein
or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document, or (v) the satisfaction of any
condition set forth in Section 7.1 or 7.2 or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to the
Administrative Agent.

 

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Section 11.4.                   Reliance by Administrative Agent.  The
Administrative Agent shall be entitled to rely upon, and shall be fully
protected in relying and shall not incur any liability for relying upon, any
notice, request, certificate, communication, consent, statement, instrument,
document or other writing (including any electronic message, Internet or
intranet website posting or other distribution) believed by it to be genuine and
to have been signed, sent or otherwise authenticated by the proper Person.  The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to have been made by the proper Person, and shall
be fully protected in relying and shall not incur any liability for relying
thereon.  In determining compliance with any condition hereunder to the making
of a Revolving Loan, or the issuance, extension, renewal or increase of a Letter
of Credit, that by its terms must be fulfilled to the satisfaction of a Lender
or the L/C Issuer, the Administrative Agent may presume that such condition is
satisfactory to such Lender or the L/C Issuer unless the Administrative Agent
shall have received notice to the contrary from such Lender or the L/C Issuer
prior to the making of such Revolving Loan or the issuance of such Letter of
Credit.  The Administrative Agent may consult with legal counsel (who may be
counsel for the Borrower), independent accountants and other experts selected by
it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts.

 

Section 11.5.                   Delegation of Duties.  The Administrative Agent
may perform any and all of its duties and exercise its rights and powers
hereunder or under any other Loan Document by or through any one or more
sub-agents appointed by the Administrative Agent.  The Administrative Agent and
any such sub-agent may perform any and all of its duties and exercise its rights
and powers by or through their respective Related Parties.  The exculpatory
provisions of this Section shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the Facilities
as well as activities as Administrative Agent.  The Administrative Agent shall
not be responsible for the negligence or misconduct of any sub-agents except to
the extent that a court of competent jurisdiction determines in a final and
nonappealable judgment that the Administrative Agent acted with gross negligence
or willful misconduct in the selection of such sub-agents.

 

Section 11.6.                   Resignation of Administrative Agent.  (a) The
Administrative Agent may at any time give notice of its resignation to the
Lenders, the L/C Issuer and the Borrower.  Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with the
Borrower, to appoint a successor, which shall be a bank with an office in the
United States of America, or an Affiliate of any such bank with an office in the
United States of America.  If no such successor shall have been so appointed by
the Required Lenders and shall have accepted such appointment within thirty (30)
days after the retiring Administrative Agent gives notice of its resignation (or
such earlier day as shall be agreed by the Required Lenders) (the “Resignation
Effective Date”), then the retiring Administrative Agent may (but shall not be
obligated to), on behalf of the Lenders and the L/C Issuer, appoint a successor
Administrative Agent meeting the qualifications set forth above.  Whether or not
a successor has been appointed, such resignation shall become effective in
accordance with such notice on the Resignation Effective Date.

 

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(b)                    If the Person serving as Administrative Agent is a
Defaulting Lender pursuant to clause (d) of the definition thereof, the Required
Lenders may, to the extent permitted by applicable law, by notice in writing to
the Borrower and such Person remove such Person as Administrative Agent and, in
consultation with the Borrower, appoint a successor. If no such successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days (or such earlier day as shall be agreed by the
Required Lenders) (the “Removal Effective Date”), then such removal shall
nonetheless become effective in accordance with such notice on the Removal
Effective Date.

 

(c)                     With effect from the Resignation Effective Date or the
Removal Effective Date (as applicable) (i) the retiring or removed
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents and (ii) except for any indemnity
payments owed to the retiring or removed Administrative Agent, all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender and the L/C
Issuer directly, until such time, if any, as the Required Lenders appoint a
successor Administrative Agent as provided for above.  Upon the acceptance of a
successor’s appointment as Administrative Agent hereunder, such successor shall
succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring or removed Administrative Agent (other than any rights to
indemnity payments or other amounts owed to the retiring or removed
Administrative Agent), and the retiring or removed Administrative Agent shall be
discharged from all of its duties and obligations hereunder or under the other
Loan Documents.  The fees payable by the Borrower to a successor Administrative
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between the Borrower and such successor.  After the retiring or removed
Administrative Agent’s resignation or removal hereunder and under the other Loan
Documents, the provisions of this Section 11 and Section 12.13 shall continue in
effect for the benefit of such retiring or removed Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while the retiring or removed
Administrative Agent was acting as Administrative Agent.

 

Section 11.7.                   Non-Reliance on Administrative Agent and Other
Lenders.  Each Lender and the L/C Issuer acknowledges that it has, independently
and without reliance upon the Administrative Agent or any other Lender or any of
their Related Parties and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this
Agreement.  Each Lender and the L/C Issuer also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other
Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document or any related agreement or any document furnished
hereunder or thereunder.

 

Section 11.8.                   L/C Issuer   The L/C Issuer shall act on behalf
of the Lenders with respect to any Letters of Credit issued by it and the
documents associated therewith.  The L/C Issuer shall each have all of the
benefits and immunities (i) provided to the Administrative Agent in this
Section 11 with respect to any acts taken or omissions suffered by the L/C
Issuer in connection with Letters of Credit issued by it or proposed to be
issued by it and the Applications pertaining

 

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to such Letters of Credit as fully as if the term “Administrative Agent”, as
used in this Section 11, included the L/C Issuer with respect to such acts or
omissions and (ii) as additionally provided in this Agreement with respect to
the L/C Issuer.  Any resignation by the Person then acting as Administrative
Agent pursuant to Section 11.6 shall also constitute its resignation or the
resignation of its Affiliate as the L/C Issuer except as it may otherwise
agree.  If such Person then acting as the L/C Issuer so resigns, it shall retain
all the rights, powers, privileges and duties of the L/C Issuer hereunder with
respect to all Letters of Credit outstanding as of the effective date of its
resignation as the L/C Issuer and all L/C Obligations with respect thereto,
including the right to require the Lenders to make Revolving Loans or fund risk
participations in Reimbursement Obligations pursuant to Section 2.2.  Upon the
appointment by the Borrower of a successor L/C Issuer hereunder (which successor
shall in all cases be a Lender other than a Defaulting Lender), (i) such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring L/C Issuer (other than any rights to
indemnity payments or other amounts that remain owing to the retiring L/C
Issuer), and (ii) the retiring L/C Issuer shall be discharged from all of its
duties and obligations hereunder or under the other Loan Documents other than
with respect to its outstanding Letters of Credit, and (iii) upon the request of
the resigning L/C Issuer, the successor L/C Issuer shall issue letters of credit
in substitution for the Letters of Credit, if any, outstanding at the time of
such succession or make other arrangements satisfactory to the resigning L/C
Issuer to effectively assume the obligations of the resigning L/C Issuer with
respect to such Letters of Credit.

 

Section 11.9.                   Designation of Additional Agents.  The
Administrative Agent shall have the continuing right, for purposes hereof, at
any time and from time to time to designate one or more of the Lenders (and/or
its or their Affiliates) as “syndication agents,” “documentation agents,” “book
runners,” “lead arrangers,” “arrangers,” or other designations for purposes
hereto, but such designation shall have no substantive effect, and such Lenders
and their Affiliates shall have no additional powers, duties or responsibilities
as a result thereof.

