Exhibit 10.17

 

AMENDMENT NO. 4 TO LOAN AGREEMENT

 

 

This Amendment No. 4 to Loan Agreement (this “Amendment”), dated as of March 6,
2018 is entered into by and among GENESIS HEALTHCARE, INC., a Delaware
corporation (“Ultimate Parent”), FC-GEN OPERATIONS INVESTMENT, LLC, a Delaware
limited liability company (the “Borrower”), GEN OPERATIONS I, LLC, a Delaware
limited liability company (“Parent”), GEN OPERATIONS II, LLC, a Delaware limited
liability company (“Holdings”, and together with Ultimate Parent, Borrower and
Parent, “Amendment Parties”), each of the Lenders (as defined below) party
hereto and WELLTOWER INC., as Administrative Agent (in such capacity, and
together with its successors and permitted assigns, “Administrative Agent”).

 

WHEREAS, Amendment Parties, Administrative Agent, Collateral Agent and the
financial institutions from time to time party thereto as lenders (the
“Lenders”) are parties to that certain Term Loan Agreement, dated as of July 29,
2016, as amended by that certain Amendment No. 1 to Loan Agreement, dated as of
December 22, 2016, as amended by that certain Amendment No. 2 and Waiver to Loan
Agreement, dated as of May 5, 2017, and as amended by that certain Amendment No.
3 to Loan Agreement, dated as of August 8, 2017 (as it may have been further
amended, restated, amended and restated, supplemented or otherwise modified
through the date hereof prior to this Amendment, the “Existing Loan Agreement”),
pursuant to which Administrative Agent, Collateral Agent and the Lenders, among
other things, provided certain loans and other financial accommodations to
Borrower in accordance with the terms and conditions set forth therein;

 

WHEREAS, Amendment Parties and the Loan Parties have requested that
Administrative Agent and the Lenders agree to amend and restate the Existing
Loan Agreement in the form attached hereto as Exhibit B (the “Restated Loan
Agreement”) to provide, among other things, for the extension of new term loans
and to reflect certain revisions to the PIK interest payments and the financial
covenants, in each case as set forth in the Restated Loan Agreement;

 

WHEREAS, Amendment Parties and the Loan Parties have requested that
Administrative Agent and the Lenders agree to release the Subsidiary Guarantors
identified on Schedule III hereto (the “Released Entities”) from the Guarantee
and Collateral Agreement and the other Loan Documents upon such Subsidiary
Guarantors becoming Unrestricted Subsidiaries;

 

WHEREAS, Amendment Parties and the Loan Parties wish to amend and restate the
schedules to the Guarantee and Collateral Agreement to provide for certain
updates to the schedules;

 

WHEREAS, on the Restatement Date (as defined in the Restated Loan Agreement),
the Borrower shall borrow new term loans in an aggregate principal amount of
$40,000,000 (the “2018 Term Loans”) having the terms set forth in the Restated
Loan Agreement (the “2018 Term Loan Facility”) and shall use the proceeds of the
2018 Term Loan Facility for the purposes described in the Restated Loan
Agreement (the transactions described in this paragraph, including entry into
this Amendment and amending and restating the Existing Loan Agreement in the
form of the

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Restated Loan Agreement attached hereto, are collectively referred to as the
“2018 Term Loan Financing”);

 

WHEREAS, the Borrower has requested that the Lenders set forth on Schedule I
hereto commit to make the 2018 Term Loan on the Restatement Date up to the
amounts set forth on Schedule I for each Lender (the “2018 Term Loan
Commitment”);

 

WHEREAS, each of the Lenders party hereto will be deemed to have committed to
make the 2018 Term Loans up to the amounts set forth for each such Lender on
Schedule I hereto, the proceeds of which will be used as set forth above; and

 

WHEREAS, Administrative Agent and the Lenders are willing to agree to Amendment
Parties’ request to enter into the Restated Loan Agreement and the other
amendments, agreements and waivers set forth herein, subject to and in
accordance with the terms and conditions set forth in this Amendment.

 

NOW, THEREFORE, Amendment Parties, Administrative Agent and the Lenders each
hereby agrees as follows:

 

1. Recitals; Definitions.    The foregoing recitals, including all terms defined
therein, are incorporated herein and made a part hereof.  All capitalized terms
used herein (including, without limitation, in the foregoing recitals) and not
defined herein shall have the meanings given to such terms in the Restated Loan
Agreement and the rules of interpretation set forth in Section 1.2 thereof are
incorporated herein mutatis mutandis.

2. Amendments to the Existing Loan Agreement and the Guarantee and Collateral
Agreement.  Subject to the terms and conditions of this Amendment, including,
without limitation, the conditions to effectiveness set forth in Section 4
below:

(a) the Existing Loan Agreement (including all the exhibits and schedules
attached thereto) is hereby amended and restated in the form of the Restated
Loan Agreement attached hereto (including all the exhibits and schedules
attached hereto), such that on the Restatement Date, the terms set forth in
Exhibit B hereto shall replace the terms of the Existing Loan Agreement; and

 

(b) the schedules to the Guarantee and Collateral Agreement are hereby amended
and restated in their entirety as set forth in Exhibit C hereto.

 

3. Waiver and Release.  

(a) Subject to the terms and conditions of this Amendment, Administrative Agent
and the Lenders hereby waive any Event of Default that may have occurred as
described on Schedule II hereto (the “Specified Defaults”).  The waiver set
forth herein shall be limited precisely as written and relate solely to the
Specified Defaults in connection with the  noncompliance by the Loan Parties
with Sections 7.12, 7.13, 7.14, 7.15, and, solely to the extent relating to the
Specified Defaults, each of 8(d), 8(f)(ii) and 8(n) of the Existing Loan
Agreement (the “Waived Provision”) in the manner and to the extent described
above, and nothing in this

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Amendment shall be deemed to (i) constitute a waiver of compliance by the Loan
Parties with respect to (x) the Waived Provision in any other instance or (y)
any other term, provision or condition of the Loan Agreement or any other Loan
Document, or (ii) prejudice any right or remedy that Administrative Agent or any
Lender may now have or may have in the future under or in connection with the
Loan Agreement or any other Loan Document.

 

(b) Upon the satisfaction or waiver of the conditions precedent set forth in
Section 3 on the Restatement Date, the Released Entities shall be designated as
Unrestricted Subsidiaries and shall be automatically released from their
Guarantee Obligations under the Guarantee and Collateral Agreement and the other
Loan Documents and any security interest granted by the Released Entities in the
Collateral shall be automatically released.  Upon the reasonable request of the
Borrower, the Collateral Agent shall (without notice to, or vote or consent of,
any Lender, any Hedge Counterparty that is a party to any Specified Hedge
Agreement or any Cash Management Counterparty that is a party to any Cash
Management Document) take such additional actions as shall be required to
evidence release of its security interest in any Collateral being released
pursuant to this Section 3(b).  The Amendment Parties hereby jointly represent
and warrant to the Agents and each Lender as of the date hereof that no Released
Entity holds any material assets and that upon the satisfaction or waiver of the
conditions precedent set forth in Section 4 below on the Restatement Date, each
such Released Entity will meet the requirements set forth in the definition of
Unrestricted Subsidiary under the Restated Loan Agreement.  The Amendment
Parties further represent and warrant that (i) after giving effect to this
Amendment and the Transactions (as defined in the Restated Loan Agreement),
Ultimate Parent and the Restricted Subsidiaries are in compliance with each
Financial Condition Covenant calculated on a Pro Forma Basis, (ii) each Released
Entity, after designation as an Unrestricted Subsidiary, is not a Restricted
Subsidiary for the purpose of any other Indebtedness of any Loan Party, and
(iii) the designation of each Released Entity as an Unrestricted Subsidiary
constituted an Investment by Ultimate Parent therein at the date of designation
in an amount equal to the fair market value as determined by Ultimate Parent in
good faith of Ultimate Parent or its Subsidiaries’ (as applicable) Investment
therein.

 

4. Conditions.  The effectiveness of this Amendment (including the amendment and
restatement of the Existing Loan Agreement in the form of the Restated Loan
Agreement attached hereto) is subject to the satisfaction (or written waiver) of
the following conditions, each in form and substance satisfactory to
Administrative Agent and the Lenders: 

(a) Amendment. Administrative Agent and the Lenders shall have received a fully
executed copy of this Amendment, with all exhibits, schedules and other
attachments hereto;

 

(b) Intercreditor Agreement. Administrative Agent and the Lenders shall have
received a fully executed copy of the Intercreditor Agreement (as amended and
restated on the date hereof);

 

(c) Notes. Administrative Agent shall have received executed copies of Notes as
each Lender may reasonably require and substantially in the form of Exhibit I to
the Restated Loan Agreement;

 

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(d) Solvency Certificate.  Administrative Agent and the Lenders shall have
received a solvency certificate signed by a Responsible Officer of Ultimate
Parent, substantially in the form of Exhibit G to the Restated Loan Agreement;

 

(e) Closing Certificate.  Administrative Agent and the Lenders shall have
received a certificate of each of the Parent Companies and the Subsidiary
Guarantors dated the Restatement Date, substantially in the form of Exhibit D to
the Restated Loan Agreement, with appropriate insertions and attachments;

 

(f) Representations and Warranties.  As of the Restatement Date, after giving
effect to this Amendment, each of the representations and warranties set forth
in Section 3 of the Restated Loan Agreement shall be true and correct in all
material respects (or, with respect to representations and warranties modified
by materiality standards, in all respects) (it being understood and agreed that
any representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects (or, with
respect to any such representation or warranty which is modified by materiality
standards, in all respects) only as of such specified date);

 

(g) Lien Searches.  Administrative Agent and Lenders shall have received the
results of recent lien searches on certain Loan Parties, the scope of which
shall be reasonably satisfactory to Administrative Agent and Lenders, and such
searches shall reveal no Liens on any of the assets of such Loan Parties, except
for Liens permitted by Section 7.2 of the Restated Loan Agreement;

 

(h) Borrowing Notice.  Administrative Agent shall have received an irrevocable
notice of borrowing in accordance with Section 2.3 and substantially in the form
of Exhibit A-2 to the Restated Loan Agreement;

 

(i) Attestation Certificate.  Administrative Agent shall have received a
certificate attesting to the compliance with clauses (f), (j), (k) and (n) of
this Section 4 on the Restatement Date from a Responsible Officer of Ultimate
Parent;

 

(j) Insolvency.  As of the Restatement Date, none of Ultimate Parent nor any of
its Subsidiaries shall have filed or otherwise become subject to a case under
the Bankruptcy Code;

 

(k) No Default or Event of Default.  (i) No Default or Event of Default shall
have occurred and be continuing as of the date hereof under this Amendment, the
Restated Loan Agreement or any other Loan Document after giving effect to this
Amendment and the Transactions (as defined in the Restated Loan Agreement); (ii)
no default (including any disputed default that is subject to arbitration under
the terms of the Omnibus Agreement dated as of February 21, 2018 by and between
the parties set forth therein attached hereto as Exhibit A (the “Omnibus
Agreement”)) shall have occurred and be continuing as of the date hereof by
Ultimate Parent or any of its subsidiaries or affiliates under the Omnibus
Agreement (whether or not such defaults have become Omnibus Events of Default
(as defined in the Omnibus Agreement), (iii) no Events of Default (as defined
therein) shall have occurred and be continuing as of the date hereof

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under (x) the Skilled RE Loan Documents, (y) the Revera Loan Documents or (z)
the Welltower Lease, in each case as amended, restated, supplemented or modified
and in effect as of the date hereof, and (iv) no material defaults shall have
occurred and are continuing by Ultimate Parent or any of its subsidiaries under
(x) any Material Master Lease, (y) any Material Indebtedness, or (z) any
agreement with MidCap Financial Trust, in each case, that are not subject to a
waiver or other similar agreement not to enforce any such contractual
obligations in form and substance satisfactory to the Lenders;

 

(l) Legal Opinion. Administrative Agent and the Lenders shall have received an
executed legal opinion of Skadden, Arps, Slate, Meagher & Flom LLP, counsel to
the Parent Companies, covering such customary matters incident to this Amendment
as Administrative Agent and Lenders may reasonably require and in form and
substance reasonably satisfactory to Administrative Agent and Lenders;

 

(m) ABL Loan Documents.  Prior to or substantially simultaneously with the
making of Loans on the Restatement Date, the loans and other obligations under
the ABL Credit Agreement have been either (x) amended or otherwise restructured
such that all outstanding defaults thereunder have been satisfied or permanently
waived and the terms of any amendment or restructured loans and other
obligations, and the agreements related to the same, are reasonably acceptable
to the Lenders, or (y) fully refinanced in a manner, as reasonably determined by
the Lenders, substantially consistent with the terms and conditions set forth in
that certain Commitment Letter, dated as of February 2, 2017 (the “MidCap
Commitment Letter”), between MidCap Financial Trust and Ultimate Parent or on
such other terms and conditions reasonably acceptable to the Lenders; 

 

(n) Third Party Consents.  All required third party consents in connection with
this Amendment and the 2018 Term Loans have been obtained by Ultimate Parent and
its subsidiaries;

 

(o) Material Master Lease Amendments.  Administrative Agent and the Lenders
shall have received a copy of (i) amendments to the Material Master Leases
(other than that certain Master Lease, dated as of November 1, 2016, among
LG-OHI Seaford LLC and certain affiliates thereof, as landlords, and Genesis LGO
Operations LLC as tenant, as it may be amended, restated, replaced or otherwise
modified from time to time in accordance with the terms of the LGO Intercreditor
Agreement and this Agreement (the “LGO Lease”), executed by the parties thereto,
in form and substance reasonably acceptable to Administrative Agent and the
Lenders and (ii) in the case of the LGO Lease, a waiver or other similar
agreement in form and substance reasonably acceptable to Administrative Agent
and the Lenders;

 

(p) Other Documents.  Loan Parties shall have delivered such further documents,
information, certificates, records and filings as Administrative Agent may
reasonably request.  

 

5. Covenant to Cooperate with Respect to and Deliver Collateral Review.  The
Loan Parties agree to reasonably cooperate with Administrative Agent and the
Lenders in conducting a Collateral review promptly upon the effectiveness of
this Agreement. Administrative

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Agent shall have the option in its reasonable discretion to hire a third party
to audit the information received as to the Collateral on behalf of
Administrative Agent.  The Loan Parties agree promptly (but in no event later
than 3 Business Days) upon request to reimburse Administrative Agent for the
reasonable and documented out-of-pocket costs of Administrative Agent
(including, without limitation, reasonable and documented out-of-pocket legal
costs and expenses, and reasonable and documented expenses of any third party
appraiser or auditor) in connection with the Collateral review contemplated
hereby in an amount not to exceed $100,000 in the aggregate.

6. Reaffirmation of Loan Documents.  By executing and delivering this Amendment,
each Loan Party hereby (i) reaffirms, ratifies and confirms its Obligations
under the Restated Loan Agreement, the Notes and the other Loan Documents, as
applicable, (ii) agrees that this Amendment shall be a “Loan Document” under the
Restated Loan Agreement and (iii) hereby expressly agrees that the Restated Loan
Agreement, the Notes and each other Loan Document shall remain in full force and
effect.

7. Reaffirmation of Grant of Security Interest in Collateral.  Each Loan Party
hereby expressly reaffirms, ratifies and confirms its obligations under the
Guarantee and Collateral Agreement, including its mortgage, grant, pledge and
hypothecation to Administrative Agent for the benefit of the Secured Parties, of
the Lien on and security interest in, all of its right, title and interest in,
all of the Collateral and it is the intent of the parties that such Lien on and
security interest granted pursuant to the Guarantee and Collateral Agreement
shall continue in full force and effect.

8. Confirmation of Liens; No Default.  Each Loan Party hereby confirms that (i)
after giving effect to this Amendment and the Transactions (as defined in the
Restated Loan Agreement), there are no continuing Defaults or Events of Default
that have not been waived or cured, (ii) subject to the terms and conditions of
the Loan Documents, Administrative Agent has and shall continue to have valid,
enforceable and perfected Liens on the Collateral with the priority set forth in
the Intercreditor Agreement, for the benefit of the Secured Parties, pursuant to
the Loan Documents or otherwise granted to or held by Administrative Agent, for
the benefit of the Secured Parties, subject only to Liens expressly permitted
pursuant to Section 7.2 of the Restated Loan Agreement, and (iii) the agreements
and obligations of Borrower and each other Loan Party contained in the Restated
Loan Agreement, the other Loan Documents and in this Amendment constitute the
legal, valid and binding obligations of Borrower and each other Loan Party,
enforceable against Borrower and each other Loan Party in accordance with their
respective terms, except to the extent limited by general principles of equity
and by bankruptcy, insolvency, fraudulent conveyance, or other similar laws
affecting creditors’ rights generally. 

9. Effect of Amendments.  On and after the Restatement Date, as used in the
Restated Loan Agreement, the terms “Agreement”, “this Agreement”, “herein”,
“hereinafter”, “hereto”, “hereof”, and words of similar import shall, unless the
context otherwise requires, mean the Restated Loan Agreement and each reference
to the Existing Loan Agreement in any Loan Document shall be deemed to be a
reference to the Restated Loan Agreement. This Amendment shall be limited
precisely and expressly as drafted and shall not be construed as consent to the
amendment, restatement, modification, supplementation or waiver of any other
terms or provisions of the Restated Loan Agreement or any other Loan Document.  
 

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10. Costs and Expenses.  The payment of all fees, costs and expenses incurred by
Administrative Agent in connection with the preparation and negotiation of this
Amendment shall be governed by Section 5(g) of the Omnibus Agreement in lieu of
Section 10.5 of the Restated Loan Agreement. 

11. Governing Law.    THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.  THE JURISDICTION AND
WAIVER OF RIGHT TO TRIAL BY JURY PROVISIONS IN SECTIONS 10.12 AND 10.17 OF THE
RESTATED LOAN AGREEMENT ARE INCORPORATED, MUTATIS MUTANDIS, HEREIN BY REFERENCE.

12. Successors/Assigns. The provisions of this Amendment shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns.

13. Headings.  Section headings in this Amendment are included for convenience
of reference only and shall not constitute a part of this Amendment for any
other purpose.

14. Counterparts.  This Amendment may be executed by one or more of the parties
to this Amendment on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.  Delivery of an executed signature page of this Amendment by
facsimile transmission or by electronic mail in “portable document format” shall
be effective as delivery of a manually executed counterpart hereof.  A set of
the copies of this Amendment signed by all the parties shall be lodged with the
Borrower and Administrative Agent.

15. Release of Claims.  In consideration of the Lenders’ and Administrative
Agent’s agreements contained in this Amendment, each Loan Party hereby releases
and discharges each Lender and Administrative Agent and their affiliates,
subsidiaries, successors, assigns, directors, officers, employees, agents,
consultants and attorneys (each, a “Released Person”) of and from any and all
claims, suits, actions, investigations, proceedings or demands, whether based in
contract, tort, implied or express warranty, strict liability, criminal or civil
statute or common law of any kind or character, known or unknown, which such
Loan Party ever had or now has against Administrative Agent, any Lender or any
other Released Person which relates, directly or indirectly, to any acts or
omissions of Administrative Agent, any Lender or any other Released Person
relating to the Existing Loan Agreement, the Restated Loan Agreement or any
other Loan Document on or prior to the date hereof.

 

[SIGNATURE PAGES FOLLOW]

 

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IN WITNESS WHEREOF, each of the undersigned has executed this Amendment or has
caused the same to be executed by its duly authorized representatives as of the
date first above written.

 

 

GENESIS HEALTHCARE, INC.,
as Ultimate Parent

 

By:/s/ Michael S. Sherman
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

 

FC-GEN OPERATIONS INVESTMENT, LLC,

as Borrower

 

By:/s/ Michael S. Sherman
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

 

GEN OPERATIONS I, LLC,

as Parent

 

By:/s/ Michael S. Sherman
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

 

GEN OPERATIONS II, LLC,
as Holdings

 

By:/s/ Michael S. Sherman
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

 

1104281.02A-CHISR02A - MSW

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EACH OF THE ENTITIES LISTED ON ANNEX I ATTACHED HERETO:

 

By: FC-GEN OPERATIONS INVESTMENT, LLC,

its authorized agent

 

 

By:/s/ Michael S. Sherman
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

 

 

 

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WELLTOWER INC.,
as Administrative Agent and Collateral Agent

 

By:/s/ Justin Skiver
Name:Justin Skiver
Title:Authorized Signatory

 

 

 

 

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HCRI TUCSON PROPERTIES, INC.,
as Lender

 

By:/s/ Justin Skiver
Name:Justin Skiver
Title:Authorized Signatory

 

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OHI MEZZ LENDER LLC,

as Lender

 

By:/s/ Daniel J. Booth
Name:Daniel J. Booth
Title:  Chief Operating Officer

 

 

 

 

 

 

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ANNEX I

 

1 EMERSON DRIVE NORTH OPERATIONS LLC

1 EMERSON DRIVE SOUTH OPERATIONS LLC

1 MAGNOLIA DRIVE OPERATIONS LLC

1 SUTPHIN DRIVE OPERATIONS LLC

10 WOODLAND DRIVE OPERATIONS LLC

100 CHAMBERS STREET OPERATIONS LLC

100 EDELLA ROAD OPERATIONS LLC

100 ST. CLAIRE DRIVE OPERATIONS LLC

1000 ASSOCIATION DRIVE OPERATIONS LLC

1000 LINCOLN DRIVE OPERATIONS LLC

1000 ORWIGSBURG MANOR DRIVE OPERATIONS LLC

1000 SCHUYLKILL MANOR ROAD OPERATIONS LLC

101 13TH STREET OPERATIONS LLC

1020 SOUTH MAIN STREET OPERATIONS LLC

106 TYREE STREET OPERATIONS LLC

1080 SILVER LAKE BOULEVARD OPERATIONS LLC

1104 WELSH ROAD OPERATIONS LLC

1113 NORTH EASTON ROAD OPERATIONS LLC

1145 POQUONNOCK ROAD OPERATIONS LLC

115 EAST MELROSE AVENUE OPERATIONS LLC

115 SUNSET ROAD OPERATIONS LLC

1165 EASTON AVENUE OPERATIONS LLC

1165 EASTON AVENUE PROPERTY, LLC

120 MURRAY STREET OPERATIONS LLC

120 MURRAY STREET PROPERTY LLC

1201 RURAL AVENUE OPERATIONS LLC

12-15 SADDLE RIVER ROAD OPERATIONS LLC

1240 PINEBROOK ROAD, LLC

1245 CHURCH ROAD OPERATIONS LLC

1248 HOSPITAL DRIVE OPERATIONS LLC

1248 HOSPITAL DRIVE PROPERTY LLC

125 HOLLY ROAD OPERATIONS LLC

128 EAST STATE STREET ASSOCIATES, LLC

1350 E. LOOKOUT DRIVE OPERATIONS LLC

1351 OLD FREEHOLD ROAD OPERATIONS LLC

1361 ROUTE 72 WEST OPERATIONS LLC

140 PRESCOTT STREET OPERATIONS LLC

1420 SOUTH BLACK HORSE PIKE OPERATIONS LLC

1420 SOUTH BLACK HORSE PIKE PROPERTY, LLC

144 MAGNOLIA DRIVE OPERATIONS LLC

1501 SE 24TH ROAD, LLC

1515 LAMBERTS MILL ROAD OPERATIONS LLC

1526 LOMBARD STREET SNF OPERATIONS LLC

1539 COUNTRY CLUB ROAD OPERATIONS LLC

 

 

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1543 COUNTRY CLUB ROAD MANOR OPERATIONS LLC

16 FUSTING AVENUE OPERATIONS LLC

161 BAKERS RIDGE ROAD OPERATIONS LLC

1631 RITTER DRIVE OPERATIONS LLC

1680 SPRING CREEK ROAD OPERATIONS LLC

1700 PINE STREET OPERATIONS LLC

1700 WYNWOOD DRIVE OPERATIONS LLC

1718 SPRING CREEK ROAD OPERATIONS LLC

1775 HUNTINGTON LANE, LLC

1801 TURNPIKE STREET OPERATIONS LLC

1801 WENTWORTH ROAD OPERATIONS LLC

184 BETHLEHEM PIKE OPERATIONS LLC

191 HACKETT HILL ROAD OPERATIONS LLC

1980 SUNSET POINT ROAD, LLC

2 DEER PARK DRIVE OPERATIONS LLC

20 SUMMIT STREET OPERATIONS LLC

200 MARTER AVENUE OPERATIONS LLC

200 REYNOLDS AVENUE OPERATIONS LLC

200 SOUTH RITCHIE AVENUE OPERATIONS LLC

201 NEW ROAD OPERATIONS LLC

201 WOOD STREET OPERATIONS LLC

2015 EAST WEST HIGHWAY OPERATIONS LLC

2015 EAST WEST HIGHWAY PROPERTY, LLC

205 ARMSTRONG AVENUE OPERATIONS LLC

2101 FAIRLAND ROAD OPERATIONS LLC

22 SOUTH STREET OPERATIONS LLC

22 TUCK ROAD OPERATIONS LLC

2240 WHITE HORSE MERCERVILLE ROAD OPERATIONS LLC

225 EVERGREEN ROAD OPERATIONS LLC

227 EVERGREEN ROAD OPERATIONS LLC

227 PLEASANT STREET OPERATIONS LLC

23 FAIR STREET OPERATIONS LLC

23 FAIR STREET PROPERTY, LLC

2305 RANCOCAS ROAD OPERATIONS LLC

239 PLEASANT STREET OPERATIONS LLC

24 TRUCKHOUSE ROAD OPERATIONS LLC

25 EAST LINDSLEY ROAD OPERATIONS LLC

2507 CHESTNUT STREET OPERATIONS LLC

2600 HIGHLANDS BOULEVARD, NORTH, LLC

2601 EVESHAM ROAD OPERATIONS LLC

261 TERHUNE DRIVE OPERATIONS LLC

261 TERHUNE DRIVE PROPERTY, LLC

262 TOLL GATE ROAD OPERATIONS LLC

2720 CHARLES TOWN ROAD OPERATIONS LLC

279 CABOT STREET OPERATIONS LLC

279 CABOT STREET PROPERTY LLC

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290 HANOVER STREET OPERATIONS LLC

290 RED SCHOOL LANE OPERATIONS LLC

2900 TWELFTH STREET NORTH, LLC

292 APPLEGARTH ROAD OPERATIONS LLC

3 PARK DRIVE OPERATIONS LLC

30 PRINCETON BOULEVARD OPERATIONS LLC

30 WEST AVENUE OPERATIONS LLC

300 COURTRIGHT STREET OPERATIONS LLC

300 PEARL STREET OPERATIONS LLC

300 PEARL STREET PROPERTY LLC

3000 BALFOUR CIRCLE OPERATIONS LLC

3001 EVESHAM ROAD OPERATIONS LLC

302 CEDAR RIDGE ROAD OPERATIONS LLC

315 UPPER RIVERDALE ROAD LLC

32 HOSPITAL HILL ROAD OPERATIONS LLC

3227 BEL PRE ROAD OPERATIONS LLC

329 EXEMPLA CIRCLE OPERATIONS LLC

330 FRANKLIN TURNPIKE OPERATIONS LLC

333 GRAND AVENUE OPERATIONS LLC

333 GREEN END AVENUE OPERATIONS LLC

336 SOUTH WEST END AVENUE OPERATIONS LLC

3485 DAVISVILLE ROAD OPERATIONS LLC

35 MARC DRIVE OPERATIONS LLC

35 MILKSHAKE LANE OPERATIONS LLC

350 HAWS LANE OPERATIONS LLC

3809 BAYSHORE ROAD OPERATIONS LLC

3865 TAMPA ROAD, LLC

390 RED SCHOOL LANE OPERATIONS LLC

4 HAZEL AVENUE OPERATIONS LLC

40 PARKHURST ROAD OPERATIONS LLC

400 29TH STREET NORTHEAST OPERATIONS LLC

400 29TH STREET NORTHEAST PROPERTY LLC

400 GROTON ROAD OPERATIONS LLC

4140 OLD WASHINGTON HIGHWAY OPERATIONS LLC

422 23RD STREET OPERATIONS LLC

44 KEYSTONE DRIVE OPERATIONS LLC

440 NORTH RIVER STREET OPERATIONS LLC

450 EAST PHILADELPHIA AVENUE OPERATIONS LLC

455 BRAYTON AVENUE OPERATIONS LLC

4602 NORTHGATE COURT, LLC

462 MAIN STREET OPERATIONS LLC

464 MAIN STREET OPERATIONS LLC

475 JACK MARTIN BOULEVARD OPERATIONS LLC

4755 SOUTH 48TH STREET OPERATIONS LLC

4755 SOUTH 48TH STREET PROPERTY LLC

4901 NORTH MAIN STREET OPERATIONS LLC

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4927 VOORHEES ROAD, LLC

50 MULBERRY TREE STREET OPERATIONS LLC

500 EAST PHILADELPHIA AVENUE OPERATIONS LLC

5101 NORTH PARK DRIVE OPERATIONS LLC

515 BRIGHTFIELD ROAD OPERATIONS LLC

525 GLENBURN AVENUE OPERATIONS LLC

530 MACOBY STREET OPERATIONS LLC

536 RIDGE ROAD OPERATIONS LLC

54 SHARP STREET OPERATIONS LLC

5485 PERKIOMEN AVENUE OPERATIONS LLC

549 BALTIMORE PIKE OPERATIONS LLC

55 COOPER STREET OPERATIONS LLC

55 KONDRACKI LANE OPERATIONS LLC

55 KONDRACKI LANE PROPERTY, LLC

5501 PERKIOMEN AVENUE OPERATIONS LLC

56 HAMILTON AVENUE OPERATIONS LLC

56 WEST FREDERICK STREET OPERATIONS LLC

59 HARRINGTON COURT OPERATIONS LLC

590 NORTH POPLAR FORK ROAD OPERATIONS LLC

600 PAOLI POINTE DRIVE OPERATIONS LLC

6000 BELLONA AVENUE OPERATIONS LLC

61 COOPER STREET OPERATIONS LLC

610 DUTCHMAN’S LANE OPERATIONS LLC

610 TOWNBANK ROAD OPERATIONS LLC

613 HAMMONDS LANE OPERATIONS LLC

625 STATE HIGHWAY 34 OPERATIONS LLC

63 COUNTRY VILLAGE ROAD OPERATIONS LLC

642 METACOM AVENUE OPERATIONS LLC

65 COOPER STREET OPERATIONS LLC

650 EDISON AVENUE OPERATIONS LLC

70 GILL AVENUE OPERATIONS LLC

700 TOLL HOUSE AVENUE OPERATIONS LLC

700 TOWN BANK ROAD OPERATIONS LLC

715 EAST KING STREET OPERATIONS LLC

72 SALMON BROOK DRIVE OPERATIONS LLC

723 SUMMERS STREET OPERATIONS LLC

7232 GERMAN HILL ROAD OPERATIONS LLC

735 PUTNAM PIKE OPERATIONS LLC

7395 W. EASTMAN PLACE OPERATIONS LLC

740 OAK HILL ROAD OPERATIONS LLC

740 OAK HILL ROAD PROPERTY LLC

75 HICKLE STREET OPERATIONS LLC

7520 SURRATTS ROAD OPERATIONS LLC

7525 CARROLL AVENUE OPERATIONS LLC

77 MADISON AVENUE OPERATIONS LLC

7700 YORK ROAD OPERATIONS LLC

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

 

 

777 LAFAYETTE ROAD OPERATIONS LLC

78 OPAL STREET LLC

8 ROSE STREET OPERATIONS LLC

80 MADDEX DRIVE OPERATIONS LLC

800 WEST MINER STREET OPERATIONS LLC

8015 LAWNDALE STREET OPERATIONS LLC

810 SOUTH BROOM STREET OPERATIONS LLC

8100 WASHINGTON LANE OPERATIONS LLC

825 SUMMIT STREET OPERATIONS LLC

84 COLD HILL ROAD OPERATIONS LLC

840 LEE ROAD OPERATIONS LLC

841 MERRIMACK STREET OPERATIONS LLC

843 WILBUR AVENUE OPERATIONS LLC

845 PADDOCK AVENUE OPERATIONS LLC

850 PAPER MILL ROAD OPERATIONS LLC

867 YORK ROAD OPERATIONS LLC

8710 EMGE ROAD OPERATIONS LLC

8720 EMGE ROAD OPERATIONS LLC

89 MORTON STREET OPERATIONS LLC 

899 CECIL AVENUE OPERATIONS LLC

905 PENLLYN PIKE OPERATIONS LLC

91 COUNTRY VILLAGE ROAD OPERATIONS LLC

9101 SECOND AVENUE OPERATIONS LLC

93 MAIN STREET SNF OPERATIONS LLC

932 BROADWAY OPERATIONS LLC

9701 MEDICAL CENTER DRIVE OPERATIONS LLC

9738 WESTOVER HILLS BOULEVARD OPERATIONS LLC

98 HOSPITALITY DRIVE OPERATIONS LLC

98 HOSPITALITY DRIVE PROPERTY LLC

ALEXANDRIA CARE CENTER, LLC

ALTA CARE CENTER, LLC

ANAHEIM TERRACE CARE CENTER, LLC

BAY CREST CARE CENTER, LLC

BELEN MEADOWS HEALTHCARE AND REHABILITATION CENTER, LLC

BELMONT NURSING CENTER, LLC

BRADFORD SQUARE NURSING, LLC

BRIER OAK ON SUNSET, LLC

CAREERSTAFF UNLIMITED, LLC

CLAIRMONT LONGVIEW PROPERTY, LLC

CLAIRMONT LONGVIEW, LLC

CLOVIS HEALTHCARE AND REHABILITATION CENTER, LLC

COLONIAL TYLER CARE CENTER, LLC

COURTYARD JV LLC

CRESTVIEW NURSING, LLC

DIANE DRIVE OPERATIONS LLC

ELMCREST CARE CENTER, LLC

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

 

 

FC-GEN HOSPICE HOLDINGS, LLC

FIVE NINETY SIX SHELDON ROAD OPERATIONS LLC

FLATONIA OAK MANOR, LLC

FLORIDA HOLDINGS I, LLC

FLORIDA HOLDINGS II, LLC

FLORIDA HOLDINGS III, LLC

FORT WORTH CENTER OF REHABILITATION, LLC

FORTY SIX NICHOLS STREET OPERATIONS LLC

FORTY SIX NICHOLS STREET PROPERTY LLC

FOUNTAIN CARE CENTER, LLC

FOUNTAIN VIEW SUBACUTE AND NURSING CENTER, LLC

FRANKLIN WOODS JV LLC

GENESIS ADMINISTRATIVE SERVICES LLC

GENESIS BAYVIEW JV HOLDINGS, LLC

GENESIS CO HOLDINGS LLC

GENESIS CT HOLDINGS LLC

GENESIS DE HOLDINGS LLC

GENESIS DYNASTY OPERATIONS LLC

GENESIS ELDERCARE NETWORK SERVICES, LLC

GENESIS ELDERCARE PHYSICIAN SERVICES, LLC

GENESIS ELDERCARE REHABILITATION SERVICES, LLC

GENESIS HEALTH VENTURES OF NEW GARDEN, LLC

GENESIS HEALTHCARE LLC

GENESIS HOLDINGS LLC

GENESIS IP LLC

GENESIS LGO OPERATIONS LLC

GENESIS MA HOLDINGS LLC

GENESIS MD HOLDINGS LLC

GENESIS NH HOLDINGS LLC

GENESIS NJ HOLDINGS LLC

GENESIS OMG OPERATIONS LLC

GENESIS OPERATIONS II LLC

GENESIS OPERATIONS III LLC

GENESIS OPERATIONS IV LLC

GENESIS OPERATIONS LLC

GENESIS OPERATIONS V LLC

GENESIS OPERATIONS VI LLC

GENESIS PA HOLDINGS LLC

GENESIS PARTNERSHIP LLC

GENESIS PROSTEP, LLC

GENESIS RI HOLDINGS LLC

GENESIS STAFFING SERVICES LLC

GENESIS TX HOLDINGS LLC

GENESIS VA HOLDINGS LLC

GENESIS VT HOLDINGS LLC

GENESIS WV HOLDINGS LLC

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

 

 

GHC BURLINGTON WOODS DIALYSIS JV LLC

GHC DIALYSIS JV LLC

GHC HOLDINGS II LLC

GHC HOLDINGS LLC

GHC JV HOLDINGS LLC

GHC MATAWAN DIALYSIS JV LLC

GHC PAYROLL LLC

GHC RANDALLSTOWN DIALYSIS JV LLC

GHC SELECTCARE LLC

GHC TX OPERATIONS LLC

GHC WINDSOR DIALYSIS JV LLC

GRANITE LEDGES JV LLC

GRANT MANOR LLC

GREAT FALLS HEALTH CARE COMPANY, L.L.C.