 

Section 11.10.                   Authorization of Administrative Agent to File
Proofs of Claim  In case of the pendency of any proceeding under any Debtor
Relief Law or any other judicial proceeding relative to the Borrower, the
Administrative Agent (irrespective of whether the principal of any Revolving
Loan or L/C Obligation shall then be due and payable as herein expressed or by
declaration or otherwise and irrespective of whether the Administrative Agent
shall have made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise:

 

(a)                        to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Revolving Loans, L/C
Obligations and all other Obligations that are owing and unpaid and to file such
other documents as may be necessary or advisable in order to have the claims of
Lenders, the L/C Issuer and the Administrative Agent (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Lenders, the L/C Issuer and the Administrative Agent and their respective agents
and counsel and all other amounts due the Lenders, the L/C Issuer and the
Administrative Agent under the Loan Documents including, but not limited to,
Sections 2.10, 3.1, 10.3 and 12.13) allowed in such judicial proceeding; and

 

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(b)                        to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender and the L/C Issuer to make such payments to the Administrative Agent
and, in the event that the Administrative Agent shall consent to the making of
such payments directly to the Lenders and the L/C Issuer, to pay to the
Administrative Agent any amount due for the reasonable compensation, expenses,
disbursements and advances of the Administrative Agent and its agents and
counsel, and any other amounts due the Administrative Agent under Sections 3.1
and 12.13.  Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender or the L/C Issuer any plan of reorganization, arrangement, adjustment
or composition affecting the Obligations or the rights of any Lender or the L/C
Issuer or to authorize the Administrative Agent to vote in respect of the claim
of any Lender or the L/C Issuer in any such proceeding.

 

SECTION 12.                                      MISCELLANEOUS.

 

Section 12.1.                   Taxes.  (a)  Certain Defined Terms.  For
purposes of this Section, the term “Lender” includes the L/C Issuer and the term
“applicable law” includes FATCA.

 

(b)                                  Payments Free of Taxes.  Any and all
payments by or on account of any obligation of the Borrower under any Loan
Document shall be made without deduction or withholding for any Taxes, except as
required by applicable law.  If any applicable law (as determined in the good
faith discretion of an applicable Withholding Agent) requires the deduction or
withholding of any Tax from any such payment by a Withholding Agent, then the
applicable Withholding Agent shall be entitled to make such deduction or
withholding and shall timely pay the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law and, if such
Tax is an Indemnified Tax, then the sum payable by the Borrower shall be
increased as necessary so that after such deduction or withholding has been made
(including such deductions and withholdings applicable to additional sums
payable under this Section) the applicable Recipient receives an amount equal to
the sum it would have received had no such deduction or withholding been made.

 

(c)                                   Payment of Other Taxes by the Borrower. 
The Borrower shall timely pay to the relevant Governmental Authority in
accordance with applicable law, or at the option of the Administrative Agent
timely reimburse it for the payment of, any Other Taxes.

 

(d)                                  Indemnification by the Borrower.  The
Borrower shall indemnify each Recipient, within ten (10) days after demand
therefor, for the full amount of any Indemnified Taxes (including Indemnified
Taxes imposed or asserted on or attributable to amounts payable under this
Section) payable or paid by such Recipient or required to be withheld or
deducted from a payment to such Recipient and any reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes were
correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate as to the amount of such payment or liability
delivered to the Borrower by a Lender (with a copy to the Administrative Agent),
or by the Administrative Agent on its own behalf or on behalf of a Lender, shall
be conclusive absent manifest error.

 

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(e)                                   Indemnification by the Lenders.  Each
Lender shall severally indemnify the Administrative Agent, within ten (10) days
after demand therefor, for (i) any Indemnified Taxes or Other Taxes attributable
to such Lender (but only to the extent that the Borrower has not already
indemnified the Administrative Agent for such Indemnified Taxes or Other Taxes
and without limiting the obligation of the Borrower to do so), (ii) any Taxes
attributable to such Lender’s failure to comply with the provisions of
Section 12.10(d) relating to the maintenance of a Participant Register and
(iii) any Excluded Taxes attributable to such Lender, in each case, that are
payable or paid by the Administrative Agent in connection with any Loan
Document, and any reasonable expenses arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority.  A certificate as to the amount of such payment
or liability delivered to any Lender by the Administrative Agent shall be
conclusive absent manifest error.  Each Lender hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing
to such Lender under any Loan Document or otherwise payable by the
Administrative Agent to the Lender from any other source against any amount due
to the Administrative Agent under this subsection (e).

 

(f)                                  Evidence of Payments.  As soon as
practicable after any payment of Taxes by the Borrower to a Governmental
Authority pursuant to this Section, the Borrower shall deliver to the
Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.

 

(g)                                   Status of Lenders.  (i) Any Lender that is
entitled to an exemption from or reduction of withholding Tax with respect to
payments made under any Loan Document shall deliver to the Borrower and the
Administrative Agent, at the time or times reasonably requested by the Borrower
or the Administrative Agent, such properly completed and executed documentation
reasonably requested by the Borrower or the Administrative Agent as will permit
such payments to be made without withholding or at a reduced rate of
withholding.  In addition, any Lender, if reasonably requested by the Borrower
or the Administrative Agent, shall deliver such other documentation prescribed
by applicable law or reasonably requested by the Borrower or the Administrative
Agent as will enable the Borrower or the Administrative Agent to determine
whether or not such Lender is subject to backup withholding or information
reporting requirements.  Notwithstanding anything to the contrary in the
preceding two sentences, the completion, execution and submission of such
documentation (other than such documentation set forth in
Section 12.1(g)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in
the Lender’s reasonable judgment such completion, execution or submission would
subject such Lender to any material unreimbursed cost or expense or would
materially prejudice the legal or commercial position of such Lender.

 

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(ii)                                    Without limiting the generality of the
foregoing,

 

(A)                         any Lender that is a U.S. Person shall deliver to
the Borrower and the Administrative Agent on or prior to the date on which such
Lender becomes a Lender under this Agreement (and from time to time thereafter
upon the reasonable request of the Borrower or the Administrative Agent),
executed originals of IRS Form W-9 certifying that such Lender is exempt from
U.S. federal backup withholding tax;

 

(B)                         any Foreign Lender shall, to the extent it is
legally entitled to do so, deliver to the Borrower and the Administrative Agent
(in such number of copies as shall be requested by the recipient) on or prior to
the date on which such Foreign Lender becomes a Lender under this Agreement (and
from time to time thereafter upon the reasonable request of the Borrower or the
Administrative Agent), whichever of the following is applicable:

 

(i)                          in the case of a Foreign Lender claiming the
benefits of an income tax treaty to which the United States is a party (x) with
respect to payments of interest under any Loan Document, executed originals of
IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal
withholding Tax pursuant to the “interest” article of such tax treaty and
(y) with respect to any other applicable payments under any Loan Document, IRS
Form W-8BEN establishing an exemption from, or reduction of, U.S. federal
withholding Tax pursuant to the “business profits” or “other income” article of
such tax treaty;

 

(ii)                          executed originals of IRS Form W-8ECI;

 

(iii)                           in the case of a Foreign Lender claiming the
benefits of the exemption for portfolio interest under Section 881(c) of the
Code, (x) a certificate substantially in the form of Exhibit H-1 to the effect
that such Foreign Lender is not a “bank” within the meaning of
Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of the Borrower
within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign
corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax
Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN; or

 

(iv)                         to the extent a Foreign Lender is not the
beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS
Form W-8ECI, IRS Form W-8BEN, a U.S. Tax Compliance Certificate substantially in
the form of Exhibit H-2 or Exhibit H-3, IRS Form W-9, and/or other certification
documents from each beneficial owner, as applicable; provided that if the
Foreign Lender is a partnership and one or more direct or indirect partners of
such Foreign Lender are claiming the portfolio interest exemption, such Foreign
Lender may provide a U.S. Tax Compliance Certificate substantially in the form
of Exhibit H-4 on behalf of each such direct and indirect partner;

 

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(C)                         any Foreign Lender shall, to the extent it is
legally entitled to do so, deliver to the Borrower and the Administrative Agent
(in such number of copies as shall be requested by the recipient) on or prior to
the date on which such Foreign Lender becomes a Lender under this Agreement (and
from time to time thereafter upon the reasonable request of the Borrower or the
Administrative Agent), executed originals of any other form prescribed by
applicable law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such supplementary
documentation as may be prescribed by applicable law to permit the Borrower or
the Administrative Agent to determine the withholding or deduction required to
be made; and

 

(D)                         if a payment made to a Lender under any Loan
Document would be subject to U.S. federal withholding Tax imposed by FATCA if
such Lender were to fail to comply with the applicable reporting requirements of
FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as
applicable), such Lender shall deliver to the Borrower and the Administrative
Agent at the time or times prescribed by law and at such time or times
reasonably requested by the Borrower or the Administrative Agent such
documentation prescribed by applicable law (including as prescribed by
Section 1471(b)(3)(C)(i) of the Code) and such additional documentation
reasonably requested by the Borrower or the Administrative Agent as may be
necessary for the Borrower and the Administrative Agent to comply with their
obligations under FATCA and to determine that such Lender has complied with such
Lender’s obligations under FATCA or to determine the amount to deduct and
withhold from such payment.  Solely for purposes of this clause (D), “FATCA”
shall include any amendments made to FATCA after the date of this Agreement.

 

Each Lender agrees that if any form or certification it previously delivered
expires or becomes obsolete or inaccurate in any respect, it shall update such
form or certification or promptly notify the Borrower and the Administrative
Agent in writing of its legal inability to do so.

 

(h)                     Treatment of Certain Refunds.  If any party determines,
in its sole discretion exercised in good faith, that it has received a refund of
any Taxes as to which it has been indemnified pursuant to this
Section (including by the payment of additional amounts pursuant to this
Section), it shall pay to the indemnifying party an amount equal to such refund
(but only to the extent of indemnity payments made under this Section with
respect to the Taxes giving rise to such refund), net of all out-of-pocket
expenses (including Taxes) of such indemnified party and without interest (other
than any interest paid by the relevant Governmental Authority with respect to
such refund).  Such indemnifying party, upon the request of such indemnified
party, shall repay to such indemnified party the amount paid over pursuant to
this subsection (h) (plus any penalties, interest or other charges imposed by
the relevant Governmental Authority) in the event that such indemnified party is
required to repay such refund to such Governmental Authority.  Notwithstanding
anything to the contrary in this subsection (h), in no event will the
indemnified party be required to pay any amount to an indemnifying party
pursuant to this subsection (h) the payment of which would place the indemnified
party in a less favorable net after-Tax position than the indemnified party
would have been in if the Tax subject to

 

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indemnification and giving rise to such refund had not been deducted, withheld
or otherwise imposed and the indemnification payments or additional amounts with
respect to such Tax had never been paid.  This subsection shall not be construed
to require any indemnified party to make available its Tax returns (or any other
information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.

 

(i)                      Survival.  Each party’s obligations under this
Section shall survive the resignation or replacement of the Administrative Agent
or any assignment of rights by, or the replacement of, a Lender, the termination
of the Revolving Credit Commitments and the repayment, satisfaction or discharge
of all obligations under any Loan Document.

 

Section 12.2.                   Other Taxes.  The Borrower agrees to pay on
demand, and indemnify and hold the Administrative Agent, the Lenders, and the
L/C Issuer harmless from, any Other Taxes payable in respect of this Agreement
or any other Loan Document, including interest and penalties, in the event any
such taxes are assessed, irrespective of when such assessment is made and
whether or not any credit is then in use or available hereunder.

 

Section 12.3.                   No Waiver, Cumulative Remedies.  No delay or
failure on the part of the Administrative Agent, the L/C Issuer, or any Lender,
or on the part of the holder or holders of any of the Obligations, in the
exercise of any power or right under any Loan Document shall operate as a waiver
thereof or as an acquiescence in any default, nor shall any single or partial
exercise of any power or right preclude any other or further exercise thereof or
the exercise of any other power or right.  The rights and remedies hereunder of
the Administrative Agent, the L/C Issuer, the Lenders, and of the holder or
holders of any of the Obligations are cumulative to, and not exclusive of, any
rights or remedies which any of them would otherwise have.

 

Section 12.4.                   Non-Business Days.  If any payment hereunder
becomes due and payable on a day which is not a Business Day, the due date of
such payment shall be extended to the next succeeding Business Day on which date
such payment shall be due and payable.  In the case of any payment of principal
falling due on a day which is not a Business Day, interest on such principal
amount shall continue to accrue during such extension at the rate per annum then
in effect, which accrued amount shall be due and payable on the next scheduled
date for the payment of interest.

 

Section 12.5.                   Survival of Representations.  All
representations and warranties made herein or in any other Loan Document or in
certificates given pursuant hereto or thereto shall survive the execution and
delivery of this Agreement and the other Loan Documents, and shall continue in
full force and effect with respect to the date as of which they were made as
long as any credit is in use or available hereunder.

 

Section 12.6.                   Survival of Indemnities.  All indemnities and
other provisions relative to reimbursement to the Lenders and the L/C Issuer of
amounts sufficient to protect the yield of the Lenders and the L/C Issuer with
respect to the Revolving Loans and Letters of Credit, including, but not limited
to, Sections 2.10, 10.3, and 12.13, shall survive the termination of this
Agreement and the other Loan Documents and the payment of the Obligations.

 

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Section 12.7.                   Sharing of Payments by Lenders.  If any Lender
shall, by exercising any right of setoff or counterclaim or otherwise, obtain
payment in respect of any principal of or interest on any of its Revolving Loans
or other obligations hereunder resulting in such Lender receiving payment of a
proportion of the aggregate amount of its Revolving Loans and accrued interest
thereon or other such obligations greater than its pro rata share thereof as
provided herein, then the Lender receiving such greater proportion shall
(a) notify the Administrative Agent of such fact, and (b) purchase (for cash at
face value) participations in the Revolving Loans and such other obligations of
the other Lenders, or make such other adjustments as shall be equitable, so that
the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Revolving Loans and other amounts owing them; provided that:

 

(i)                          if any such participations are purchased and all or
any portion of the payment giving rise thereto is recovered, such participations
shall be rescinded and the purchase price restored to the extent of such
recovery, without interest; and

 

(ii)                          the provisions of this Section shall not be
construed to apply to (x) any payment made by the Borrower pursuant to and in
accordance with the express terms of this Agreement (including the application
of funds arising from the existence of a Defaulting Lender), or (y) any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Revolving Loans or participations in L/C Obligations
to any assignee or participant, other than to the Borrower or any Subsidiary
thereof (as to which the provisions of this Section shall apply).

 

The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of setoff and counterclaim with respect to such participation as
fully as if such Lender were a direct creditor of the Borrower in the amount of
such participation.

 

Section 12.8.                   Notices.  (a) Except as otherwise specified
herein, all notices hereunder and under the other Loan Documents shall be in
writing (including, without limitation, notice by telecopy) and shall be given
to the relevant party at its address or telecopier number set forth below, or
such other address or telecopier number as such party may hereafter specify by
notice to the Administrative Agent and the Borrower given by courier, by United
States certified or registered mail, by telecopy or by other telecommunication
device capable of creating a written record of such notice and its receipt. 
Notices under the Loan Documents to any Lender shall be addressed to its address
or telecopier number set forth on its Administrative Questionnaire; and notices
under the Loan Documents to the Borrower, the Administrative Agent, or the L/C
Issuer shall be addressed to its respective address or telecopier number set
forth below:

 

to the Borrower:

to the Administrative Agent and L/C Issuer:

 

 

LTC Properties, Inc.