GRS JV LLC

GUADALUPE SEGUIN PROPERTY, LLC

GUADALUPE VALLEY NURSING CENTER, LLC

HALLETTSVILLE REHABILITATION AND NURSING CENTER, LLC

HALLMARK INVESTMENT GROUP, LLC

HALLMARK REHABILITATION GP, LLC

HARBORSIDE CONNECTICUT LIMITED PARTNERSHIP

HARBORSIDE DANBURY LIMITED PARTNERSHIP

HARBORSIDE HEALTH I LLC

HARBORSIDE HEALTHCARE ADVISORS LIMITED PARTNERSHIP

HARBORSIDE HEALTHCARE LIMITED PARTNERSHIP

HARBORSIDE HEALTHCARE, LLC

HARBORSIDE MASSACHUSETTS LIMITED PARTNERSHIP

HARBORSIDE NEW HAMPSHIRE LIMITED PARTNERSHIP

HARBORSIDE NORTH TOLEDO LIMITED PARTNERSHIP

HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP

HARBORSIDE OF DAYTON LIMITED PARTNERSHIP

HARBORSIDE OF OHIO LIMITED PARTNERSHIP

HARBORSIDE POINT PLACE, LLC

HARBORSIDE REHABILITATION LIMITED PARTNERSHIP

HARBORSIDE RHODE ISLAND LIMITED PARTNERSHIP

HARBORSIDE SWANTON, LLC

HARBORSIDE SYLVANIA, LLC

HARBORSIDE TOLEDO BUSINESS LLC

HARBORSIDE TOLEDO LIMITED PARTNERSHIP

HARBORSIDE TROY, LLC

HBR BARDWELL LLC

HBR BARKELY DRIVE, LLC

HBR BOWLING GREEN LLC

HBR BROWNSVILLE, LLC

HBR CAMPBELL LANE, LLC

HBR DANBURY, LLC

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

 

 

HBR ELIZABETHTOWN, LLC

HBR KENTUCKY, LLC

HBR LEWISPORT, LLC

HBR MADISONVILLE, LLC

HBR OWENSBORO, LLC

HBR PADUCAH, LLC

HBR STAMFORD, LLC

HBR TRUMBULL, LLC

HBR WOODBURN, LLC

HC 63 OPERATIONS LLC

HHCI LIMITED PARTNERSHIP

HOSPITALITY LUBBOCK PROPERTY, LLC

HOSPITALITY NURSING AND REHABILITATION CENTER, LLC

HUNTINGTON PLACE LIMITED PARTNERSHIP

KANSAS CITY TRANSITIONAL CARE CENTER, LLC

KENNETT CENTER, L.P.

KHI LLC

KLONDIKE MANOR LLC

LEISURE YEARS NURSING, LLC

LINCOLN HIGHWAY JV LLC

LINCOLN HIGHWAY OPERATIONS LLC

LIVE OAK NURSING CENTER, LLC

MAGNOLIA JV LLC

MARIETTA HEALTHCARE, LLC

MARYLAND HARBORSIDE, LLC

MASSACHUSETTS HOLDINGS I, LLC

MONTEBELLO CARE CENTER, LLC

MONUMENT LA GRANGE PROPERTY, LLC

MONUMENT REHABILITATION AND NURSING CENTER, LLC

MS EXTON HOLDINGS, LLC

MS EXTON, LLC

OAKLAND MANOR NURSING CENTER, LLC

ODD LOT LLC

OHIO HOLDINGS I, LLC

OWENTON MANOR NURSING, LLC

PDDTSE LLC

PEAK MEDICAL ASSISTED LIVING, LLC

PEAK MEDICAL COLORADO NO. 2, LLC

PEAK MEDICAL COLORADO NO. 3, LLC

PEAK MEDICAL IDAHO OPERATIONS, LLC

PEAK MEDICAL LAS CRUCES NO. 2, LLC

PEAK MEDICAL LAS CRUCES, LLC

PEAK MEDICAL MONTANA OPERATIONS, LLC

PEAK MEDICAL NEW MEXICO NO. 3, LLC

PEAK MEDICAL OF BOISE, LLC

PEAK MEDICAL OF COLORADO, LLC

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

 

 

PEAK MEDICAL OF IDAHO, LLC

PEAK MEDICAL OF UTAH, LLC

PEAK MEDICAL ROSWELL, LLC

PEAK MEDICAL, LLC

PINE TREE VILLA LLC

PM OXYGEN SERVICES, LLC

PROCARE ONE NURSES, LLC

PROPERTY RESOURCE HOLDINGS, LLC

REGENCY HEALTH SERVICES, LLC

REGENCY NURSING, LLC

RESPIRATORY HEALTH SERVICES LLC

RIO HONDO SUBACUTE AND NURSING CENTER, LLC

RIVERSIDE RETIREMENT LIMITED PARTNERSHIP

ROMNEY HEALTH CARE CENTER LIMITED PARTNERSHIP

ROUTE 92 OPERATIONS LLC

ROYALWOOD CARE CENTER, LLC

SADDLE SHOP ROAD OPERATIONS LLC

SALISBURY JV LLC

SHARON CARE CENTER, LLC

SHG PARTNERSHIP, LLC

SHG RESOURCES, LLC

SKIES HEALTHCARE AND REHABILITATION CENTER, LLC

SKILES AVENUE AND STERLING DRIVE URBAN RENEWAL OPERATIONS LLC

SKILLED HEALTHCARE, LLC

SOUTHWOOD AUSTIN PROPERTY, LLC

SOUTHWOOD CARE CENTER, LLC

SR-73 AND LAKESIDE AVENUE OPERATIONS LLC

ST. ANTHONY HEALTHCARE AND REHABILITATION CENTER, LLC

ST. CATHERINE HEALTHCARE AND REHABILITATION CENTER, LLC

ST. ELIZABETH HEALTHCARE AND REHABILITATION CENTER, LLC

ST. JOHN HEALTHCARE AND REHABILITATION CENTER, LLC

ST. THERESA HEALTHCARE AND REHABILITATION CENTER, LLC

STATE STREET ASSOCIATES, L.P.

STATE STREET KENNETT SQUARE, LLC

STILLWELL ROAD OPERATIONS LLC

SUMMIT CARE PARENT, LLC

SUMMIT CARE, LLC

SUN HEALTHCARE GROUP, INC.

SUNBRIDGE BECKLEY HEALTH CARE LLC

SUNBRIDGE BRASWELL ENTERPRISES, LLC

SUNBRIDGE BRITTANY REHABILITATION CENTER, LLC

SUNBRIDGE CARE ENTERPRISES WEST, LLC

SUNBRIDGE CARE ENTERPRISES, LLC

SUNBRIDGE CARMICHAEL REHABILITATION CENTER, LLC

SUNBRIDGE CIRCLEVILLE HEALTH CARE LLC

SUNBRIDGE CLIPPER HOME OF PORTSMOUTH, LLC

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

 

 

SUNBRIDGE CLIPPER HOME OF ROCHESTER, LLC

SUNBRIDGE DUNBAR HEALTH CARE LLC

SUNBRIDGE GARDENDALE HEALTH CARE CENTER, LLC

SUNBRIDGE GLENVILLE HEALTH CARE, LLC

SUNBRIDGE GOODWIN NURSING HOME, LLC

SUNBRIDGE HALLMARK HEALTH SERVICES, LLC

SUNBRIDGE HARBOR VIEW REHABILITATION CENTER, LLC

SUNBRIDGE HEALTHCARE, LLC

SUNBRIDGE MARION HEALTH CARE LLC

SUNBRIDGE MEADOWBROOK REHABILITATION CENTER, LLC

SUNBRIDGE MOUNTAIN CARE MANAGEMENT, LLC

SUNBRIDGE NURSING HOME, LLC

SUNBRIDGE PARADISE REHABILITATION CENTER, LLC

SUNBRIDGE PUTNAM HEALTH CARE LLC

SUNBRIDGE REGENCY - TENNESSEE, LLC

SUNBRIDGE REGENCY-NORTH CAROLINA, LLC

SUNBRIDGE RETIREMENT CARE ASSOCIATES, LLC

SUNBRIDGE SALEM HEALTH CARE LLC

SUNBRIDGE SHANDIN HILLS REHABILITATION CENTER, LLC

SUNBRIDGE STOCKTON REHABILITATION CENTER, LLC

SUNBRIDGE SUMMERS LANDING, LLC

SUNDANCE REHABILITATION AGENCY, LLC

SUNDANCE REHABILITATION HOLDCO, INC.

SUNDANCE REHABILITATION, LLC

SUNMARK OF NEW MEXICO, LLC

THE CLAIRMONT TYLER, LLC

THE EARLWOOD, LLC

THE HEIGHTS OF SUMMERLIN, LLC

THE REHABILITATION CENTER OF ALBUQUERQUE, LLC

THE REHABILITATION CENTER OF OMAHA, LLC

THREE MILE CURVE OPERATIONS LLC

TOWN AND COUNTRY BOERNE PROPERTY, LLC

TOWN AND COUNTRY MANOR, LLC

VINTAGE PARK AT SAN MARTIN, LLC

WAKEFIELD HEALTHCARE, LLC

WESTFIELD HEALTHCARE, LLC

WOODLAND CARE CENTER, LLC

WOODSPOINT LLC

 

 

 

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

 

 

EXHIBIT B

 

 

 

$167,100,417.51

AMENDED AND RESTATED TERM LOAN AGREEMENT

among

GENESIS HEALTHCARE, INC.,
as Ultimate Parent

 

FC-GEN Operations Investment, LLC,

as Borrower and LLC Parent,

 

GEN Operations I, LLC,

as Parent,

 

GEN OPERATIONS II, LLC,
as Holdings,

The Several Lenders from Time to Time Parties Hereto,

and

WELLTOWER INC.
as Administrative Agent and Collateral Agent,

dated as of July 29, 2016,

 

as amended and restated as of March 6, 2018

 

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

 

TABLE OF CONTENTS

 

Page

 

SECTION 1. DEFINITIONS

1

1.1

Defined Terms

1

1.2

Other Definitional Provisions

34

SECTION 2. AMOUNT AND TERMS OF COMMITMENTS

34

2.1

Commitments

34

2.2

[Reserved]

35

2.3

Procedure for Loan Borrowing

35

2.4

Repayment of Loans

35

2.5

Repayment of Loans

35

2.6

Fees, etc

36

2.7

Optional Prepayments

36

2.8

Mandatory Prepayments

36

2.9

[Reserved].

38

2.10

[Reserved].

38

2.11

Interest Rates and Payment Dates

38

2.12

Computations of Interest and Fees

38

2.13

[Reserved].

39

2.14

Pro Rata Treatment and Payments

39

2.15

Requirements of Law.

41

2.16

Taxes

42

2.17

[Reserved].

45

2.18

[Reserved].

45

2.19

Mitigation of Costs; Change of Lending Office

45

2.20

Replacement of Lenders

45

2.21

[Reserved].

45

2.22

[Reserved].

45

2.23

[Reserved].

45

2.24

Nature and Extent of Borrower’s Liability

45

SECTION 3. REPRESENTATIONS AND WARRANTIES

46

3.1

Corporate Existence; Compliance with Law

46

3.2

Loan Documents and Lease Amendment Agreements

47

3.3

Financial Statements

48

3.4

Material Adverse Effect

49

3.5

Solvency

49

3.6

Litigation

49

3.7

Taxes

49

3.8

Margin Regulations

49

3.9

No Burdensome Obligations; No Defaults

50

3.10

Investment Company Act

50

3.11

Labor Matters

50

3.12

ERISA

50

3.13

Environmental Matters

51

3.14

Intellectual Property

51

3.15

Title; Real Property

51

3.16

Full Disclosure

52

3.17

Patriot Act; OFAC

52

i

 

1101322.03B-CHISR02A - MSW

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

 

TABLE OF CONTENTS

Page

 

3.18

No Default

52

3.19

Use of Proceeds

52

3.20

Insurance

52

3.21

Reportable Transactions

53

3.22

Security Documents

53

SECTION 4. CONDITIONS PRECEDENT

53

SECTION 5. REPORTING COVENANTS

56

5.1

Financial Statements

56

5.2

Other Events

57

5.3

ERISA Matters

58

5.4

Environmental Matters

58

5.5

Other Information

58

SECTION 6. AFFIRMATIVE COVENANTS

59

6.1

Maintenance of Corporate Existence

59

6.2

Compliance with Laws, Etc

59

6.3

Payment of Obligations

60

6.4

Maintenance of Property

60

6.5

Maintenance of Insurance

61

6.6

Keeping of Books

61

6.7

Access to Books and Property

61

6.8

Environmental

61

6.9

Post Closing Obligations

62

6.10

Additional Collateral, etc

62

6.11

Further Assurances

64

6.12

Use of Proceeds

64

6.13

Material Master Leases

64

6.14

Local Counsel Opinions

65

6.15

Taxes

65

6.16

Omnibus Agreement

65

SECTION 7. NEGATIVE COVENANTS

65

7.1

Indebtedness

65

7.2

Liens

68

7.3

Sale and Lease-Back Transactions

71

7.4

Investments, Loans and Advances

71

7.5

Mergers, Consolidations, Sales of Assets and Acquisitions

74

7.6

Restricted Payments; Restrictive Agreements

76

7.7

Transactions with Affiliates

77

7.8

Business of the Borrower and the Restricted Subsidiaries

78

7.9

Other Indebtedness and Agreements

78

7.10

[Reserved].

79

7.11

Account Changes; Fiscal Year

79

7.12

Capital Expenditures

79

7.13

Minimum Fixed Charge Coverage Ratio

79

7.14

Maximum Leverage Ratio

80

7.15

Minimum Interest Coverage Ratio

80

7.16

Certain Cure Rights

81

SECTION 8. EVENTS OF DEFAULT

82

ii

 

 

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

 

TABLE OF CONTENTS

Page

 

SECTION 9. THE AGENTS

84

9.1

Appointment

84

9.2

Delegation of Duties

84

9.3

Exculpatory Provisions

85

9.4

Reliance by the Agents

85

9.5

Non-Reliance on Agents and Other Lenders

86

9.6

Indemnification

86

9.7

Agent in Its Individual Capacity

87

9.8

Successor Agents

87

9.9

Authorization to Release Liens and Guarantees

87

9.10

Administrative Agent May File Proofs of Claim

88

SECTION 10. MISCELLANEOUS

88

10.1

Amendments and Waivers

88

10.2

Notices

90

10.3

No Waiver; Cumulative Remedies

91

10.4

Survival of Representations and Warranties

91

10.5

Payment of Expenses; Indemnification; Limitation of Liability

91

10.6

Successors and Assigns; Participations and Assignments

92

10.7

Adjustments; Set-off

95

10.8

Counterparts

96

10.9

Severability

96

10.10

Integration

96

10.11

GOVERNING LAW

96

10.12

Submission to Jurisdiction; Waivers

96

10.13

Acknowledgments

97

10.14

Confidentiality

97

10.15

Release of Collateral and Guarantee Obligations; Subordination of Liens

98

10.16

Accounting Changes

99

10.17

WAIVERS OF JURY TRIAL

99

10.18

USA PATRIOT ACT

99

10.19

Acknowledgement and Consent to Bail-In of EEA Financial Institution

99

 

 

 

 

iii

 

 

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

 

 

APPENDICES:

ACommitments

 

SCHEDULES:

1.1AClosing Date Mortgages

1.1BSubsidiary Guarantors

1.1CUnrestricted Subsidiaries

3.1(a)Corporate Existence, Compliance with Law

3.1(b)Healthcare Facilities

3.1(c)Primary Licenses

3.1(e)Healthcare Facility Violations

3.2Required Permits; Governmental Authority

3.6Litigation

3.7Taxes

3.11Labor Matters

3.12(b)Foreign Pension Plans

3.15Title Real Property

3.19Use of Proceeds

3.20Insurance

3.22(a)UCC Filing Jurisdictions

6.9Post Closing Obligations

7.1Existing Indebtedness

7.2Existing Liens

7.4Existing Investments

7.7Transactions with Affiliates

 

 

EXHIBITS:

A-1Form of Notice of Borrowing

A-2Form of Notice of Borrowing (2018 Term Loans)

BForm of Guarantee and Collateral Agreement

CForm of Compliance Certificate

DForm of Closing Certificate

EForm of Assignment and Assumption

FForm of Exemption Certificate

GForm of Solvency Certificate

HForm of Prepayment Notice

IForm of Promissory Note

J[reserved]

K[reserved]

LForm of Intercreditor Agreement

MForm of Intercompany Promissory Note

 

iv

 

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

 

 

AMENDED AND RESTATED TERM LOAN AGREEMENT, dated as of March 6, 2018, among
GENESIS HEALTHCARE, INC., a Delaware corporation (“Ultimate Parent”), FC-GEN
OPERATIONS INVESTMENT, LLC, a Delaware limited liability company (“LLC Parent”
or the “Borrower”), GEN OPERATIONS I, LLC, a Delaware limited liability company
(“Parent”), GEN OPERATIONS II, LLC, a Delaware limited liability company
(“Holdings”), HCRI TUCSON PROPERTIES, INC., a Delaware corporation (together
with its successors and permitted assigns, “Welltower Lender”), and OHI MEZZ
LENDER, LLC, a Delaware limited liability company (together with its successors
and permitted assigns, “Omega Lender”; and together with Welltower Lender, the
“Initial Lenders”) and any other Lender from time to time party to this
Agreement and WELLTOWER INC., as administrative agent (in such capacity,
together with its successors and permitted assigns, the “Administrative Agent”)
and collateral agent (in such capacity, together with its successors and
permitted assigns, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Borrower, Ultimate Parent, Parent, Holdings, the Lenders, the
Administrative Agent and the Collateral Agent previously entered into that
certain Term Loan Agreement, dated as of July 29, 2016, as amended by that
certain Amendment No. 1 to Loan Agreement, dated as of December 22, 2016, as
amended by that certain Amendment No. 2 and Waiver to Loan Agreement, dated as
of May 5, 2017, and as amended by that certain Amendment No. 3 to Loan
Agreement, dated as of August 8, 2017 (as it may have been further amended,
restated, amended and restated, supplemented or otherwise modified prior to the
Restatement Date (as defined below), the “Existing Term Loan Agreement”),
pursuant to which the Initial Lenders made term loans to the Borrower on the
Closing Date in an aggregate initial principal amount of $120,000,000 (the
“Initial Term Loans”);

WHEREAS, the Initial Term Loans made on the Closing Date and outstanding on the
Restatement Date will remain outstanding under this Agreement (as defined
below);

WHEREAS, the Borrower has requested the Lenders extend additional credit in the
form of new term loans in an aggregate initial principal amount of $40,000,000,
the proceeds of which will be used for the purposes described in Section 3.19
and Section 6.12 herein;

WHEREAS, pursuant to the Fourth Amendment (as defined below), the Borrower,
Ultimate Parent, Parent, Holdings, the Lenders party thereto, the Administrative
Agent and the Collateral Agent have agreed to amend and restate the Existing
Term Loan Agreement (as defined below) in the form hereof; and

WHEREAS, the Lenders are willing to make and maintain the term loan facilities
described herein available to the Borrower upon and subject to the terms and
conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the premises and the agreements hereinafter
set forth, the parties hereto hereby agree as follows:

SECTION 1. DEFINITIONS

1.1 Defined Terms.  As used in this Agreement, the terms listed in this Section
shall have the respective meanings set forth in this Section.

 

“2012 Credit Agreement”: the term loan agreement, dated as of December 3, 2012
(as amended, restated, amended and restated, supplemented or otherwise
modified), by and among LLC Parent,

 

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

 

 

Parent, Holdings, GHLLC, Sun Healthcare Group, Inc., the lenders party thereto,
Barclays Bank PLC, as administrative agent and collateral agent for the lenders,
and the other agents party thereto. 

“2012 Refinancing”: the refinancing and termination in full of the 2012 Credit
Agreement with the proceeds of Initial Term Loans and the discharge in full of
all guarantees and collateral provided in connection therewith. 

“2018 Term Loan Commitment”: as defined in the Fourth Amendment.

“2018 Term Loans”: as defined in the Fourth Amendment.

“ABL Credit Agreement”: the Fourth Amended and Restated Credit Agreement, dated
as of the Restatement Date by and among, inter alios, the Borrowers (as defined
therein), the Guarantors (as defined therein), the lenders party thereto and
MidCap Funding IV Trust (as successor to Healthcare Financial Solutions, LLC),
as administrative agent.

“ABL Loan Documents”: has the meaning assigned to the term “Loan Documents” in
the ABL Credit Agreement.

“ABL Obligations”: the “Obligations” under and as defined in the ABL Credit
Agreement.

“ABL Facility”: each of the asset-based revolving credit facilities incurred
pursuant to the ABL Loan Documents.

“Accounting Changes”: as defined in Section 10.16.

“Acquired EBITDA”: with respect to any Acquired Entity or Business or other
property for any period, the amount for such period of Consolidated EBITDA of
such Acquired Entity or Business or such property (determined as if references
to Ultimate Parent and its Subsidiaries in the definition of Consolidated EBITDA
were references to such Acquired Entity or Business and its Subsidiaries or such
property), all as determined on a consolidated basis for such Acquired Entity or
Business or such property.

“Acquired Entity or Business”: as defined in the definition of “Consolidated
EBITDA”.

“Administrative Agent”: as defined in the preamble hereto.

“Affiliate”: as to any Person, any other Person that, directly or indirectly, is
in control of, is controlled by, or is under common control with, such
Person.  No Secured Party shall be an Affiliate of the Borrower nor shall any
Secured Party be deemed to be an “Affiliate” of any Loan Party solely by virtue
of being a “Lender” or “Secured Party” under this Agreement.  For purposes of
this definition, “control” of a Person means (i) the power, directly or
indirectly to direct or cause the direction of the management and policies of
such Person, in either case whether by contract or otherwise or (ii) beneficial
ownership of 10% or more of the Voting Stock of such Person.

“Agent-Related Persons”: each Agent, together with its Related Parties.

“Agents”: the collective reference to the Collateral Agent and the
Administrative Agent.

“Agreement”: this Amended and Restated Term Loan Agreement.

“Applicable Indebtedness”:  as defined in the definition of “Weighted Average
Life to Maturity”.

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“Approved Fund”: as defined in Section 10.6(b).

“Asset Sale”: the sale, transfer or other Disposition (by way of merger,
casualty, condemnation or otherwise) by Ultimate Parent or any of the Restricted
Subsidiaries to any person other than Ultimate Parent, the Borrower or any
Subsidiary Guarantor of (a) any Capital Stock of any of the Subsidiaries (other
than directors’ qualifying shares) or (b) any other assets of Ultimate Parent or
any of the Restricted Subsidiaries (other than (i) inventory, damaged, no longer
useful or needed, obsolete or worn out assets, scrap, cash and Cash Equivalents,
in each case Disposed of in the ordinary course of business, (ii) Dispositions
between or among Foreign Subsidiaries, (iii) Dispositions of property to the
extent that (A) such property is exchanged for credit against the purchase price
of similar replacement property or (B) the proceeds of such Disposition are
applied to the purchase price of such replacement property (which replacement
property is actually promptly purchased), (iv) leases, subleases, licenses or
sublicenses (including the provision of software under an open source license),
in each case in the ordinary course of business and which do not materially
interfere with the business of Ultimate Parent and the Restricted Subsidiaries,
taken as a whole, (v) Dispositions of accounts receivable in connection with the
collection or compromise thereof in the ordinary course of business, (vi)
Dispositions of Investments in joint ventures to the extent required by, or made
pursuant to customary buy/sell arrangements between, the joint venture parties
set forth in joint venture arrangements and similar binding arrangements, (vii)
Dispositions permitted by Sections 7.4, 7.5 and 7.6 and Liens permitted by
Section 7.2, (viii) the unwinding of any Hedge Agreement, (ix) any sale,
transfer or other Disposition or series of related sales, transfers or other
Dispositions having a value not in excess of $1,500,000, (x) the assignment,
cancellation, abandonment or other disposition of Intellectual Property that is,
in the reasonable judgment of Ultimate Parent, no longer economically
practicable to maintain or useful in the conduct of the business of Ultimate
Parent and the Restricted Subsidiaries taken as a whole and (xi)  Dispositions
of licenses in connection with the implementation of a UPL Program).

“Assignee”: as defined in Section 10.6(b).

“Assignment and Assumption”: an Assignment and Assumption, substantially in the
form of Exhibit E.

“Audited Financial Statements”: Ultimate Parent’s audited Consolidated balance
sheet as of December 31, 2015 and the related Consolidated statements of income
or operations, shareholders’ equity and cash flows, including the notes thereto,
each for the three fiscal years ended December 31, 2013, December 31, 2014 and
December 31, 2015.

“Bail-In Action”: 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.

“Bail-In Legislation”: 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.

“Bankruptcy Code”: the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. §101, et
seq.), as amended and in effect from time to time and the regulations issued
from time to time thereunder.

“Benefit Plan”: any employee benefit plan as defined in Section 3(3) of ERISA
(whether governed by the laws of the United States or otherwise), other than a
Foreign Pension Plan or Multiemployer Plan, to which any Loan Party incurs or
otherwise has any obligation or liability, contingent or otherwise.

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“Benefited Lender”: as defined in Section 10.7(a).

“Board”: the Board of Governors of the Federal Reserve System of the United
States (or any successor).

“Borrower”: as defined in the preamble hereto.

“Borrowing Date”: any Business Day specified by the Borrower as a date on which
the Borrower requests the relevant Lenders to make Loans hereunder.

“Business”: the business and any services, activities or businesses incidental
or directly related or similar or complementary to any business or line of
business engaged in by Ultimate Parent or the Restricted Subsidiaries as of the
Closing Date or any business or business activity that is a reasonable
extension, development or expansion thereof or ancillary thereto.

“Business Day”: a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close.

“Capital Expenditures”: for any period, the additions to property, plant and
equipment and other capital expenditures of Ultimate Parent and the Restricted
Subsidiaries that are (or should be) set forth in a Consolidated statement of
cash flows of Ultimate Parent for such period prepared in accordance with GAAP,
but excluding (i) any such expenditure made to restore, replace or rebuild
property to the condition of such property immediately prior to any damage,
loss, destruction or condemnation of such property, to the extent such
expenditure is made with insurance proceeds, condemnation awards or damage
recovery proceeds relating to any such damage, loss, destruction or
condemnation, (ii) any such expenditure to the extent that proceeds of Asset
Sales, debt financings or lease financings are used to make such expenditure,
(iii) the purchase price of assets purchased during such period to the extent
the consideration therefor consists of any combination of (A) assets traded in
at the time of such purchase and (B) the proceeds of a concurrent sale of
assets, in each case in the ordinary course of business, (iv) expenditures which
constitute consideration paid in respect of Permitted Acquisitions and other
Investments permitted under Section 7.4 (other than Investments permitted under
Section 7.4(j)), (v) any such expenditures made with the proceeds of any
Excluded Issuance or the incurrence of any Indebtedness permitted under this
Agreement, (vi) expenditures constituting interest capitalized during such
period and (vii) expenditures that are accounted for as capital expenditures of
such Person and that actually are paid for by a third party and for which no
Loan Party has provided or is required to provide or incur, directly or
indirectly, any consideration or obligation to such third party or any other
person.

“Capital Lease Obligations”: as to any Person, the obligations of such Person to
pay rent or other amounts under any lease of (or other arrangement conveying the
right to use) real or tangible personal property, or a combination thereof, to
the extent such obligations are required to be classified and accounted for as
capital leases or similar lease financing obligations on a balance sheet of such
Person under GAAP and, for the purposes of this Agreement, the amount of such
obligations at any time shall be the capitalized amount thereof at such time
determined in accordance with GAAP; provided that, notwithstanding the
foregoing, all obligations of any Person that are or would have been treated as
operating leases for purposes of GAAP prior to the issuance by the Financial
Accounting Standards Board on February 25, 2016 of an Accounting Standards
Update (the “ASU”) shall continue to be accounted for as operating leases for
purposes of all financial definitions and calculations for purpose of this
Agreement (whether or not such operating lease obligations were in effect on
such date) notwithstanding the fact that such obligations are required in
accordance with the ASU (on a prospective or retroactive basis or otherwise) to
be treated as Capital Lease Obligations in the financial statements to be
delivered pursuant to Section 5.1.

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“Capital Stock”: any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, and any and
all equivalent ownership interests in a Person (other than a corporation) and
any and all warrants, rights or options to purchase any of the foregoing, but
excluding Indebtedness convertible or exchangeable into Capital Stock.

“CapOne Letter of Credit Facility” means that certain letter of credit facility
entered into on or about the date hereof by Capital One, National Association
(“CapOne”), as the issuing bank, and the Ultimate Parent and one or more
additional Loan Parties, as the applicants, whereby CapOne will issue letters of
credit for the account of one or more Loan Parties from time to time, as such
letter of credit facility may be amended, restated, replaced, refinanced,
extended, renewed or otherwise modified from time to time with one or more
issuers in whole or in part. 

“Cash Equivalents”: (a) any readily-marketable securities (i) issued by, or
directly, unconditionally and fully guaranteed or insured by the United States
federal government or (ii) issued by any agency or instrumentality of the United
States federal government the obligations of which are fully backed by the full
faith and credit of the United States federal government, (b) any
readily-marketable direct obligations issued by any other agency of the United
States federal government, any state of the United States or any political
subdivision of any such state or any public instrumentality thereof, in each
case having a rating of at least “A-2” from S&P or at least “P-2” from Moody’s,
(c) any commercial paper rated at least “A-2” by S&P or “P-2” by Moody’s and
issued by any Person organized under the laws of any state of the United States,
(d) any Dollar-denominated time deposit, insured certificate of deposit,
overnight bank deposit or bankers’ acceptance issued or accepted by (i) any
Lender or (ii) any commercial bank that is (A) organized under the laws of the
United States, any state thereof or the District of Columbia, (B) “adequately
capitalized” (as defined in the regulations of its primary federal banking
regulators) and (C) has Tier 1 capital (as defined in such regulations) in
excess of $250,000,000 and (e) shares of any United States money market fund
that (i) has substantially all of its assets invested continuously in the types
of investments referred to in clause (a), (b), (c) or (d) above with maturities
as set forth in the proviso below, (ii) has net assets in excess of $500,000,000
and (iii) has obtained from either S&P or Moody’s the highest rating obtainable
for money market funds in the United States; provided, however, that the
maturities of all obligations specified in any of clauses (a), (b), (c) and (d)
above shall not exceed 365 days.

“Cash Management Counterparty”: any Person that is a party to a Cash Management
Document that was a Lender or Agent at the time any such Cash Management
Document was entered into or an Affiliate of such a Lender or Agent, in each
case in its capacity as party to a Cash Management Document.

“Cash Management Document”: any certificate, agreement or other document
executed by Ultimate Parent or any Restricted Subsidiary in respect of the Cash
Management Obligations of Ultimate Parent or any Restricted Subsidiary.

“Cash Management Obligation”: with respect to Ultimate Parent and the Restricted
Subsidiaries, any direct or indirect liability, contingent or otherwise, of any
such Person in respect of cash management services (including treasury,
depository, overdraft, credit or debit card, electronic funds transfer and other
cash management arrangements) provided after the Closing Date (regardless of
whether these or similar services were provided prior to the Closing Date by the
Administrative Agent, any Lender or any Affiliate of any of them) by the
Administrative Agent, any Lender or any Affiliate of any of them, including
obligations for the payment of fees, interest, charges, expenses, attorneys’
fees and disbursements in connection therewith.

“Certificated Security”: as defined in the Guarantee and Collateral Agreement.

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“Change of Control”: (i) Ultimate Parent shall cease to own directly or
indirectly (x) no less than 50% of the Capital Stock of LLC Parent; (y) 100% of
the Capital Stock of any other of the managing members of LLC Parent or (z) 100%
of the Capital Stock of SGH Partnership, LLC or Genesis Partnership, LLC
(except, in each case, to the extent expressly permitted by Section
7.5(a)(i)(A)), (ii) except to the extent expressly permitted by Section
7.5(a)(i)(D), Ultimate Parent and LLC Parent shall cease to own, directly or
indirectly, 100% of the Capital Stock of GHLLC, Parent, Holdings, Skilled
Holdings or Genesis Holdings; (iii) Holdings (or, if Holdings is no longer in
existence in accordance with Section 7.5(a)(i)(D), Parent or LLC Parent) shall
cease to own, directly or indirectly, 100% of the Capital Stock of GHLLC and
Skilled Holdings; (iv) any “person” or “group” (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act, but excluding any employee benefit
plan of such person and its subsidiaries and any person acting in its capacity
as trustee, agent or other fiduciary or administrator of any such plan), other
than the Permitted Investors is or becomes the beneficial owner, directly or
indirectly, of more than 35% of the Voting Stock of Ultimate Parent and such
person or group is or becomes, directly or indirectly, the beneficial owner of a
greater percentage of the Voting Stock of Ultimate Parent than the percentage of
outstanding Voting Stock of Ultimate Parent owned by the Permitted Investors or
(v) a “change of control” or similar concept under the ABL Loan Documents or any
Material Master Leases shall have occurred.

“Chattel Paper”: as defined in the Guarantee and Collateral Agreement.

“Closing Date”: July 29, 2016.

“Closing Date Mortgages”: Mortgages on the real properties listed on Schedule
1.1A to be delivered pursuant to Section 4(b).

“Code”: the Internal Revenue Code of 1986, as amended from time to time.

“Collateral”: as defined in the Guarantee and Collateral Agreement.

“Collateral Agent”: as defined in the preamble hereto.

“Commitment”: as to any Lender, the obligation of such Lender, if any, to make a
Loan to the Borrower under this Agreement in a principal amount not to exceed
the amount set forth opposite such Lender’s name on Appendix A. 

“Committed Reinvestment Amount”: as defined in the definition of “Reinvestment
Prepayment Amount”.

“Commodity Exchange Act”: the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as
amended from time to time, and any successor statute.

“Compliance Certificate”: a certificate duly executed by a Responsible Officer
substantially in the form of Exhibit C.

“Confidential Information”: as defined in Section 10.14.

“Consolidated”: with respect to Ultimate Parent and its Subsidiaries,
consolidated in accordance with GAAP, excluding the revenues, expenses, assets
and liabilities of variable interest entities having Indebtedness that is
non-recourse to Ultimate Parent and its Subsidiaries.

“Consolidated Cash Interest Expense”: for any period, the Consolidated Interest
Expense for such period minus the sum of, in each case to the extent included in
the definition of Consolidated

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Interest Expense, (a) the amortized amount of debt discount and debt issuance
costs (including, without limitation, amortization of financing fees and
expenses paid in connection with the transactions contemplated by the Loan
Documents and Permitted Acquisitions), (b) interest payable in evidences of
Indebtedness or by addition to the principal of the related Indebtedness and (c)
other non-cash interest. 

“Consolidated EBITDA”: for any period, Consolidated Net Income for such period
plus without duplication and to the extent deducted in determining such
Consolidated Net Income, the sum of (i) Consolidated Interest Expense for such
period, plus (ii) Consolidated income tax expense for such period, plus (iii)
all amounts attributable to the amount of the provision for depreciation and
amortization; plus (iv) the amount of any non-cash charges (other than the write
down of current assets), plus (v) the amount of any loss from unusual or
extraordinary items in excess of $100,000, including any related management
incentive or stay-pay plans in place as of the Closing Date, any restructuring
charges and any other non-recurring loss not to exceed $20,000,000 in the
aggregate for this clause (v) for any period, plus (vi) costs, fees and expenses
for such period paid in connection with the Transactions, plus (vii) any
non-recurring fees, costs or expenses for such period incurred in connection
with a Permitted Acquisition or any Investment, Disposition, incurrence of (or
amendments or modifications to) Indebtedness (including the Fourth Amendment),
issuance of Capital Stock or entry into new (or amendments or modifications to)
Material Master Leases, in each case, permitted under this Agreement (in each
case, including any such transaction undertaken but not completed); provided
that the costs, fees and expenses added pursuant to clause (vi) and this clause
(vii), in the aggregate, shall not exceed 20% of Consolidated EBITDA in any
period, plus (viii) the amount of cost savings and acquisition synergies
projected by Ultimate Parent in good faith to be realized within (x) 15 months
of the date such actions are first taken in connection with the Transactions or
(y) 12 months of the date such actions are first taken in connection with any
other acquisition or Disposition or restructuring of the business by the Parent
Companies, the Borrower or any Restricted Subsidiary, in each case, calculated
on a Pro Forma Basis as though such cost savings or acquisition synergies had
been realized on the first day of such period, net of the amount of actual
benefits realized during such period that are otherwise included in the
calculation of Consolidated EBITDA from such actions; provided that (A) such
cost savings and acquisition synergies are reasonably identifiable and factually
supportable, and (B) the aggregate amount of cost savings and acquisition
synergies added pursuant to this clause (viii) shall not exceed (x) $50,000,000
in the aggregate (and in no event shall the total amount of all cost savings and
acquisition synergies with respect to the Transactions exceed $50,000,000), in
the case of net cost savings and acquisition synergies with respect to the
Transactions; and (y) 15% of Consolidated EBITDA in any period, otherwise, plus
(ix) [reserved], plus (x) the amount of management, consulting, monitoring and
advisory fees (including termination fees and transaction fees) and related
indemnities and expenses paid or accrued in such period (and prior to the
Closing Date) to the Sponsor pursuant to any management agreement permitted by
Section 7.6(a)(vi) and deducted (and not added back) in such period in computing
such Consolidated Net Income, in an aggregate amount not exceeding $3,000,000 in
any fiscal year, plus (xi) solely in connection with calculating the Fixed
Charge Coverage Ratio, Consolidated Total Leverage Ratio and Interest Coverage
Ratio for any periods, the Customer Charge, minus (xii) the amount of any cash
or non-cash unusual or extraordinary gains that are in excess of $100,000 and
any other non-recurring gains. Any non-cash expenses related to the management
incentive or stay-pay plans in place as of the Closing Date will be included in
clause (v) above.  In addition, (A) there shall be included on a Pro Forma Basis
in determining Consolidated EBITDA for any period, without duplication, Acquired
EBITDA of any Person, business or other property acquired by Ultimate Parent or
any of the Restricted Subsidiaries during such period (but not the Acquired
EBITDA of any related Person or business to the extent not so acquired) in
accordance with the terms of this Agreement, to the extent not subsequently
sold, transferred or otherwise Disposed of by Ultimate Parent or such Restricted
Subsidiary during such period (each such Person or business acquired and not
subsequently so Disposed of, an “Acquired Entity or Business”), based on the
actual Acquired EBITDA of such Acquired Entity or Business for such period
(including the portion thereof occurring prior to such acquisition); (B) there
shall be excluded on a Pro Forma Basis in determining Consolidated EBITDA for
any period the Disposed

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EBITDA of any Person, property, business transferred or otherwise Disposed of,
closed or classified as discontinued operations as classified under GAAP by
Ultimate Parent or any of the Restricted Subsidiaries during such period (each
such Person, property, business so sold or Disposed of, a “Sold Entity or
Business”), based on the actual Disposed EBITDA of such Sold Entity or Business
for such period (including the portion thereof occurring prior to such sale,
transfer or Disposition); and (C) there shall be excluded on a Pro Forma Basis
in determining Consolidated EBITDA for any period the Consolidated EBITDA of any
newly constructed healthcare facilities for the twelve month period following
receipt of a certificate of occupancy for such properties, in an aggregate
amount not exceeding $5,000,000 in any four fiscal quarter period. 