Bank of Montreal

2829 Townsgate Road, Suite 350

100 High Street, 26th Floor

Westlake Village, California 91361

Boston, Massachusetts 02110

Attention:

Chief Financial Officer

Attention: Lloyd Baron

Telephone:

(805) 981-8655

Telephone: (617) 960-2372

Telecopy:

(805) 981-8663

 

 

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Each such notice, request or other communication shall be effective (i) if given
by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section or in the relevant Administrative Questionnaire and a
confirmation of such telecopy has been received by the sender, (ii) if given by
mail, five (5) days after such communication is deposited in the mail, certified
or registered with return receipt requested, addressed as aforesaid or (iii) if
delivered through electronic communications, to the extent provided in
subsection (b) below, shall be effective as provided in said subsection (b).

 

(b)                                  Electronic Communications.  Notices and
other communications to the Lenders and the L/C Issuers hereunder may be
delivered or furnished by electronic communication (including e-mail and
Internet or intranet websites) pursuant to procedures approved by the
Administrative Agent, provided that the foregoing shall not apply to notices to
any Lender or L/C Issuer pursuant to Sections 2.2, 2.3 and 2.6 if such Lender or
L/C Issuer, as applicable, has notified the Administrative Agent that it is
incapable of receiving notices under such Sections by electronic communication. 
The Administrative Agent or the Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications.

 

Unless the Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), and (ii) notices or communications posted to an
Internet or intranet website shall be deemed received upon the deemed receipt by
the intended recipient, at its e-mail address as described in the foregoing
clause (i), of notification that such notice or communication is available and
identifying the website address therefor; provided that, for both clauses
(i) and (ii) above, if such notice, email or other communication is not sent
during the normal business hours of the recipient, such notice or communication
shall be deemed to have been sent at the opening of business on the next
business day for the recipient.

 

(c)                                   Change of Address, etc.  Any party hereto
may change its address or facsimile number for notices and other communications
hereunder by notice to the other parties hereto.

 

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(d)                                  Platform.  (i) The Borrower agrees that the
Administrative Agent may, but shall not be obligated to, make the Communications
(as defined below) available to the L/C Issuer and the other Lenders by posting
the Communications on Debt Domain, Intralinks, Syndtrak or a substantially
similar electronic transmission system (the “Platform”).

 

(ii)                                    The Platform is provided “as is” and “as
available.”  The Agent Parties (as defined below) do not warrant the adequacy of
the Platform and expressly disclaim liability for errors or omissions in the
Communications.  No warranty of any kind, express, implied or statutory,
including, without limitation, any warranty of merchantability, fitness for a
particular purpose, non-infringement of third-party rights or freedom from
viruses or other code defects, is made by any Agent Party in connection with the
Communications or the Platform.  In no event shall the Administrative Agent or
any of its Related Parties (collectively, the “Agent Parties”) have any
liability to the Borrower, any Subsidiary, any Lender or any other Person or
entity for damages of any kind, including, without limitation, direct or
indirect, special, incidental or consequential damages, losses or expenses
(whether in tort, contract or otherwise) arising out of the Borrower’s, any
Subsidiary’s or the Administrative Agent’s transmission of communications
through the Platform.  “Communications” means, collectively, any notice, demand,
communication, information, document or other material provided by or on behalf
of the Borrower or any Subsidiary pursuant to any Loan Document or the
transactions contemplated therein which is distributed to the Administrative
Agent, any Lender or any L/C Issuer by means of electronic communications
pursuant to this Section, including through the Platform.

 

Section 12.9.                   Counterparts.  (a) This Agreement may be
executed in any number of counterparts, and by the different parties hereto on
separate counterpart signature pages, and all such counterparts taken together
shall be deemed to constitute one and the same instrument.  This Agreement and
the other Loan Documents, and any separate letter agreements with respect to
fees payable to the Administrative Agent, constitute the entire contract among
the parties relating to the subject matter hereof and supersede any and all
previous agreements and understandings, oral or written, relating to the subject
matter hereof.  Except as provided in Section 7.2, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof that, when
taken together, bear the signatures of each of the other parties hereto. 
Delivery of an executed counterpart of a signature page of this Agreement by
facsimile or in electronic (e.g., “pdf” or “tif”) format shall be effective as
delivery of a manually executed counterpart of this Agreement.  For purposes of
determining compliance with the conditions specified in Section 7.2, the L/C
Issuer and each Lender that has signed this Agreement shall be deemed to have
consented to, approved or accepted or to be satisfied with, each document or
other matter required thereunder to be consented to or approved by or acceptable
or satisfactory to the L/C Issuer or a Lender unless the Administrative Agent
shall have received notice from such Lender or L/C Issuer prior to the Closing
Date specifying its objection thereto.

 

(b)                                  Electronic Execution of Assignments.  The
words “execution,” “signed,” “signature,” and words of like import in any
Assignment and Assumption shall be deemed to include electronic signatures or
the keeping of records in electronic form, each of which shall be of the same
legal effect, validity or enforceability as a manually executed signature or the
use of a paper-based recordkeeping system, as the case may be, to the extent and
as provided for in any

 

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applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronics Signatures and Records
Act, or any other similar state laws based on the Uniform Electronic
Transactions Act.

 

Section 12.10.                   Successors and Assigns.  (a)   Successors and
Assigns Generally.  The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that the Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of the Administrative Agent and each Lender, and no Lender may assign or
otherwise transfer any of its rights or obligations hereunder except (i) to an
assignee in accordance with the provisions of paragraph (b) of this Section,
(ii) by way of participation in accordance with the provisions of
paragraph (d) of this Section, or (iii) by way of pledge or assignment of a
security interest subject to the restrictions of paragraph (e) of this
Section (and any other attempted assignment or transfer by any party hereto
shall be null and void).  Nothing in this Agreement, expressed or implied, shall
be construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants to the extent
provided in paragraph (d) of this Section and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent and
the Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.

 

(b)                     Any Lender may at any time assign to one or more
Eligible Assignees all or a portion of such Lender’s rights and obligations
under this Agreement (including all or a portion of its Revolving  Credit
Commitment and the Revolving Loans at the time owing to it); provided that any
such assignment shall be subject to the following conditions:

 

(i)                          Minimum Amounts.  (A) In the case of an assignment
of the entire remaining amount of the assigning Lender’s Revolving Credit
Commitment and the Revolving Loans and participation interest in L/C Obligations
at the time owing to it or in the case of an assignment to a Lender, an
Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned;
and (B) in any case not described in subsection (b)(i)(A) of this Section, the
aggregate amount of the Revolving Credit Commitment (which for this purpose
includes Revolving Loans and participation interest in L/C Obligations
outstanding thereunder) or, if the applicable Revolving Credit Commitment is not
then in effect, the principal outstanding balance of the Revolving Loans and
participation interest in L/C Obligations of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and Acceptance
with respect to such assignment is delivered to the Administrative Agent or, if
“Effective Date” is specified in the Assignment and Acceptance, as of the
Effective Date specified in such Assignment and Acceptance) shall not be less
than $5,000,000, unless each of the Administrative Agent and, so long as no
Event of Default has occurred and is continuing, the Borrower otherwise consents
(each such consent not to be unreasonably withheld or delayed);

 

(ii)                          Proportionate Amounts.  Each partial assignment
shall be made as an assignment of a proportionate part of all the assigning
Lender’s rights and obligations under this Agreement with respect to the
Revolving Loan or the Revolving Credit Commitment.