“Consolidated EBITDAR”: for any period, Consolidated EBITDA for such period
plus, to the extent deducted in determining Consolidated EBITDA for such period,
Consolidated Rental Expense.

“Consolidated Fixed Charges”: for any period, the sum of Consolidated Cash
Interest Expense and scheduled payments of principal on Consolidated Total Debt
(without giving effect to the netting of unrestricted cash and Cash Equivalents
pursuant to clause (d) of such definition) of the Parent Companies, the Borrower
and the Restricted Subsidiaries for such period.

“Consolidated Interest Expense”: for any period, the sum of (a) the interest
expense (including imputed interest expense in respect of Capital Lease
Obligations (other than Real Property Financing Obligations)) of the Parent
Companies, the Borrower and the Restricted Subsidiaries for such period,
determined on a Consolidated basis in accordance with GAAP, plus (b) any
interest accrued during such period in respect of Indebtedness of the Parent
Companies, the Borrower or any Restricted Subsidiary that is required to be
capitalized rather than included in Consolidated Interest Expense for such
period in accordance with GAAP; provided, that Consolidated Interest Expense for
any period ending on any day prior to the first anniversary of the Closing Date
shall be deemed equal to the product of (i) Consolidated Interest Expense
computed in accordance with the requirements of this definition for the period
from and including the Closing Date to and including such day by (ii) a
fraction, the numerator of which is the number of days from and including the
Closing Date to and including such day and the denominator of which is 365.

“Consolidated Net Income”: for any period, the net income or loss of the Parent
Companies, the Borrower and the Restricted Subsidiaries for such period
determined on a Consolidated basis in accordance with GAAP; provided that there
shall be excluded, without duplication, (a) the income of any Restricted
Subsidiary to the extent that the declaration or payment of dividends or similar
distributions by such Restricted Subsidiary of that income is not at the time
permitted by operation of the terms of its charter or any agreement, instrument,
judgment, decree, statute, rule or governmental regulation applicable to such
Restricted Subsidiary, (b) the income or loss of any Person accrued prior to the
date it becomes a Restricted Subsidiary or is merged into or consolidated with
Ultimate Parent or any Restricted Subsidiary or the date that such Person’s
assets are acquired by Ultimate Parent or any Restricted Subsidiary, (c) any
gains or losses attributable to sales of assets outside of the ordinary course
of business, (d) earnings (or losses) resulting from any reappraisal,
revaluation or write-up (or write-down) of assets (other than current assets);
(e) unrealized gains and losses with respect to Hedge Agreements or other
derivative instruments for such period and (f) any gains or losses relating to
discontinued operations; provided further that the net income of any person in
which any other person (other than Ultimate Parent or a Wholly-Owned Restricted
Subsidiary or any director or foreign national holding qualifying shares in
accordance with applicable law) has a joint interest shall be included in
Consolidated Net Income only to the extent of the percentage interest of such
person owned by the Parent Companies, the Borrower and the Restricted
Subsidiaries.  In addition, to the extent not already included in Consolidated
Net Income, notwithstanding anything to the contrary in the foregoing,
Consolidated Net Income shall include (i) any expenses and charges that are
reimbursed by indemnification or other reimbursement provisions in

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connection with any Investment or any Asset Sale permitted hereunder and (ii) to
the extent covered by insurance and actually reimbursed, expenses with respect
to liability or casualty events or business interruption.

“Consolidated Rental Expense”: for any period, the total cash rental expense for
operating leases and Real Property Financing Obligations (including the imputed
interest expense with respect thereto) of the Parent Companies, the Borrower and
the Restricted Subsidiaries (regardless of the accounting treatment thereof),
determined on a Consolidated basis for such period and adjusted, for avoidance
of doubt, to exclude the non-cash impact resulting from the straight-lining of
rents; provided that Consolidated Rental Expense shall be reduced by any rental
income.

 “Consolidated Total Assets”: as of any date of determination, the total amount
of all assets of the Parent Companies, the Borrower and the Restricted
Subsidiaries determined on a Consolidated basis in accordance with GAAP as of
the last day of the period for which the most recent financial statements were
delivered prior to such date of determination.

“Consolidated Total Debt”: as of any date of determination, the aggregate
principal amount of Indebtedness of the Parent Companies, the Borrower and the
Restricted Subsidiaries less (a) Indebtedness of the type described in clause
(e) of the definition of such term to the extent related to Real Property
Financing Obligations, (b) Indebtedness of a type described in clauses (d) and
(f) of the definition thereof, (c) any letters of credit, banker acceptances or
similar instruments to the extent undrawn, and (d) unrestricted cash and Cash
Equivalents as shown on the balance sheet on a Consolidated basis of the Parent
Companies, the Borrower and the Restricted Subsidiaries (it being understood
that cash and Cash Equivalents on deposit in an account in which the Collateral
Agent, the collateral agent under the ABL Facility or, subject to the
Intercreditor Agreement, the Skilled RE Lender or the MidCap RE Agent has a
perfected Lien constitutes unrestricted cash for purposes hereof).

“Consolidated Total Leverage Ratio”: as of any date of determination, the ratio
of Consolidated Total Debt as of such date to Consolidated EBITDA of the Parent
Companies, the Borrower and the Restricted Subsidiaries for the four fiscal
quarter period ending on such date calculated on a Pro Forma Basis.

“Contractual Obligation”: as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which
such Person is a party or by which it or any of its Property is bound.

“Controlled Investment Affiliate”: means, as applied to any Person, any other
Person which directly or indirectly is in control of, is controlled by, or is
under common control with, such Person and that is organized by such Person (or
any Person controlling such Person) primarily for the purpose of making equity
or debt investments in Ultimate Parent or other portfolio companies.  For
purposes of this definition, “control” of a Person means the power, directly or
indirectly to direct or cause the direction of the management and policies of
such Person, in either case whether by contract or otherwise.

“Curable Period”: as defined in Section 7.16(a).

“Cure Amount”: as defined in Section 7.16(a).

“Cure Right”: as defined in Section 7.16(a).

“Customary Permitted Liens”: any Lien permitted by Section 7.2 other than those
described clauses (j), (k), (l), (m), (n), (o), (p), (s)(ii), (v), (w), (x),
(z), and (bb) of Section 7.2.

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“Customer Charge”: for any measurement period, without duplication, the amount
of any cash or non-cash charge or write-down (net of any subsequent adjustment
taken as income) recognized by the Borrower and the Ultimate Parent and/or their
respective Subsidiaries, in respect of receivables owing by Fortis Management
Group, Consulate Healthcare LLC and any applicable Affiliate thereof to the
Borrower and the Ultimate Parent and/or their respective Subsidiaries.

“Debtor Relief Laws”: the Bankruptcy Code, 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 and affecting the rights of creditors generally.

“Default”: any of the events specified in Section 8, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.

“Designated Jurisdiction”: any country or territory to the extent that such
country or territory itself is the subject of any Sanction.

“Disposed EBITDA”: with respect to any Sold Entity or Business or property for
any period, the amount for such period of Consolidated EBITDA of such Sold
Entity or Business or property (determined as if references to the Parent
Companies, the Borrower and the Restricted Subsidiaries in the definition of
Consolidated EBITDA were references to such Sold Entity or Business and their
Subsidiaries or such property), all as determined on a consolidated basis for
such Sold Entity or Business or property.

“Disposition”: with respect to any Property, any sale, sale and leaseback,
assignment, conveyance, transfer or other effectively complete disposition
thereof.  The terms “Dispose” and “Disposed of” shall have correlative meanings.

“Disqualified Capital Stock”: any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, (a) matures (excluding any
maturity as the result of an optional redemption by the issuer thereof) or is
mandatorily redeemable (other than solely for Qualified Capital Stock), pursuant
to a sinking fund obligation or otherwise (except as the result of a Change of
Control or asset sale so long as any rights of the holders thereof upon the
occurrence of a Change of Control or asset sale event shall be subject to the
prior repayment in full of the Loans and all Obligations that are accrued and
payable), or is redeemable at the option of the holder thereof, in whole or in
part (other than solely for Qualified Capital Stock), or requires the payment of
any cash dividend or any other scheduled payment constituting a return of
capital, in each case at any time on or prior to the date that is 91 days after
the Maturity Date, or (b) is convertible into or exchangeable (unless at the
sole option of the issuer thereof) for (i) debt securities or (ii) any Capital
Stock referred to in clause (a) above, in each case at any time prior to the
date that is 91 days after the Maturity Date; provided that if such Capital
Stock is issued to any plan for the benefit of employees of the Parent
Companies, the Borrower, or the Restricted Subsidiaries or by any such plan to
such employees, such Capital Stock shall not constitute Disqualified Capital
Stock solely because it may be required to be repurchased by the Parent
Companies, the Borrower, or the Restricted Subsidiaries in order to satisfy
applicable statutory or regulatory obligations; provided,  further, that any
Capital Stock held by any present or former officers, consultants, directors or
employees (and their spouses, former spouses, heirs, estates and assigns) of the
Parent Companies, the Borrower or any Restricted Subsidiary upon the death,
disability, engaging in competitive activity or termination of employment of
such officer, director, consultant or employee or pursuant to any equity
subscription, shareholder, employment or other agreement shall not constitute
Disqualified Capital Stock solely because it may be required to be repurchased
by the Parent Companies, the Borrower or the Restricted Subsidiaries.

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“Dollars” and “$”: dollars in lawful currency of the United States.

“Domestic Subsidiary”: any direct or indirect Subsidiary incorporated in or
organized under the laws of any jurisdiction within the United States.

“EEA Financial Institution”: (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 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”: any of the member states of the European Union, Iceland,
Liechtenstein, and Norway.

“EEA Resolution Authority”: 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”: (a) any Lender, any Affiliate of a Lender and any Approved
Fund, and (b) any commercial bank, insurance company, investment or mutual fund
or other entity (other than a natural person) that is an “accredited investor”
(as defined in Regulation D under the Securities Act) and that extends credit or
buys loans in the ordinary course; provided that none of the Parent Companies,
the Borrower, their Subsidiaries, Permitted Investors or any other equity holder
of a Parent Company or an Affiliate of a Permitted Investor or such equity
holder shall be an Eligible Assignee. 

“Environmental Claims”: any and all actions, suits, orders, decrees, demands,
demand letters, claims, liens, notices of noncompliance, violation or potential
responsibility or investigation (other than internal reports prepared by the
Parent Companies, the Borrower or any of their Subsidiaries (a) in the ordinary
course of such Person’s business or (b) as required in connection with a
financing transaction or an acquisition or Disposition of real estate) or
proceedings pursuant to or in connection with any Environmental Law or any
permit issued, or any approval given, under any such Environmental Law
(hereinafter, “Claims”), including, without limitation, (i) any and all Claims
by governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law, (ii) any and all Claims by any third party seeking damages,
contribution, indemnification, cost recovery, compensation or injunctive relief
relating to the presence, release or threatened release of Hazardous Materials
or arising from alleged injury or threat of injury to health or safety (to the
extent relating to human exposure to Hazardous Materials) or the environment
including, without limitation, ambient air, surface water, groundwater, land
surface and subsurface strata and natural resources such as wetlands, and (iii)
any and all Claims by any third party regarding environmental liabilities or
obligations assumed or assigned by contract or operation of law.

“Environmental Laws”: any applicable Federal, state, foreign or local statute,
law, rule, regulation, ordinance, code and rule of common law now or hereafter
in effect and in each case as amended, and any binding judicial or
administrative interpretation thereof, including any binding judicial or
administrative order, consent decree or judgment, relating to pollution, the
protection of the environment, including, without limitation, ambient air,
surface water, groundwater, land surface and subsurface strata and natural
resources such as wetlands, or human health or safety (to the extent relating to
human exposure to Hazardous Materials).

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“Environmental Liabilities”: all Liabilities (including costs of Remedial
Actions, natural resource damages and costs and expenses of investigation and
feasibility studies) that may be imposed on, incurred by or asserted against any
Loan Party as a result of, or related to, any Environmental Claim and resulting
from the ownership, lease, sublease or other operation or occupation of property
by any Loan Party, whether on, prior or after the Closing Date.

“Equity Issuance”: the issuance of any Capital Stock by Ultimate Parent, other
than any Excluded Prepayment Equity Issuance.  The term “Equity Issuance” shall
not be deemed to include any Asset Sale.

“ERISA”: the Employee Retirement Income Security Act of 1974, as amended from
time to time.

“ERISA Affiliate” collectively, any Loan Party, and any Person under common
control, or treated as a single employer, with any Loan Party, within the
meaning of Section 414(b), (c), (m) or (o) of the Code.

“ERISA Event”: any of the following: (a) a reportable event described in Section
4043(b) of ERISA or Section 4043(c) with respect to a Title IV Plan, other than
an event for which the notice requirement has been duly waived under the
applicable regulations, (b) the withdrawal of any ERISA Affiliate from a Title
IV Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer, as defined in Section 4001(a)(2) of ERISA, (c) the
complete or partial withdrawal of any ERISA Affiliate from any Multiemployer
Plan, (d) with respect to any Multiemployer Plan, the filing of a notice of
insolvency or termination (or treatment of a plan amendment as termination)
under Section 4041A of ERISA, (e) the filing of a notice of intent to terminate
a Title IV Plan (or treatment of a plan amendment as termination) under Section
4041 of ERISA, (f) the institution of proceedings to terminate a Title IV Plan
or Multiemployer Plan by the PBGC, (g) the failure to make any required
contribution to any Title IV Plan or Multiemployer Plan when due, (h) the
imposition of a lien under Section 412 of the Code or Section 302 or 4068 of
ERISA on any property (or rights to property, whether real or personal) of any
ERISA Affiliate, (i) the failure of a Multiemployer Plan, Benefit Plan or any
trust thereunder intended to qualify for tax exempt status under Section 401 or
501 of the Code or other Requirements of Law to qualify thereunder, (j) any
other event or condition that might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Title IV Plan or Multiemployer Plan or for the
imposition of any liability upon any ERISA Affiliate under Title IV of ERISA
other than for PBGC premiums due but not delinquent and (k) the occurrence of a
Foreign Benefit Event.

“E-System”: any electronic system, including Intralinks®, ClearPar® and
SyndTrak®  and any other Internet or extranet-based site, whether such
electronic system is owned, operated or hosted by the Administrative Agent, any
of its Affiliates or agents or any other Person, providing for access to data
protected by passcodes or other security system.

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

“Event of Default”: any of the events specified in Section 8; provided that any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.

“Excess Liquidity”: as defined in Section 2.8(d).

“Excess Liquidity Application Date”: as defined in Section 2.8(d).

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“Excluded Prepayment Equity Issuance”: the issuance by Ultimate Parent of its
Capital Stock (a) in connection with employee stock option plans, employee stock
ownership or purchase plans or other equity or incentive plans and (b)(i) as
consideration in connection with, or (ii) to the extent the proceeds thereof are
used to fund all or a portion of, an acquisition of assets related to healthcare
facilities or any ancillary businesses related thereto or other Investment
permitted pursuant to Sections 7.4(g) and 7.4(u); provided that if any portion
of the proceeds of any issuance of Capital Stock described in clause (b)(ii) are
not used to fund an acquisition or other Investment as described in clause
(b)(ii) (the “Uninvested Proceeds”) within 180 days of receipt thereof by
Ultimate Parent, then the portion of such Uninvested Proceeds shall be treated
as proceeds of an Equity Issuance (and not an Excluded Prepayment Equity
Issuance) for purposes of Section 2.8(b).

“Excluded Issuance”: a Qualified Equity Issuance (other than any Qualified
Equity Issuances utilized in connection with an exercise of Ultimate Parent’s
Cure Right under Section 7.16(a)); provided that, the Net Cash Proceeds
therefrom shall be reduced to the extent previously expended pursuant to clause
(v) of the definition of “Capital Expenditures”, Section 7.4(k) and/or Section
7.9(b)(ii).

“Excluded Swap Obligations”: means any obligation to pay or perform under any
Swap Transaction if, and to the extent that, all or a portion of the guarantee
of any Guarantor of, or the grant by any Guarantor of a security interest to
secure, such Swap Transaction (or any guarantee thereof) is or becomes illegal
under the Commodity Exchange Act or rule, regulation or order of the Commodity
Futures Trading Commission (or the application or official interpretation of any
thereof) by virtue of any Guarantor’s failure for any reason to constitute an
“eligible contract participant” as defined in the Commodity Exchange Act and the
regulations thereunder at the time the guaranty or the grant of such security
interest becomes effective with respect to such Swap Transactions. If a Swap
Transaction arises under a master agreement governing more than one swap, such
exclusion shall apply only to the portion of such Swap Transaction that is
attributable to swaps for which such guaranty or security interest is or becomes
illegal.

“Excluded Taxes”: as defined in Section 2.16(a).

“Existing Term Loan Agreement”: as defined in the recitals hereto.

“Facility”: the Commitments and the Loans made hereunder.

“FATCA”: Sections 1471 through 1474 of the Code (effective as of the Closing
Date) (or any amended or successor version that is substantially comparable and
not materially more onerous to comply with) and any current or future
regulations or official interpretations thereof and any agreements entered into
pursuant to Section 1471(b) of the Code.

“Federal Funds Effective Rate”: for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
federal funds transactions with members of the Federal Reserve System arranged
by federal funds brokers, 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 Effective 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 Effective Rate for such day
shall be the average rate (rounded upwards, if necessary, to the next 1/100 of
1%) charged to the Person acting as the Administrative Agent on such day on such
transactions as determined by the Administrative Agent.

"Financial Concessions": (a) the accommodations made with respect to the
Welltower Lease and the Sabra Lease on or prior to February 28, 2018, which
provide for an aggregate annual rent

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concession of approximately $54,000,000 and (b) the accommodations made with
respect to the Loans under this Agreement and certain other loans made available
to certain Subsidiaries of Ultimate Parent as borrowers thereunder, by (i)
certain Affiliates of Omega Healthcare Investors, Inc., and (ii) Welltower Inc.
and certain Affiliates thereof, on or prior to February 28, 2018, which provide
for an annual aggregate reduction in cash interest expense of approximately
$8,000,000.

“Financial Condition Covenant”: the covenants set forth in Sections 7.13, 7.14
and 7.15.

“Financial Cure Covenant”: as defined in Section 7.16(a).

“Fixed Charge Coverage Ratio”: as of any date of determination, the ratio of (i)
Consolidated EBITDA minus Maintenance Capital Expenditures to (ii) Consolidated
Fixed Charges of the Parent Companies, the Borrower and the Restricted
Subsidiaries for the four fiscal quarter periods ending on such date calculated
on a Pro Forma Basis.

“Foreign Benefit Event”: with respect to any Foreign Pension Plan, (a) the
failure of any such Foreign Pension Plan or any trust thereunder intended to
qualify for tax exempt status under any Requirements of Law, (b) the existence
of unfunded liabilities in excess of the amount permitted under any applicable
law, (c) the failure to make the required contributions or payments under any
applicable law on or before the due date for such contributions or payments, (d)
the receipt of a notice by a Governmental Authority relating to its intention to
terminate any such Foreign Pension Plan or to appoint a trustee or similar
official to administer any such Foreign Pension Plan, or alleging the insolvency
of any such Foreign Pension Plan, (e) the incurrence of any liability in excess
of $1,000,000 by the Parent Companies, the Borrower or any Restricted Subsidiary
under applicable law on account of the complete or partial termination of such
Foreign Pension Plan or the complete or partial withdrawal of any participating
employer therein, or (f) the occurrence of any transaction that is prohibited
under any applicable law and that could reasonably be expected to result in the
incurrence of any liability by the Parent Companies, the Borrower or any of the
Restricted Subsidiaries, or the imposition on the Parent Companies, the Borrower
or any of the Restricted Subsidiaries of any fine, excise tax or penalty
resulting from any noncompliance with any applicable law, in each case in excess
of $1,000,000.

“Foreign Pension Plan”: any pension plan maintained outside the jurisdiction of
the United States that under applicable law is required to be funded through a
trust or other funding vehicle other than a trust or funding vehicle maintained
exclusively by a Governmental Authority to which the Parent Companies, the
Borrower or any of the Restricted Subsidiaries incurs or otherwise has any
obligation or liability, contingent or otherwise.

“Foreign Subsidiary”: any direct or indirect Restricted Subsidiary that is not a
Domestic Subsidiary or a Domestic Subsidiary where substantially all of its
assets consist of stock of controlled foreign corporations, as defined in
Section 957 of the Code.

“Fourth Amendment”: the Amendment No. 4 to Loan Agreement, dated as of the
Restatement Date, among Ultimate Parent, the Borrower, Parent, Holdings, the
Lenders party thereto and the Administrative Agent, which, among other things,
effected the amendment and restatement of the Existing Term Loan Agreement.

“Funding Office”: the office specified from time to time by the Administrative
Agent as its funding office by notice to the Borrower and the Lenders.

“GAAP”: generally accepted accounting principles in the United States as in
effect from time to time.

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“Genesis Holdings”: Genesis Holdings, LLC, a Delaware limited liability company.

“GHLLC”: Genesis HealthCare LLC, a Delaware limited liability company.

“Governmental Authority”: any nation or government, any state, province or other
political subdivision thereof and any governmental entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government and, as to any Lender, any securities exchange and any
self-regulatory organization (including the National Association of Insurance
Commissioners).

“Guarantee and Collateral Agreement”: the Guarantee and Collateral Agreement,
dated as of the Closing Date, to be executed and delivered by the Parent
Companies, the Borrower and each Subsidiary Guarantor, substantially in the form
of Exhibit B, as the same may be amended, supplemented or otherwise modified
from time to time.

“Guarantee Obligation”: as to any Person (the “guaranteeing person”), any
obligation of the guaranteeing person guaranteeing or by which such Person
becomes contingently liable for any Indebtedness, net worth, working capital
earnings, leases, dividends or other distributions upon the stock or equity
interests (other than Real Property Financing Obligations) (the “primary
obligations”) of any other third Person (the “primary obligor”) in any manner,
whether directly or indirectly, including, without limitation, any obligation of
the guaranteeing person, whether or not contingent, (i) to purchase any such
primary obligation or any Property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or payment of any
such primary obligation or (2) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase Property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided,  however, that the term
Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business and reasonable indemnity
obligations in effect on the Closing Date or entered into in connection with any
acquisition or Disposition of assets or any Investment permitted under this
Agreement.  The amount of any Guarantee Obligation of any guaranteeing Person
shall be deemed to be such guaranteeing Person’s maximum reasonably anticipated
liability in respect thereof as determined by the Borrower in good faith.

“Guarantors”: the collective reference to the Parent Companies and the
Subsidiary Guarantors.

“Hazardous Materials”: (a) any petroleum or petroleum products, radioactive
materials, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls, radon gas, mold, toxic mold, lead and medical waste; (b) any
chemicals, wastes, materials or substances defined as or included in the
definition of “hazardous substances”, “hazardous waste”, “hazardous materials”,
“extremely hazardous waste”, “restricted hazardous waste”, “toxic substances”,
“toxic pollutants”, “contaminants”, or “pollutants”, or words of similar import,
under any applicable Environmental Law; and (c) any other chemical, waste,
material or substance which is prohibited, limited or regulated by or with
respect to which liability is imposed under any Environmental Law.

“Healthcare Facilities”: collectively, each hospital, clinic, skilled nursing
facility, assisted living facility, independent living facility or mental health
facility (or state equivalent of such licensure categories) or other healthcare
facility owned, leased or managed by Ultimate Parent or any of its Subsidiaries,
as listed on Schedule 3.15 hereto.

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“Healthcare Laws”: all federal, state, county, municipal and other governmental
statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and
injunctions or agreements, in each case, pertaining to  or concerned with the
establishment, construction, ownership, operation, use or occupancy of a
Healthcare Facility or any part thereof and all material Permits and Primary
Licenses, including those relating to the quality and adequacy of care,
equipment, personnel, operating policies, additions to facilities and services,
medical care, distribution of pharmaceuticals, rate setting, kickbacks, fee
splitting, patient healthcare and/or patient healthcare information, including
the Health Insurance Portability and Accountability Act of 1996, as amended, and
the rules and regulations promulgated thereunder, and as amended by the Health
Information Technology for Economic and Clinical Health Act provisions of the
American Recovery and Reinvestment Act of 2009, and the rules and regulations
promulgated thereunder (collectively “HIPAA”).

“Hedge Agreements”: all agreements with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by
reference to, one or more rates, currencies, equity or debt instruments or
securities (other than equity or security of Ultimate Parent), or economic,
financial or pricing indices or measures of economic, financial or pricing risk
or value or any similar transaction or any combination of these transactions, in
each case, entered into by Ultimate Parent or any of its Subsidiaries.

“Hedge Counterparty”: any Person that is a party to a Hedge Agreement that was a
Lender or Agent at the time any such Hedge Agreement was entered into or an
Affiliate of such a Lender or Agent, in each case in its capacity as party to a
Hedge Agreement.

“HIPAA”: as defined in the definition of “Healthcare Laws”.

“Holdings”: as defined in the preamble hereto.

“HUD”: the U.S. Department of Housing and Urban Development.

“HUD RE Loan Agreements”: one or more regulatory agreements and each note,
mortgage and security agreement related thereto, by and among, in each case, the
HUD RE Entities party thereto, and the HUD-approved lenders party thereto, as
applicable.

“HUD RE Entities”: each of the subsidiaries of Ultimate Parent from time to time
party to the HUD RE Loan Agreements.

“HUD Sub-Facility Credit Agreements”: that certain Second Amended and Restated
Credit Agreement, dated as of March 31, 2016, by and among the HUD Sub-Facility
Entities, as borrowers, GHLLC and GHC Holdings LLC, each as a guarantor, certain
other Persons party thereto as guarantors, MidCap Financial Trust (as successor
to Healthcare Financial Solutions, LLC)], as administrative agent, and the
lenders party thereto, as may be further amended, restated, replaced or
otherwise modified from time to time.

“HUD Sub-Facility Entities”: each of the entities listed on Annex I-A and Annex
I-B attached to the HUD Sub-Facility Credit Agreement and each other Person, if
any, from time to time becoming a party to the HUD Sub-Facility Credit Agreement
as a borrower.

“Indebtedness”: of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of Property or services (other than (i)
trade payables, accrued expenses, current accounts and similar obligations
incurred in the ordinary course of such Person’s business, (ii) deferred
compensation accrued in the ordinary

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course of business and (iii) earn-outs and other contingent payments in respect
of acquisitions except as and to the extent that the liability on account of any
such earn-out or contingent payment appears in the liabilities section of the
balance sheet of such Person in accordance with GAAP), (c) all obligations of
such Person evidenced by notes, bonds, debentures or other similar instruments,
(d) all indebtedness created or arising under any conditional sale or other
title retention agreement with respect to Property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such Property, in
which case only the lesser of the amount of such obligation and the fair market
value of such Property shall constitute Indebtedness), (e) all Capital Lease
Obligations of such Person, (f) all obligations of such Person, contingent or
otherwise, as an account party or applicant under acceptance, letter of credit
or similar facilities, (g) all obligations of such Person in respect of
Disqualified Capital Stock valued at, in the case of redeemable preferred
Capital Stock, the greater of the voluntary liquidation preference and the
involuntary liquidation preference of such Capital Stock plus accrued and unpaid
dividends, (h) all payments that would be required to be made in respect of any
Hedge Agreement with a counterparty other than any Agent in the event of a
termination (including an early termination) on the date of determination, and
(i) all Guarantee Obligations of such Person in respect of obligations of the
kind referred to in clauses (a) through (h) above.

“Indemnified Liabilities”: as defined in Section 10.5(a).

“Indemnitee”: as defined in Section 10.5(a).

“Initial 2016 Commitment”: as to any Lender, the commitment of such Lender to
make Initial Term Loans in a principal amount not to exceed the amount set forth
opposite such Lender’s name on Section 1 of Appendix A. 

“Initial Lenders”: as defined in the preamble hereto.

“Initial Term Loans”: as defined in the recitals hereto.

“Instrument”: as defined in the Guarantee and Collateral Agreement.

“Insurance Captive”: Liberty Health Corporation, Ltd., a Bermuda company,
Fountain View Reinsurance, Ltd., a Cayman Islands company, or any other
insurance captive or other self insurance program established by Ultimate Parent
or a Restricted Subsidiary.

“Insurer”: a Person that insures a Patient against certain of the costs incurred
in the receipt by such Patient of Medical Services, or that has an agreement
with Ultimate Parent to compensate the Borrower for providing such goods or
services to a Patient, including but not limited to Medicaid,  Medicare and
TRICARE.

“Intellectual Property”: the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including, without
limitation, copyrights and copyright applications, domain names, patents and
patent applications, trademarks and trademark applications, trade names, rights
in technology, trade secrets, know-how and processes.

“Intercreditor Agreement”: the Third Amended and Restated Intercreditor
Agreement, dated as of December 22, 2016, by and among the Administrative Agent,
the “Administrative Agent” (as defined in the ABL Credit Agreement) and Skilled
RE Lender (in its capacity as a lender under each Skilled RE Credit Agreement)
and acknowledged by the Borrower and the other Loan Parties, and along with any

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joinders made a part thereof from time to time (or any amendment or amendment
and restatement reasonably acceptable to the Administrative Agent and the
Borrower).

“Interest Coverage Ratio”: as of any date of determination, the ratio of
Consolidated EBITDA for such period to Consolidated Cash Interest Expense of the
Parent Companies, the Borrower and the Restricted Subsidiaries for the four
fiscal quarter periods ending on such date calculated on a Pro Forma Basis.

“Interest Payment Date”: (a) the last Business Day of each month while such Loan
is outstanding and the final maturity date of such Loan, (b) as to any Loan, the
date of any repayment or prepayment made in respect thereof and (c) the day that
such Loan is required to be repaid.

“Investments”: as defined in Section 7.4.

“IRS”: the Internal Revenue Service.

“Laws”: collectively, federal, state, local or foreign law, statute or
ordinance, common law, or any rule, regulation, judgment, order, writ,
injunction, decree, arbitration award, agency requirement, license or permit of
any Governmental Authority.

“Lease Amendment Agreement”: each of the Welltower Lease Amendment Agreement,
Omega Lease Amendment Agreement and Sabra Lease Amendment Agreement.

“Leases”: all leases and subleases or any similar document affecting the use,
enjoyment or occupancy of the real property, including resident care agreements
and service agreements that include an occupancy agreement, whether existing as
of the Closing Date or thereafter arising.

“Lender”: each Lender that has a Commitment or that holds a Loan.

“LGO Intercreditor Agreement” means that certain Intercreditor Agreement, dated
as of November 1, 2016, by and among the LGO Landlords party thereto, the
Administrative Agent and MidCap Funding IV Trust (as successor to Healthcare
Financial Solutions, LLC) and acknowledged by certain Loan Parties party thereto
as tenants, as it may be amended, restated, replaced or otherwise modified from
time to time.

“LGO Landlords” means LG-OHI Seaford and certain of its affiliates as the
landlords under the LGO Lease.

“LGO Lease” means that certain Master Lease, dated as of November 1, 2016, among
LG-OHI Seaford LLC and certain affiliates thereof, as landlords, and Genesis LGO
Operations LLC as tenant, as it may be amended, restated, replaced or otherwise
modified from time to time in accordance with the terms of the LGO Intercreditor
Agreement and this Agreement.

“Liabilities”: all claims, actions, suits, judgments, damages, losses,
liability, obligations, responsibilities, fines, penalties, sanctions, costs,
fees, taxes, commissions, charges, disbursements and expenses, in each case of
any kind or nature (including interest accrued thereon or as a result thereto
and fees, charges and disbursements of financial, legal and other advisors and
consultants), whether joint or several, whether or not indirect, contingent,
consequential, actual, punitive, treble or otherwise.

“Lien”: any mortgage, pledge, hypothecation, collateral assignment, encumbrance,
lien (statutory or other), charge or other security interest or any other
security agreement of any kind or nature

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whatsoever (including any conditional sale or other title retention agreement
and any capital lease having substantially the same economic effect as any of
the foregoing).

“Liquidity”: with respect to any Person, the sum of (i) unrestricted cash and
Cash Equivalents, plus (ii) Borrowing Availability (as defined in the ABL Credit
Agreement) and plus (iii) any other sources of liquid capital agreed in writing
by the Lenders and the Borrower.

“LLC Parent”: as defined in the preamble hereto.

“Loan Documents”: the collective reference to this Agreement, the Security
Documents and the Notes (if any).

“Loan Parties”: the Parent Companies, the Borrower and each Subsidiary
Guarantor.

“Loan Percentage”: as to any Lender at any time, the percentage which the sum of
such Lender’s Commitments then constitutes of the aggregate Commitments (or, at
any time after the Closing Date, the percentage which the aggregate principal
amount of such Lender’s Loans then outstanding constitutes of the aggregate
principal amount of the Loans then outstanding).

“Loans”: Loans made pursuant to Section 2.1.  For the avoidance of doubt, the
term “Loans” shall include the Initial Term Loans and the 2018 Term Loans. 

“Maintenance Capital Expenditures”: for each annual period, an aggregate amount
equal to $800 for each weighted average licensed bed of the Loan Parties during
such period.

“Majority Controlled Affiliate”: means, with respect to any Person, each
officer, director, general partner or joint-venturer of such Person and any
other Person that directly or indirectly controls, is controlled by, or is under
common control with, such Person; provided, however, that no Secured Party shall
be a Majority Controlled Affiliate of the Borrower.  For purpose of this
definition, “control” means the possession of either (a) the power to vote, or
the beneficial ownership of, 51% or more of the Voting Stock of such Person or
(b) the power to direct or cause the direction of the management and policies of
such Person, whether by contract or otherwise.

“Master Leases”: the collective reference to the Welltower Lease, the Sabra
Lease and the Omega Lease.

“Master Lease Intercreditor Agreements”: the collective reference to the
Welltower Intercreditor Agreement, the Sabra Intercreditor Agreement and the
Omega Intercreditor Agreement.

“Material Adverse Effect”: a material adverse effect on (a) the business,
operations property or financial condition of the Parent Companies, the Borrower
and the Restricted Subsidiaries, taken as a whole, or (b) the validity or
enforceability of the Loan Documents or the material rights and remedies of the
Agents and the Lenders thereunder, in each case, taken as a whole.

“Material Indebtedness”: Indebtedness (other than the Loans and Real Property
Financing Obligations), or obligations in respect of one or more Hedge
Agreements, of any one or more of the Parent Companies, the Borrower or any of
the Restricted Subsidiaries in an aggregate principal amount exceeding,
$30,000,000.  For purposes of determining Material Indebtedness for all
Sections, the “principal amount” of the obligations of the Parent Companies, the
Borrower or any of the Restricted Subsidiaries in respect of any Hedge Agreement
at any time shall be the maximum aggregate amount (giving effect to any netting

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agreements) that the Parent Companies, the Borrower or any of the Restricted
Subsidiaries would be required to pay if such Hedge Agreement were terminated at
such time.

“Material Master Lease”: each Master Lease and each other facility master lease
agreement entered into by Ultimate Parent or any of the Restricted Subsidiaries
after the Closing Date if such facility master lease agreement, individually or
in the aggregate when taken together with each other facility master lease from
the same landlord or an Affiliate of the landlord, represents greater than 5% of
the licensed beds of the Loan Parties, taken as a whole. 

“Material Master Lease Intercreditor Agreement”: the collective reference to
each of the Master Lease Intercreditor Agreements and any other intercreditor or
similar agreement entered into pursuant to Section 6.13.

“Material Restricted Subsidiary”: at any date of determination, any Restricted
Subsidiary that would account for more than 5%, individually or 7.5%, with
respect to one or more Restricted Subsidiaries in the aggregate, of the
Consolidated Total Assets or gross revenue (as shown on the most recent
financial statements of Ultimate Parent delivered pursuant to Section 5.1(a) or
(b)) of the Parent Companies, the Borrower and the Restricted Subsidiaries on a
Consolidated basis for such period, determined in accordance with GAAP; provided
that if, at any time and from time to time after the Closing Date, Domestic
Subsidiaries that are not Guarantors solely because they do not meet the
thresholds set forth above comprise in the aggregate more than 7.5% of the
Consolidated Total Assets or the gross revenue (as shown on the most recent
financial statements of Ultimate Parent delivered pursuant to Section 5.1(a) or
(b)) of the Parent Companies, the Borrower and the Restricted Subsidiaries on a
Consolidated basis for such period, determined in accordance with GAAP, then the
Borrower shall, not later than 45 days after the date by which financial
statements for such fiscal quarter are required to be delivered pursuant to
Section 5.1(b), (x) designate in writing to the Administrative Agent one or more
of such Domestic Subsidiaries as “Material Restricted Subsidiaries” so that
Domestic Subsidiaries that are not Guarantors do not comprise more than 7.5% in
the aggregate of the Consolidated Total Assets or the gross revenues (as shown
on the most recent financial statements of Ultimate Parent delivered pursuant to
Section 5.1(a) or (b)) of the Parent Companies, the Borrower and the Restricted
Subsidiaries on a Consolidated basis for such period, determined in accordance
with GAAP and (y) comply with the provisions of Section 6.10 applicable to such
Subsidiary.

“Maturity Date”: July 29, 2020.

“Medicaid”: (a) the United States of America acting under Title XIX of the
Social Security Act, (b) any state or the District of Columbia acting pursuant
to a health plan adopted pursuant to Title XIX of the Social Security Act, or
(c) any agent, carrier, administrator or intermediary for any of the foregoing.

“Medical Services”:  medical and health care services, performed or provided by
any Ultimate Parent or a Restricted Subsidiary to a Patient, which services
include, general medical and health care services, physician services, nurse and
therapist services, dental services, hospital services, skilled nursing facility
services, assisted living facility services, independent senior housing
services, Alzheimer’s services, comprehensive inpatient and outpatient
rehabilitation services, home health care services, hospice services,
residential and outpatient behavioral healthcare services, and medical or health
care equipment provided for a necessary or specifically requested valid and
proper medical or health purpose and any other service approved by the
Administrative Agent in its sole discretion.

“Medicare”: (a) the United States of America acting under the Medicare program
established pursuant to Title XVIII of the Social Security Act, or (b) any
agent, carrier, administrator or intermediary for any of the foregoing.

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“MidCap RE Agent”: MidCap Financial Trust, in its capacity as administrative
agent under each MidCap RE Credit Agreement together with its successors and
assigns.

“MidCap RE Borrowers”: collectively, the subsidiaries of the Ultimate Parent set
forth in Schedule 1.1(D) that will become borrowers under the MidCap RE Credit
Agreement on the MidCap RE Closing Date.

“MidCap RE Closing Date”: the date after the Closing Date on which the MidCap RE
Credit Facility closes.

“MidCap RE Credit Agreement”: collectively, the MidCap RE Credit Agreement (A-1)
and the MidCap RE Credit Agreement (A-2).

“MidCap RE Credit Agreement (A-1)”: the Credit and Security Agreement (A-1),
dated as of the MidCap RE Closing Date between the MidCap RE Borrowers from time
to time party thereto, the MidCap RE Agent, and certain financial institutions
from time to time party thereto as lenders, as it may be amended, restated,
replaced or otherwise modified from time to time in accordance with the terms of
this Agreement and the Intercreditor Agreement.

“MidCap RE Credit Agreement (A-2)”: the Credit and Security Agreement (A-2),
dated as of the MidCap RE Closing Date between the MidCap RE Borrowers from time
to time party thereto, the MidCap RE Agent, and certain financial institutions
from time to time party thereto as lenders, as it may be amended, restated,
replaced or otherwise modified from time to time in accordance with the terms of
this Agreement and the Intercreditor Agreement.

“MidCap RE Credit Facility”: collectively, the term loan credit facilities
incurred pursuant to the MidCap RE Loan Documents.

“MidCap RE Loan Documents”: collectively, the Financing Documents (as defined in
each MidCap RE Credit Agreement).

“MidCap RE Priority Collateral”: the MidCap RE Priority Collateral (as defined
in the Intercreditor Agreement); provided that, until the Midcap RE Closing
Date, the collateral of the MidCap RE Borrowers shall be Skilled RE Priority
Collateral to the extent such MidCap RE Borrower is a Skilled RE Borrower on the
Closing Date. 

“Moody’s”: Moody’s Investors Service, Inc. or any successor to the rating agency
business thereof.

“Mortgage”: any mortgage, deed of trust, hypothec or other similar document made
by any Loan Party in favor of, or for the benefit of, the Collateral Agent for
the benefit of the Secured Parties, in form and substance reasonably
satisfactory to the Administrative Agent and the Borrower (taking into account
the law of the jurisdiction in which such mortgage, deed of trust, hypothec or
similar document is to be recorded).  Mortgage shall specifically include the
Closing Date Mortgages.

“Multiemployer Plan”: a pension plan  that is a “multiemployer plan” (as defined
in Section 4001(a)(3) of ERISA) subject to Title IV of ERISA to which any ERISA
Affiliate incurs or otherwise has any obligation or liability, contingent or
otherwise.

“Net Cash Proceeds”: (a) in connection with any Asset Sale or any Recovery
Event, the proceeds thereof in the form of cash and Cash Equivalents (including
any such proceeds received by way

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of deferred payment of principal pursuant to a note or installment receivable or
purchase price adjustment receivable or otherwise, but only as and when
received) of such Asset Sale or Recovery Event received by the Parent Companies,
the Borrower or any of the Restricted Subsidiaries, net of broker’s fees and
commissions, attorneys’ fees, accountants’ fees, investment banking fees,
consulting fees, amounts (including premiums or penalties, if any) required to
be applied to the repayment of Indebtedness secured by a Lien expressly
permitted hereunder on any asset which is the subject of such Asset Sale or
Recovery Event (other than any Lien pursuant to a Security Document in which the
Collateral Agent has (or is intended to have), whether pursuant to the
Intercreditor Agreement or otherwise, a first priority perfected security
interest) and other reasonable fees and expenses (including legal fees and
expenses) actually incurred by the Parent Companies, the Borrower or any of the
Restricted Subsidiaries in connection therewith and net of Taxes paid or
reasonably estimated to be payable by such Parent Company, the Borrower or such
Restricted Subsidiary as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing arrangements) and any
escrow or reserve for any adjustment in respect of the sale price of such asset
or assets and indemnification payments (fixed or contingent) attributable to
seller’s indemnities and representations and warranties to purchaser in respect
of the applicable Asset Sale undertaken by the Parent Companies, the Borrower or
the Restricted Subsidiaries or other liabilities in connection with such Asset
Sale (provided that upon release of any such escrow or reserve, the amount
released shall be considered Net Cash Proceeds) and (b) in connection with any
(i) Equity Issuance or (ii) issuance or sale of debt securities or instruments
or the incurrence of Indebtedness, in each case, the cash proceeds received from
such issuance or incurrence, net of transaction costs, attorneys’ fees,
investment banking fees, accountants’ fees, consulting fees, underwriting
discounts and commissions, placement fees and other reasonable fees and expenses
(including legal fees and expenses) actually incurred in connection therewith.

“New Capital”: Capital Stock or Qualified Mezzanine Debt.

“Non-Excluded Taxes”: as defined in Section 2.16(a).

“Non-Guarantor Subsidiary”: any Restricted Subsidiary which is not a Subsidiary
Guarantor.

“Non-U.S. Lender”: as defined in Section 2.16(d).

“Note”: any promissory note evidencing any Loan.

“Notice of Intent to Cure”: as defined in Section 7.16(b).

“Obligations”: the unpaid principal of and interest on (including, without
limitation, interest accruing after the maturity of the Loans, and interest
accruing after the filing of any petition in bankruptcy, or the commencement of
any insolvency, reorganization or like proceeding, relating to the Borrower,
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding) the Loans, and all other obligations and liabilities of the
Borrower to the Administrative Agent, the Collateral Agent, or any Lender (or,
in the case of Specified Hedge Agreements and Cash Management Documents of the
Parent Companies, the Borrower or any of the Restricted Subsidiaries to the
Administrative Agent, the Collateral Agent, any Lender, any Hedge Counterparty,
Cash Management Counterparty, or any of their Affiliates), whether direct or
indirect, absolute or contingent, due or to become due, or existing as of the
Closing Date or thereafter incurred, which may arise under, out of, or in
connection with, this Agreement, any other Loan Document, any Specified Hedge
Agreement, any Cash Management Document, whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses
(including, without limitation, all fees, charges and disbursements of counsel
to the Administrative Agent, the Collateral Agent, or any Lender that are
required to be paid by the Borrower pursuant hereto) or otherwise;

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other than Excluded Swap Obligations; provided that (a) obligations of the
Parent Companies, the Borrower or any of the Restricted Subsidiaries under any
Specified Hedge Agreement or Cash Management Document shall be secured and
guaranteed pursuant to the Security Documents only to the extent that, and for
so long as, the other Obligations are so secured and guaranteed and (b) any
release of Collateral or Guarantors effected in the manner permitted by this
Agreement shall not require the consent of holders of obligations under any
Specified Hedge Agreements or Cash Management Documents.

“OFAC”: the Officer of Foreign Assets Control of the United States Department of
the Treasury.

“Omega Intercreditor Agreement”: the Amended and Restated Intercreditor
Agreement, dated as of July 29, 2016, by and among, inter alios, the
Administrative Agent, MidCap Funding IV Trust (as successor to Healthcare
Financial Solutions, LLC), as administrative agent under the ABL Credit
Agreement, Landlord (as defined therein) and Tenants (as defined therein), as it
may be amended, restated, replaced or otherwise modified from time to time.

“Omega Lease”: the Second Consolidated Amended and Restated Master Lease
Agreement, dated as of January 30, 2015, by and among Landlord (as defined in
the Omega Intercreditor Agreement) and Tenants (as defined in the Omega
Intercreditor Agreement).

“Omega Lease Amendment Agreement”: the Ninth Amendment to the Omega Lease, dated
as of the Restatement Date, by and among Landlord (as defined in the Omega
Intercreditor Agreement) and Tenants (as defined in the Omega Intercreditor
Agreement).

“Omega Lender”: as defined in the preamble hereto.

“Omnibus Agreement”: as defined in the Fourth Amendment.

“Other Taxes”: 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, this Agreement or any other Loan Document.

“PATRIOT Act”: the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law
October 26, 2001)).

“Parent”: as defined in the preamble hereto.

“Parent Company”: Ultimate Parent, LLC Parent, Parent and Holdings.

“Participant”: as defined in Section 10.6(h).

“Participant Register”: as defined in Section 10.6(h)(ii).

“Patient”: any Person receiving Medical Services from Ultimate Parent or a
Restricted Subsidiary and all Persons legally liable to pay Ultimate Parent or a
Restricted Subsidiary for such services other than Insurers.

“PBGC”: the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).

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“Permit”: with respect to any Person, any permit, approval, authorization,
license, registration, certificate (including certificates of occupancy),
concession, grant, franchise, variance or permission from any Governmental
Authority, in each case whether or not having the force of law and applicable to
or binding upon such Person or any of its property or to which such Person or
any of its property is subject.

“Permitted Acquisition”: as defined in Section 7.4(g).

“Permitted Investor”: collectively, (i) any Person that is a member of LLC
Parent as of the Closing Date to the extent such Person, directly or indirectly,
owns or controls 10% or more of LLC Parent as of the Closing Date and to the
extent such Person has satisfied the requirements regarding OFAC, Anti-Terrorism
Laws, SEC, Healthcare Laws, and other similar regulations, (ii) GEN Management
LLC or GEN Management Investors, LLC and to the extent each such entity has
satisfied the requirements regarding OFAC, Anti-Terrorism Laws, SEC Healthcare
Laws, and other similar regulations, or (iii) any successor of the foregoing
pursuant to a Permitted Investor Transfer (which successors, to the extent such
successors will, directly or indirectly, own or control 10% or more of any Loan
Party, must satisfy requirements regarding OFAC, Anti-Terrorism Laws, SEC,
Healthcare Laws, and other similar regulations).

“Permitted Investor Transfer”:  one or more of the following, and, in the case
of clauses (ii)  and (iii) below, with the prior consent of Administrative
Agent, which consent shall not be unreasonably withheld, conditioned or delayed
(provided that Borrower provides timely information reasonably requested by
Administrative Agent with respect to such proposed transferee which approval
shall consider criteria including, but not limited to, Administrative Agent’s
standards with respect to (x) previously relationships between Administrative
Agent, Lenders and the proposed transferee and its principals, (y) the
reputation for integrity, honesty and veracity of the proposed transferee and
its principals, owners, officers and directors and (z) information with respect
to OFAC, Anti-Terrorism Laws, SEC, Healthcare Laws, and other similar
regulations and activities):

(i) any Disposition by a Permitted Investor to another Permitted Investor;

(ii) any Disposition of a direct or indirect interest in Ultimate Parent by a
Permitted Investor to a family trust for estate planning purposes; provided that
such Permitted Investor does not transfer the power to direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise;

(iii) any Disposition from any Permitted Investor of any direct or indirect
interest in Ultimate Parent to a Majority Controlled Affiliate, or the admission
of a new member into a Permitted Investor, provided the Persons that had the
power to direct or cause the direction of the management and policies of such
Permitted Investor on the Closing Date retain such power over such Permitted
Investor; or

(iv) the purchase by Welltower Inc. of certain ownership interests in Ultimate
Parent pursuant to that certain Amended and Restated Call and Exchange
Agreement, dated as of May 25, 2012 (as may be amended, supplemented or
otherwise modified from time to time).

“Permitted Refinancing”: with respect to any Person, any modification,
refinancing, refunding, renewal or extension of any Indebtedness of such Person;
provided  that (a) the principal amount (or accreted value, if applicable)
thereof does not exceed the principal amount (or accreted value, if applicable)
of the Indebtedness so modified, refinanced, refunded, renewed or extended
except by an

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amount equal to any interest capitalized in connection with, any premium or
other reasonable amount paid, and fees and expenses reasonably incurred, in
connection with such modification, refinancing, refunding, renewal or extension
and by an amount equal to any existing commitments unutilized and undrawn
letters of credit thereunder or as otherwise permitted pursuant to Section 7.1,
(b) such modification, refinancing, refunding, renewal or extension has a final
maturity date equal to or later than the final maturity date of, and has a
Weighted Average Life to Maturity equal to or longer than the Weighted Average
Life to Maturity of, the Indebtedness being modified, refinanced, refunded,
renewed or extended, (c) if the Indebtedness being modified, refinanced,
refunded, renewed or extended is subordinated in right of payment to the
Obligations, such modification, refinancing, refunding, renewal or extension is
subordinated in right of payment to the Obligations on terms at least as
favorable on the whole to the Lenders as those contained in the documentation
governing the Indebtedness being modified, refinanced, refunded, renewed or
extended, (d) solely with respect to any Permitted Refinancing of the ABL
Facility or any Material Master Lease, the financial covenants and events of
default of any such modified, refinanced, refunded, renewed or extended
Indebtedness are not, taken as a whole, materially more restrictive to the Loan
Parties than the financial covenants and events of default of the Indebtedness
being modified, refinanced, refunded, renewed or extended (it being understood
and agreed that any such financial covenants or events of default that are
substantially similar to those set forth herein shall be deemed not to be
materially more restrictive to the Loan Parties)  and (e) neither Ultimate
Parent nor any Restricted Subsidiary shall be an obligor or guarantor of the
Indebtedness being modified, refinanced, refunded, renewed or extended except to
the extent that such Person was such an obligor or guarantor in respect of the
Indebtedness being modified, refinanced, refunded, renewed or extended.

“Person”: an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.

“PIK Interest”: interest paid in kind by adding such interest then due to the
unpaid principal amount of the Loans.

“Pledged Securities”: as defined in the Guarantee and Collateral Agreement.

“Pledged Stock”: as defined in the Guarantee and Collateral Agreement.

“Primary License”: with respect to any Healthcare Facility or Person operating
such Healthcare Facility, as the case may be, the certificate of need, Permit or
license to operate as an assisted living, skilled nursing or independent living
facility.

“Pro Forma Basis”: for any period, with respect to the Transactions, the Skilled
Transactions or any proposed acquisition, investment, distribution, incurrence
or prepayment of Indebtedness or any other action which requires compliance with
any test or covenant hereunder, compliance as of the transaction date will be
determined giving the following pro forma effect to the Transactions, the
Skilled Transactions or such proposed acquisition investment, distribution or
any such other action: (a) pro forma effect will be given to any Indebtedness
incurred or permanently repaid during or after the relevant period to the extent
the Indebtedness is outstanding or is to be incurred or permanently repaid on
the transaction date as if the Indebtedness had been incurred or permanently
repaid on the first day of the relevant period (it being acknowledged and agreed
that any revolving Indebtedness shall only be deemed to be permanently repaid if
at the time of repayment the commitments thereunder are reduced by the amount of
the prepayment); (b) pro forma calculations of interest on Indebtedness bearing
a floating interest rate will be made as if the rate in effect on the
transaction date (taking into account any Hedge Agreement applicable to the
Indebtedness if the Hedge Agreement has a remaining term of at least 12 months)
had been the applicable rate for the entire relevant period; (c) Consolidated
Interest Expense related

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to any Indebtedness no longer outstanding or to be repaid or redeemed on the
transaction date, except for Consolidated Interest Expense accrued during the
relevant period under this Agreement to the extent of the Loans in effect on the
transaction date, will be excluded; (d) pro forma effect will be given to any
amendment or other modification of any Material Master Lease as if such
amendment or other modification shall have occurred at the beginning of the
relevant period; (e) pro forma effect will be given to (i) the creation,
designation or redesignation of Restricted and Unrestricted Subsidiaries, and
(ii) the acquisition or Disposition of companies, divisions or lines of
businesses by Ultimate Parent and the Restricted Subsidiaries, including any
acquisition or Disposition of a company, division or line of business since the
beginning of the relevant period by a Person that became a Restricted Subsidiary
after the beginning of the relevant period that have occurred since the
beginning of the relevant period as if such events had occurred, and, in the
case of any Disposition, the proceeds thereof applied, on the first day of the
relevant period; and (f) pro forma effect will be given to the Financial
Concessions as if they have been in effect from and after January 1, 2017. For
purposes of determining Consolidated Interest Expense, Consolidated Cash
Interest Expense, Consolidated Fixed Charges, Consolidated Rental Expense,
Consolidated EBITDA,  Consolidated EBITDAR and Consolidated Net Income, any
discontinuation of discontinued operations as defined under Financial Accounting
Standards Board Accounting Standards Codification 205-20 occurring during the
relevant period shall be given effect in accordance with that standard.    To
the extent that pro forma effect is to be given to an acquisition or Disposition
of a company, division or line of business, the pro forma calculation will be
based upon the most recent four full fiscal quarters for which the relevant
financial information is available (including cost savings to the extent such
cost savings would be consistent with the definition of “Consolidated EBITDA”).

“Property”: any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible, including,
without limitation, Capital Stock.

“Purchase Money Indebtedness”: as defined in Section 7.1(d).

“Qualified Capital Stock”: any Capital Stock that is not Disqualified Capital
Stock.

“Qualified Equity Issuance”: any issuance by Ultimate Parent of its Capital
Stock in a public or private offering or contribution to its capital (in each
case, other than in the form of Disqualified Capital Stock).

“Qualified Mezzanine Debt”: unsecured Indebtedness that does not mature prior to
the date that is 181 days after the Maturity Date.

“Real Property Financing Obligations”: with respect to any Person, financing
obligations and Capital Lease Obligations of such Person, to the extent such
financing obligations or Capital Lease Obligations are related to real property,
including, without limitation, such obligations under the MidCap RE Loan
Documents, the Revera Loan Documents and the Skilled RE Loan Documents.

“Recovery Event”: any settlement of or payment in respect of any property or
casualty insurance claim or any condemnation proceeding relating to any asset of
the Parent Companies, the Borrower, or any of the Restricted Subsidiaries, in an
amount for each such event exceeding $1,500,000.

“Refinanced Loans”: as defined in Section 10.1(d).

“Register”: as defined in Section 10.6(b)(iv).

“Regulation T”: Regulation T of the Board as in effect from time to time.

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“Regulation U”: Regulation U of the Board as in effect from time to time.

“Regulation X” Regulation X of the Board as in effect from time to time.

“Reinvestment Deferred Amount”: with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by the Parent Companies, the Borrower or
any Restricted Subsidiary for its own account in connection therewith that are
not paid to the Administrative Agent pursuant to Section 2.8(b) as a result of
the delivery of a Reinvestment Notice.

“Reinvestment Event”: any Asset Sale or Recovery Event in respect of which a
Loan Party has delivered a Reinvestment Notice.

“Reinvestment Notice”: a written notice signed on behalf of the Parent
Companies, the Borrower, or any of the Restricted Subsidiaries by a Responsible
Officer stating that the Parent Companies, the Borrower, or such Restricted
Subsidiaries (directly or indirectly through a Subsidiary) intends and expects
to use all or a specified portion of the Net Cash Proceeds of an (x) Asset Sale
to acquire assets useful in its (or such Restricted Subsidiary’s) business or in
connection with a Permitted Acquisition or (y) Recovery Event to acquire or
repair assets useful in its (or such Restricted Subsidiary’s) business or in
connection with a Permitted Acquisition.

“Reinvestment Prepayment Amount”: with respect to any Reinvestment Event, the
Reinvestment Deferred Amount relating thereto less any amount contractually
committed to be expended prior to the relevant Reinvestment Prepayment Date (a
“Committed Reinvestment Amount”), or actually expended prior to such date, in
each case to acquire or repair assets useful in the Business or in connection
with a Permitted Acquisition.

“Reinvestment Prepayment Date”: with respect to any Reinvestment Event, the
earlier of (i) the date occurring 180 days after such Reinvestment Event and
(ii) with respect to any portion of a Reinvestment Deferred Amount, the date on
which the Parent Companies, the Borrower, or any of the Restricted Subsidiaries
shall have determined not to acquire or repair assets useful in their or such
Restricted Subsidiary’s business or in connection with a Permitted Acquisition
with such portion of such Reinvestment Deferred Amount.

“Related Parties”: as to any Person, such Person’s Affiliates and the partners,
directors, officers, employees, agents, attorneys-in-fact, trustees,
administrators, managers, advisors and representatives of such Person and of
such Person’s Affiliates.

“Release” any release, threatened release, spill, emission, leaking, pumping,
pouring, emitting, emptying, escape, injection, deposit, disposal, discharge,
dispersal, dumping, leaching or migration of Hazardous Material into or through
the environment.

“Remedial Action”: all actions required to (a) clean up, remove, treat or in any
other way address any Hazardous Material Released into the indoor or outdoor
environment, (b) prevent or minimize any Release so that a Hazardous Material
does not migrate or endanger or threaten to endanger public health or welfare or
the indoor or outdoor environment or (c) perform pre-remedial studies and
investigations and post-remedial monitoring and care with respect to any
Hazardous Material.

“Replacement Loans”: as defined in Section 10.1(d).

“Representatives”: as defined in Section 10.14.

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“Required Lenders”: at any time, the holders of more than 50% of the sum of the
aggregate unpaid principal amount of the Loans then outstanding.

“Required Prepayment Date”: as defined in Section 2.8(f).

“Requirement of Law”: as to any Person, the certificate of incorporation and
by-laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation or determination of a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject.

“Responsible Officer”: the chief executive officer, president, senior vice
president, chief financial officer (or similar title), chief operating officer,
controller or treasurer (or similar title) of the Parent Companies or the
Borrower, as applicable, and, with respect to financial matters, the chief
financial officer (or similar title) or treasurer (or similar title) of Ultimate
Parent.

“Restatement Date”: March 6, 2018.

“Restricted Payment”:  any dividend or other distribution (whether in cash,
securities or other property (other than Qualified Capital Stock)) with respect
to any Capital Stock of Ultimate Parent or any Restricted Subsidiary, or any
payment (whether in cash, securities or other property (other than Qualified
Capital Stock)), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, acquisition, cancellation or termination
of any Capital Stock in the Parent Companies, the Borrower or any Restricted
Subsidiary.

“Restricted Subsidiary”: any Subsidiary that is not an Unrestricted Subsidiary.

“Revera Borrowers”: collectively, the subsidiaries of Ultimate Parent that are
borrowers under the Revera Credit Agreement.

“Revera Credit Agreement”: the Amended and Restated Loan Agreement (B-1), dated
as of December 22, 2016 (as amended, restated, amended and restated,
supplemented or modified), between Revera Borrowers, Revera Lender and certain
financial institutions from time to time party thereto as lenders, as it may be
amended, restated, replaced or otherwise modified from time to time in
accordance with the terms of this Agreement.

“Revera Lender”: Welltower Inc., in its capacity as lender under the Revera
Credit Agreement together with its successors and assigns.

“Revera Loan Documents”: has the meaning assigned to the term “Loan Documents”
in the Revera Credit Agreement.

“Sabra Intercreditor Agreement”: the Amended and Restated Amendment to Lease and
Intercreditor Agreement, dated as of July 29, 2016, by and among, inter alios,
the Landlord (as defined therein), the Administrative Agent, MidCap Funding IV
Trust (as successor to Healthcare Financial Solutions, LLC), as administrative
agent under the ABL Credit Agreement, as it may be amended, restated, replaced
or otherwise modified from time to time.

“Sabra Lease”: collectively, the Leases and Master Leases between certain
affiliates of Sabra Healthcare REIT, Inc. and the tenant parties thereto.

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“Sabra Lease Amendment Agreement”: collectively, the Lease and Master Lease
Amendments, dated as of the Restatement Date, between certain affiliates of
Sabra Healthcare REIT, Inc. and the tenant parties thereto.

“Sale and Lease-Back Transaction”: any arrangement with any Person providing for
the leasing by Ultimate Parent or any of the Restricted Subsidiaries of real or
personal property which has been or is to be sold or transferred by Ultimate
Parent or such Restricted Subsidiary to such Person or from any other Person to
whom funds have been or are to be advanced by such Person based on a Lien on, or
an assignment of, such property and rental obligations of Ultimate Parent or
such Restricted Subsidiary.

“Sanctions”: any international economic sanction administered or enforced by
OFAC, the United Nations Security Council, the European Union, Her Majesty’s
Treasury or other relevant sanctions authority.

“S&P”: Standard & Poor’s Ratings Group, Inc., or any successor to the rating
agency business thereof.

“SEC”: the Securities and Exchange Commission (or successors thereto or an
analogous Governmental Authority).

“Secured Parties”: collectively, the Lenders, the Administrative Agent, the
Collateral Agent, any Hedge Counterparty, any Cash Management Counterparty, any
other holder from time to time of any of the Obligations (in their capacities as
holders thereof) and, in each case, their respective successors and permitted
assigns.

“Security Documents”: the collective reference to the Guarantee and Collateral
Agreement, the Intercreditor Agreement, the Material Master Lease Intercreditor
Agreements, the Mortgages and all other security documents hereafter delivered
to the Administrative Agent purporting to grant a Lien on any Property of any
Loan Party to secure the Obligations.

“Skilled Acquisition”: the indirect acquisition of Ultimate Parent and the
consummation of the transactions described therein.

“Skilled Holdings”: Skilled HealthCare, LLC, a Delaware limited liability
company.

“Skilled RE Borrowers”: collectively, the subsidiaries of Ultimate Parent that
are borrowers under the Skilled RE Credit Agreement.

“Skilled RE Credit Agreement”: collectively, the Skilled RE Credit Agreement
(A-2) and the Skilled RE Credit Agreement (Consolidated).

“Skilled RE Credit Agreement (A-2)”: the Amended and Restated Loan Agreement
(A-2), dated as of December 22, 2016 (as amended, restated, amended and
restated, supplemented or modified), between the Skilled RE Borrowers from time
to time party thereto, Skilled RE Lender and certain financial institutions from
time to time party thereto as lenders, as it may be amended, restated, replaced
or otherwise modified from time to time in accordance with the terms of this
Agreement and the Intercreditor Agreement.

“Skilled RE Credit Agreement (Consolidated)”: the Consolidated, Amended and
Restated Loan Agreement, dated as of December 22, 2016 (as amended, restated,
amended and restated, supplemented or modified), between the Skilled RE
Borrowers from time to time party thereto, Skilled RE Lender and certain
financial institutions from time to time party thereto as lenders, as it may be
amended,

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restated, replaced or otherwise modified from time to time in accordance with
the terms of this Agreement and the Intercreditor Agreement.

“Skilled RE Credit Facility”: collectively, the term loan credit facilities
incurred pursuant to the Skilled RE Loan Documents.

“Skilled RE Lender”: Welltower, Inc., in its capacity as lender under the
Skilled RE Credit Agreement, together with its successors and assigns.

“Skilled RE Loan Documents”: collectively, the Loan Documents (as defined in the
Skilled RE Credit Agreement).

“Skilled RE Priority Collateral”: the HCN Priority Collateral (as defined in the
Intercreditor Agreement).

“Skilled Transactions”: collectively, (a) the Skilled Acquisition; (b) the
execution and delivery of the Skilled RE Loan Documents and the incurrence of
the obligations thereunder; and (c) the payment of all fees and expenses to be
paid in connection with the foregoing.

“Sold Entity or Business”: as set forth in the definition of the term
“Consolidated EBITDA”.

“Solvent”: with respect to any Person, as of any date of determination, (a) the
amount of the “present fair saleable value” of the assets of such Person will,
as of such date, exceed the amount of all “liabilities of such Person,
contingent or otherwise”, as of such date, as such quoted terms are determined
in accordance with applicable federal and state laws governing determinations of
the insolvency of debtors, (b) the present fair saleable value of the assets of
such Person will, as of such date, be greater than the amount that will be
required to pay the liability of such Person on its debts as such debts become
absolute and matured, (c) such Person will not have, as of such date, an
unreasonably small amount of capital with which to conduct its business and (d)
such Person will be able to pay its debts as they mature.  For purposes of this
definition, (i) “debt” means liability on a “claim”, (ii) “claim” means any (x)
right to payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured or (y) right to an equitable
remedy for breach of performance if such breach gives rise to a right to
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured
or unsecured and (iii) except as otherwise provided by applicable law, the
amount of “contingent liabilities” at any time shall be the amount thereof
which, in light of all the facts and circumstances existing at such time, can
reasonably be expected to become actual or matured liabilities.

“Specified RE Asset Sales”: Dispositions permitted under clause (E) of Section
7.5(b).

“Specified Hedge Agreement”: any Hedge Agreement (a) entered into by (i)
Ultimate Parent or any of the Restricted Subsidiaries and (ii) any Hedge
Counterparty at the time such Hedge Agreement was entered into, as counterparty
and (b) that has been designated by the Borrower, by notice to the
Administrative Agent, as a Specified Hedge Agreement.  The designation of any
Hedge Agreement as a Specified Hedge Agreement shall not create in favor of the
Lender or Affiliate thereof that is a party thereto any rights in connection
with the management or release of any Collateral or of the obligations of any
Guarantor under the Guarantee and Collateral Agreement.

“Sponsor”: Formation Capital LLC.

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“Subordinated Indebtedness”: with respect to Obligations, any Indebtedness of
any Loan Party that is by its terms subordinated in right of payment to any of
the Obligations.

“Subsidiary”: as to any Person, a corporation, partnership, limited liability
company or other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to elect a
majority of the board of directors or other managers of such corporation,
partnership or other entity are at the time owned, directly or indirectly
through one or more intermediaries, or both, by such Person.  Unless otherwise
qualified, all references to a “Subsidiary” or to “Subsidiaries” in this
Agreement shall refer to a direct or indirect Subsidiary or Subsidiaries of
Ultimate Parent; provided that in determining the percentage of ownership
interests of any Person controlled by another Person, no ownership interest in
the nature of a director’s “qualifying share” of the former Person shall be
deemed to be outstanding.

“Subsidiary Guarantors”: each Subsidiary listed on Schedule 1.1B, and each other
Restricted Subsidiary that is or becomes a party to this Agreement pursuant to
Section 6.10; provided that in no event shall a HUD Sub-Facility Entity or a HUD
RE Entity be deemed as a Subsidiary Guarantor.

“Subsidiary Redesignation”: as defined in the definition of “Unrestricted
Subsidiary”.

“Swap Transaction”: means any agreement, contract or transaction between the
Borrower and any Secured Party that constitutes a “swap” within the meaning of
Section 1a(47) of the Commodity Exchange Act.

“Tax Affiliate”: (a) the Borrower and (b) any Affiliate of the Borrower with
which the Borrower files or is eligible to file consolidated, combined or
unitary Tax Returns.

“Tax Distributions”: as defined in Section 7.6(a).

“Tax Return”: as defined in Section 3.7.

“Taxes”: 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.

“Third-Party Payor Programs”: Medicare, Medicaid, TRICARE, Blue Cross/Blue
Shield or any other public program or private commercial insurance, managed
care, or employee assistance program providing reimbursement or coverage for
Medical Services and with which Ultimate Parent or any of its Subsidiaries has
entered into a participation agreement, provider agreement, or similar
arrangement for coverage of eligible Patients.

“Title IV Plan”: a pension plan subject to Title IV of ERISA, other than a
Multiemployer Plan, to which any ERISA Affiliate incurs or otherwise has any
obligation or liability, contingent or otherwise.

“Transactions”: collectively, (a) the consummation of the 2012 Refinancing; (b)
the execution and delivery of the Loan Documents and the incurrence of the
obligations thereunder; (c) the amendment or amendment and restatement of the
ABL Facility, the Revera Loan Documents, the Skilled RE Loan Documents, the
Material Master Leases and the related transactions intended to be consummated
on or about the Closing Date and the Restatement Date, as applicable and (d) the
payment of all fees and expenses to be paid in connection with the foregoing.

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“TRICARE”: (a) the United States of America acting under TRICARE, or (b) any
agent, carrier, administrator or intermediary for any of the foregoing.

“Trigger Date”: as defined in Section 2.8(b).

“Trigger Event”: (a) any Default or Event of Default under Sections 8(b), (c),
(g), (h) or (l), (b) a Default or Event of Default under Section 7.13, 7.14 or
7.15 or (c) the acceleration of the Loans pursuant to Section 8 upon the
unanimous approval of Welltower Lender and Omega Lender as sole Lenders
hereunder; provided, that solely for the basis of determining whether a Trigger
Event has occurred under clause (b) of this definition, no Default or Event of
Default under Sections 7.13, 7.14 or 7.15 shall be deemed to have occurred at
any time if the Borrower was in compliance at such time with such provisions as
of the most recently ended fiscal quarter for which financial statements under
Section 5.1(a) or (b) have been delivered or should have been delivered.

“UCC”: the Uniform Commercial Code of the State of New York, as in effect on the
Closing Date.

“Ultimate Parent”: has the meaning specified in the recitals to this Agreement.

“United States”: the United States of America.

“Unrestricted Subsidiary”: (a) any Subsidiary of Ultimate Parent designated by
the Borrower as an Unrestricted Subsidiary hereunder on Schedule 1.1C or by
written notice to the Administrative Agent; provided that the Borrower shall
only be permitted to so designate a Subsidiary as an Unrestricted Subsidiary so
long as (i) immediately before and after such designation, (x) no Event of
Default shall have occurred and be continuing and (y) Ultimate Parent and the
Restricted Subsidiaries shall be in compliance with each Financial Condition
Covenant calculated on a Pro Forma Basis, (ii) no Subsidiary may be designated
as an Unrestricted Subsidiary if, after such designation, it would be a
“Restricted Subsidiary” for the purpose of any other Indebtedness of any Loan
Party, (iii) the designation of any Subsidiary as an Unrestricted Subsidiary
shall constitute an Investment by Ultimate Parent therein at the date of
designation in an amount equal to the fair market value as determined by
Ultimate Parent in good faith of Ultimate Parent or its Subsidiary’s (as
applicable) Investment therein, (iv) the designation of any Unrestricted
Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the
time of designation of any Indebtedness or Liens of such Subsidiary existing at
such time and (v) the Borrower shall have delivered to the Administrative Agent
an officer’s certificate executed by a Responsible Officer of Ultimate Parent,
certifying compliance with the requirements of preceding clauses (i) through
(iv), and (b) any Subsidiary of an Unrestricted Subsidiary. The Borrower may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary for purposes
of this Agreement (each, a “Subsidiary Redesignation”); provided that (A)
immediately after such designation, no Default shall have occurred and be
continuing and (B) the Borrower shall have delivered to the Administrative Agent
an officer’s certificate executed by a Responsible Officer of Ultimate Parent,
certifying compliance with the requirements of preceding clause (A); provided,
 further, that no Unrestricted Subsidiary that has been designated as a
Restricted Subsidiary pursuant to a Subsidiary Redesignation may again be
designated as an Unrestricted Subsidiary.  In no case shall the Borrower or any
Parent Company be permitted to be designated as an Unrestricted Subsidiary.

“UPL Facility” means each Facility that is the subject of a UPL Program.

“UPL Hospital” means each county hospital or other unit of government that is or
becomes an operator of a UPL Facility.

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“UPL Program” means a program under which, in exchange for certain payment of
fees, costs and other reimbursements from the UPL Hospital, Ultimate Parent or
any Restricted Subsidiary agrees to manage one or more Facilities, the
possession and operation of which has been transferred to such UPL Hospital and,
subsequent to such transfer, the accounts related to such Facility or Facilities
qualify under a Medicaid “upper payment limit” program.

“U.S. Lender”: as defined in Section 2.16(e).

“Voting Stock”: Capital Stock of any Person having ordinary power to vote in the
election of members of the board of directors, managers, trustees or other
controlling Persons, of such Person (irrespective of whether, at the time,
Capital Stock of any other class or classes of such entity shall have or might
have voting power by reason of the occurrence of any contingency).

“Waivable Mandatory Prepayment”: as defined in Section 2.8(f).

“Weighted Average Life to Maturity”: when applied to any Indebtedness at any
date, the number of years obtained by dividing: (a) the sum of the products
obtained by multiplying (i) the amount of each then remaining installment,
sinking fund, serial maturity or other required payments of principal, including
payment at final maturity, in respect thereof, by (ii) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date and
the making of such payment by (b) the then outstanding principal amount of such
Indebtedness; provided that for purposes of determining the Weighted Average
Life to Maturity of any Indebtedness being refinanced or any Indebtedness that
is being modified, refinanced, refunded, renewed, replaced or extended (the
“Applicable Indebtedness”), the effects of any amortization or prepayments made
on such Applicable Indebtedness prior to the date of the applicable
modification, refinancing, refunding, renewal, replacement or extension shall be
disregarded.