 

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(iii)                           Required Consents.  No consent shall be required
for any assignment except to the extent required by Section 12.10(b)(i)(B) and,
in addition:

 

(A)                         the consent of the Borrower (such consent not to be
unreasonably withheld or delayed) shall be required unless (x) an Event of
Default has occurred and is continuing at the time of such assignment or
(y) such assignment is to a Lender, an Affiliate of a Lender or an Approved
Fund; provided that the Borrower shall be deemed to have consented to any such
assignment unless it shall object thereto by written notice to the
Administrative Agent within five (5) Business Days after having received notice
thereof; and provided, further, that the Borrower’s consent shall not be
required during the primary syndication of the Revolving Credit;

 

(B)                         the consent of the Administrative Agent (such
consent not to be unreasonably withheld or delayed) shall be required if such
assignment is to a Person that is not a Lender with a Revolving Credit
Commitment, an Affiliate of such Lender or an Approved Fund with respect to such
Lender; and

 

(C)                         the consent of the L/C Issuer (such consent not to
be unreasonably withheld or delayed) shall be required for any assignment that
increases the obligation of the assignee to participate in exposure under one or
more Letters of Credit (whether or not then outstanding).

 

(iv)                         Assignment and Acceptance.  The parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Acceptance, together with a processing and recordation fee of $3,500 (except
no fee shall be required for an assignment by a Lender to an Approved Fund
related to such Lender), and the assignee, if it is not a Lender, shall deliver
to the Administrative Agent an Administrative Questionnaire.

 

(v)                        No Assignment to Borrower.  No such assignment shall
be made to (a) the Borrower or any of its Subsidiaries or any Affiliate of the
Borrower or any Subsidiary or (b) to any Defaulting Lender or any of its
Subsidiaries, or any Person who, upon becoming a Lender hereunder would
constitute a Defaulting Lender or a Subsidiary thereof.

 

(vi)                         No Assignment to Natural Persons.  No such
assignment shall be made to a natural person.

 

(vii)                          Certain Additional Payments.  In connection with
any assignment of rights and obligations of any Defaulting Lender hereunder, no
such assignment shall be effective unless and until, in addition to the other
conditions thereto set forth herein, the parties to the assignment shall make
such additional payments to the Administrative

 

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Agent in an aggregate amount sufficient, upon distribution thereof as
appropriate (which may be outright payment, purchases by the assignee of
participations or subparticipations, or other compensating actions, including
funding, with the consent of the Borrower and the Administrative Agent, the
applicable pro rata share of Revolving Loans previously requested but not funded
by the Defaulting Lender, to each of which the applicable assignee and assignor
hereby irrevocably consent), to (x) pay and satisfy in full all payment
liabilities then owed by such Defaulting Lender to the Administrative Agent, the
L/C Issuer and each other Lender hereunder (and interest accrued thereon), and
(y) acquire (and fund as appropriate) its full pro rata share of all Revolving
Loans and participations in Letters of Credit in accordance with its Revolver
Percentage.  Notwithstanding the foregoing, in the event that any assignment of
rights and obligations of any Defaulting Lender hereunder shall become effective
under applicable law without compliance with the provisions of this paragraph,
then the assignee of such interest shall be deemed to be a Defaulting Lender for
all purposes of this Agreement until such compliance occurs.

 

Subject to acceptance and recording thereof by the Administrative Agent pursuant
to paragraph (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the assignee thereunder shall be a party to this
Agreement and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto) but shall continue to be entitled to
the benefits of Sections 12.7 and 12.13 with respect to facts and circumstances
occurring prior to the effective date of such assignment; provided that except
to the extent otherwise expressly agreed by the affected parties, no assignment
by a Defaulting Lender will constitute a waiver or release of any claim of any
party hereunder arising from that Lender’s having been a Defaulting Lender.  Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (d) of this Section.

 

(c)                     Register.  The Administrative Agent, acting solely for
this purpose as an agent of the Borrower, shall maintain at one of its offices
in Chicago, Illinois a copy of each Assignment and Assumption delivered to it
and a register for the recordation of the names and addresses of the Lenders,
and the Revolving Credit Commitments of, and principal amounts (and stated
interest) of the Revolving Loans owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive absent manifest error, and the Borrower, the Administrative Agent and
the Lenders shall treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement.  The Register shall be available for inspection by the Borrower and
any Lender, at any reasonable time and from time to time upon reasonable prior
notice.

 

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(d)                     Participations.  Any Lender may at any time, without the
consent of, or notice to, the Borrower or the Administrative Agent, sell
participations to any Person (other than a natural Person or the Borrower or the
Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a
portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Revolving Credit Commitments and/or the
Revolving Loans owing to it); provided that (i) such Lender’s obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
and (iii) the Borrower, the Administrative Agent, the L/C Issuer and Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender’s rights and obligations under this Agreement.  For the avoidance of
doubt, each Lender shall be responsible for the indemnity under Section 11.8
with respect to any payments made by such Lender to its Participant(s).

 

Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, modification or waiver described in Section 12.11 that
expressly relate to amendments requiring the unanimous consent of the Lenders in
the Revolving Credit.  The Borrower agrees that each Participant shall be
entitled to the benefits of Sections 2.10, 10.3 and 12.1 (subject to the
requirements and limitations therein, including the requirements under
Section 12.1(g) (it being understood that the documentation required under
Section 12.1(g) shall be delivered to the participating Lender)) to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section; provided that such Participant
(A) agrees to be subject to the provisions of Sections 2.12 and 10.4 as if it
were an assignee under paragraph (b) of this Section; and (B) shall not be
entitled to receive any greater payment under Sections 10.3 or 12.1, with
respect to any participation, than its participating Lender would have been
entitled to receive, except to the extent such entitlement to receive a greater
payment results from a Change in Law that occurs after the Participant acquired
the applicable participation.  Each Lender that sells a participation agrees, at
the Borrower’s request and expense, to use reasonable efforts to cooperate with
the Borrower to effectuate the provisions of Section 2.12 with respect to any
Participant.  To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 12.14 as though it were a Lender; provided
that such Participant agrees to be subject to Section 12.7 as though it were a
Lender.  Each Lender that sells a participation shall, acting solely for this
purpose as an agent of the Borrower, maintain a register on which it enters the
name and address of each Participant and the principal amounts (and stated
interest) of each Participant’s interest in the Revolving Loans or other
obligations under the Loan Documents (the “Participant Register”); provided that
no Lender shall have any obligation to disclose all or any portion of the
Participant Register (including the identity of any Participant or any
information relating to a Participant’s interest in any commitments, loans,
letters of credit or its other obligations under any Loan Document) to any
Person except to the extent that such disclosure is necessary to establish that
such commitment, loan, letter of credit or other obligation is in registered
form under Section 5f.103-1(c) of the United States Treasury Regulations.  The
entries in the Participant Register shall be conclusive absent manifest error,
and such Lender shall treat each Person whose name is recorded in the
Participant Register as the owner of such participation for all purposes of this
Agreement notwithstanding any notice to the contrary.  For the avoidance of
doubt, the Administrative Agent (in its capacity as Administrative Agent) shall
have no responsibility for maintaining a Participant Register.

 

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(e)                     Certain Pledges.  Any Lender may at any time pledge or
assign a security interest in all or any portion of its rights under this
Agreement to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided that no
such pledge or assignment shall release such Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.