“Welltower Intercreditor Agreement”: the Amended and Restated Amendment to Lease
and Intercreditor Agreement, dated as of July 29, 2016, by and among, inter
alios, the Landlord (as defined therein), the Administrative Agent, MidCap
Funding IV Trust, (as successor to Healthcare Financial Solutions, LLC), as
administrative agent under the ABL Credit Agreement, as it may be amended,
restated, replaced or otherwise modified from time to time.

“Welltower Lease”: the Twentieth Amended and Restated Master Lease Agreement,
dated as of January 31, 2017, by and among FC-Gen Real Estate, LLC, a Delaware
limited liability company, as landlord, and Genesis Operations, LLC, a Delaware
limited liability company, as tenant.

“Welltower Lease Amendment Agreement”: the Third Amendment to the Welltower
Lease, dated as of the Restatement Date, by and among FC-Gen Real Estate, LLC, a
Delaware limited liability company and Genesis Operations, LLC, a Delaware
limited liability company.

“Welltower Lender”: as defined in the preamble hereto.

“Wholly-Owned”: as to any Person, a Subsidiary of such person all of the
outstanding Capital Stock of which (other than director’s qualifying shares) are
owned by such Person or by one or more Wholly-Owned Subsidiaries of such Person.

“Withdrawal Liability”: at any time, any liability incurred (whether or not
assessed) by any ERISA Affiliate and not yet satisfied or paid in full at such
time with respect to any Multiemployer Plan pursuant to Section 4201 of ERISA.

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“Write-Down and Conversion Powers”: 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.

1.2 Other Definitional Provisions.   Unless otherwise specified therein, all
terms defined in this Agreement shall have the defined meanings when used in the
other Loan Documents or any certificate or other document made or delivered
pursuant hereto or thereto.

 

(a) As used herein and in the other Loan Documents, and any certificate or other
document made or delivered pursuant hereto or thereto, (i) accounting terms
relating to the Parent Companies, the Borrower and their Subsidiaries not
defined in Section 1.1 and accounting terms partly defined in Section 1.1, to
the extent not defined, shall have the respective meanings given to them under
GAAP, (ii) the words “include”, “includes” and “including” shall be deemed to be
followed by the phrase “without limitation”, and (iii) references to agreements
or other Contractual Obligations shall, unless otherwise specified, be deemed to
refer to such agreements or Contractual Obligations as amended, supplemented,
restated or otherwise modified, extended, replaced or refinanced from time to
time (subject to any restrictions or qualifications on such amendments,
restatements, supplements, restatements, modifications, extensions, replacements
or refinancings set forth herein or in the Intercreditor Agreement or any
Material Master Lease Intercreditor Agreement). Notwithstanding any other
provision contained herein, all terms of an accounting or financial nature used
herein shall be construed, and all computations of amounts and ratios referred
to in Section 7 shall be made, without giving effect to any election under
Statement of Financial Accounting Standards 159 (or any other Financial
Accounting Standard having a similar result or effect) to value any Indebtedness
or other liabilities of any Loan Party or any Subsidiary of any Loan Party at
“fair value.”  To the extent that any provision of this Agreement requires or
tests compliance with (or with respect to) the Financial Condition Covenants
prior to the date that such covenants are first tested, such provision shall be
deemed to refer to the first covenant level set forth in each applicable
Financial Condition Covenant.

(b) Unless otherwise specified herein, any calculation of the Fixed Charge
Coverage Ratio, Interest Coverage Ratio, and Consolidated Total Leverage Ratio
shall be determined based on the most recently ended fiscal quarter for which
financial statements are required to be delivered pursuant to Section 5.1(a) or
(b), as applicable, prior to the applicable date of determination and subject to
pro forma adjustments to the extent specified in any applicable provision.

(c) The words “hereof”, “herein” and “hereunder” and words of similar import,
when used in this Agreement, shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and Annex, Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.

(d) The term “license” shall include sub-licenses.

(e) The term “lease” shall include sub-leases.

(f) The meanings given to terms defined herein shall be equally applicable to
both the singular and plural forms of such terms.

SECTION 2. AMOUNT AND TERMS OF COMMITMENTS

2.1 Commitments.  Each Lender made an Initial Term Loan in Dollars to the
Borrower on the Closing Date in an amount equal to the amount of the Initial
2016 Commitment of such Lender.  Subject to the terms and conditions set forth
in the Fourth Amendment and hereof, each Lender severally agrees to

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make the 2018 Term Loans in Dollars to the Borrower on the Restatement Date in
an amount equal to the amount of the 2018 Term Loan Commitment of such Lender. 

 

2.2 [Reserved].

 

2.3 Procedure for Loan Borrowing.  The Borrower shall give the Administrative
Agent irrevocable notice, substantially in the form of Exhibit A-2 hereto,
(which notice must be received by the Administrative Agent not later than 3:00
P.M., New York City time, one Business Day prior to the anticipated applicable
Borrowing Date) requesting that the Lenders make the Loans on the applicable
Borrowing Date and specifying (i) the aggregate principal amount to be borrowed,
(ii) the requested Borrowing Date and (iii) the Borrower.  Upon receipt of such
borrowing notice the Administrative Agent shall promptly notify each Lender
thereof.  Not later than 10:00 A.M., New York City time, on the applicable
Borrowing Date each Lender shall make available to the Administrative Agent at
the Funding Office an amount in immediately available funds equal to the Loan or
Loans to be made by such Lender.

 

2.4 Repayment of Loans.  (a) The Initial Term Loan of each Lender shall be
payable in equal consecutive monthly installments, commencing on August 31,
2016, on the last Business Day of each calendar month following the Closing
Date, until and including January 31, 2018, and each such monthly installment
shall be in an amount equal to such Lender’s pro rata share of the amount
indicated below (as adjusted to reflect any prepayments thereof in accordance
with Section 2.14(h)):

 

Date of Payment

Principal Payment

Commencing on August 31, 2016, and continuing on the last Business Day of each
calendar month until and including January 31, 2018

$250,000

(a) After January 31, 2018, no amortization payments shall be payable on any
Loans, including the Initial Term Loans.    

(b) The unpaid principal amount of the Initial Term Loans and the 2018 Term
Loans shall be payable on the Maturity Date.

2.5 Repayment of Loans.   The Borrower hereby unconditionally promises to pay to
the Administrative Agent for the account of the appropriate Lender the principal
amount of each outstanding Loan of such Lender made to the Borrower in
installments according to the amortization schedule set forth in Section 2.4 (or
on such earlier date on which the Loans become due and payable pursuant to
Section 8).  The Borrower hereby further agrees to pay interest on the unpaid
principal amount of the Loans made to the Borrower from time to time outstanding
from the Closing Date until payment in full thereof at the rates per annum, and
on the dates, set forth in Section 2.11.

 

(a) Notwithstanding anything herein to the contrary, each Lender may, at its
option, elect not to receive its pro rata share of any scheduled installments of
principal repayments made pursuant to Section 2.4 and Section 2.5(a) (other than
payments due on the Maturity Date or such earlier date on which the Loans become
due and payable pursuant to Section 8), by giving written notice to the Borrower
and the Administrative Agent of its election to do so at least five Business
Days prior to the next scheduled installment of principal repayments. Any Lender
may revoke such election at any time by giving written notice to the Borrower
and the Administrative Agent of its election to do so no later than two Business
Days prior to the next scheduled installment of principal repayments.

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(b) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing indebtedness of the Borrower to such Lender resulting
from each Loan of such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time under
this Agreement.

(c) The Administrative Agent, on behalf of the Borrower, shall maintain the
Register pursuant to Section 10.6(b)(iv), and a subaccount therein for each
Lender, in which shall be recorded (A) the amount of each Loan made hereunder
and any Note evidencing such Loan, (B) the amount of any principal, interest and
fees, as applicable, due and payable or to become due and payable from the
Borrowers to each Lender hereunder and (C) the amount of any sum received by the
Administrative Agent hereunder from the Borrower and each Lender’s share
thereof.

(d) The entries made in the Register and the accounts of each Lender maintained
pursuant to Section 2.5(d) shall, to the extent permitted by applicable law, be
conclusive absent manifest error, and the Lenders shall treat each registered
holder as the owner of such Loan for all purposes of this Agreement,
notwithstanding any notice to the contrary.

(e) Any Lender may request that the Loans made by it be evidenced by a
promissory note.  In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note payable to such Lender or its registered
assigns and in the form attached hereto as Exhibit I.  Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 10.6) be represented by one or
more promissory notes in such form payable to the payee named therein and its
registered assigns.

2.6 Fees, etc.  The Borrower agrees to pay to the Administrative Agent the fees
in the amounts and on the dates as set forth in any fee agreements.

 

2.7 Optional Prepayments.   The Borrower may at any time prepay the Loans, in
whole or in part, subject to Section 2.14(i), but otherwise without premium or
penalty, upon irrevocable notice (provided that such notice may be conditioned
on receiving proceeds of any refinancing or Disposition) in substantially the
form of Exhibit H hereto delivered to the Administrative Agent no later than
3:00 P.M., New York City time, one Business Day prior thereto, which notice
shall specify the date and amount of prepayment.  Upon receipt of any such
notice the Administrative Agent shall promptly notify each relevant Lender
thereof.  If any such notice is given, the amount specified in such notice shall
be due and payable on the date specified therein, together with accrued interest
to such date on the amount prepaid.  Partial prepayments of Loans shall be in an
aggregate principal amount of $500,000 or a whole multiple of $500,000 in excess
thereof, and shall be subject to the provisions of Section 2.14.

 

(a) Amounts to be applied in connection with prepayments pursuant to this
Section shall be applied to the Obligations in accordance with Section
2.14.  Each prepayment of Loans under this Section shall be accompanied by
accrued interest to the date of such prepayment on the amount prepaid.

2.8 Mandatory Prepayments.   If any Indebtedness (other than any Indebtedness
permitted to be incurred in accordance with Section 7.1) shall be incurred by
the Parent Companies, the Borrower or any of the Restricted Subsidiaries, the
Borrower shall pay an amount equal to 100% of the Net Cash Proceeds of such
Indebtedness within three Business Days of the date of receipt thereof to the
Administrative Agent to be applied to the Obligations in accordance with Section
2.14.

 

(a) If on any date any of the Parent Companies, the Borrower or any of the
Restricted Subsidiaries shall receive Net Cash Proceeds from an issuance or
incurrence of New Capital, the Borrower shall pay an amount equal to 100% of
such Net Cash Proceeds substantially concurrently with

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the receipt thereof to the Administrative Agent to be applied to the Obligations
in accordance with Section 2.14(i). 

(b) If on any date any of the Parent Companies, the Borrower or any of the
Restricted Subsidiaries shall for its own account receive Net Cash Proceeds from
any Asset Sale (other than any Asset Sale that is of (A) ABL Priority Collateral
(as defined in the Intercreditor Agreement), (B) Skilled RE Priority Collateral,
(C) MidCap RE Priority Collateral or (D) Specified RE Asset Sales) or any
Recovery Event (other than any Recovery Event that is of (i) ABL Priority
Collateral (as defined in the Intercreditor Agreement), (ii) Skilled RE Priority
Collateral, (iii) MidCap RE Priority Collateral or (iv) Specified RE Asset
Sales) then, unless a Reinvestment Notice shall be delivered in respect thereof,
the Borrower shall pay an amount equal to 100% of such Net Cash Proceeds within
five Business Days of the date of receipt thereof to the Administrative Agent to
be applied to the Obligations in accordance with Section 2.14; provided that
delivery of such Reinvestment Notice shall be subject to the Administrative
Agent’s reasonable consent; provided,  further, that notwithstanding the
foregoing, (1) on each Reinvestment Prepayment Date, an amount equal to the
Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event
shall be paid to the Administrative Agent to be applied to the Obligations in
accordance with Section 2.14 and (2) on the date (the “Trigger Date”) that is
180 days after any such Reinvestment Prepayment Date, an amount equal to the
portion of any Committed Reinvestment Amount with respect to the relevant
Reinvestment Event not actually expended by such Trigger Date shall be paid to
the Administrative Agent to be applied to the Obligations in accordance with
Section 2.14.

(c) If, as of the last day of any fiscal quarter of Ultimate Parent, commencing
with the fiscal quarter ending September 30, 2016, Ultimate Parent and its
Restricted Subsidiaries shall have Liquidity (after giving pro forma effect to
borrowings and letters of credit made or issued under the ABL Credit Agreement
on or prior to the last day of such fiscal quarter) in excess of $400,000,000
(such excess amount, “Excess Liquidity”), the Borrower shall, on the relevant
Excess Liquidity Application Date thereafter, pay an amount equal to 100% of
such Excess Liquidity to the Administrative Agent to be applied to the
Obligations in accordance with Section 2.14.  Each such payment shall be made on
a date (an “Excess Liquidity Application Date”) no later than three Business
Days after the date financial statements with respect to such fiscal quarter (or
fiscal year with respect to the fourth fiscal quarter) are required to be
delivered pursuant to Section 5.1(a) or 5.1(b), as applicable.

(d) Amounts to be applied in connection with prepayments pursuant to Section 2.8
shall be applied to the Obligations in accordance with Section 2.14.

(e) Anything contained herein to the contrary notwithstanding, so long as any
Loans are outstanding, in the event the Borrower is required to make any
mandatory prepayment under Section 2.8 (b), (c) or (d) (each, a “Waivable
Mandatory Prepayment”), not less than five Business Days prior to the date (the
“Required Prepayment Date”) on which the Borrower is required to make such
Waivable Mandatory Prepayment, the Borrower shall notify the Administrative
Agent of the amount of such prepayment, and the Administrative Agent will
promptly thereafter notify each Lender holding an outstanding Loan of the amount
of such Lender’s pro rata share of such Waivable Mandatory Prepayment and such
Lender’s option to refuse such amount. Each such Lender shall give written
notice to the Borrower and the Administrative Agent of its election to do so on
or before two Business Days prior to the Required Prepayment Date (it being
understood that any Lender which does not notify the Borrower and the
Administrative Agent of its election to exercise such option on or before two
Business Days prior to the Required Prepayment Date shall be deemed to have
elected, as of such date, not to exercise such option). The Administrative Agent
shall notify the Borrower at least one Business Day prior to the Required
Prepayment Date of the decision of the Lenders.  If all of the Lenders
unanimously agree to exercise their options to refuse such Waivable Mandatory
Prepayment, then the amount of the Waivable

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Mandatory Prepayment shall be retained by the Borrower and used by the Borrower
for working capital and other general corporate purposes.  If any Lender does
not agree to exercise their option to refuse such Waivable Mandatory Prepayment,
then the Borrower shall make a prepayment of the Loans in the amount of Waivable
Mandatory Prepayment, which prepayment shall be applied in accordance with
Section 2.14.

2.9 [Reserved].

2.10 [Reserved].

2.11 Interest Rates and Payment Dates.   Each Initial Term Loan shall bear
interest at a rate per annum equal to 14.00%.

 

 

(a) Each 2018 Term Loan shall bear interest at a rate per annum equal to 10.00%.

(b) If (i) all or a portion of the principal amount of any Loan shall not be
paid when due (whether at the stated maturity, by acceleration or otherwise) or
(ii) all or a portion of any interest payable on any Loan or other amount
payable hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall bear interest at a rate
per annum equal to the rate that would otherwise be applicable thereto pursuant
to the foregoing provisions of this Section plus 2%, from the date of such
non-payment until such amount is paid in full (as well after as before
judgment).

(c) Interest shall be payable by the Borrower in arrears on each Interest
Payment Date; provided that interest accruing pursuant to paragraph (c) of this
Section shall be payable from time to time on demand.

(d) The Borrower may elect to pay up to (i) from the Closing Date to and
including February 21, 2018, 2.00% per annum and (ii) thereafter, 9.00% per
annum of interest on the Initial Term Loans as PIK Interest and such PIK
Interest shall be added to the aggregate principal balance of the Loans in
arrears on the applicable Interest Payment Date. The Borrower may elect to pay
up to 5.00% per annum of interest on the 2018 Term Loan as PIK Interest and such
PIK Interest shall be added to the aggregate principal balance of the Loans in
arrears on the applicable Interest Payment Date.  The Borrower shall deliver to
the Administrative Agent, at least five (5) Business Days prior to the
applicable Interest Payment Date, a written notice setting forth (i) its
election to pay a percentage of interest in the form of PIK Interest and (ii)
the percentage of interest that shall constitute PIK Interest on the applicable
Interest Payment Date.  Any such election shall be deemed to remain in effect
until superseded by a subsequent notice delivered as set forth in the preceding
sentence.  Notwithstanding anything herein to the contrary, following the
occurrence and during the continuance of an Event of Default, the Borrower may
not pay any interest as PIK Interest.  The Borrower and the Administrative Agent
acknowledge and agree that, (i) effective as of February 22, 2018, the Borrower
shall be deemed to have elected to pay 9% per annum of the interest as PIK
Interest on the Initial Term Loan and (ii) effective as of the Restatement Date,
the Borrower shall be deemed to have elected to pay 5.00% per annum of the
interest as PIK Interest on the 2018 Term Loan, and that no separate notice
shall be required hereunder until such time as the Borrower elects (if ever) to
adjust the percentage of interest that shall constitute PIK Interest.

2.12 Computations of Interest and Fees.  All computations of interest and of
fees shall be made by the Administrative Agent on the basis of a year of 365/366
days for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest and fees are
payable.  Each determination of an interest rate or the amount of a fee
hereunder shall be made by the Administrative Agent and shall be conclusive,
binding and final for all purposes, absent manifest error.

 

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2.13 [Reserved].

2.14 Pro Rata Treatment and Payments.   Each borrowing by the Borrower from the
Lenders hereunder and each payment by the Borrower shall be made pro rata
according to the respective Loan Percentages of the relevant Lenders in respect
of each tranche of the Loans.  Each payment (including prepayments) in respect
of principal, interest or fees in respect of Loans shall be applied pro rata
among tranches of Loans.  Except as set forth in Section 2.14(i) each payment
(including prepayments) in respect of principal or interest in respect of any
tranche of the Loans and each payment in respect of fees payable hereunder shall
be applied to the amounts of such obligations owing to the Lenders with respect
to such tranche, pro rata according to the respective amounts then due and owing
to such Lenders; provided, the provisions of this sentence shall not be
construed to apply to any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans to any assignee or
participant.

 

(a) Payments.  The Borrower shall make each payment under any Loan Document not
later than 2:00 P.M., New York City time, on the day when due to the
Administrative Agent by wire transfer to the following account (or at such other
account or by such other means to such other address as Administrative Agent
shall have notified the Borrower in writing within a reasonable time prior to
such payment) in immediately available Dollars and without setoff or
counterclaim:

Bank Name: KeyBank

Address: 127 Public Square, Cleveland, OH 44114

ABA #: 041001039

Account #: 353321001011

Account Name: Welltower Inc.

(b) Payment Dates.  If any payment hereunder becomes due and payable on a day
other than a Business Day, such payment shall be extended to the next succeeding
Business Day.  In the case of any extension of any payment of principal pursuant
to the preceding sentence, interest thereon shall be payable at the then
applicable rate during such extension.

(c) Advancing Payments.   Unless the Administrative Agent shall have been
notified in writing by any Lender prior to a borrowing that such Lender will not
make the amount that would constitute its share of such borrowing available to
the Administrative Agent, the Administrative Agent may assume that such Lender
is making such amount available to the Administrative Agent, and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower a corresponding amount.  If such amount is not made available to
the Administrative Agent by the required time on the Borrowing Date therefor,
such Lender shall pay to the Administrative Agent on demand, such amount with
interest thereon, at a rate equal to the greater of (i) the Federal Funds
Effective Rate and (ii) a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation, for the period
until such Lender makes such amount immediately available to the Administrative
Agent.  A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this paragraph shall be presumptively correct
in the absence of manifest error.  If such Lender’s share of such borrowing is
not made available to the Administrative Agent by such Lender within three
Business Days after such Borrowing Date, the Administrative Agent shall give
notice of such fact to the Borrower and the Administrative Agent shall also be
entitled to recover such amount with interest thereon at the rate per annum
applicable to Loans under the relevant Facility, on demand,

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from the Borrower.  If the Borrower and such Lender shall pay such interest to
the Administrative Agent for the same or an overlapping period, the
Administrative Agent shall promptly remit to the Borrower the amount of such
interest paid by the Borrower for such period.  If such Lender pays its share of
the applicable borrowing to the Administrative Agent, then the amount so paid
shall constitute such Lender’s Loan included in such borrowing.

(i) Unless the Administrative Agent shall have been notified in writing by the
Borrower prior to the date of any payment due to be made by the Borrower
hereunder that the Borrower will not make such payment to the Administrative
Agent, the Administrative Agent may assume that the Borrower is making such
payment, and the Administrative Agent may, but shall not be required to, in
reliance upon such assumption, make available to the relevant Lenders their
respective pro rata shares of a corresponding amount.  If such payment is not
made to the Administrative Agent by the Borrower within three Business Days
after such due date, the Administrative Agent shall be entitled to recover, on
demand, from each relevant Lender to which any amount which was made available
pursuant to the preceding sentence, such amount with interest thereon at the
rate per annum equal to the daily average Federal Funds Effective Rate.  Nothing
herein shall be deemed to limit the rights of the Administrative Agent or any
Lender against the Borrower.

(d) Application of Voluntary Prepayments.  Unless otherwise provided in this
Section or elsewhere in any Loan Document, all payments and any other amounts
received by an Administrative Agent from or for the benefit of the Borrower
shall be applied to repay the Obligations the Borrower designates.  Amounts
repaid or prepaid pursuant to this clause (e) or clause (f) below on account of
the Loans may not be reborrowed.

(e) Application of Mandatory Prepayments.  Subject to the provisions of clause
(g) below with respect to the application of payments during the continuance of
an Event of Default, any payment made by the Borrower to an Agent pursuant to
Section 2.8 or any other prepayment of the Obligations required to be applied in
accordance with this clause (f) shall be applied: first, to repay the
outstanding principal balance of the Loans until paid in full in accordance with
Section 2.14(h), and second, the excess (if any) shall be retained by the
Borrower.

(f) Application of Payments During an Event of Default.  Notwithstanding
anything herein to the contrary, following the occurrence and during the
continuance of an Event of Default, and notice thereof to the Administrative
Agent by the Borrower or the Required Lenders, all payments received on account
of the Obligations shall be applied by the Administrative Agent as follows:

first, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts payable to the Administrative Agent in
its capacity as such;

second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts payable to the Lenders (including fees and
disbursements and other charges of counsel) arising under the Loan Documents,
ratably among them in proportion to the respective amounts described in this
clause second payable to them;

third, to payment of that portion of the Obligations constituting accrued and
unpaid interest on the Loans, ratably among the Lenders in proportion to the
respective amounts described in this clause third payable to them;

fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and amounts owing with respect to Specified Hedge
Agreements and Cash Management Documents in each case ratably based upon the
respective aggregate amounts of all such Obligations owing in accordance with
the respective amounts thereof then due and payable;

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fifth, to the payment in full of all other Obligations, in each case ratably
among the Administrative Agent and the Lenders based upon the respective
aggregate amounts of all such Obligations owing to them in accordance with the
respective amounts thereof then due and payable; and

finally, the balance, if any, after all Obligations have been paid in full, to
the Borrower or as otherwise required by Law;

provided, that, notwithstanding anything to the contrary set forth above, in no
event shall the proceeds of any Collateral owned, or any Guarantee Obligations
provided, by any Loan Party under any Loan Document be applied to repay or cash
collateralized any Excluded Swap Obligation with respect to such Loan Party.

(g) Application of Payments Generally.  Each optional prepayment on account of
principal of and interest on the Loans pursuant to Section 2.7 shall be applied
to any installments thereof as the Borrower shall determine.  Each mandatory
prepayment on account of principal of and interest on the Loans pursuant to
Sections 2.8(a),  (b),  (c) and (d) shall be applied first, to the payment
required to be made on the Maturity Date and second, to the remaining scheduled
installments of principal in inverse order of maturity.  If sufficient amounts
are not available to pay in cash all outstanding Obligations described in any
priority level set forth in this Section, the available amounts shall be
applied, unless otherwise expressly specified herein, to such Obligations
ratably based on the proportion of the Secured Parties’ interest in such
Obligations.  Any priority level set forth in this Section that includes
interest shall include all such interest, whether or not accruing after the
filing of any petition in bankruptcy or the commencement of any insolvency,
reorganization or similar proceeding, and whether or not a claim for post-filing
or post-petition interest is allowed in any such proceeding.  While an Event of
Default is continuing, any payments or prepayments received by Administrative
Agent shall be applied under Section 2.14(g).

(h) Notwithstanding anything in this Agreement to the contrary, provided no
Trigger Event has occurred and is continuing at the time of such prepayment, any
payment made by the Borrower pursuant to Section 2.8(b) shall be applied: first,
to repay the outstanding principal balance and accrued interest of the Loans of
Welltower Lender until such Loans are paid in full, second, to repay the
outstanding principal balance and accrued interest of the Loans of Omega Lender
until such Loans are paid in full and third, the excess (if any) shall be
retained by the Borrower.  In the event a Trigger Event has occurred and is
continuing at the time of such prepayment, any payment made by the Borrower
pursuant to Section 2.8(b) shall be applied pursuant to the terms of Section
2.14(a).  Notwithstanding any provision of this Section 2.14(i), any payment
made to Welltower Lender pursuant to the order of priority set forth above shall
not be subject to later rescission or recovery by any party, including Omega
Lender, on the basis that a Trigger Event based on clause (b) of the definition
thereof was in effect at the time of the payment, provided that in the event the
most recent financial statements delivered pursuant to Section 5.1(a) or (b)
prior to the time of such payment show that a Trigger Event based on clause (b)
of the definition thereof had occurred and was continuing at the time of such
payment, such payment made to Welltower Lender pursuant to this Section 2.14(i)
shall be subject to recovery at the option of Omega Lender and, if so recovered,
shall be applied as set forth in Section 2.14(a).

2.15 Requirements of Law.

(a) [Reserved].

(b) If any Lender shall have determined that the adoption of or any change in
any Requirement of Law regarding capital adequacy or liquidity or in the
interpretation or application thereof or compliance by such Lender or such
Lender’s holding company with any request or directive regarding

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capital adequacy (whether or not having the force of law) from any Governmental
Authority made, in each case, subsequent to the Closing Date shall have the
effect of reducing the rate of return on such Lender’s or such holding company’s
capital or liquidity as a consequence of its obligations hereunder to a level
below that which such Lender or such Lender’s holding company could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender’s or such holding company’s policies with respect to capital
adequacy) by an amount deemed in good faith by such Lender to be material, then
from time to time, after submission by such Lender to the Borrower (with a copy
to the Administrative Agent) of a reasonably detailed written request therefor
(consistent with the detail provided by such Lender to similarly situated
borrowers), the Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender or such Lender’s holding company for such
reduction.

(c) A certificate as to any additional amounts payable pursuant to this Section
submitted by any Lender to the Borrower (with a copy to the Administrative
Agent) with reasonable detail demonstrating how such amounts were derived shall
be presumptively correct in the absence of manifest error.  Notwithstanding
anything to the contrary in this Section, the Borrower shall not be required to
compensate a Lender pursuant to this Section for any amounts incurred more than
six months prior to the date that such Lender notifies the Borrower of such
Lender’s intention to claim compensation therefor; provided that if the
circumstances giving rise to such claim have a retroactive effect, then such
six-month period shall be extended to include the period of such retroactive
effect.  The obligations of the Borrower pursuant to this Section shall survive
the termination of this Agreement and the payment of the Obligations.

(d) Notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall
Street Reform and Consumer Protection Act and all requests, rules, guidelines,
requirements and directives thereunder, issued in connection therewith or in
implementation thereof and (ii) 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 a Requirement of Law, regardless of the
date enacted, adopted, issued or implemented.

2.16 Taxes.   All payments made by or on behalf of the Borrower or any Guarantor
under this Agreement shall be made free and clear of, and without deduction or
withholding for or on account of, any Taxes, as of the Closing Date or
thereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority responsible for administering taxes, excluding (i) Taxes imposed on or
measured by net income (however determined), franchise Taxes, and branch profits
taxes, in each case (A) imposed on the Administrative Agent or any Lender as a
result of a present, former or future connection between the Administrative
Agent or such Lender and the jurisdiction of the Governmental Authority imposing
such Tax or any political subdivision or taxing authority thereof or therein
(other than any such connection arising solely from the Administrative Agent or
such Lender having executed, delivered or performed its obligations or received
a payment under, or enforced, this Agreement or any other Loan Document), or (B)
imposed as a result of the Administrative Agent or any Lender 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); (ii) any United States
withholding Tax that (A) is imposed on amounts payable to a Lender at the time
such Lender becomes a party to this Agreement or designates a new lending office
(other than pursuant to a request by the Borrower under Sections 2.19 or 2.20 of
this Agreement), except to the extent that such Lender (or its assignor, if any)
was entitled at the time of designation of a new lending office (or assignment),
to receive additional amounts from the Borrower with respect to such withholding
Tax pursuant to this Section or (B) or is attributable to such Lender’s failure
to comply with Section 2.16(d) and Section 2.16(e), and (iii) any United States
withholding Tax imposed under FATCA (together the amounts described in clauses
(i)-(iii) are the “Excluded Taxes”). 

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If any such Taxes that are not Excluded Taxes (the “Non-Excluded Taxes”) or
Other Taxes are required to be withheld from any amounts payable by or on behalf
of the Borrower or any Guarantor hereunder, the amounts payable by the Borrower
or such Guarantor shall be increased to the extent necessary to yield the
Administrative Agent or such Lender (after deduction or withholding of all
Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement.

 

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

(b) Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower,
as promptly as possible thereafter the Borrower shall send to the Administrative
Agent for the account of the Administrative Agent or the relevant Lender, as the
case may be, a certified copy of an original official receipt received by the
Borrower showing payment thereof if such receipt is obtainable, or, if not,
other reasonable evidence of payment satisfactory to the Administrative Agent.

(c) Each Lender that is not a United States person (as such term is defined in
Section 7701(a)(30) of the Code) (a “Non-U.S. Lender”) shall deliver to the
Borrower and the Administrative Agent (or, in the case of a Participant, to the
Borrower and to the Lender from which the related participation shall have been
purchased) (i) two accurate and complete signed copies of IRS Form W-8ECI,
W-8EXP, W-8BEN or W-8BEN-E (claiming benefits under an applicable treaty) or
W-8IMY (together with any applicable underlying forms), whichever is applicable,
(ii) in the case of a Non-U.S. Lender claiming exemption from United States
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of “portfolio interest”, a statement substantially in the form of
Exhibit F and two accurate and complete signed copies of IRS Form W-8BEN or
W-8BEN-E, or any subsequent versions or successors to such forms, in each case
properly completed and duly executed by such Non-U.S. Lender.  Such forms shall
be delivered by each Non‑U.S. Lender on or before the date it becomes a party to
this Agreement (or, in the case of any Participant, on or before the date such
Participant purchases the related participation), and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent.  In addition, each Non-U.S. Lender shall deliver such forms promptly upon
the obsolescence or invalidity of any form previously delivered by such Non-U.S.
Lender.  Notwithstanding any other provision of this paragraph, a Non-U.S.
Lender shall not be required to deliver any form pursuant to this paragraph that
such Non-U.S. Lender is not legally able to deliver.

(d) Each Lender that is a United States person (as such term is defined in
Section 7701(a)(30) of the Code) (a “U.S. Lender”) shall deliver to the Borrower
and the Administrative Agent two accurate and complete signed copies of IRS Form
W-9, or any subsequent versions or successors to such form.  Such forms shall be
delivered by each U.S. Lender on or before the date it becomes a party to this
Agreement, and from time to time thereafter upon the reasonable request of the
Borrower or the Administrative Agent.  In addition, each U.S. Lender shall
deliver such forms promptly upon the obsolescence or invalidity of any form
previously delivered by such U.S. Lender.

(e) The Borrower shall indemnify the Administrative Agent and any Lender, within
30 days after the written demand therefor, for the full amount of any
Non-Excluded Taxes or Other Taxes (including any Non-Excluded Taxes or Other
Taxes imposed or asserted on amounts payable under this Section) payable or paid
by the Administrative Agent or Lender or required to be withheld or deducted
from a payment to the Administrative Agent or Lender and any reasonable expenses
arising therefrom or with respect thereto, whether or not such Taxes are
correctly or legally asserted by the relevant Governmental Authority.  A
certificate as to the amount of such amount or liability delivered to the

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Borrower by a Lender (with a copy to the Administrative Agent) or by the
Administrative Agent on its behalf of on behalf of a Lender, shall be conclusive
absent manifest error.

(f) If any Secured Party determines, in good faith, that it has received a
refund of any Non-Excluded Taxes or Other Taxes as to which it has been
indemnified by the Borrower or with respect to which the Borrower have paid
additional amounts pursuant to this Section, it shall promptly pay over such
refund to the Borrower (but only to the extent of indemnity payments made, or
additional amounts paid, by the Borrower under this Section with respect to the
Non-Excluded Taxes or Other Taxes giving rise to such refund), net of all
out-of-pocket expenses (including Taxes) of the Administrative Agent or such
Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided that the Borrower,
upon the request of the Administrative Agent or such Lender, agrees to repay the
amount paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the Administrative Agent or
such Lender in the event the Administrative Agent or such Lender is required to
repay such refund to such Governmental Authority.  Notwithstanding anything to
the contrary in this paragraph (g), in no event will the Administrative Agent or
Lender be required to pay any amount to the Borrower pursuant to this paragraph
(g) the payment of which would place the Lender or the Administrative Agent in a
less favorable net after-Tax position than the Lender or the Administrative
Agent would have been in if the indemnification payments or additional amounts
giving rise to such refund had never been paid.  This paragraph shall not be
construed to require the Administrative Agent or any Lender to make available
its Tax Returns (or any other information relating to its Taxes which it deems
confidential) to the Borrower or any other Person.

(g) Each Lender shall severally indemnify the Administrative Agent, within 10
days after demand therefor, for (i) any Non-Excluded Taxes attributable to such
Lender (but only to the extent that the Borrower has not already indemnified the
Administrative Agent for such Non-Excluded 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 10.6 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
paragraph (h).  The agreements in this paragraph (h) shall survive the
resignation and/or replacement of the Administrative Agent.

(h) 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 paragraph, FATCA shall include any amendments made to FATCA after the date
of this Agreement.

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(i) The agreements in this Section shall survive the termination of this
Agreement and the payment of the Obligations.

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.

2.17 [Reserved].

2.18 [Reserved].

2.19 Mitigation of Costs; Change of Lending Office.  Each Lender agrees that,
upon the occurrence of any event giving rise to the operation of Section 2.15 or
2.16(a) with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans affected by such event with the
object of avoiding the consequences of such event; provided that no such
designation is made on terms that, in the sole judgment of such Lender, subject
such Lender and its lending office(s) to any unreimbursed costs or are otherwise
disadvantageous to such Lender and its lending office(s); provided,  further,
that nothing in this Section shall affect or postpone any of the obligations of
the Borrower or the rights of any Lender pursuant to Section 2.15 or 2.16(a).

 

2.20 Replacement of Lenders.  The Borrower shall be permitted to replace with a
financial institution any Lender that (a) requests reimbursement for amounts
owing pursuant to Section 2.15 or 2.16, (b) defaults in its obligation to make
Loans hereunder, or (c) that has refused to consent to any waiver or amendment
with respect to any Loan Document that requires the consent of each Lender
directly affected thereby or of each Lender and has been consented to by the
Required Lenders; provided that (i) such replacement does not conflict with any
Requirement of Law, (ii) the replacement financial institution shall purchase,
at par, all Loans and other amounts owing to such replaced Lender on or prior to
the date of replacement, (iii) the replacement financial institution, if not
already a Lender, shall be reasonably satisfactory to the Administrative Agent
to the extent that an assignment to such replacement financial institution of
the rights and obligations being acquired by it would otherwise require the
consent of the Administrative Agent pursuant to Section 10.6(b), (iv) the
replaced Lender shall be obligated to make such replacement in accordance with
the provisions of Section 10.6, (v) the Borrower shall pay all additional
amounts (if any) required pursuant to Section 2.15 or 2.16, as the case may be,
in respect of any period prior to the date on which such replacement shall be
consummated, (vi) if applicable, the replacement financial institution shall
consent to such amendment or waiver, (vii) in the case of any such assignment
resulting from a claim for reimbursement under Section 2.15 or Section 2.16,
such assignment will result in a reduction in such reimbursement thereafter;
(viii) any such replacement shall not be deemed to be a waiver of any rights
that the Borrower, the Administrative Agent or any other Lender shall have
against the replaced Lender, and (ix) the replacement financial institution
shall be an Eligible Assignee.

 

2.21 [Reserved].

2.22 [Reserved]. [Reserved].

 

2.23 Nature and Extent of Borrower’s Liability.  The Borrower hereby
subordinates any claims, including any rights at law or in equity to payment,
subrogation, reimbursement, exoneration, contribution, indemnification or set
off, that it may have at any time against any other Loan Party, howsoever
arising, to the satisfaction in full of all Obligations (other than contingent
indemnification obligations not yet due and payable).