 

Section 12.11.                   Amendments.  Subject to Section 10.2, any
provision of this Agreement or the other Loan Documents may be amended or waived
if, but only if, such amendment or waiver is in writing and is signed by (a) the
Borrower, (b) the Required Lenders, and (c) if the rights or duties of the
Administrative Agent or the L/C Issuer are affected thereby, the Administrative
Agent or the L/C Issuer, as applicable; provided that:

 

(i)                          no amendment or waiver pursuant to this
Section 12.11 shall (A) increase any Revolving Credit Commitment of any Lender
without the consent of such Lender or (B) reduce the amount of or postpone the
date for any scheduled payment of any principal of or interest on any Revolving
Loan or of any Reimbursement Obligation or of any fee payable hereunder without
the consent of the Lender to which such payment is owing or which has committed
to make such Revolving Loan or Letter of Credit (or participate therein)
hereunder, it being agreed and understood that any change in any ratio used in
the calculation of any interest or fees due hereunder (including any component
definition thereof) shall not constitute a reduction in any rate of interest or
fees hereunder; provided, however, that only the consent of the Required Lenders
shall be necessary to amend the default rate provided in Section 2.8 or to waive
any obligation of the Borrower to pay interest or fees at the default rate as
set forth therein; and

 

(ii)                         no amendment or waiver pursuant to this
Section 12.11 shall, unless signed by each Lender, extend the Revolving Credit
Termination Date, change the definition of Required Lenders, amend the waterfall
provisions of Section 4.1, change the provisions of this Section 12.11 or affect
the number of Lenders required to take any action hereunder or under any other
Loan Document.

 

Notwithstanding anything to the contrary herein, (1) no Defaulting Lender shall
have any right to approve or disapprove any amendment, waiver or consent
hereunder (and any amendment, waiver or consent which by its terms requires the
consent of all Lenders or each affected Lender may be effected with the consent
of the applicable Lenders other than Defaulting Lenders), except that (x) the
Revolving Credit Commitment of any Defaulting Lender may not be increased or
extended without the consent of such Lender and (y) any waiver, amendment or
modification requiring the consent of all Lenders or each affected Lender that
by its terms affects any Defaulting Lender more adversely than other affected
Lenders shall require the consent of such Defaulting Lender, (2) if the
Administrative Agent and the Borrower have jointly identified an obvious error
or any error or omission of a technical nature, in each case, in any provision
of the Loan Documents, then the Administrative Agent and the Borrower shall be
permitted to amend such provision, (3) guarantees and related documents executed
by the Borrower or any

 

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guarantor in connection with this Agreement may be in a form reasonably
determined by the Administrative Agent and may be amended, supplemented or
waived without the consent of any Lender if such amendment, supplement or waiver
is delivered in order to (x) comply with local law or advice of local counsel,
(y) cure ambiguities, omissions, mistakes or defects or (z) cause such guarantee
or other document to be consistent with this Agreement and the other Loan
Documents, and (4) the Borrower and the Administrative Agent may, without the
input or consent of any other Lender, effect amendments to this Agreement and
the other Loan Documents as may be necessary in the reasonable opinion of the
Borrower and the Administrative Agent to effect the provisions of Section 2.13.

 

Section 12.12.                   Headings.  Section headings used in this
Agreement are for reference only and shall not affect the construction of this
Agreement.

 

Section 12.13.                   Costs and Expenses; Indemnification.  The
Borrower agrees to pay all reasonable costs and expenses of the Administrative
Agent in connection with the preparation, negotiation, syndication, and
administration of the Loan Documents, including, without limitation, the
reasonable fees and disbursements of counsel to the Administrative Agent, in
connection with the preparation and execution of the Loan Documents, and any
amendment, waiver or consent related thereto, whether or not the transactions
contemplated herein are consummated.  The Borrower agrees to pay to the
Administrative Agent, the L/C Issuer, and each Lender, and any other holder of
any Obligations outstanding hereunder, all costs and expenses reasonably
incurred or paid by the Administrative Agent, the L/C Issuer, such Lender, or
any such holder, including reasonable attorneys’ fees and disbursements and
court costs, in connection with any Default or Event of Default hereunder or in
connection with the enforcement of any of the Loan Documents (including all such
costs and expenses incurred in connection with any proceeding under the United
States Bankruptcy Code involving the Borrower as a debtor thereunder).  The
Borrower further agrees to indemnify the Administrative Agent, the L/C Issuer,
each Lender, and any security trustee therefor, and their respective directors,
officers, employees, agents, financial advisors, and consultants (each such
Person being called an “Indemnitee”) against all losses, claims, damages,
penalties, judgments, liabilities and expenses (including, without limitation,
all reasonable fees and disbursements of counsel for any such Indemnitee and all
reasonable expenses of litigation or preparation therefor, whether or not the
Indemnitee is a party thereto, or any settlement arrangement arising out of, in
connection with, or as a result of (i) the execution or delivery of this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto of their respective
obligations hereunder or thereunder or the consummation of the transactions
contemplated hereby or thereby, or, in the case of Administrative Agent (and any
sub-agent thereof), the L/C Issuer, and their Related Parties, the
administration and enforcement of this Agreement and the other Loan Documents
(including all such costs and expenses incurred in connection with any
proceeding under the United States Bankruptcy Code involving the Borrower as a
debtor thereunder), (ii) any Loan or Letter of Credit or the use or proposed use
of the proceeds therefrom (including any refusal by any L/C Issuer to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter
of Credit), (iii) any Environmental Claim or Environmental Liability, including
with respect to the actual or alleged presence or Release of Hazardous Materials
on or from any property owned or operated by the Borrower or any of its
Subsidiaries, related in any way to the Borrower or any of its

 

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Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory, whether brought by a third party or by the Borrower or any
Subsidiary, and regardless of whether any Indemnitee is a party thereto
(including, without limitation, any settlement arrangement arising from or
relating to the foregoing); provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee.  The Borrower, upon demand
by the Administrative Agent, the L/C Issuer, or a Lender at any time, shall
reimburse the Administrative Agent, the L/C Issuer, or such Lender for any legal
or other expenses (including, without limitation, all reasonable fees and
disbursements of counsel for any such Indemnitee) incurred in connection with
investigating or defending against any of the foregoing (including any
settlement costs relating to the foregoing) except if the same is directly due
to the gross negligence or willful misconduct of the Indemnitee.  The Borrower
hereby agrees to indemnify the Administrative Agent and the Lenders against, and
agrees that it will hold the Administrative Agent and the Lenders harmless from,
any claim, demand, or liability for any such broker’s or finder’s fees alleged
to have been incurred in connection herewith and any expenses (including
reasonable attorneys’ fees) arising in connection with any such claim, demand,
or liability.  To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or the other Loan Documents or any agreement or instrument
contemplated hereby or thereby, the transactions contemplated hereby or thereby,
any Revolving Loan or Letter of Credit or the use of the proceeds thereof.  No
Indemnitee referred to in subsection above shall be liable for any damages
arising from the use by unintended recipients of any information or other
materials distributed by it through telecommunications, electronic or other
information transmission systems in connection with this Agreement or the other
Loan Documents or the transactions contemplated hereby or thereby, except to the
extent that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee.  All amounts due under this Section shall be payable promptly
after demand therefor.  The obligations of the Borrower under this Section shall
survive the termination of this Agreement.