 

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SECTION 3. REPRESENTATIONS AND WARRANTIES

To induce the Agents and the Lenders to enter into this Agreement and to make
the Loans, the Parent Companies and the Borrower hereby jointly represents and
warrants (as to itself and each of its Subsidiaries) to the Agents and each
Lender, which representations and warranties shall be deemed made on the Closing
Date (immediately after giving effect to the Transactions) and on the date of
each borrowing of Loans hereunder (including, without limitation, on the
Restatement Date), that:

3.1 Corporate Existence; Compliance with Law.   Except as set forth on Schedule
3.1(a), each Loan Party and each of its Restricted Subsidiaries (i) is duly and
solely organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (ii) is duly qualified to do business as a
foreign entity and in good standing under the laws of each jurisdiction where
such qualification is necessary, except where the failure to be so qualified or
in good standing would not, in the aggregate, reasonably be expected to have a
Material Adverse Effect, (iii) has all requisite power and authority and the
legal right to own, pledge, mortgage and operate its property, to lease or
sublease any property it operates under a Lease or sublease, as applicable, and
to conduct its business as now or currently proposed to be conducted, except
where the failure to do so would not reasonably be expected to have a Material
Adverse Effect, (iv) is in compliance with all applicable Requirements of Law
and Healthcare Laws, except where the failure to be in compliance would not
reasonably be expected to have a Material Adverse Effect, (v) has all necessary
Permits and Primary Licenses from or by, has made all necessary filings with,
and has given all necessary notices to, each Governmental Authority having
jurisdiction, to the extent required for such ownership, lease, sublease,
operation, occupation or conduct of business, except where the failure to obtain
such Permits and Primary Licenses, make such filings or give such notices, in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect, and (vi) as of the Restatement Date, solely with respect to each Loan
Party, no Loan Party has changed its name since the Closing Date.

 

(a) Except as set forth on Schedule 3.1(b), each Healthcare Facility (i) is
being operated or managed as an assisted living, skilled nursing or independent
living facility, (ii) is in conformance in all material respects with all
insurance, reimbursement and cost reporting requirements, and (iii) is in
compliance with all applicable Requirements of Law and Healthcare Laws (giving
effect to any waivers thereof currently in place), including all Primary
Licenses, except, in each case, where the failure to be in conformance or
compliance would not reasonably be expected to have a Material Adverse Effect.
Notwithstanding the foregoing, each Healthcare Facility that bills a federal
health care program has a provider agreement that is in full force and effect
under Medicare and/or Medicaid, except where the failure to do so would be
limited to one or more Healthcare Facilities accounting in the aggregate for
less than 5% of Consolidated EBITDAR of GHLLC. There is no threatened in
writing, existing or pending revocation, suspension, termination, probation,
restriction, limitation, or nonrenewal proceeding by any Third-Party Payor
Program, to which any Loan Party or any Restricted Subsidiary may presently be
subject, except as could not reasonably be expected to have a Material Adverse
Effect.

(b) Except as set forth on Schedule 3.1(c), all Primary Licenses necessary for
using and operating the Healthcare Facilities for the uses described in clause
(b), above, are either held by the Loan Parties or the Subsidiaries, or in the
name of the applicable Loan Party or Subsidiary, as required under applicable
Requirements of Law, and are in full force and effect, unless failure to have
same could not reasonably be expected to have a Material Adverse Effect.

(c) To the Loan Parties’ knowledge, with respect to any Healthcare Facility,
there are no proceedings by any Governmental Authority or notices thereof that
are reasonably likely directly or indirectly, or with the passage of time (i) to
have a material adverse impact on the Loan Parties’ or the Subsidiaries’ ability
to accept and/or retain patients or residents or operate such Healthcare
Facility for its current use or result in the imposition of a fine, a sanction,
a lower rate

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certification or a lower reimbursement rate for services rendered to eligible
patients or residents, except to the extent that the same could not reasonably
be expected to have a Material Adverse Effect, and, with respect to the Loan
Parties’ or the Subsidiaries’ ability to accept and/or retain patients or
residents or operate such Healthcare Facility, reimbursement for which is
provided under Medicare or Medicaid, except to the extent that the same could
not be reasonably likely to have an adverse impact on one or more Healthcare
Facilities accounting in the aggregate for more than 5% of the Consolidated
EBITDAR of GHLLC, (ii) to modify, limit or result in the transfer, suspension,
revocation or imposition of probationary use of any of the Permits or Primary
Licenses, other than a transfer of such Permit or Primary License to a new
location or to any Loan Party if such Permit or Primary License is not already
held by such Loan Party, except to the extent same would not be reasonably
likely to have a Material Adverse Effect, or (iii) to affect any Loan Party’s or
Subsidiary’s continued participation in the applicable Third-Party Payor
Programs, or any successor programs thereto, except to the extent that the same
could not reasonably be expected to have a Material Adverse Effect, and, with
respect to any Loan Party’s or Subsidiary’s continued participation in Medicare
or Medicaid, except to the extent that the same could not reasonably be expected
to affect one or more Healthcare Facilities accounting in the aggregate for more
than 5% of the Consolidated EBITDAR of GHLLC.

(d) With respect to any Healthcare Facility, except as set forth on Schedule
3.1(e), no Healthcare Facility currently has outstanding any violation, and no
statement of charges or deficiencies has been made or penalty enforcement action
has been undertaken each that remain outstanding against any Healthcare
Facility, any Loan Party, any Subsidiary or against any officer, director,
partner, member or stockholder of the Borrower, by any Governmental Authority,
and there have been no violations threatened in writing against any Healthcare
Facility’s, or any Loan Party’s or any Subsidiary’s certification for
participation in applicable Third-Party Payor Programs that remain open or
unanswered except to the extent same could not reasonably be expected to have a
Material Adverse Effect and, with respect to any Healthcare Facility’s or any
Loan Party’s certificate for participation in Medicare or Medicaid, except to
the extent that the same could not reasonably be expected to affect one or more
Healthcare Facilities accounting in the aggregate for more than 5% of the
Consolidated EBITDAR of Ultimate Parent.

(e) With respect to any Healthcare Facility, (i) there are no current, pending
or outstanding Third-Party Payor Programs reimbursement audits, appeals or
recoupment efforts actually pending at any Healthcare Facility and (ii) to the
Loan Parties’ knowledge, there are no years that are subject to an open audit in
respect of any Third-Party Payor Program, other than customary audit rights
pursuant to an Insurer’s program, which, in the case of clauses (i) and (ii),
could reasonably be expected to have a Material Adverse Effect and, with respect
to any such open audit in respect of Medicare or Medicaid (other than customary
audit rights pursuant to Medicare or Medicaid), could reasonably be expected to
adversely affect one or more Healthcare Facilities accounting in the aggregate
for more than 5% of the Consolidated EBITDAR of Ultimate Parent. No Loan Party
nor any Subsidiary (i) has received federal funds authorized under the
Hill-Burton Act (42 U.S.C. 291, et seq.), as it may be amended or (ii) is a
participant in any federal or state program whereby any governmental agency may
have the right to recover funds by reason of the advance of federal or state
funds.

3.2 Loan Documents and Lease Amendment Agreements.   The execution, delivery and
performance by each Loan Party of the Loan Documents and Lease Amendment
Agreements to which it is a party and the Omnibus Agreement and the consummation
of the other transactions contemplated therein (i) are within such Loan Party’s
corporate or similar powers and, at the time of execution thereof, have been
duly authorized by all necessary corporate and similar action, (ii) do not (A)
contravene such Loan Party’s organizational or governing documents, (B) violate
any applicable Requirement of Law in any material respect, (C) conflict with,
contravene, constitute a default or breach under, or result in or permit

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the termination or acceleration of, any material Contractual Obligation
(including the Material Master Leases) of any Loan Party or any of their
Restricted Subsidiaries other than those that (x) have been permanently waived
or consented to in writing by the applicable counterparty or (y) would not, in
the aggregate, have a Material Adverse Effect or (D) result in the imposition of
any Lien (other than a Lien permitted by Section 7.2) upon any property of any
Loan Party or any of their Restricted Subsidiaries and (iii) do not require any
Permit of, or filing with, any Governmental Authority or any consent of, or
notice to, any Person, other than (A) with respect to the Loan Documents, the
filings required to perfect the Liens created by the Loan Documents, (B) those
listed on Schedule 3.2 and that have been, or will be prior to the Restatement
Date, obtained or made, copies of which have been, or, upon request, will be,
prior to the Restatement Date, made available or delivered to the Administrative
Agent, and each of which on the Restatement Date, will be in full force and
effect, and (C) those which the failure to obtain would not result in a Material
Adverse Effect. The Material Master Leases are valid, binding and enforceable
according to their terms.

 

(a) From and after its delivery to the Administrative Agent, each Loan Document
that has been duly executed and delivered to the other parties thereto by each
Loan Party thereto, is the legal, valid and binding obligation of such Loan
Party and is enforceable against such Loan Party in accordance with its terms
except to the extent limited by general principles of equity and by bankruptcy,
insolvency, fraudulent conveyance or other similar laws affecting creditors’
rights generally.

3.3 Financial Statements.   The Audited Financial Statements were prepared in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; and (ii) fairly present in all
material respects the financial condition of Ultimate Parent and its
Subsidiaries, as of the date thereof and their results of operations for the
period covered thereby in accordance with GAAP consistently applied throughout
the periods covered thereby, except as otherwise expressly noted therein.

 

(a) The unaudited Consolidated balance sheets with respect to Ultimate Parent
dated September 30, 2017, and the related Consolidated statements of income or
operations and cash flows for the fiscal quarter ended on that date, in each
case, (x) were prepared in accordance with GAAP consistently applied throughout
the period covered thereby, except as otherwise expressly noted therein, and (y)
fairly present in all material respects the financial condition of Ultimate
Parent and its Subsidiaries, as of the date thereof and their results of
operations for the period covered thereby, subject, in the case of clauses (x)
and (y), to the absence of footnotes and to normal year-end audit adjustments.

(b) The Consolidated pro forma balance sheet of Ultimate Parent and its
Subsidiaries as at September 30, 2017, and the related Consolidated pro forma
statements of income and cash flows of Ultimate Parent and its Subsidiaries for
the twelve months then ended, certified by the chief financial officer or
treasurer of Ultimate Parent, copies of which have been furnished to each
Lender, fairly present in all material respects the Consolidated pro forma
financial condition of Ultimate Parent and its Subsidiaries as at such date and
the Consolidated pro forma results of operations of Ultimate Parent and its
Subsidiaries for the period ended on such date, in each case giving effect to
the Transactions, all in accordance with GAAP.

(c) The annual business plan and the Consolidated forecasted projections of
Ultimate Parent and its Subsidiaries were prepared in good faith on the basis of
the assumptions stated therein, which assumptions were believed to be reasonable
in light of the conditions existing at the time of delivery of such forecasts,
it being understood that actual results may vary from such forecasts and that
such variations may be material.

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3.4 Material Adverse Effect.  Since December 31, 2016, there have been no
events, circumstances, developments or other changes in facts that would, in the
aggregate, have a Material Adverse Effect, except as disclosed on any 10-K or
10-Q filed by Ultimate Parent or any 8-K filed by Ultimate Parent prior to
February 2, 2018.

 

3.5 Solvency.  Both before and after giving effect to (a) the disbursement of
the proceeds of the Loans, (b) the consummation of the transactions contemplated
by the Fourth Amendment and (c) the payment and accrual of all transaction costs
in connection with the foregoing and any contribution and indemnification
between such Person, the Parent Companies, the Borrower and the Restricted
Subsidiaries, on a Consolidated basis, are Solvent.

 

3.6 Litigation.  Except as disclosed on Schedule 3.6, there are no pending (or,
to the knowledge of any Loan Party, threatened) actions, investigations, suits,
proceedings, audits, claims, demands, orders or disputes affecting the Loan
Parties or any Restricted Subsidiary with, by or before any Governmental
Authority other than those that could not reasonably be expected to, in the
aggregate, have a Material Adverse Effect.

 

3.7 Taxes.  Except as set forth on Schedule 3.7 for which reserves shall be
established upon the reasonable request of the Administrative Agent, or for such
matters as would not reasonably be expected individually or in the aggregate to
cause a Material Adverse Effect, all federal, state, local and foreign income
and franchise and other material tax returns, reports and statements
(collectively, the “Tax Returns”) required to be filed by any Loan Party or any
Restricted Subsidiary have been filed in its own name with the appropriate
Governmental Authorities in all jurisdictions in which such Tax Returns are
required to be filed, all such Tax Returns are true and correct in all material
respects, and all Taxes, charges and other impositions reflected therein or
otherwise due and payable have been paid prior to the date on which any
Liability may be added thereto for non-payment thereof except for those
contested in good faith by appropriate proceedings diligently conducted and for
which adequate reserves are maintained on the books of the appropriate Loan
Party or any Restricted Subsidiary in accordance with GAAP. Other than as set
forth on Schedule 3.7, no material Tax Return is under audit or examination by
any Governmental Authority and no written notice of such an audit or examination
or any written assertion of any claim for material Taxes has been given or made
by any Governmental Authority. Except as set forth on Schedule 3.7, or for such
matters as would not reasonably be expected individually or in the aggregate to
cause a Material Adverse Effect, proper and accurate amounts have been withheld
by each Loan Party or any Restricted Subsidiary from their respective employees
for all periods in full and complete compliance with the Tax, social security
and unemployment withholding provisions of applicable Requirements of Law and
such withholdings have been timely paid to the respective Governmental
Authorities. No Tax Affiliate has participated in a “reportable transaction”
within the meaning of Treasury Regulation Section 1.6011-4(b) or has been a
member of an affiliated, combined or unitary group other than the group of which
a Tax Affiliate is the common parent.

 

The Borrower is treated as a partnership for U.S. federal income tax purposes
and for all applicable state income tax purposes and has not made any election
to be treated as an association taxable as a corporation under the Code or under
any corresponding provision of federal, state or local tax law.

To the extent required to be paid on or prior to the Closing Date, all Other
Taxes required to be paid in connection with the granting of the security
interest under the Loan Documents have been paid or will be paid on the Closing
Date.

3.8 Margin Regulations.  No Loan Party is engaged in the business of extending
credit for the purpose of, and no proceeds of any Loan or other extensions of
credit hereunder will be used for the purpose of, buying or carrying margin
stock (within the meaning of Regulation U of the Board) or extending credit

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to others for the purpose of purchasing or carrying any such margin stock, in
each case in contravention of Regulation T, U or X of the Board.

 

3.9 No Burdensome Obligations; No Defaults.  No Loan Party nor any Restricted
Subsidiary is a party to any Contractual Obligation, no Loan Party nor any
Restricted Subsidiary has organizational or governing documents containing
obligations, and, to the knowledge of the Loan Parties, there are no applicable
Requirements of Law, in each case the compliance with which would have, in the
aggregate, a Material Adverse Effect.  No Loan Party nor any Restricted
Subsidiary (and, to the knowledge of each Loan Party, no other party thereto) is
in default under or with respect to any Contractual Obligation of any Loan Party
or any Restricted Subsidiary, other than those that would not, in the aggregate,
have a Material Adverse Effect.

 

3.10 Investment Company Act.   No Loan Party nor any Restricted Subsidiary is an
“investment company” or an “affiliated person” of, or “promoter” or “principal
underwriter” for, an “investment company”, as such terms are defined in the
Investment Company Act of 1940.

 

3.11 Labor Matters.  There are no strikes, work stoppages, slowdowns or lockouts
existing, pending (or, to the knowledge of any Loan Party, threatened) against
or involving any Loan Party or any Restricted Subsidiary, except, for those that
would not, in the aggregate, have a Material Adverse Effect.  Except as set
forth on Schedule 3.11, as of the Restatement Date, (a) there is no collective
bargaining or similar agreement with any union, labor organization, works
council or similar representative covering any employee of any Loan Party, (b)
no petition for certification or election of any such representative is existing
or pending with respect to any employee of any Loan Party or any Restricted
Subsidiary and (c) no such representative has sought certification or
recognition with respect to any employee of any Loan Party or any Restricted
Subsidiary.

 

3.12 ERISA.   Each Benefit Plan and Multiemployer Plan, and each trust
thereunder, intended to qualify for tax exempt status under Section 401 or 501
of the Code or other Requirements of Law so qualifies. Except for those that
would not, in the aggregate, have a Material Adverse Effect, (x) each Benefit
Plan is in compliance with applicable provisions of ERISA, the Code and other
Requirements of Law, (y) there are no existing or pending (or to the knowledge
of any Loan Party, threatened) claims (other than routine claims for benefits in
the normal course), sanctions, actions, lawsuits or other proceedings or (to the
knowledge of any Loan Party) investigation involving any Benefit Plan and, to
the knowledge of any Loan Party, Multiemployer Plan, to which any Loan Party or
any Restricted Subsidiary incurs or otherwise has or could have an obligation or
any Liability and (z) no ERISA Event is reasonably expected to occur. On the
Closing Date, no ERISA Event has occurred in connection with which obligations
and liabilities (contingent or otherwise) remain outstanding.  Except for such
liabilities that would not, in the aggregate, have a Material Adverse Effect, no
ERISA Affiliate would have any Withdrawal Liability as a result of a complete
withdrawal, as of the Closing Date, from any Multiemployer Plan.

 

(a) Schedule 3.12(b) sets forth, as of the Restatement Date, a complete and
correct list of, and that separately identifies all Foreign Pension Plans.  Each
Foreign Pension Plan, and each trust thereunder, intended to qualify for tax
exempt status under any Requirements of Law so qualifies.  Except for those that
would not, in the aggregate, have a Material Adverse Effect, each Foreign
Pension Plan is in compliance with all requirements of law applicable thereto
and the respective requirements of the governing documents for such plan.   No
Loan Party has engaged in a transaction which would subject any Loan Party,
directly or indirectly, to a tax or civil penalty that could reasonably be
expected to result in a Material Adverse Effect.  With respect to each Foreign
Pension Plan, reserves have been established in the financial statements
furnished to Lenders in respect of any unfunded liabilities in accordance with
applicable law and prudent business practice or, where required, in accordance
with ordinary accounting practices in the jurisdiction in which such Foreign
Pension Plan is maintained. The aggregate unfunded

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liabilities with respect to such Foreign Pension Plans will not result in
liability of the Borrower that could reasonably be expected to result in a
Material Adverse Effect.

3.13 Environmental Matters.  Except for such matters as would not reasonably be
expected individually or in the aggregate to cause a Material Adverse Effect,
(i) the operations of each Loan Party and each Restricted Subsidiary are and
have been in compliance with all applicable Environmental Laws, including
obtaining, maintaining and complying with all Permits required by any applicable
Environmental Law, (ii) no Loan Party nor any Restricted Subsidiary is subject
to or has received written notice of any Environmental Claim, or to its
knowledge been threatened with any potential Environmental Claim, excluding any
Environmental Claim which has been fully resolved with no further obligations on
the part of said Loan Party or Restricted Subsidiary, (iii) no Loan Party or
Restricted Subsidiary has received notice from a Governmental Authority that a
Lien in favor of such Governmental Authority has attached to any Property of any
Loan Party or Restricted Subsidiary, securing, in whole or part, Environmental
Liabilities, (iv) there has been no Release, or to the knowledge of any Loan
Party, threatened Release, on, under or migrating to or from any real property
currently, or to the knowledge of any Loan Party, formerly, owned, leased,
subleased, operated, or otherwise occupied by any Loan Party or any Restricted
Subsidiary that is likely to result in any Loan Party or Restricted Subsidiary
incurring Environmental Liabilities, and (v) to the knowledge of any Loan Party,
there are no facts, circumstances or conditions arising out of or relating to
the operations of any Loan Party or any Restricted Subsidiary or real property
currently or, to the knowledge of any Loan Party, formerly owned, leased,
subleased, operated or otherwise occupied by or for any Loan Party or any
Restricted Subsidiary that would be reasonably expected to result in any Loan
Party or any Restricted Subsidiary incurring Environmental Liabilities.

 

3.14 Intellectual Property.  To the knowledge of each Loan Party, except as
could not reasonably be expected individually or in the aggregate to cause a
Material Adverse Effect, (a) each Loan Party and each Restricted Subsidiary owns
or licenses all Intellectual Property that is  necessary for the operations of
its business, (b) the conduct and operations of the businesses of each Loan
Party and each Restricted Subsidiary does not infringe, misappropriate, dilute,
violate or otherwise impair any Intellectual Property owned by any other Person
and (c) no other Person has contested any right, title or interest of any Loan
Party or any Restricted Subsidiary in or to any Intellectual Property, other
than, in each case, as cannot reasonably be expected to affect the Loan
Documents and the transactions contemplated therein. Except for matters which
are not reasonably expected to, in the aggregate, have a Material Adverse
Effect, there are (x) no pending (or, to the knowledge of any Loan Party,
threatened) actions, investigations, suits, proceedings, audits, claims,
demands, orders or disputes affecting any Loan Party or any Restricted
Subsidiary, (y) no judgment or order rendered by any competent Governmental
Authority, and  (z) no settlement agreement or similar Contractual Obligation
entered into by any Loan Party or any Restricted Subsidiary, in each case, with
respect to Intellectual Property owned by any Loan Party or any Restricted
Subsidiary and/or based on a claim of infringement, misappropriation, dilution,
violation or impairment or contest of Intellectual Property owned by a third
party, and no Loan Party knows of any valid bases for any such claim.

 

3.15 Title; Real Property.   Set forth on Schedule 3.15 is, as of the
Restatement Date, a complete and accurate list of (i) all Healthcare Facilities
and other material real property in which any Loan Party and any Restricted
Subsidiary owns a leasehold, joint venture or other interest, and (ii) each
Contractual Obligation made by a Loan Party or a Restricted Subsidiary, whether
contingent or otherwise, to Dispose of such real property on or after the
Restatement Date.

 

(a) Each Loan Party and each Restricted Subsidiary has good and marketable,
valid, and binding and enforceable leasehold interests in all leased real
property that is purported to be leased by it as set forth on Schedule 3.15 and
owns or leases all of its personal property (other than Intellectual Property)
regardless of the location of such personal property, in each case, free and
clear of all Liens

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other than Liens permitted under Section 7.2 (other than Section 7.2(c)) and the
real property on Schedule 3.15 and such personal property constitutes all
property (other than Intellectual Property) necessary to conduct the business as
currently conducted.

3.16 Full Disclosure.  The information (other than projections and statements of
a general economic or general industry nature) prepared or furnished in writing
by or on behalf of any Loan Party to the Administrative Agent or any Lender in
connection with any Loan Document or any other transaction contemplated therein
(in each case, as modified or supplemented by other information so furnished),
taken as a whole, does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements contained
therein, in light of the circumstances when made, not materially misleading,
when considered in their entirety; provided,  however, that projections
contained therein are not to be viewed as factual and that actual results during
the periods covered thereby may differ from the results set forth in such
projections by a material amount.

 

3.17 Patriot Act; OFAC.    To the extent applicable, each Loan Party and its
Subsidiaries are in compliance in all material respects with (i) the Trading
with the Enemy Act, as amended, and each of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended), and any other enabling legislation or executive order
relating thereto, and (ii) the PATRIOT Act.

 

(a) No Loan Party or any of its Subsidiaries (or officer or director thereof)
and, to the knowledge of the Loan Parties, no direct or indirect parent or joint
venture thereof (or director or officer of such direct and indirect parent or
joint venture), (i) is currently the subject of any Sanctions, (ii) is located,
organized or residing in any Designated Jurisdiction, or (iii) is or has been
(within the previous five years) engaged in any transaction with any Person who
is now or was then the subject of Sanctions or who is located, organized or
residing in any Designated Jurisdiction.  No Loan, nor the proceeds from any
Loan, is being or has been used, directly or, to the knowledge of the Loan
Parties, indirectly, to lend, contribute, provide or has otherwise made
available to fund any activity or business in any Designated Jurisdiction or to
fund any activity or business of any Person located, organized or residing in
any Designated Jurisdiction or who is the subject of any Sanctions, or in any
other manner that will result in any violation by any Person (including any
Lender or the Administrative Agent) of Sanctions.  No part of the proceeds of
the Loans made hereunder will be used by any Loan Party or its Affiliates,
directly or indirectly, for any payments to any governmental official or
employee, political party, official of a political party, candidate for
political office or anyone else acting in an official capacity in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as amended.

3.18 No Default.  After giving effect to the Fourth Amendment, no Default or
Event of Default has occurred and is continuing.

 

3.19 Use of Proceeds.  The Borrower used the proceeds of the Initial Term Loans
made on the Closing Date (i) to finance the 2012 Refinancing; (ii) to pay all
related fees and expenses associated with the foregoing and (iii) for working
capital and general corporate purposes. The Borrower shall use the proceeds of
the 2018 Term Loans (i) as set forth in Schedule 3.19; (ii) to pay all related
fees and expenses associated with the foregoing and (iii) for working capital
and general corporate purposes. 

 

3.20 Insurance.  Schedule 3.20 sets forth, as of the Closing Date, a true,
complete and correct description of all general liability, casualty, property
and business interruption insurance maintained by each Loan Party for itself or
for the Restricted Subsidiaries as of the Restatement Date.  As of the
Restatement Date, such insurance is in full force and effect and all premiums
have been duly paid.  As of the Restatement Date, the Loan Parties and the
Restricted Subsidiaries have insurance in such amounts and

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covering such risks and liabilities as is customary with companies in the same
or similar businesses operating in the same or similar locations.

 

3.21 Reportable Transactions.  Neither the Borrower nor any of its Restricted
Subsidiaries expects to identify one or more of the Loans under this Agreement
as a “reportable transaction” on IRS Form 8886 filed with the U.S. Tax Returns
for purposes of Section 6011, 6111 or 6112 of the Code or the Treasury
regulations promulgated thereunder.

 

3.22 Security Documents.   The Guarantee and Collateral Agreement is effective
to create in favor of the Collateral Agent for the benefit of the Secured
Parties, a legal and valid security interest (with the priority specified in the
Intercreditor Agreement) in the Collateral as provided in the Guarantee and
Collateral Agreement described therein (including any proceeds of any item of
Collateral), subject to no Liens other than Liens permitted by Section 7.2.  In
the case of (i) the Pledged Securities described in the Guarantee and Collateral
Agreement, when any stock certificates or notes, as applicable, representing
such Pledged Securities are delivered to the Collateral Agent and (ii) the other
Collateral described in the Guarantee and Collateral Agreement, when financing
statements in appropriate form are filed in the offices specified on Schedule
3.22(a) (which financing statements have been duly completed and delivered to
the Collateral Agent), recordation of the security interest of the Collateral
Agent on behalf of the Secured Parties has been made in the United States Patent
and Trademark Office or the Copyright Office, and such other filings as are
specified on Schedule 3.22(a) are made, the Collateral Agent shall have a fully
perfected Lien on, and security interest in, all right, title and interest of
the Loan Parties in such Collateral (including any proceeds of any item of
Collateral) (solely to the extent a security interest in such Collateral can be
perfected through the filing of financing statements in the offices specified on
Schedule 3.22(a), the recordation of the security interest of the Collateral
Agent on behalf of the Secured Parties in the United States Patent and Trademark
Office and the other filings specified on Schedule 3.22(a), and through the
delivery of the Pledged Securities required to be delivered on the Closing
Date), as security for the Obligations, in each case prior and superior in right
to any other Person (except with respect Customary Permitted Liens).

 

(a) Upon the execution and delivery of any Closing Date Mortgage and any
Mortgage to be executed and delivered pursuant to Section 6.10(b), such Mortgage
shall be effective to create in favor of the Collateral Agent for the benefit of
the Secured Parties a legal and valid Lien on the mortgaged property described
therein and proceeds thereof; and when such Mortgage is filed in the recording
office designated by the Borrower, such Mortgage shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the Loan Parties in such mortgaged property and the proceeds thereof, as
security for the Obligations (as defined in the relevant Mortgage), in each case
prior and superior in right to any other Person (except with respect to Liens
permitted by Section 7.2).

SECTION 4. CONDITIONS PRECEDENT

4.1The obligation of each Lender to make the Initial Term Loans on the Closing
Date is subject to the satisfaction (or waiver) of (i) each of the conditions
precedent set forth in the Initial Lenders Terms (as defined in the Existing
Term Loan Agreement) and (ii) each of the following conditions precedent:

(a) Credit Agreement.  The Administrative Agent shall have received this
Agreement, executed and delivered by the Administrative Agent, the Parent
Companies, the Borrower and each Lender whose name appears on the signature
pages hereof.

(b) Security Documents.  The Administrative Agent shall have received (i) the
Guarantee and Collateral Agreement, executed and delivered by the parties
thereto, (ii) the Intercreditor Agreement, executed and delivered by the parties
thereto, (iii) the Closing Date Mortgages and (iv) the

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Master Lease Intercreditor Agreements, executed and delivered by the parties
thereto, in form reasonably satisfactory to the Administrative Agent and on
terms consistent with those provided in each Lease Amendment Agreement, as
applicable.

(c) ABL Loan Documents.  Prior to or substantially simultaneously with the
making of Loans on the Closing Date, the Administrative Agent shall be
reasonably satisfied with the terms and conditions of the ABL Credit Agreement
(or an amendment thereto), executed by the parties thereto.

(d) Consummation of the Refinancing; Extinguishment of Liens.  On or prior to
the Closing Date and concurrently with the incurrence of the Loans, Indebtedness
under the 2012 Credit Agreement shall have been repaid in full, together with
all fees and other amounts owing thereon and all commitments thereunder shall
have been terminated and all liens securing the obligations under the 2012
Credit Agreement shall have been terminated (or arrangements reasonably
satisfactory to the Administrative Agent for such termination shall have been
made). The Parent Companies, the Borrower and their Restricted Subsidiaries
shall have no Indebtedness for borrowed money outstanding as of the Closing Date
other than the Indebtedness under the Loan Documents and the other Indebtedness
permitted by Section 7.1.

(e) Solvency Certificate.  The Administrative Agent shall have received a
solvency certificate signed by a Responsible Officer of Ultimate Parent,
substantially in the form of Exhibit G hereto.

(f) Lien Searches.  The Collateral Agent shall have received the results of
recent lien searches on certain Loan Parties as agreed between the Collateral
Agent and the Loan Parties, and such search shall reveal no Liens on any of the
assets of such Loan Parties, except for Liens permitted by Section 7.2 or Liens
to be discharged on or prior to the Closing Date.

(g) Closing Certificate.  The Administrative Agent shall have received a
certificate of each of the Parent Companies, the Borrower and each Subsidiary
Guarantor dated the Closing Date, substantially in the form of Exhibit D, with
appropriate insertions and attachments.

(h) Insurance Certificates.  The Borrower shall have used commercially
reasonable efforts to deliver to the Administrative Agent a certificate in form
and substance reasonably satisfactory to the Administrative Agent from the
Borrower’s insurance broker demonstrating that the insurance required to be
maintained by Section 6.5 are in full force and effect, together with
endorsements naming the Collateral Agent, on behalf of the Secured Parties, as
additional insured or loss payee thereunder to the extent required by such
Section 6.5.

(i) Financial Statements.  The Administrative Agent shall have received (i) the
Audited Financial Statements and (ii) unaudited Consolidated balance sheets and
related statements of income, changes in equity and cash flows of Ultimate
Parent for each subsequent fiscal quarter after December 31, 2015 ended at least
45 days before the Closing Date.

(j) Pro Forma Financial Statements.  The Administrative Agent shall have
received a pro forma Consolidated balance sheet and related pro forma
Consolidated statement of income of the Parent Companies, the Borrower and their
respective Restricted Subsidiaries as of and for the twelve-month period ending
on the last day of the most recently completed four-fiscal quarter period ended
at least 45 days prior to the Closing Date, prepared after giving effect to the
Transactions as if the Transactions had occurred as of such date (in the case of
such balance sheet) or at the beginning of such period (in the case of such
other financial statements).

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(k) Legal Opinions.  The Administrative Agent shall have received an executed
legal opinion of Skadden, Arps, Slate, Meagher & Flom LLP, counsel to the Loan
Parties, covering such customary matters incident to the transactions
contemplated by this Agreement as the Administrative Agent may reasonably
require and in form and substance reasonably satisfactory to the Administrative
Agent.

(l) Pledged Stock; Stock Powers; Pledged Notes.  The Collateral Agent shall have
received (i) the certificates representing the shares, if any, of Capital Stock
of each Parent Company (other than Ultimate Parent) and the Borrower and (to the
extent required by the terms of the Guarantee and Collateral Agreement) each of
the Borrower’s Subsidiaries pledged to the Collateral Agent pursuant to (and, in
the case of the Capital Stock of any Foreign Subsidiary, subject to the
limitations of) the Guarantee and Collateral Agreement, together with an undated
stock power for each such certificate executed in blank by a duly authorized
officer of the pledgor thereof and (ii) each promissory note (if any) required
to be pledged to the Collateral Agent pursuant to the Guarantee and Collateral
Agreement endorsed (without recourse) in blank (or accompanied by an executed
transfer form in blank) by the pledgor thereof.

(m) Filings, Registrations and Recordings.  Each document (including, without
limitation, any UCC financing statement) required by the Security Documents to
be filed, registered or recorded in order to create in favor of the Collateral
Agent for the benefit of the Secured Parties, a Lien (with the priority
specified in the Intercreditor Agreements) on the Collateral described therein
(subject to Liens permitted by Section 7.2), shall have been delivered to the
Collateral Agent in proper form for filing, registration or recordation.

(n) Master Lease Amendments.  The Administrative Agent shall have received
copies of the Lease Amendment Agreements, in each case executed by the parties
thereto, in form and substance reasonably acceptable to the Lenders.

(o) Fees.  All fees and reasonable out-of-pocket expenses, to the extent due and
payable and invoiced at least 1 Business Day prior to the Closing Date, shall
have been paid.

(p) Representations and Warranties.  On the Closing Date, each of the
representations and warranties set forth in Section 3 shall be true and correct
in all respects (it being understood and agreed that any representation or
warranty which by its terms is made as of a specified date shall be required to
be true and correct in all material respects only as of such specified date).

(q) Borrowing Notice.  The Administrative Agent shall have received an
irrevocable notice of borrowing in accordance with Section 2.3 and substantially
in the form of Exhibit A-1 hereto.

(r) Attestation Certificate.  The Administrative Agent shall have received a
certificate attesting to the compliance with clauses (c), (d), (p), (t) and (u)
of this Section on the Closing Date and attesting to the authenticity of the
documents delivered under clauses (c) and (n) from a Responsible Officer of
Ultimate Parent.

(s) USA Patriot Act.  The Administrative Agent shall have received, at least 3
Business Days prior to the Closing Date, from each of the Loan Parties
documentation and other information reasonably requested in writing by the
Administrative Agent in connection with applicable “know your customer” and
anti-money laundering rules and regulations, including the USA PATRIOT Act, to
the extent requested by the Administrative Agent at least 7 Business Days prior
to the Closing Date.

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(t) Material Adverse Effect.  Since December 31, 2015, no event, circumstance,
development or other change in facts shall have occurred that has had or would
have, in the aggregate, a Material Adverse Effect.

(u) Insolvency.  As of the Closing Date, none of Ultimate Parent nor any of its
Subsidiaries shall have filed or otherwise become subject to a case under the
Bankruptcy Code.

4.2The obligation of each Lender to make the 2018 Term Loans on the Restatement
Date is subject to the satisfaction (or waiver in writing) of each of the
conditions precedent set forth in Section 4 of the Fourth Amendment.

SECTION 5. REPORTING COVENANTS

Each of Ultimate Parent and the Borrower (on behalf of itself and each of the
Subsidiaries) hereby agrees that, beginning on the Closing Date and so long as
the Commitments remain in effect or any Loan or other amount is owing to any
Lender or any Agent hereunder (other than contingent or indemnification
obligations not then asserted or due), the Parent Companies and the Borrower
shall and (to the extent relevant) shall cause each of the Restricted
Subsidiaries to:

5.1 Financial Statements.   Deliver to the Administrative Agent each of the
following:

 

(a) Quarterly Reports.   As soon as available, and in any event within 45 days
after the end of each of the first three fiscal quarters of each fiscal year,
the Consolidated unaudited balance sheet of Ultimate Parent and its Subsidiaries
in each case, as of the close of such fiscal quarter and related Consolidated
statements of income and cash flow for such fiscal quarter and that portion of
the fiscal year ending as of the close of such fiscal quarter, setting forth in
comparative form the figures for the corresponding period in the prior fiscal
year and the figures contained in the latest projections, in each case certified
by a Responsible Officer of Ultimate Parent in each case, as fairly presenting
in all material respects the Consolidated financial position, results of
operations and cash flow of Ultimate Parent and its Subsidiaries as at the dates
indicated and for the periods indicated in accordance with GAAP (subject to the
absence of footnote disclosure and normal year-end audit adjustments).  The
financial statements delivered under this clause (a) shall include an unaudited
schedule reflecting the adjustments necessary to eliminate the accounts of the
Unrestricted Subsidiaries (if any).

(b) Annual Reports.  As soon as available, and in any event within 120 days
after the end of each fiscal year, the Consolidated balance sheet of Ultimate
Parent and its Subsidiaries in each case, of the end of such year and related
Consolidated statements of income, stockholders’ equity and cash flow for such
fiscal year, each prepared in accordance with GAAP, together with a
certification by Ultimate Parent’s nationally-recognized independent registered
public accountants that such Consolidated financial statements fairly present in
all material respects the Consolidated financial position, results of operations
and cash flow of Ultimate Parent and its Subsidiaries as at the dates indicated
and for the periods indicated therein in accordance with GAAP without
qualification as to the scope of the audit or as to going concern and without
any other similar qualification. The financial statements delivered under this
clause (b) shall include an unaudited schedule reflecting the adjustments
necessary to eliminate the accounts of the Unrestricted Subsidiaries (if any).