 

Section 12.14.                   Set-off.  If an Event of Default shall have
occurred and be continuing, each Lender, the L/C Issuer, and each of their
respective Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by applicable law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final, in whatever
currency) at any time held, and other obligations (in whatever currency) at any
time owing, by such Lender, the L/C Issuer or any such Affiliate, to or for the
credit or the account of the Borrower against any and all of the obligations of
the Borrower now or hereafter existing under this Agreement or any other Loan
Document to such Lender or the L/C Issuer or their respective Affiliates,
irrespective of whether or not such Lender, the L/C Issuer or Affiliate shall
have made any demand under this Agreement or any other Loan Document and
although such obligations of the Borrower may be contingent or unmatured or are
owed to a branch, office or Affiliate of such

 

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Lender or the L/C Issuer different from the branch, office or Affiliate holding
such deposit or obligated on such indebtedness; provided that in the event that
any Defaulting Lender shall exercise any such right of setoff, (x) all amounts
so set off shall be paid over immediately to the Administrative Agent for
further application in accordance with the provisions of Section 2.14 and,
pending such payment, shall be segregated by such Defaulting Lender from its
other funds and deemed held in trust for the benefit of the Administrative
Agent, the L/C Issuer, and the Lenders, and (y) the Defaulting Lender shall
provide promptly to the Administrative Agent a statement describing in
reasonable detail the Obligations owing to such Defaulting Lender as to which it
exercised such right of setoff.  The rights of each Lender, the L/C Issuer and
their respective Affiliates under this Section are in addition to other rights
and remedies (including other rights of setoff) that such Lender, the L/C Issuer
or their respective Affiliates may have.  Each Lender and the L/C Issuer agrees
to notify the Borrower and the Administrative Agent promptly after any such
setoff and application; provided that the failure to give such notice shall not
affect the validity of such setoff and application.

 

Section 12.15.                   Entire Agreement.  The Loan Documents
constitute the entire understanding of the parties thereto with respect to the
subject matter thereof and any prior agreements, whether written or oral, with
respect thereto are superseded hereby.

 

Section 12.16.                   Governing Law.  This Agreement and the other
Loan Documents (except as otherwise specified therein), and the rights and
duties of the parties hereto, shall be construed and determined in accordance
with the internal laws of the State of New York.

 

Section 12.17.                   Severability of Provisions.  Any provision of
any Loan Document which is unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.  All rights,
remedies and powers provided in this Agreement and the other Loan Documents may
be exercised only to the extent that the exercise thereof does not violate any
applicable mandatory provisions of law, and all the provisions of this Agreement
and other Loan Documents are intended to be subject to all applicable mandatory
provisions of law which may be controlling and to be limited to the extent
necessary so that they will not render this Agreement or the other Loan
Documents invalid or unenforceable.

 

Section 12.18.                   Excess Interest.  Notwithstanding any provision
to the contrary contained herein or in any other Loan Document, no such
provision shall require the payment or permit the collection of any amount of
interest in excess of the maximum amount of interest permitted by applicable law
to be charged for the use or detention, or the forbearance in the collection, of
all or any portion of the Revolving Loans or other obligations outstanding under
this Agreement or any other Loan Document (“Excess Interest”).  If any Excess
Interest is provided for, or is adjudicated to be provided for, herein or in any
other Loan Document, then in such event (a) the provisions of this Section shall
govern and control, (b) the Borrower shall not be obligated to pay any Excess
Interest, (c) any Excess Interest that the Administrative Agent or any Lender
may have received hereunder shall, at the option of the Administrative Agent, be
(i) applied as a credit against the then outstanding principal amount of
Obligations hereunder and accrued and unpaid interest thereon (not to exceed the
maximum amount permitted by applicable law),

 

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(ii) refunded to the Borrower, or (iii) any combination of the foregoing,
(d) the interest rate payable hereunder or under any other Loan Document shall
be automatically subject to reduction to the maximum lawful contract rate
allowed under applicable usury laws (the “Maximum Rate”), and this Agreement and
the other Loan Documents shall be deemed to have been, and shall be, reformed
and modified to reflect such reduction in the relevant interest rate, and
(e) the Borrower shall not have any action against the Administrative Agent or
any Lender for any damages whatsoever arising out of the payment or collection
of any Excess Interest.  Notwithstanding the foregoing, if for any period of
time interest on any of the Borrower’s Obligations is calculated at the Maximum
Rate rather than the applicable rate under this Agreement, and thereafter such
applicable rate becomes less than the Maximum Rate, the rate of interest payable
on the Borrower’s Obligations shall remain at the Maximum Rate until the Lenders
have received the amount of interest which such Lenders would have received
during such period on the Borrower’s Obligations had the rate of interest not
been limited to the Maximum Rate during such period.

 

Section 12.19.                   Construction.  The parties acknowledge and
agree, to the extent permitted by law, that the Loan Documents shall not be
construed more favorably in favor of any party hereto based upon which party
drafted the same, it being acknowledged that all parties hereto contributed
substantially to the negotiation of the Loan Documents.  The provisions of this
Agreement relating to Subsidiaries shall only apply during such times as the
Borrower has one or more Subsidiaries.

 

Section 12.20.                   Lender’s and L/C Issuer’s Obligations Several. 
The obligations of the Lenders and the L/C Issuer hereunder are several and not
joint.  Nothing contained in this Agreement and no action taken by the Lenders
or the L/C Issuer pursuant hereto shall be deemed to constitute the Lenders and
the L/C Issuer a partnership, association, joint venture or other entity.

 

Section 12.21.                   No Advisory or Fiduciary Responsibility.  In
connection with all aspects of each transaction contemplated hereby (including
in connection with any amendment, waiver or other modification hereof or of any
other Loan Document), the Borrower acknowledges and agrees, and acknowledges its
Subsidiaries’ and Affiliates’ understanding, that: (a) (i) no fiduciary,
advisory or agency relationship between the Borrower and its Subsidiaries and
the Administrative Agent, the L/C Issuer, or any Lender is intended to be or has
been created in respect of the transactions contemplated hereby or by the other
Loan Documents, irrespective of whether the Administrative Agent, the L/C
Issuer, or any Lender has advised or is advising the Borrower or any of its
Subsidiaries on other matters, (ii) the arranging and other services regarding
this Agreement provided by the Administrative Agent, the L/C Issuer, and the
Lenders are arm’s-length commercial transactions between the Borrower, its
Subsidiaries and their Affiliates, on the one hand, and the Administrative
Agent, the L/C Issuer, and the Lenders, on the other hand, (iii) the Borrower
and its Subsidiaries have consulted its own legal, accounting, regulatory and
tax advisors to the extent that it has deemed appropriate and (iv) the Borrower
and its Subsidiaries are capable of evaluating, and understands and accepts, the
terms, risks and conditions of the transactions contemplated hereby and by the
other Loan Documents; and (b) (i) the Administrative Agent, the L/C Issuer, and
the Lenders each is and has been acting solely as a principal and, except as
expressly agreed in writing by the relevant parties, has not

 

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been, is not, and will not be acting as an advisor, agent or fiduciary for the
Borrower, its Subsidiaries or any of their Affiliates, or any other Person;
(ii) none of the Administrative Agent, the L/C Issuer, and the Lenders has any
obligation to the Borrower, its Subsidiaries or any of their Affiliates with
respect to the transactions contemplated hereby except those obligations
expressly set forth herein and in the other Loan Documents; and (iii) the
Administrative Agent, the L/C Issuer, and the Lenders and their respective
Affiliates may be engaged, for their own accounts or the accounts of customers,
in a broad range of transactions that involve interests that differ from those
of the Borrower, any Subsidiary and their Affiliates, and none of the
Administrative Agent, the L/C Issuer, and the Lenders has any obligation to
disclose any of such interests to the Borrower, any Subsidiary or their
Affiliates.  To the fullest extent permitted by law, the Borrower, on behalf of
itself and its Subsidiaries, hereby waives and releases any claims that it may
have against the Administrative Agent, the L/C Issuer, and the Lenders with
respect to any breach or alleged breach of agency or fiduciary duty in
connection with any aspect of any transaction contemplated hereby.

 

Section 12.22.                   Submission to Jurisdiction; Waiver of Jury
Trial.  The Borrower hereby submits to the nonexclusive jurisdiction of the
United States District Court for the Southern District of New York and of any
New York State court sitting in New York, New York for purposes of all legal
proceedings arising out of or relating to this Agreement, the other Loan
Documents or the transactions contemplated hereby or thereby.  The Borrower
irrevocably waives, to the fullest extent permitted by law, any objection which
it may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.  THE BORROWER, THE
ADMINISTRATIVE AGENT, THE L/C ISSUER, AND THE LENDERS HEREBY IRREVOCABLY WAIVE
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY.

 

Section 12.23.                   USA Patriot Act.  Each Lender and the L/C
Issuer that is subject to the requirements of the USA Patriot Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”) hereby notifies
the Borrower that pursuant to the requirements of the Act, it is required to
obtain, verify, and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Lender or the L/C Issuer to identify the Borrower in
accordance with the Act.

 

Section 12.24.                   Confidentiality.  Each of the Administrative
Agent, the Lenders, and the L/C Issuer severally agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates’ directors, officers, employees
and agents, including accountants, legal counsel and other advisors to the
extent any such Person has a need to know such Information (it being understood
that the Persons to whom such disclosure is made will first be informed of the
confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority
(including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
hereto, (e) in connection with the exercise of any remedies hereunder or under
any other Loan Document or any suit, action or proceeding relating to this
Agreement or any other Loan Document or the enforcement of rights hereunder or

 

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thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (A) any assignee of or participant in, or any
prospective assignee of or participant in, any of its rights or obligations
under this Agreement or (B) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Borrower or any
Subsidiary and its obligations, (g) with the prior written consent of the
Borrower, (h) to the extent such Information (A) becomes publicly available
other than as a result of a breach of this Section or (B) becomes available to
the Administrative Agent, any Lender or the L/C Issuer on a non-confidential
basis from a source other than the Borrower or any Subsidiary or any of their
directors, officers, employees or agents, including accountants, legal counsel
and other advisors, (i) to rating agencies if requested or required by such
agencies in connection with a rating relating to the Revolving Loans or
Revolving Credit Commitments hereunder, or (j) to entities which compile and
publish information about the syndicated loan market, provided that only basic
information about the pricing and structure of the transaction evidenced hereby
may be disclosed pursuant to this subsection (j).  For purposes of this Section,
“Information” means all information received from the Borrower or any of the
Subsidiaries or from any other Person on behalf of the Borrower or any
Subsidiary relating to the Borrower or any Subsidiary or any of their respective
businesses, other than any such information that is available to the
Administrative Agent, any Lender or the L/C Issuer on a non-confidential basis
prior to disclosure by the Borrower or any of its Subsidiaries or from any other
Person on behalf of the Borrower or any of the Subsidiaries.  Any Person
required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.

 

Section 12.25.                   Acknowledgement and Consent to Bail-In of EEA
Financial Institutions.  Notwithstanding anything to the contrary in any Loan
Document or in any other agreement, arrangement or understanding among any such
parties, each party hereto (including any party becoming a party hereto by
virtue of an Assignment and Acceptance) acknowledges that any liability of any
EEA Financial Institution arising under any Loan Document, to the extent such
liability is unsecured, may be subject to the write-down and conversion powers
of an EEA Resolution Authority and agrees and consents to, and acknowledges and
agrees to be bound by:

 

(a)                        the application of any Write-Down and Conversion
Powers by an EEA Resolution Authority to any such liabilities arising hereunder
which may be payable to it by any party hereto that is an EEA Financial
Institution; and

 

(b)                         the effects of any Bail-in Action on any such
liability, including, if applicable:

 

(i)                          a reduction in full or in part or cancellation of
any such liability;

 

(ii)                          a conversion of all, or a portion of, such
liability into shares or other instruments of ownership in such EEA Financial
Institution, its parent undertaking, or a bridge institution that may be issued
to it or otherwise conferred on it, and that such shares or other instruments of
ownership will be accepted by it in lieu of any rights with respect to any such
liability under this Agreement or any other Loan Document; or

 

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(iii)                           the variation of the terms of such liability in
connection with the exercise of the write-down and conversion powers of any EEA
Resolution Authority.

 

Section 12.26.                   Amendment and Restatement; No Novation.  This
Agreement shall become effective as of the date hereof, and supersede all
provisions of the Prior Credit Agreement as of such date, upon the execution of
this Agreement by each of the parties hereto and fulfillment of the conditions
precedent contained in Section 7.2.  This Agreement shall constitute for all
purposes an amendment and restatement of the Prior Credit Agreement and not a
new agreement and all obligations outstanding under the Prior Credit Agreement
shall continue to be outstanding hereunder and shall not constitute a novation
of the indebtedness or other obligations outstanding under the Prior Credit
Agreement.  Upon the satisfaction of the conditions precedent set forth in
Section 7.2, all loans outstanding under the Prior Credit Agreement shall remain
outstanding as the initial Borrowing of Revolving Loans under this Agreement.

 

[SIGNATURE PAGES TO FOLLOW]

 

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This Second Amended and Restated Credit Agreement is entered into between us for
the uses and purposes hereinabove set forth as of the date first above written.

 

 

“BORROWER”

 

 

 

LTC PROPERTIES, INC.

 

 

 

 

 

 

 

By

/s/ Wendy Simpson

 

 

Name Wendy Simpson

 

 

Title Chairman, CEO & President

 

 

 

 

 

 

 

By

/s/ Pamela Shelley-Kessler

 

 

Name Pamela Shelley-Kessler

 

 

Title EVP & Chief Financial Officer

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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“ADMINISTRATIVE AGENT AND L/C ISSUER”

 

 

 

BANK OF MONTREAL, as Administrative Agent and as L/C Issuer

 

 

 

 

 

 

 

By:

/s/ Lloyd Baron

 

 

Name Lloyd Baron

 

 

Title Director

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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“LENDERS”

 

 

 

 

 

BANK OF MONTREAL, as a Lender

 

 

 

 

 

By:

/s/ Lloyd Baron

 

 

Name Lloyd Baron

 

 

Title Director

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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CITIZENS BANK, N.A., as a Lender

 

 

 

 

 

By:

/s/ David R. Jablonowski

 

 

Name David R. Jablonowski

 

 

Title Senior Vice President

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK, as a Lender

 

 

 

 

 

By:

/s/ Karen L. Ramos

 

 

Name Karen L. Ramos

 

 

Title Managing Director

 

 

 

 

 

 

 

By:

/s/ Gordon Yip

 

 

Name Gordon Yip

 

 

Title Director

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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KEYBANK NATIONAL ASSOCIATION, as a Lender

 

 

 

 

 

By:

/s/ Laura Conway

 

 

Name Laura Conway

 

 

Title Senior Vice President

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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MIZUHO BANK, LTD., as a Lender

 

 

 

 

 

By:

/s/ Tracy Rahn

 

 

Name Tracy Rahn

 

 

Title Authorized Signatory

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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MUFG UNION BANK, N.A., as a Lender

 

 

 

 

 

By:

/s/ Gina M. West

 

 

Name Gina M. West

 

 

Title Vice President

 

S-1

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ROYAL BANK OF CANADA, as a Lender

 

 

 

 

 

By:

/s/ Sheena Lee

 

 

Name Sheena Lee

 

 

Title Authorized Signatory

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender

 

 

 

 

 

By:

/s/ Darin Mullis

 

 

Name Darin Mullis

 

 

Title Managing Director

 

[Signature Page to Second Amended and Restated Credit Agreement (LTC
Properties, Inc.)]

 

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