(c) Compliance Certificate.  Together with each delivery of any financial
statement pursuant to clause (a) or (b) above, a Compliance Certificate
substantially in the form attached hereto as Exhibit C, duly executed by a
Responsible Officer of Ultimate Parent in each case, that, among other things,
(i) shows in reasonable detail the calculations used in determining each
financial covenant, (ii) demonstrates compliance with each Financial Condition
Covenant that is tested at least on a quarterly

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basis and (iii) states that no Default is continuing as of the date of delivery
of such Compliance Certificate or, if a Default is continuing, states the nature
thereof and the action that the Borrower proposes to take with respect thereto.

(d) Projections.  As soon as available, but in any event not later than 30 days
after the end of each fiscal year, a reasonably detailed Consolidated budget in
a form reasonably acceptable to the Administrative Agent for the following
fiscal year on a quarterly basis and for each of the subsequent two fiscal
years, on an annual basis, including a projected Consolidated balance sheet of
the Parent Companies, the Borrower and the Restricted Subsidiaries as of the end
of the fiscal quarter or the fiscal year, as applicable, and the related
Consolidated statements of projected cash flows and projected income.

(e) Management Discussion and Analysis.  Together with each delivery of any
Compliance Certificate pursuant to clause (c) above, a discussion and analysis
of the financial condition and results of operations of the Loan Parties for the
portion of the fiscal year then elapsed and discussing the reasons for any
significant variations from the projections for such period and the figures for
the corresponding period in the previous fiscal year.

(f) Audit Reports, Management Letters, Etc.  Together with each delivery of any
financial statement for any fiscal year pursuant to clause (b) above, copies of
each management letter, audit report or similar letter or report received by
Ultimate Parent in each case, from any independent registered certified public
accountant (including Ultimate Parents’ accountants) in connection with such
financial statements or any audit thereof, each certified to be complete and
correct copies by a Responsible Officer of Ultimate Parent in each case, as part
of the Compliance Certificate delivered in connection with such financial
statements.

(g) Insurance.  Together with each delivery of any financial statement for any
fiscal year pursuant to clause (b) above, each in form and substance
satisfactory to the Administrative Agent and certified as complete and correct
by a Responsible Officer of Ultimate Parent in each case, as part of the
Compliance Certificate delivered in connection with such financial statements, a
summary of all material insurance coverage maintained as of the date thereof by
any Loan Party and any Restricted Subsidiary and including a representation that
all improvements on any parcel of real property that are within a special flood
hazard area as defined under the U.S. Flood Disaster Protection Act of 1973, as
amended or as a wetlands area by any governmental entity having jurisdiction
over any real property, are covered by flood insurance, together with such other
related documents and information as the Administrative Agent may require.

Information required to be delivered pursuant to Sections 5.1(a), 5.1(b) and
5.1(e) shall be deemed to have been delivered if such information, or one or
more annual, quarterly or other periodic reports containing such information,
shall be available on the website of the SEC at http://www.sec.gov; provided
that, for the avoidance of doubt, Ultimate Parent shall be required to provide
copies of the compliance certificates required by clause (c) of this Section 5.1
to the Administrative Agent.

5.2 Other Events.  Give the Administrative Agent notice of each of the following
(which may be made by telephone if promptly confirmed in writing) as soon as
practicable but in any event within 2 Business Days after any Responsible
Officer of any Loan Party knows or has reason to know of it: (a)(i) any Default
under this Agreement or any Material Master Lease; provided that such notice
shall be required immediately after any Responsible Officer of any Loan Party
receives a written notification that a Default has occurred under the LGO Lease;
and (ii) any event that would have a Material Adverse Effect, specifying, in
each case, the nature and anticipated effect thereof and any action proposed to
be taken in connection therewith, (b) any event reasonably expected to result in
a mandatory payment of the Obligations pursuant to Section 2.8(a) of the ABL
Credit Agreement, including without limitation any Recovery Event over
$1,500,000, which notice shall state the material terms and conditions of such

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transaction and estimating the Net Cash Proceeds thereof, (c) any potential,
threatened or existing material litigation or material proceeding against, or
material investigation by or before any Governmental Authority of (or any agent,
contractor, employee, designee of any Governmental Authority, including any
private contractors retained by and/or acting on behalf of any Governmental
Authority), any Loan Party, any Restricted Subsidiary or any Healthcare
Facility, that could reasonably be expected to have a Material Adverse Effect,
or to materially and adversely affect the right to operate any Healthcare
Facility, (d) to the extent not already disclosed, the entering into any
Material Master Lease, and (e) the closing of, or loss or non-renewal (or
written threat of loss) of Primary License related to, any Healthcare Facility,
or withdrawal from Medicare, Medicaid or TRICARE or any of the next five largest
Third-Party Payor Programs based on the reimbursements from such Third-Party
Payor Programs to Ultimate Parent and its Subsidiaries on a Consolidated basis.

 

5.3 ERISA Matters.  Give the Administrative Agent (a) on or prior to any filing
by any ERISA Affiliate of any notice of intent to terminate any Title IV Plan, a
copy of such notice, provided, that when such a notice is filed by an ERISA
Affiliate that is not a Loan Party, such notice must only be given to the
Administrative Agent where such termination would reasonably be expected to have
a material impact on a Loan Party, and (b) promptly, and in any event within 10
days, after any Responsible Officer of any ERISA Affiliate knows or has reason
to know that a request for a minimum funding waiver under Section 412 of the
Code has been filed with respect to any Title IV Plan or Multiemployer Plan, a
notice (which may be made by telephone if promptly confirmed in writing)
describing such waiver request and any action that any ERISA Affiliate proposes
to take with respect thereto, together with a copy of any notice filed with the
PBGC or the IRS pertaining thereto.

 

5.4 Environmental Matters.   Provide the Administrative Agent notice of each of
the following (which may be made by telephone if promptly confirmed in writing)
promptly but in any event no later than 14 days after any Responsible Officer of
any Loan Party knows of it (and, upon reasonable request of the Administrative
Agent, documents and information in connection therewith): (i)(A) unpermitted
Releases, (B) the receipt by any Loan Party of any written notice of violation
of or potential liability or similar notice under, or the existence of any
condition that could reasonably be expected to result in violations of or
liabilities under, any Environmental Law or (C) the commencement of, or any
material change to, any action, investigation, suit, proceeding, audit, claim,
demand, dispute alleging a violation of or liability under any Environmental Law
or any Environmental Claim, that, for each of clauses (A), (B) and (C) above
(and, in the case of clause (C), if adversely determined), in the aggregate for
each such clause, could reasonably be expected to result in a Material Adverse
Effect, and (ii) the receipt by any Loan Party of notification that any property
of any Loan Party is subject to any Lien in favor of any Governmental Authority
securing, in whole or in part, Environmental Liabilities.

 

(a) Upon request of the Administrative Agent, provide the Administrative Agent a
report containing an update as to the status of any matter as to which notice
has been provided to the Administrative Agent pursuant to Section 5.4(a).

5.5 Other Information.  (a)  Provide the Administrative Agent with such other
documents and information with respect to the business, property, condition
(financial or otherwise), legal, financial or corporate or similar affairs or
operations of any Loan Party as the Administrative Agent or such Lender through
the Administrative Agent may from time to time reasonably request, including,
without limitation, if requested by the Administrative Agent, copies of field
audits and appraisals that are delivered to the administrative agent under the
ABL Facility.

 

(b)Upon request of the Administrative Agent and, in any event, at the end of
each calendar month, provide updates on all material progress related to the
securing of an alternative long term financing option that could be used to
repay the Loans, including, but not limited to, the New Capital and

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in each case providing the Administrative Agent with any substantially final or
final letters of intent, term sheets, engagement or commitment letters.

(c)Provide the Administrative Agent with notice as soon as practicable, but in
any event within 2 Business Days after any Responsible Officer of any Loan Party
receives any written notice or other written correspondence relating to any
Material Master Lease that would be reasonably expected to have a material
adverse impact on the Administrative Agent and the Lenders; provided that such
notice shall be required immediately after any Responsible Officer of any Loan
Party receives any such written notice or other written correspondence relating
to the LGO Lease that would be reasonably expected to have a material adverse
impact on the Administrative Agent and the Lenders.

SECTION 6. AFFIRMATIVE COVENANTS

Each of the Parent Companies and the Borrower (on behalf of itself and each of
its Restricted Subsidiaries) hereby agrees that, beginning on the Closing Date
and so long as the Commitments remain in effect or any Loan or other amounts
owing to any Lender or any Agent hereunder (other than contingent or
indemnification obligations not then asserted or due), the Parent Companies and
the Borrower shall and (to the extent relevant) shall cause each of their
Restricted Subsidiaries to:

6.1 Maintenance of Corporate Existence.  (i) Preserve and maintain its legal
existence, including doing all the things necessary to observe organizational
formalities (except to the extent expressly permitted by Section 7.5); (ii)
preserve and maintain its rights (charter and statutory), privileges, franchises
and Permits necessary or desirable in the conduct of its business, except, in
the case of clause (ii), the failure to do so would not, in the aggregate, have
a Material Adverse Effect.

 

6.2 Compliance with Laws, Etc.   Comply in all material respects with and cause
each of its employees, and use commercially reasonable efforts to cause each of
its, contractors and its tenants or operators under any Lease to comply in all
material respects with all applicable Requirements of Law including Healthcare
Laws, Permits and the Primary Licenses.  Each Loan Party and Restricted
Subsidiary shall maintain in all material respects all records required to be
maintained by any Governmental Authority or otherwise under the Healthcare
Laws.  No Loan Party or Restricted Subsidiary shall transfer any Permit to any
location other than in compliance with Healthcare Laws or pledge any Permit as
collateral security for any Indebtedness (except as permitted under the Loan
Documents), and each Loan Party and Restricted Subsidiary shall hold each Permit
free from restrictions or known conflicts, which, in each case, would materially
impair the use or operation of the related Facility for the uses described in
Section 3.1(b).  The Borrower shall not (i) subject to Section 6.4, rescind,
withdraw or revoke the Permit for any Healthcare Facility or amend, modify,
supplement or otherwise alter the nature, tenor or scope of the Permit for any
Healthcare Facility to the extent that such change, revocation or alteration in
the Permit would have a Material Adverse Effect; or (ii) voluntarily transfer or
encourage the transfer of any resident of a Healthcare Facility to any other
facility, unless such transfer is permitted or required by Requirements of Law
or Healthcare Laws, is for reasons relating to the welfare, health or safety of
the resident to be transferred or other individuals or residents at the facility
or is due to good faith concerns that the resident will not be able to pay his
or her bills owed to the Healthcare Facility.

 

(a) If required under applicable Requirements of Law, maintain in full force and
effect all Permits and Primary Licenses for the Healthcare Facilities, and a
provider agreement or participation agreement for each Third-Party Payor
Program, except to the extent that any such failure to maintain such Permits,
Primary Licenses, provider agreements or participation agreements could not be
reasonably likely to result in a Material Adverse Effect. True and complete
copies of the Permits, including any certificates of occupancy, the Primary
Licenses, and provider agreement or participation agreement 

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shall be delivered to the Administrative Agent promptly upon its reasonable
request to the extent such copies are available.

(b) To the extent applicable, and except as could not be reasonably expected to
have a Material Adverse Effect, operate each Healthcare Facility in substantial
compliance with all requirements for participation in all Third-Party Payor
Programs; provided,  however, that, each Loan Party and Restricted Subsidiary
may withdraw from Third-Party Payor Programs (other than from Medicare, Medicaid
or TRICARE) in the ordinary course of business.

(c) Other than in the normal course of business, and except as could not be
reasonably expected to have a Material Adverse Effect, with respect to each
Healthcare Facility, not change the terms of any Third-Party Payor Program now
or hereinafter in effect or their normal billing payment or reimbursement
policies and procedures with respect thereto (including the amount and timing of
finance charges, fees and write-offs). All cost reports and financial reports
submitted by the Borrower to any third party payor shall be materially accurate
and complete and shall not be misleading in any material respects and all
patient or resident records, including patient or resident trust fund accounts,
shall remain true and correct in all material respects.

(d) Comply with all obligations under the contracts and leases with residents of
each Healthcare Facility, and no Loan Party or Restricted Subsidiary shall
commit or permit any default by a Loan Party or a Restricted Subsidiary
thereunder except, in any case, where the failure to do so, either individually
or in the aggregate, would not be reasonably likely to have a Material Adverse
Effect.

(e) Make all payments and otherwise perform all obligations in respect of all
Material Master Leases to which Ultimate Parent or any of its Restricted
Subsidiaries is a party, keep such leases in full force and effect and not allow
such leases to lapse or be terminated other than in accordance with their terms
or any rights to renew such leases to be forfeited or cancelled, notify the
Administrative Agent of any default by any party with respect to such leases and
cooperate with the Administrative Agent in all respects to cure any such
default, and cause each of its Restricted Subsidiaries to do so, except, in any
case, where the failure to do so, either individually or in the aggregate, would
not be reasonably likely to have a Material Adverse Effect.

6.3 Payment of Obligations.  Pay or discharge before they become delinquent (a)
all material claims, Taxes, assessments, charges and levies imposed by any
Governmental Authority and (b) all other lawful claims that if unpaid would, by
the operation of applicable Requirements of Law, become a Lien upon any property
of any Loan Party, except, in each case, for those whose amount or validity is
being contested in good faith by proper proceedings diligently conducted and for
which adequate reserves are maintained on the books of the appropriate Loan
Party or Restricted Subsidiary in accordance with GAAP or with respect to which
failure to do so would not have a Material Adverse Effect.

 

6.4 Maintenance of Property.   Maintain and preserve, in its own name, (a) in
good working order and condition all of its property necessary in the conduct of
its business, and (b) all rights, permits, licenses, approvals and privileges
(including all Permits and Primary Licenses) necessary, used or useful, whether
because of its ownership, lease, sublease or other operation or occupation of
property or other conduct of its business, and shall make all necessary or
appropriate filings with, and give all required notices to, Governmental
Authorities, except for such failures to maintain and preserve the items set
forth in clauses (a) and (b) or to make such necessary or appropriate filings
above that would not, in the aggregate, have a Material Adverse Effect.

 

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6.5 Maintenance of Insurance.   Maintain or cause to be maintained in full force
and effect all policies of insurance of the kinds customarily insured against by
Persons engaged in the same or similar business (including self insurance) with
respect to the property and businesses of the Loan Parties and the Restricted
Subsidiaries with financially sound and reputable insurance companies or
associations of similar nature.

 

(a) With respect to the Insurance Captives, the Borrower shall (i) upon request,
provide to the Administrative Agent any and all actuarial reports, opinions and
studies performed by actuaries or insurance advisors related to its business,
including information related to the professional and general liability claims
and other claims covered by the Insurance Captives and (ii) cause the Insurance
Captives to at all times be in good standing under the statutes of the
jurisdiction of its organization and in compliance with all applicable
Requirements of Law, including establishing and maintaining assets of the
Insurance Captives in an amount necessary to comply with the self-insurance
retention program requirements in accordance with applicable Requirements of
Law.

6.6 Keeping of Books.  Keep proper books of record and account, in which full,
true and correct entries in all material respects shall be made in accordance
with GAAP and in substantial compliance in all material respects with all other
applicable Requirements of Law of all financial transactions and the assets and
business of each Loan Party and each Restricted Subsidiary.

 

6.7 Access to Books and Property.  Permit the Administrative Agent (and, after
and during the continuance of an Event of Default, the Lenders and any Related
Party of any of them accompanying the Administrative Agent) at any reasonable
time during normal business hours and with reasonable advance notice to the
Borrower (during the continuance of an Event of Default, 1 Business Day shall be
deemed to be reasonable advance notice) to (a) visit and inspect the property of
each Loan Party and each Restricted Subsidiary and examine and make copies of
and abstracts from, the corporate (and similar), financial, operating and other
books and records of each Loan Party and each Restricted Subsidiary, (b) discuss
the affairs, finances and accounts of such Loan Party or such Restricted
Subsidiary with any officer or director of any Loan Party or any Restricted
Subsidiary and (c) communicate with an officer of any Loan Party or any
Restricted Subsidiary and upon receipt of prior approval, directly with any
registered certified public accountants (including Ultimate Parent’s
accountants) of any Loan Party or any Restricted Subsidiary; provided, that,
excluding any such visits and inspections during the continuation of an Event of
Default the Administrative Agent and the Lenders shall not exercise such rights
more than one time (in the aggregate) in any calendar year. Each Loan Party and
each Restricted Subsidiary shall authorize their respective registered certified
public accountants (including Ultimate Parent’s accountants) to communicate
directly with the Administrative Agent, the Lenders, their respective Related
Parties and such officer contemporaneously, and to disclose to the
Administrative Agent, the Lenders and their respective Related Parties all
financial statements and other documents and information as they might have and
are available to a Loan Party or a Restricted Subsidiary and the Administrative
Agent or any Lender reasonably requests with respect to any Loan Party or any
Restricted Subsidiary.  The Administrative Agent and the Lenders shall give the
Parent Companies and the Borrower the opportunity to participate in any
discussions with Ultimate Parent’s independent public accountants.

 

6.8 Environmental.  Comply with, and maintain its real property, whether owned,
leased, subleased or otherwise operated or occupied, in compliance with, all
applicable Environmental Laws (including by implementing any Remedial Action
necessary to achieve such compliance or that is required by orders and
directives of any Governmental Authority) except for failures to comply that
would not, in the aggregate, have a Material Adverse Effect. Without limiting
the foregoing, if the Administrative Agent at any time has a reasonable basis to
believe that there exist material violations of Environmental Laws by any Loan
Party or that there exist any material Environmental Liabilities, in each case,
then each Loan Party shall promptly upon receipt of request from the
Administrative Agent, cause the

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performance of environmental audits and assessments, including subsurface
sampling of soil and groundwater, and cause the preparation of such reports, in
each case as the Administrative Agent may from time to time reasonably request.
In the event (a) the Loan Party does not commence such work within thirty (30)
days of such request and diligently pursue such work or (b) there is an Event of
Default, the Administrative Agent, upon written notice to such Loan Party, shall
have access to such real property to undertake the work, provided, that the
Administrative Agent shall only be allowed to do so under the following
conditions: (i) that it provide written notice at least five (5) business days
in advance prior to the intended entrance onto the real property; (ii) that the
work be conducted during normal business hours; (iii) that the Administrative
Agent indemnify and hold harmless said Loan Party for any damages or losses
resulting from the performance of the work by the Administrative Agent or its
representatives; (iv) that the Administrative Agent ensure that the real
property is restored to its pre-work condition, including, without limitation,
restoring any surfaces that were disturbed during the performance of the work
and properly closing any wells or boreholes installed during the performance of
the work; and (v) abiding by all other health and safety requirements of the
Loan Party that would typically be imposed on a visitor to the real
property.  Such audits, assessments and reports, to the extent not conducted by
the Administrative Agent, shall be conducted and prepared by reputable
environmental consulting firms reasonably acceptable to the Administrative Agent
and shall be in form and substance reasonably acceptable to the Administrative
Agent.

 

6.9 Post Closing Obligations.  Cause to be performed and completed, to the
Administrative Agent’s reasonable satisfaction, all of the obligations set forth
on Schedule 6.9 hereto within the time periods set forth on Schedule 6.9 or such
longer period as the Administrative Agent shall permit in its reasonable
discretion.

 

6.10 Additional Collateral, etc.   Subject to the Intercreditor Agreement (if
applicable), with respect to any personal property or registered Intellectual
Property (other than assets expressly excluded from the Collateral pursuant to
the Security Documents) located in the United States acquired or created after
the Closing Date by any Loan Party that is required by the terms of this
Agreement and the other Loan Documents to become Collateral (other than any
property subject to a Lien expressly permitted by Section 7.2(c), any Skilled RE
Priority Collateral and any MidCap RE Priority Collateral) as to which the
Collateral Agent for the benefit of the Secured Parties does not have a
perfected Lien, except as otherwise provided in the Security Documents promptly,
but in any case within 45 days (which period may be extended by the
Administrative Agent in its reasonable discretion), (i) give notice of such
property to the Collateral Agent and execute and deliver to the Collateral Agent
such amendments to the Guarantee and Collateral Agreement or such other
documents as the Collateral Agent reasonably requests to grant to the Collateral
Agent for the benefit of the Secured Parties a security interest in such
Property (with the priority specified in the Intercreditor Agreement) and (ii)
take all actions reasonably requested by the Collateral Agent to grant to the
Collateral Agent for the benefit of the Secured Parties a perfected security
interest (to the extent required by the Security Documents and with the priority
required by the Intercreditor Agreement) in such property (with respect to
property of a type owned by a Loan Party as of the Closing Date to the extent
the Collateral Agent for the benefit of the Secured Parties, has a perfected
security interest in such property as of the Closing Date), including, without
limitation, the filing of UCC financing statements in such jurisdictions as may
be required by the Guarantee and Collateral Agreement or by law or as may be
reasonably requested by the Collateral Agent.

 

(a) Subject to the Intercreditor Agreement (if applicable), with respect to any
fee owned real property located in the United States having a value (together
with improvements thereof) of at least $1,000,000 acquired after the Closing
Date by any Loan Party (other than any such real property subject to a Lien
expressly permitted by Section 7.2(c), (i), (o),  (p) or (x);  provided,
however, that with respect to Liens permitted by Section 7.2(c) or (i), this
exception shall apply to the extent such Liens expressly restrict the granting
of a Mortgage) (i) within 45 days of such acquisition, give notice of such

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acquisition to the Collateral Agent and, if requested by the Collateral Agent
promptly thereafter execute and deliver a Mortgage (subject to Liens permitted
by Section 7.2) in favor of the Collateral Agent for the benefit of the Secured
Parties, covering such real property (provided that no Mortgage nor survey shall
be obtained if the Collateral Agent reasonably determines in consultation with
the Borrower that the costs of obtaining such Mortgage or survey are excessive
in relation to the value of the security to be afforded thereby), (ii) if
reasonably requested by the Collateral Agent (A) provide the Lenders with a
lenders’ title insurance policy with extended coverage covering such real
property in an amount at least equal to the purchase price of such real property
as well as a current ALTA survey thereof, together with a surveyor’s certificate
unless the title insurance policy referred to above shall not contain an
exception for any matter shown by a survey (except to the extent an existing
survey has been provided and specifically incorporated into such title insurance
policy), each in form and substance reasonably satisfactory to the Collateral
Agent, and (B) use commercially reasonable efforts to obtain any consents or
estoppels reasonably deemed necessary by the Collateral Agent in connection with
such Mortgage, each of the foregoing in form and substance reasonably
satisfactory to the Collateral Agent and (iii) if requested by the Collateral
Agent deliver to the Collateral Agent legal opinions relating to the matters
described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to the Collateral Agent.

(b) Except as otherwise permitted in the Security Documents, with respect to any
(x) new Domestic Subsidiary that is created or acquired after the Closing Date
by any Loan Party that is a Material Restricted Subsidiary or (y) any
Unrestricted Subsidiary designated as a Restricted Subsidiary after the Closing
Date, promptly, but in any case within 45 days of such creation, acquisition or
designation (which period may be extended by the Administrative Agent in its
reasonable discretion), (i) give notice of such acquisition, creation or
designation to the Collateral Agent, (ii) if such Subsidiary is a Material
Restricted Subsidiary, (A) execute and deliver to the Collateral Agent such
amendments to the Guarantee and Collateral Agreement or such other Security
Documents or other documents as the Collateral Agent reasonably deems necessary
to grant to the Collateral Agent for the benefit of the Secured Parties a
perfected security interest (to the extent required by the Security Documents
and with the priority specified in the Intercreditor Agreement) in the Capital
Stock of such new Material Restricted Subsidiary that is owned by such Loan
Party and (B) deliver to the Collateral Agent the certificates, if any,
representing such Capital Stock, together with undated stock powers, in blank,
executed and delivered by a duly authorized officer of such Loan Party, and
(iii) if such new Material Restricted Subsidiary is a Wholly-Owned Domestic
Subsidiary, cause such new Subsidiary (A) to become a party to the Guarantee and
Collateral Agreement and (B) to take such actions necessary or advisable to
grant to the Collateral Agent for the benefit of the Secured Parties a perfected
security interest (to the extent required by the Security Documents and with the
priority specified in the Intercreditor Agreement) in the Collateral described
in the Guarantee and Collateral Agreement with respect to such new Subsidiary
(to the extent the Collateral Agent, for the benefit of the Secured Parties, has
a perfected security interest in the same type of Collateral as of the Closing
Date), including, without limitation, the filing of UCC financing statements in
such jurisdictions as may be required by the Guarantee and Collateral Agreement
or by law or as may be reasonably requested by the Collateral Agent; provided
that, notwithstanding anything to the contrary in this Section 6.10(c), the
provisions of this Section 6.10(c) shall not apply to any Material
Restricted Subsidiary that is a HUD Sub-Facility Entity or a HUD RE Entity.

(c) With respect to any new Foreign Subsidiary directly owned by a Parent
Company, the Borrower or a Domestic Subsidiary that is created or acquired after
the Closing Date by any Loan Party, promptly, but in any case within 45 days of
such acquisition (which period may be extended by the Administrative Agent in
its sole discretion), (i) give notice of such acquisition or creation to the
Collateral Agent and, if requested by the Collateral Agent, execute and deliver
to the Collateral Agent such amendments to the Guarantee and Collateral
Agreement or such other documents as the Collateral Agent deems necessary or
reasonably advisable in order to grant to the Collateral Agent, for the benefit

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of the Secured Parties, a perfected security interest (to the extent required by
the Security Documents and with the priority specified in the Intercreditor
Agreement) in the Capital Stock of such new Subsidiary that is owned by such
Loan Party (provided that (x) in no event shall more than 65% of the total
outstanding voting Capital Stock of any Foreign Subsidiary be required to be so
pledged and (y) 100% of non-voting stock of any Foreign Subsidiary, if any,
shall be required to be so pledged) and (ii) to the extent permitted by
applicable law, deliver to the Collateral Agent the certificates, if any,
representing such Capital Stock, together with undated stock powers, in blank,
executed and delivered by a duly authorized officer of such Loan Party, and take
such other action as may be necessary in the reasonable opinion of the
Collateral Agent, to perfect or ensure appropriate priority of the Lien of the
Collateral Agent thereon.

(d) Notwithstanding anything to the contrary in any Loan Document, the foregoing
provisions of this Section shall not apply with respect to any collateral (i) to
the extent the Administrative Agent has reasonably determined that the value of
such collateral to which this Section would otherwise apply is insufficient to
justify the difficulty, time and/or expense of obtaining a perfected Lien
therefrom and (ii) if so provided in any Security Document.

(e) Should the commitments and obligations under the ABL Credit Agreement (or
any asset based debt in lieu thereof consisting of a Permitted Refinancing) be
terminated and repaid in full, then the Loan Parties shall take all actions and
execute and deliver all documents, in each case reasonably requested by the
Administrative Agent so that the Obligations under the Credit Agreement shall be
secured by a first priority lien and security interest in such assets (other
than the accounts receivable that secure the Skilled RE Credit Agreement and the
assets that secure the MidCap RE Credit Agreement) securing the ABL Credit
Agreement (or any asset based debt in lieu thereof consisting of a Permitted
Refinancing).

6.11 Further Assurances.  Maintain the security interest created by the Security
Documents as a perfected security interest having at least the priority
specified in the Intercreditor Agreement (to the extent such security interest
can be perfected through the filing of UCC-1 financing statements, the
Intellectual Property filings to be made pursuant to Schedule 4 of the Guarantee
and Collateral Agreement, the execution of control agreements, or the delivery
of Pledged Securities required to be delivered under the Guarantee and
Collateral Agreement), subject to the rights of the Loan Parties under the Loan
Documents to Dispose of the Collateral.  From time to time the Loan Parties
shall execute and deliver, or cause to be executed and delivered, such
additional instruments, certificates or documents, and take all such actions, as
the Collateral Agent may reasonably request for the purposes of implementing or
effectuating the provisions of this Agreement and the other Loan Documents, or
of renewing the rights of the Secured Parties with respect to the Collateral as
to which the Collateral Agent, for the ratable benefit of the Secured Parties,
has a perfected Lien pursuant hereto or thereto, including, without limitation,
filing any financing or continuation statements or financing change statements
under the UCC (or other similar laws) in effect in any United States
jurisdiction with respect to the security interests created hereby.

 

6.12 Use of Proceeds.  The proceeds of the Initial Term Loans shall be used to
effect the Transactions and for general corporate (including working capital)
purposes of the Parent Companies and their Subsidiaries not prohibited by this
Agreement.  The proceeds of the 2018 Term Loans shall be used in accordance with
Section 3.19.

 

6.13 Material Master Leases.  With respect to any Material Master Lease (other
than the Master Leases), cause the parties to such Material Master Lease to
execute an intercreditor or similar agreement satisfactory to the Administrative
Agent, on terms substantially similar to those set forth in the Master Lease
Intercreditor Agreements or on terms no less favorable to the Lenders than those
set forth in the Master Lease Intercreditor Agreements, as reasonably determined
by the Administrative Agent.

 

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6.14 Local Counsel Opinions.  Use commercially reasonable efforts to, upon
fifteen (15) Business Days prior written notice by the Administrative Agent,
deliver to the Administrative Agent local counsel opinions in Connecticut,
Maryland, New Jersey, North Carolina, Pennsylvania, Virginia and West Virginia,
covering such customary matters incident to the transactions contemplated by
this Agreement as the Administrative Agent may reasonably require and in form
and substance reasonably satisfactory to the Administrative Agent; provided that
the Loan Parties shall no longer be required to deliver such opinions if such
written notice is not delivered to the Loan Parties on or before June 6, 2018.

 

6.15 Taxes.  For as long as the Obligations remain outstanding, the Borrower
will be treated as a partnership for U.S. federal income tax purposes and for
all applicable state income tax purposes and shall not make any election to be
treated as an association taxable as a corporation under the Code or under any
corresponding provision of federal, state or local tax law.

 

6.16 Omnibus Agreement.  Comply with the provisions of the Omnibus Agreement,
including without limitation the provisions thereof relating to the raising of
New Capital and the application thereof; provided, that the provisions therein
defining “New Capital” and “Trigger Event” shall be deemed to be updated and
conformed to the corresponding definitions herein.

 

SECTION 7. NEGATIVE COVENANTS

Each of the Parent Companies and the Borrower (on behalf of itself and each of
its Restricted Subsidiaries) hereby agree that, beginning on the Closing Date
and so long as the Commitments remain in effect or any Loan or other amount is
owing to any Lender or the Agents hereunder (other than contingent or
indemnification obligations not then asserted or due), the Parent Companies and
the Borrower shall not, and shall not permit any of their Restricted
Subsidiaries to:

7.1 Indebtedness.  Incur, create, assume or permit to exist any Indebtedness,
except:

 

(a) Indebtedness existing on Restatement Date and set forth in Schedule 7.1, and
any Permitted Refinancing thereof;

(b) Indebtedness created hereunder and under the other Loan Documents;

(c) intercompany Indebtedness of Ultimate Parent and the Restricted Subsidiaries
to the extent permitted by Section 7.4(c); provided that (i) each item of
intercompany Indebtedness consisting of intercompany loans and advances made by
a Restricted Subsidiary that is not a Subsidiary Guarantor to a Parent Company,
a Subsidiary Guarantor or the Borrower which exceeds $5,000, individually, or
$1,000,000, in the aggregate, shall be evidenced by a promissory note (which
shall be substantially in the form of Exhibit M hereto) with customary
subordination provisions, (ii) each item of intercompany Indebtedness consisting
of intercompany loans and advances made by a Subsidiary that is a Borrower, to
the extent required to be pledged under the Guarantee and Collateral Agreement,
shall be evidenced by a promissory note, and (iii) each such promissory note
under clause (ii) hereof shall be pledged to the Collateral Agent pursuant to
the Guarantee and Collateral Agreement to the extent required thereby;

(d) Indebtedness of Ultimate Parent or any Restricted Subsidiary incurred to
finance the acquisition, construction or improvement of any fixed or capital
assets, and extensions, renewals, replacements, modifications, refundings and
refinancing of any such Indebtedness that do not increase the outstanding
principal amount thereof (other than to the extent of any premiums, interest or
costs and expenses incurred in connection therewith) (“Purchase Money
Indebtedness”); provided that (i) such Indebtedness is incurred prior to or
within 180 days after such acquisition or the completion of such construction or
improvement and (ii) the aggregate principal amount of Indebtedness permitted by
this

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Section 7.1(d), when combined with the aggregate principal amount of all Capital
Lease Obligations incurred pursuant to Section 7.1(e), shall not exceed
$35,000,000 at any time outstanding;

(e) Capital Lease Obligations in an aggregate principal amount, when combined
with the aggregate principal amount of all Indebtedness incurred pursuant to
Section 7.1(d), not in excess of $35,000,000 at any time outstanding and
Permitted Refinancings thereof;

(f) Indebtedness in respect of bid, workers’ compensation claims, self-insurance
obligations, bankers’ acceptances, performance or surety, appeal or similar
bonds issued for the account of and completion guarantees and other similar
obligations provided by Ultimate Parent or any Restricted Subsidiary in the
ordinary course of business, including guarantees or obligations with respect to
letters of credit supporting such bid bonds, performance bonds, surety bonds and
similar obligations;

(g) Indebtedness assumed in connection with a Permitted Acquisition and any
Permitted Refinancing thereof; provided that (i) such Indebtedness is not
incurred in contemplation of, or in connection with, such Permitted Acquisition,
(ii) both immediately prior and after giving effect thereto, no Event of Default
shall exist or result therefrom, (iii) the Consolidated Total Leverage Ratio
calculated on a Pro Forma Basis as of the most recently completed period of four
consecutive fiscal quarters ending prior to such incurrence for which the
financial statements and certificates required by Section 5.1(a) or 5.1(b), as
the case may be, and 5.1(c) have been delivered as if such incurrence had
occurred as of the first day of such period shall be 0.25:1.00 less than the
Consolidated Total Leverage Ratio required pursuant to Section 7.14 and (iv)
Ultimate Parent shall have delivered to the Administrative Agent a certificate
of a Responsible Officer to the effect set forth in clauses (ii) and (iii) above
setting forth reasonably detailed calculations demonstrating compliance with
subclauses (ii) and (iii) above;

(h) unsecured Indebtedness of Ultimate Parent or any of the Restricted
Subsidiaries,  so long as at the time of the incurrence thereof and after giving
effect thereto, the Consolidated Total Leverage Ratio does not exceed 0.50:1.00
less than the applicable maximum Consolidated Total Leverage Ratio set forth in
Section 7.14, calculated on a Pro Forma Basis as of the most recently completed
period of four consecutive fiscal quarters ending prior to such incurrence for
which the financial statements and certificates required by Section 5.1(a) or
5.1(b), as the case may be, and 5.1(c) have been delivered, and Permitted
Refinancings thereof; provided, that such Indebtedness does not mature or have
scheduled amortization or payments of principal and is not subject to mandatory
redemption or prepayment (except customary asset sale or change of control
provisions), in each case prior to the date that is 181 days after the Maturity
Date at the time such Indebtedness is incurred;

(i) Guarantee Obligations by Ultimate Parent or the Restricted Subsidiaries of
Indebtedness of Ultimate Parent and the Restricted Subsidiaries so long as
Ultimate Parent or the Restricted Subsidiaries incurring such Indebtedness are
permitted to incur such Indebtedness represented by such Guarantee Obligation
hereunder;

(j) Indebtedness of Ultimate Parent and its Subsidiaries in respect of the ABL
Loan Documents (including the HUD Sub-Facility Credit Agreement) in an aggregate
principal amount not exceeding $600,000,000 at any time outstanding (and any
Permitted Refinancing thereof permitted by the Intercreditor Agreement);

(k) other Indebtedness of Ultimate Parent or the Restricted Subsidiaries in an
aggregate principal amount not exceeding $30,000,000 at any time outstanding;

(l) Indebtedness arising from agreements of Ultimate Parent or any Restricted
Subsidiary providing for indemnification, adjustment of purchase price or
similar obligations, in each

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case entered into in connection with Permitted Acquisitions or other Investments
and the disposition of any business, assets or Capital Stock permitted
hereunder;

(m) Indebtedness consisting of (A) trade obligations or (B) accrued current
liabilities for services rendered to Ultimate Parent or any Restricted
Subsidiary, in each case, arising in the ordinary course of business;

(n) Indebtedness in respect of netting services, automatic clearinghouse
arrangements, overdraft protections, employee credit card programs and other
cash management and similar arrangements in the ordinary course of business;

(o) Indebtedness representing deferred compensation to employees of the Parent
Companies, the Borrower or any of their Subsidiaries incurred in the ordinary
course of business consistent with past practice;

(p) Guarantees incurred in the ordinary course of business in respect of
obligations to suppliers, customers, franchisees, lessors and licensees;

(q) Indebtedness incurred in the ordinary course of business in respect of
obligations of Ultimate Parent or any Restricted Subsidiary to pay the deferred
purchase price of goods or services or progress payments in connection with such
goods and services;

(r) Indebtedness consisting of (A) the financing of insurance premiums or (B)
take-or-pay obligations contained in supply arrangements, in each case, in the
ordinary course of business consistent with past practice;

(s) Indebtedness consisting of letters of credit issued or created in the
ordinary course of business or consistent with past practice by Ultimate Parent
or any of the Restricted Subsidiaries in respect of the CapOne Letter of Credit
Facility in an aggregate principal amount not to exceed $100,000,000 and secured
solely by the Liens permitted by Section 7.2(dd) and other letters of credit,
bank guarantees, bankers’ acceptances, warehouse receipts or similar instruments
issued or created in the ordinary course of business or consistent with past
practice, including in respect of workers compensation claims, health,
disability or other employee benefits or property, casualty or liability
insurance or self-insurance or other Indebtedness with respect to
reimbursement-type obligations regarding workers compensation claims; 

(t) Indebtedness of Ultimate Parent and the Restricted Subsidiaries under any
Hedge Agreement permitted under Section 7.4(f);

(u) Indebtedness of any Loan Parties owed to former or current management,
directors, officers or employees (or their transferees, estates or beneficiaries
under their estates) of the Parent Companies, the Borrower or any of the
Restricted Subsidiaries in lieu of any cash payment permitted to be made under
Section 7.6(a)(iii); provided that all such Indebtedness shall be unsecured;

(v) Guarantees in respect of Indebtedness of directors, officers and employees
of the Parent Companies, the Borrower or the Restricted Subsidiaries in respect
of expenses of such Persons in connection with relocations and other ordinary
course of business purposes, if the aggregate amount of Indebtedness so
guaranteed, when added to the aggregate amount of loans and advances then
outstanding under Section 7.4(e), shall not at any time exceed $7,000,000;

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(w) Indebtedness in respect of Real Property Financing Obligations, including
but not limited to, Indebtedness of Ultimate Parent and its Subsidiaries in
respect of the Skilled RE Loan Documents, the Revera Loan Documents and the
MidCap RE Loan Documents;

(x) Indebtedness of Restricted Subsidiaries that are not Loan Parties in an
aggregate principal amount not exceeding $10,000,000 at any time outstanding, so
long as such Indebtedness is non-recourse to the Loan Parties;

(y) [Intentionally Omitted];

(z) [Intentionally Omitted];

(aa) Indebtedness of Ultimate Parent and its Subsidiaries in respect of the HUD
RE Entities’ obligations under the HUD RE Loan Agreements (and any Permitted
Refinancing thereof); and

(bb) Qualified Mezzanine Debt the Net Cash Proceeds of which are applied
substantially concurrently with the receipt thereof to prepay the Loans in
accordance with Sections 2.8(b) or, as applicable, 2.14(i). 

The accrual of interest, the accretion of accreted value and the payment of
interest in the form of additional Indebtedness shall not be deemed to be an
incurrence of Indebtedness for purposes of this Section. The principal amount of
any non-interest bearing Indebtedness or other discount security constituting
Indebtedness at any date shall be the principal amount thereof that would be
shown on a balance sheet of Ultimate Parent in each case, dated such date
prepared in accordance with GAAP.

7.2 Liens.  Create, incur, assume or permit to exist any Lien on any property or
assets (including Capital Stock or other securities of any person, including
Ultimate Parent or any Restricted Subsidiary) owned as of the Closing Date or
thereafter acquired by it or on any income or revenues or rights in respect of
any thereof, except:

 

(a) Liens on property or assets of Ultimate Parent and the Restricted
Subsidiaries existing on the Restatement Date and set forth in Schedule 7.2;
 provided that such Liens shall secure only those obligations which they secure
on the Restatement Date other than newly created improvements thereon or
proceeds from the disposition of such property and extensions, renewals and
replacements thereof permitted hereunder;

(b) any Lien created under the (i) Loan Documents, (ii) the HUD Sub-Facility
Credit Agreement (or any Permitted Refinancing thereof) and (iii) ABL Loan
Documents (or any Permitted Refinancing thereof); provided that such Liens are
subject to the terms of the Intercreditor Agreement;

(c) any Lien existing on any property or asset prior to the acquisition thereof
by Ultimate Parent or any Restricted Subsidiary or existing on any property or
assets of any person that becomes a Restricted Subsidiary after the Closing
Date, in each case, prior to the time such person becomes a Restricted
Subsidiary, as the case may be; provided that (i) such Lien is not created in
contemplation of or in connection with such acquisition or such person becoming
a Restricted Subsidiary, (ii) such Lien does not apply to any other property or
assets of Ultimate Parent or any Restricted Subsidiary other than newly created
improvements thereon or proceeds from the disposition of such property and (iii)
such Lien secures only those obligations which it secures on the date of such
acquisition or the date such person becomes a Restricted Subsidiary, as the case
may be, and extensions, renewals and replacement of any such Liens securing
Indebtedness permitted under Section 7.1(g) hereof;

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(d) Liens for Taxes not yet due or which are being contested in compliance with
Section 6.3;

(e) Liens in respect of property of Ultimate Parent or the Restricted
Subsidiaries imposed by Requirements of Law, which were incurred in the ordinary
course of business and do not secure Indebtedness for borrowed money, such as
carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like
Liens arising in the ordinary course of business and securing obligations that
are not due or payable or which are being contested in compliance with Section
6.3;

(f) pledges and deposits made in the ordinary course of business in compliance
with workmen’s compensation, unemployment insurance and other social security
laws or regulations;

(g) deposits to secure the performance of bids, trade contracts (other than for
Indebtedness), leases (other than Capital Lease Obligations), statutory
obligations, surety and appeal bonds, performance bonds and other obligations of
a like nature incurred in the ordinary course of business;

(h) zoning restrictions, easements, rights-of-way, restrictions on use of real
property and other similar encumbrances incurred in the ordinary course of
business which, in the aggregate, are not substantial in amount and do not
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of the business of Ultimate Parent or any of the
Restricted Subsidiaries;

(i) purchase money security interests in real property, improvements thereto or
equipment acquired after the Closing Date (or, in the case of improvements,
constructed) by Ultimate Parent or any Restricted Subsidiary; provided that (i)
such security interests secure Indebtedness permitted by Section 7.1(d), (ii)
such security interests are incurred, and the Indebtedness secured thereby is
created, within 180 days after such acquisition (or construction) and (iii) such
security interests do not apply to any other Property or assets of Ultimate
Parent or any Restricted Subsidiary;

(j) Liens securing judgments that have not resulted in an Event of Default under
clause (i) of Section 8;

(k) licenses (with respect to Intellectual Property and other property), leases
or subleases granted to third parties not interfering in any material respect
with the ordinary conduct of the business of Ultimate Parent or any Restricted
Subsidiary or resulting in a material diminution in the value of any Collateral
as security for the Obligations;

(l) any (i) interest or title of a lessor or sublessor under any lease not
prohibited by this Agreement, (ii) Lien or restriction that the interest or
title of such lessor or sublessor may be subject to, or (iii) subordination of
the interest of the lessee or sublessee under such lease to any Lien or
restriction referred to in the preceding clause (ii), so long as the holder of
such Lien or restriction agrees to recognize the rights of such lessee or
sublessee under such lease;

(m) Liens arising from filing UCC financing statements relating solely to Leases
not prohibited by this Agreement;

(n) Liens securing obligations (other than obligations representing Indebtedness
for borrowed money) under operating, reciprocal easement or similar agreements
entered into in the ordinary course of business of Ultimate Parent and the
Restricted Subsidiaries;

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(o) Liens on the property subject to any Sale and Lease-Back Transactions,
securing obligations thereunder in an aggregate principal amount outstanding at
any time not to exceed $7,000,000;

(p) Liens incurred in connection with (i) Capital Lease Obligations securing
obligations permitted to be incurred pursuant to Section 7.1(e) and (ii) Real
Property Financing Obligations permitted to be incurred pursuant to Section
7.1(w), including (x) any Lien created under the Skilled RE Loan Documents
(including junior Liens in the ABL Priority Collateral subject to the
Intercreditor Agreement) and (y) any Lien created under the Revera Loan
Documents;

(q) pledges and deposits in the ordinary course of business and consistent with
past practices securing liability for reimbursement or indemnification
obligations of (including obligations in respect of letters of credit or bank
guarantees for the benefit of) insurance carriers providing property, casualty
or liability insurance to Ultimate Parent or any of the Restricted Subsidiaries;

(r) Liens (i) of a collection bank arising under Section 4-210 of the Uniform
Commercial Code on the items in the course of collection and (ii) in favor of a
banking or other financial institution arising as a matter of law or under
customary general terms and conditions encumbering deposits or other funds
maintained with a financial institution (including the right of set off) and
that are within the general parameters customary in the banking
industry; provided that, to the extent that such collection bank, banking or
other financial institution has executed and delivered a control agreement, such
Lien will be subordinated or waived to the extent set forth in such control
agreement;

(s) Liens (i) on cash advances in favor of the seller of any property to be
acquired in an Investment permitted pursuant to Section 7.4 to be applied
against the purchase price for such Investment or (ii) consisting of an
agreement to Dispose of any property in a Disposition permitted under Section
7.5, in each case, solely to the extent such Investment or Disposition, as the
case may be, would have been permitted on the date of the creation of such Lien;

(t) Liens that are contractual rights of setoff (i) relating to the
establishment of depository relations with banks or other financial institutions
not given in connection with the issuance of Indebtedness, (ii) relating to
pooled deposit or sweep accounts of Ultimate Parent or any of the Restricted
Subsidiaries to permit satisfaction of overdraft or similar obligations incurred
in the ordinary course of business of Ultimate Parent and the Restricted
Subsidiaries or (iii) relating to purchase orders and other agreements entered
into with customers of Ultimate Parent or any of the Restricted Subsidiaries, in
each case, in the ordinary course of business; provided that, to the extent that
such collection bank, banking or other financial institution has executed and
delivered a control agreement, such Lien will be subordinated or waived to the
extent set forth in such control agreement;

(u) (i) Liens solely on any cash earnest money deposits made by Ultimate Parent
or any of the Restricted Subsidiaries in connection with any letter of intent or
purchase agreement permitted hereunder and (ii) the filing of UCC financing
statements solely as a precautionary measure in connection with operating leases
or consignment of goods and similar arrangements;

(v) Liens in favor of a Loan Party on assets of a Subsidiary that is not
required to be a Subsidiary Guarantor;

(w) in the case of any joint venture, any put and call arrangements related to
its Capital Stock set forth in its organizational documents or any related joint
venture or similar agreement;

(x) [reserved];

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(y) other Liens with respect to property or assets of Ultimate Parent or any
Restricted Subsidiary securing obligations in an aggregate principal amount
outstanding at any time not to exceed $10,000,000;

(z) Liens granted in connection with the pledge or transfer of the Capital Stock
of a joint venture permitted hereunder;

(aa) Liens granted to secure obligations under and in accordance with (i) the
Material Master Leases; provided that such Liens are subject to the terms of the
Material Master Lease Intercreditor Agreements and (ii) other facility lease
agreements (other than Material Master Leases) in the ordinary course of
business;

(bb) Liens on any Indebtedness permitted under Section 7.1(aa);  

(cc) any Lien created under the MidCap RE Loan Documents; provided that any such
Lien on the Collateral is  subject to the Intercreditor Agreement; and

(dd) Liens solely on cash pledged to secure obligations of Ultimate Parent or
any Restricted Subsidiary with respect to the CapOne Letter of Credit Facility,
and the Unrestricted Account in which such cash is held; provided that the cash
held in such Unrestricted Account shall not at any time exceed 105% of the
aggregate face amount of all letters of credit issued and outstanding from time
to time under the CapOne Letter of Credit Facility.

7.3 Sale and Lease-Back Transactions.  Enter into any arrangement, directly or
indirectly, with any person (other than Ultimate Parent or any Restricted
Subsidiary) whereby it shall Dispose of any property, real or personal, used or
useful in its business, whether owned as of the Closing Date or thereafter
acquired, and thereafter rent or lease such property or other property which it
intends to use for substantially the same purpose or purposes as the property
being sold or transferred (a “Sale and Lease-Back Transaction”) unless (a) the
Disposition of such property is permitted by Section 7.5, (b) any Capital Lease
Obligations or Liens arising in connection therewith are permitted by Sections
7.1 and 7.2, as the case may be and either (1) consist of Real Property
Financing Obligations and Liens granted in connection therewith or (2) are in an
aggregate principal amount not exceeding $35,000,000 at any time outstanding and
(c) Ultimate Parent shall be in compliance with the Financial Condition
Covenants calculated on a Pro Forma Basis as of the most recently completed
period of four consecutive fiscal quarters ending prior to such incurrence for
which the financial statements and certificates required by Section 5.1(a) or
5.1(b), as the case may be, and 5.1(c) have been delivered as if such Sale and
Lease-Back Transaction had occurred as of the first day of such period; provided
that, the Net Cash Proceeds of such Sale and Lease-Back Transaction shall be
applied in accordance with Section 2.8(c);

 

7.4 Investments, Loans and Advances.  Purchase, hold or acquire any Capital
Stock, evidences of Indebtedness or other securities of, make or permit to exist
any loans or advances to, or make or permit to exist any investment or any other
interest in, any other person (all of the foregoing, “Investments”), except:

 

(a) (i) Investments by Ultimate Parent and the Restricted Subsidiaries existing
on the Restatement Date, in each case, in the Capital Stock of their
subsidiaries and (ii) additional investments by Ultimate Parent and the
Restricted Subsidiaries in the Capital Stock of the Restricted Subsidiaries;
provided that, (A) except as permitted by Section 6.10, any such Capital Stock
held by  Ultimate Parent or a Subsidiary Guarantor shall be pledged pursuant to
the Guarantee and Collateral Agreement to the extent required thereby and (B)
after the Restatement Date, the aggregate amount of investments made pursuant to
this Section 7.4(a) and Section 7.4(c) by Loan Parties in, and loans and
advances made pursuant to this Section 7.4(a) and Section 7.4(c) by Loan Parties
to, Restricted Subsidiaries that are not

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Loan Parties (determined without regard to any write­downs or write-offs of such
investments, loans and advances) shall not exceed $15,000,000 at any time
outstanding;

(b) Investments in cash and Cash Equivalents;

(c) Investments made by Ultimate Parent in any Restricted Subsidiary and made by
any Restricted Subsidiary in Ultimate Parent or any other Restricted Subsidiary;
provided that (i) any such Investments made by a Loan Party shall be pledged
pursuant to the Guarantee and Collateral Agreement to the extent required
thereby and (ii) the amount of such Investments made by Loan Parties in
Restricted Subsidiaries that are not Loan Parties shall be subject to the
limitation set forth in clause (a) above;

(d) Investments received in connection with the bankruptcy or reorganization of,
or settlement of delinquent accounts and disputes with, customers and suppliers,
in each case in the ordinary course of business; provided that, the Borrower
shall provide prompt written notice to the Administrative Agent of any such
settlement of accounts for which the face value is greater than or equal to
$1,000,000 individually (or for a group of related accounts) and for each such
settlement if the aggregate face value of such accounts is greater than or equal
to $15,000,000 in any year;

(e) Ultimate Parent and the Restricted Subsidiaries may make loans and advances
in the ordinary course of business to employees, directors and officers of the
Parent Companies, the Borrower and the Restricted Subsidiaries in an aggregate
principal amount at any time outstanding, when added to the aggregate amount of
guarantees under Section 7.1(w), not to exceed $7,000,000 (i) for reasonable and
customary business-related travel, entertainment, relocation and analogous
ordinary business purposes, (ii) in connection with such person’s purchase of
Capital Stock of  Ultimate Parent and (iii) for any other purpose;

(f) Ultimate Parent and the Restricted Subsidiaries may enter into Hedge
Agreements that are not speculative in nature and are made in the ordinary
course of business;

(g) to the extent that such assets or Capital Stock are transferred to Ultimate
Parent or a Restricted Subsidiary contemporaneously with such acquisition and
such acquisition is consensual and approved by the board of directors of such
Acquired Entity or Business, Ultimate Parent and the Restricted Subsidiaries may
acquire all or substantially all the assets of a Person or line of business of
such Person, or not less than 75% of the Capital Stock (other than directors’
qualifying shares) of a Person; provided that (i) the Acquired Entity or
Business shall be in a line of Business permitted by Section 7.8(a); (ii) at the
time of such transaction (A) after giving effect thereto, no Event of Default
shall have occurred and be continuing; (B) Ultimate Parent would be in
compliance with the Financial Condition Covenants calculated on a Pro Forma
Basis as of the most recently completed period of four consecutive fiscal
quarters ending prior to such transaction for which the financial statements and
certificates required by Section 5.1(a) or 5.1(b), as the case may be, and
5.1(c) have been delivered, as if such transaction had occurred as of the first
day of such period; (C) Ultimate Parent’s Consolidated Total Leverage Ratio does
not exceed 0.25:1.00 less than the applicable maximum Consolidated Total
Leverage Ratio set forth in Section 7.14, calculated on a Pro Forma Basis as of
the most recently completed period of four consecutive fiscal quarters ending
prior to such transaction for which the financial statements and certificates
required by Section 5.1(a) or 5.1(b), as the case may be, and 5.1(c) have been
delivered and (D) Ultimate Parent shall comply, and shall cause the Acquired
Entity or Business to comply, with the applicable provisions of Section 6.10 and
the Security Documents to the extent required thereby; and (iii) on a Pro Forma
Basis as of the most recently completed period of four consecutive fiscal
quarters ending prior to such transaction for which the financial statements and
certificates required by Section 5.1(a) or 5.1(b), as the case may be, and
5.1(c) have been delivered, as if such transaction had occurred as of the first
day of such period, the aggregate of the Acquired EBITDA of any Persons acquired
in accordance

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with this Section 7.4(g) during the term of this Agreement that are not at such
time Guarantors shall not exceed 10% of pro forma Consolidated EBITDA of
Ultimate Parent and the Restricted Subsidiaries (any acquisition of an Acquired
Entity or Business meeting all the criteria of this Section 7.4(g) being
referred to herein as a “Permitted Acquisition”);

(h) Investments set forth in Schedule 7.4;

(i) Ultimate Parent and the Restricted Subsidiaries may receive and hold
promissory notes and other non-cash consideration received in connection with
Asset Sales permitted under Section 7.5;

(j) Ultimate Parent and the Restricted Subsidiaries may make Capital
Expenditures permitted hereunder;

(k) other Investments in an aggregate amount at any time outstanding not
exceeding the amount of the Net Cash Proceeds received after the Closing Date
from any Excluded Issuance (other than the proceeds of any Excluded Issuance
made in connection with an exercise of Ultimate Parent’s Cure Right under
Section 7.16(a));

(l) [reserved];

(m) Investments made directly to the Insurance Captives in the amounts required
by the actuarial analysis or statutory requirement, copies of which are provided
to the Administrative Agent pursuant to Section 6.5;

(n) to the extent constituting Investments, transactions permitted by Sections
7.1, 7.2, 7.3, 7.5, and 7.6;

(o) Investments to the extent financed solely with the Qualified Capital Stock
of Ultimate Parent;

(p) Guarantees incurred by Ultimate Parent or any Restricted Subsidiary with
respect to operating leases or of other obligations that do not constitute
Indebtedness, in each case entered into by Ultimate Parent or any Restricted
Subsidiary in the ordinary course of business;

(q) Investments of any Person in existence at the time such Person becomes a
Restricted Subsidiary in accordance with the terms hereof; provided that such
Investment was not made in connection with or anticipation of such Person
becoming a Restricted Subsidiary and any modification, replacement, renewal or
extension thereof on terms at least as favorable on the whole to the Lenders;

(r) loans and advances to any Parent Company in lieu of, and not in excess of
the amount of (after giving effect to any other such loans or advances),
Restricted Payments to the extent permitted to be made to such Parent Company in
accordance with Section 7.6(a);

(s) so long as no Default or Event of Default shall have occurred and be
continuing or result therefrom, Investments in Healthcare Facilities guaranteed
by or otherwise subject to a mortgage, deed of trust or similar encumbrance in
favor of HUD, which Investments shall not exceed, in the aggregate, $200,000 per
such Healthcare Facility;

(t) so long as no Default or Event of Default shall have occurred and be
continuing at the time thereof or would result therefrom, Investments in joint
ventures in an amount not to exceed $25,000,000 at any time outstanding; and

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(u) other Investments in an amount not to exceed $40,000,000 at any time
outstanding, so long as (i) no Default or Event of Default shall have occurred
and be continuing at the time thereof or would result therefrom, (ii) the
outstanding principal balance of the Loans is less than $50,000,000, (iii) the
Skilled RE Credit Facility shall have been repaid such that the loan-to-value
ratio of the Skilled RE Credit Facility is less than 75% and (iv) all covenants
hereunder and in the Welltower Lease and the Omega Lease  shall have been
complied with in all material respects.

For purposes of covenant compliance with this Section, the amount of any
Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment, less any
amount paid, repaid, returned, distributed or otherwise received in cash in
respect of such Investment not to exceed the original amount of such Investment.

Notwithstanding the foregoing, the total amount of Investments in Unrestricted
Subsidiaries shall at no time exceed (i) $10,000,000 in the aggregate at any
time outstanding in connection with such Unrestricted Subsidiaries that are
Domestic Subsidiaries and (ii) $15,000,000 in the aggregate at any time
outstanding in connection with such Unrestricted Subsidiaries that are Foreign
Subsidiaries.

7.5 Mergers, Consolidations, Sales of Assets and Acquisitions.

 

(a) Consummate any merger, consolidation or amalgamation, or liquidate, wind up
or dissolve itself (or suffer any liquidation or dissolution), or Dispose of all
or substantially all of its Property or business, except that:

(i) (A) any Restricted Subsidiary may be merged, amalgamated, liquidated or
consolidated with or into and may Dispose of all or substantially all of its
assets to the Borrower (provided that, in the case of such merger, amalgamation,
liquidation or consolidation, the Borrower shall be the continuing or surviving
corporation), (B) any Restricted Subsidiary may be merged, amalgamated,
liquidated or consolidated with or into and may Dispose of all or substantially
all of its assets to any Restricted Subsidiary (other than the Borrower and
provided that if one of the parties to such merger, amalgamation, liquidation or
consolidation or Disposition is a Subsidiary Guarantor, either (x) such
Subsidiary Guarantor shall be the continuing or surviving corporation or the
recipient of such assets or (y) simultaneously with such transaction, the
continuing or surviving corporation shall become a Subsidiary Guarantor and the
Borrower shall comply with Section 6.10 in connection therewith); provided that,
neither the Borrower nor any of its Subsidiaries may be merged, amalgamated,
liquidated or consolidated with or into nor may Dispose of all or substantially
all of its assets to Ultimate Parent or any of its Subsidiaries (other than
Borrower and its Subsidiaries), (C) any Restricted Subsidiary (other than the
Borrower and its Subsidiaries) may be merged, amalgamated, liquidated or
consolidated with or into and may Dispose of all or substantially all of its
assets to the Borrower and its Restricted Subsidiaries (provided that the
Borrower or any of its Restricted Subsidiaries shall be the continuing or
surviving corporation or the recipient of such assets) or (D) Parent and
Holdings may be dissolved or merged with or into the Borrower (provided that the
Borrower shall be the continuing or surviving corporation);

(ii) any Non-Guarantor Subsidiary that is a Foreign Subsidiary may be merged or
consolidated with or into, or be liquidated into, any other Non-Guarantor
Subsidiary, and any Non-Guarantor Subsidiary that is a Domestic Subsidiary may
be merged or consolidated with or into, or be liquidated into, any other
Non-Guarantor Subsidiary that is a Domestic Subsidiary;

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(iii) any Non-Guarantor Subsidiary that is a Foreign Subsidiary may Dispose of
all or substantially all of its assets (upon voluntary liquidation, dissolution,
winding-up or otherwise) to any Loan Party or any other Non-Guarantor
Subsidiary, and any Non-Guarantor Subsidiary that is a Domestic Subsidiary may
Dispose of all or substantially all of its assets (upon voluntary liquidation
dissolution, winding-up or otherwise) to any Loan Party or any other
Non-Guarantor Subsidiary that is a Domestic Subsidiary;

(iv) any Restricted Subsidiary (other than the Borrower) may liquidate or
dissolve if (i) the Borrower determines in good faith that such liquidation or
dissolution is in the best interests of the Borrower and is not materially
disadvantageous to the Lenders and (ii) to the extent such Restricted Subsidiary
is a Loan Party, any assets or business not otherwise Disposed of or transferred
in accordance with Section 7.5(b) or, in the case of any such business,
discontinued, shall be transferred to, or otherwise owned or conducted by, a
Loan Party after giving effect to such liquidation or dissolution; and

(v) any Restricted Subsidiary may merge or consolidate in order to consummate an
Asset Sale permitted by Section 7.5(b); and

(vi) Permitted Acquisitions permitted by Section 7.4(g) may be consummated.

(b) Make any Asset Sale (other than an involuntary Asset Sale, such as casualty,
condemnation or similar events) not otherwise permitted under paragraph (a)
above (A) except for sales or other dispositions of non-core assets acquired in
a Permitted Acquisition; provided that (1) such sales shall be consummated
within 360 days of such Permitted Acquisition and (2) the consideration received
for such assets shall be in an amount at least equal to the fair market value
thereof (determined in good faith by the Borrower), (B) unless (i) such Asset
Sale is between Restricted Subsidiaries that are not Loan Parties or (ii) such
Asset Sale is from a Loan Party to a Restricted Subsidiary that is not a Loan
Party; provided that the fair market value of all assets sold, transferred,
leased, or Disposed of pursuant to this paragraph (b)(B)(ii) shall not exceed
$15,000,000 in the aggregate over the term of this Agreement, (C) unless such
Asset Sale is from a Loan Party to a Restricted Subsidiary that is a HUD
Sub-Facility Entity or a HUD RE Entity, in each case, to the extent necessary to
comply with requirements of Law related to HUD and (D) unless (i) such Asset
Sale is for consideration at least 75% of which is cash, (ii) consideration for
such Asset Sale is at least equal to the fair market value of the assets being
sold, transferred, leased or Disposed of, (iii) the fair market value of all
assets sold, transferred, leased, or Disposed of pursuant to this clause (D)
shall not exceed $130,000,000 in any fiscal year; provided that for purposes of
this clause (iii), (x) the amount of any liabilities of Ultimate Parent or any
Restricted Subsidiary that are assumed by the transferee of any such assets and
(y) involuntary Asset Sales, such as casualty, condemnation or similar events
shall be excluded, (iv) no Event of Default shall have occurred and be
continuing or result therefrom and (v) Ultimate Parent shall be in compliance
with the Financial Condition Covenants, in each case, calculated on a Pro Forma
Basis as of the most recently completed period of four consecutive fiscal
quarters ending prior to such Asset Sale for which the financial statements and
certificates required by Section 5.1(a) or 5.1(b), as the case may be, and
5.1(c) have been delivered, as if such Asset Sale had occurred as of the first
day of such period and (E) the Disposition of real property securing any Real
Property Financing Obligations and the related transfer of operations and/or
management of such related Facilities; provided that the Net Cash Proceeds of
any such Dispositions of real property securing the Skilled RE Credit Agreement
and/or the Revera Credit Agreement are applied first, to repay the indebtedness
and other obligations under the Skilled RE Credit Agreement, the Revera Credit
Agreement and/or any restructured real estate loan that replaces or

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refinances the Skilled RE Credit Agreement and/or the Revera Credit Agreement
until paid in full, and second, as otherwise required by Section 2.8(c).

7.6 Restricted Payments; Restrictive Agreements.     Declare or make, any
Restricted Payment; provided that (i) (A) the Restricted Subsidiaries that are
not Loan Parties may declare and pay dividends or make other distributions
ratably to their equity holders, (B) the Borrower may declare and pay dividends
or make other distributions to Ultimate Parent and its Subsidiaries that are
managing members of the Borrower (it being understood and agreed that this
clause (i)(B) shall not permit any Restricted Payments to be made by the
Borrower to any Person other than Ultimate Parent and its Subsidiaries that are
managing members of the Borrower) and (c) any Subsidiary may make a Restricted
Payment to a Loan Party; (ii) the Borrower and the Restricted Subsidiaries may
acquire shares of Ultimate Parent delivered or to be delivered to a director,
officer or employee of the Parent Companies, the Borrower or a Restricted
Subsidiary in connection with the grant, vesting, exercise or payment of a stock
option, warrant or other equity or equity-based award granted by the Parent
Companies, the Borrower or a Restricted Subsidiary, and the Loan Parties may
make distributions in order to satisfy the exercise or purchase price of the
award and/or any Tax withholding obligations arising in connection with such
event, provided that any Restricted Payment made under this clause (ii) shall be
non-cash; (iii) the repurchase or redemption of Capital Stock of Ultimate Parent
and the Borrower owned by former or current management, directors, officers or
employees (or their transferees, estates or beneficiaries under their estates)
of any Parent Company, the Borrower or any of the Restricted Subsidiaries or to
make payments (including on promissory notes issued to pay the purchase price)
with respect to such repurchases or redemptions upon death, disability,
retirement, severance or termination of employment or service or pursuant to any
employee, management or director equity plan, employee, management or director
stock option plan or any other employee, management or director benefit plan or
any agreement (including any stock subscription or shareholder agreement) or
similar equity incentives or equity-based incentives in an aggregate amount not
to exceed $4,000,000 in any fiscal year; (iv) payments of customary fees to
members of its or any Parent Company’s board of directors and in respect of
insurance coverage or for indemnification obligations under any law, indenture,
contract or agreement to any director or officer of any Parent Company or any of
its Restricted Subsidiaries shall be permitted; (v) [reserved]; (vi) [reserved];
(vii) [reserved]; (viii) any Parent Company may make payments in cash, in lieu
of the issuance of fractional shares, upon the exercise of warrants or upon the
conversion or exchange of Capital Stock of Ultimate Parent and the Borrower;
(ix) [reserved]; and (x) the Borrower may pay cash distributions in respect of
taxes owing by the Borrower’s direct or indirect investors in respect of GHLLC
and the Restricted Subsidiaries (“Tax Distributions”); provided that no payments
or distributions in cash may be made (i) in the case of an Event of Default
having occurred and being continuing under Section 8(b) or (c) or (ii) in the
case of an Event of Default having occurred and being continuing under Section
8(d) with respect to the covenants contained in Section 7.13, Section 7.14 or
Section 7.15 for two consecutive fiscal quarters.

 

(a) Enter into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (i) the ability of Ultimate
Parent or any Restricted Subsidiary to create, incur or permit to exist any Lien
upon any of its property or assets to secure the Obligations, or (ii) the
ability of any Subsidiary to pay dividends or other distributions with respect
to any of its Capital Stock or to make or repay loans or advances to Ultimate
Parent or any Restricted Subsidiary or to guarantee Indebtedness of Ultimate
Parent or any Restricted Subsidiary; provided that (A) the foregoing shall not
apply to restrictions and conditions imposed by law or regulations or by any
Loan Document, the ABL Loan Documents, the Skilled RE Loan Documents, the Revera
Loan Documents, the MidCap RE Loan Documents, any Material Master Lease entered
into prior to the Closing Date, or such other Indebtedness as is set forth on
Schedule 7.1, (B) the foregoing shall not apply to customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary or any
other permitted asset sale pending such sale; provided such restrictions and
conditions apply only to the Subsidiary or other asset that is to be sold and
such sale is permitted hereunder, (C) the foregoing

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shall not apply to restrictions and conditions imposed on any Foreign Subsidiary
by the terms of any Indebtedness of such Foreign Subsidiary permitted to be
incurred hereunder, (D) clause (i) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement creating Liens permitted by
Section 7.2 prohibiting further Liens on the properties encumbered thereby, (E)
clause (i) of the foregoing shall not apply to (x) customary provisions in
Leases and other contracts restricting the subletting or assignment thereof or
(y) any Material Master Leases entered into after the Closing Date;  provided,
 however, in each case, such restrictions shall not be more adverse to the
Lenders and the Borrower than the equivalent restrictions set forth in these
Material Master Leases existing as of the Restatement Date, as modified by the
Material Master Lease Intercreditor Agreements, (F) the foregoing shall not
apply to customary provisions in joint venture agreements, partnership
agreements, limited liability organizational governance documents, asset sale
agreements, sale and leaseback agreements and other similar agreements, (G) the
foregoing shall not apply to restrictions and conditions in any other agreement
that does not restrict in any manner (directly or indirectly) Liens created
pursuant to the Loan Documents on any Collateral securing the Obligations and
does not require the direct or indirect granting of any Lien securing any
Indebtedness or other obligation by virtue of the granting of Liens on or pledge
of property of any Loan Party to secure the Obligations, (H) the foregoing shall
not apply to restrictions and conditions in any Indebtedness permitted pursuant
to Section 7.1 to the extent such restrictions or conditions are no more
restrictive than the restrictions and conditions in the Loan Documents, (I) the
foregoing shall not apply to customary provisions restricting assignment of any
agreement entered into by Ultimate Parent or any Restricted Subsidiary in the
ordinary course of business, (J) the foregoing shall not apply to any agreement
assumed in connection with any Permitted Acquisition, which encumbrance or
restriction is not applicable to any person, or the properties or assets of any
person, other than the person or the properties or assets of the person so
acquired and (K) the foregoing shall not apply to restrictions and conditions
that (x) exist in any agreement in effect at the time any Restricted Subsidiary
becomes a Subsidiary of Ultimate Parent in each case, so long as such agreement
was not entered into in contemplation of such person becoming a Subsidiary, (y)
is imposed by any amendments or refinancings that are otherwise permitted by the
Loan Documents of the contracts, instruments or obligations referred to above;
provided that such amendments and refinancings are no more materially
restrictive with respect to such prohibitions and limitations than those prior
to such amendment or refinancing and such restrictions are limited solely to
such Restricted Subsidiary.

7.7 Transactions with Affiliates.  Except for transactions between or among
Ultimate Parent and the Restricted Subsidiaries, sell or transfer any property
or assets to, or purchase or acquire any property or assets from, or otherwise
engage in any other transactions with, any of its Affiliates, except that
Ultimate Parent or any of the Restricted Subsidiaries may engage in any of the
foregoing transactions on terms and conditions not less favorable to Ultimate
Parent or such Restricted Subsidiary than could be obtained on an arm’s-length
basis from unrelated third parties; provided that with respect to any such
transaction or series of transactions involving aggregate consideration in
excess of $25,000,000, a majority of the board of directors of Ultimate Parent
in each case, shall have determined in good faith that the criteria set forth
above are satisfied and have approved the relevant transaction as evidenced by a
resolution of the board of directors of Ultimate Parent; provided,  further, the
following transactions shall be permitted;

 

(a) Investments permitted under Section 7.4(e),  (p) and (q);

(b) employment and severance arrangements between the Parent Companies, the
Borrower or any of the Restricted Subsidiaries and their respective officers and
employees in the ordinary course of business and transactions pursuant to stock
option plans and employee benefit plans and arrangements;

(c) the payment of customary fees and reasonable out-of-pocket costs to, and
indemnities provided on behalf of, directors, officers, employees and
consultants of the Parent

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Companies, the Borrower and the Restricted Subsidiaries in the ordinary course
of business to the extent attributable to the ownership or operation of Ultimate
Parent and the Restricted Subsidiaries;

(d) any agreement, instrument or arrangement as in effect as of the Restatement
Date and set forth on Schedule 7.7, or any amendment thereto (so long as any
such amendment is not materially disadvantageous to the Lenders when taken as a
whole as compared to the applicable agreement as in effect on the Restatement
Date as reasonably determined in good faith by the Borrower);

(e) Restricted Payments permitted under Section 7.6;

(f) the issuance or transfer of Capital Stock of Ultimate Parent to any
Permitted Investor or to any former, current or future director, manager,
officer, employee or consultant (or any Controlled Investment Affiliate or
immediate family member of any of the foregoing) of the Borrower, any of its
Subsidiaries or any direct or indirect parent thereof;

(g) entry into a tax sharing agreement with any Parent Company providing for (in
each case subject to compliance with Section 7.6) the payment of Taxes
(including interest and penalties) and expenses, control of tax filings and
contests, and other normal, usual and customary provisions, but only to the
extent such taxes are attributable to the income or business of Ultimate Parent
and its Subsidiaries; and

(h) transactions entered into in the ordinary course of business that are
consistent with past practices.

7.8 Business of the Borrower and the Restricted Subsidiaries.      Engage at any
time in any Business or Business activity other than the Business currently
conducted by it and, in the good faith judgment of Ultimate Parent, Business
activities reasonably incidental, complementary or related thereto.

 

(a) Amend, modify or otherwise change, or consent or agree to any amendment,
modification, waiver or other change to any organizational documents of any Loan
Party in any manner that is materially adverse to the Lenders, without the prior
consent of the Administrative Agent (with approval of the Required Lenders).

(b) Sell, lease, transfer or otherwise convey, in one or a series of related
transactions, all or substantially all of the assets of Ultimate Parent and the
Restricted Subsidiaries, taken as a whole.

7.9 Other Indebtedness and Agreements.  (i) Permit any waiver, supplement,
modification, amendment, termination or release of any indenture, instrument or
agreement pursuant to which any Subordinated Indebtedness or unsecured Material
Indebtedness (for the avoidance of doubt, excluding Real Property Financing
Obligations) of Ultimate Parent or any Restricted Subsidiary is outstanding if
the effect of such waiver, supplement, modification, amendment, termination or
release would materially increase the obligations of the obligor or confer
additional material rights on the holder of such Indebtedness in a manner
materially adverse to Ultimate Parent, such Restricted Subsidiary or the
Lenders; provided, that this clause (i) shall not prohibit or restrict a
Permitted Refinancing of any such Subordinated Indebtedness or unsecured
Material Indebtedness, or (ii) permit any waiver, supplement, modification,
amendment, termination or release of any Material Master Lease, any Material
Master Lease Intercreditor Agreement or any Lease Amendment Agreement in any
manner that is materially adverse to the Lenders without the prior written
consent of Administrative Agent, which shall not be unreasonably withheld.

 

(b)Make any distribution, whether in cash, property, securities or a combination
thereof, in respect of, or pay, or commit to pay, or directly or indirectly
redeem, repurchase, retire or otherwise acquire for consideration, other than
regular scheduled payments of principal and interest as and

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when due (to the extent not prohibited by applicable subordination provisions),
or set apart any sum for the aforesaid purposes, any Subordinated Indebtedness
or unsecured Material Indebtedness  (excluding Real Property Financing
Obligations for the avoidance of doubt) (other than (i) the Loans, (ii) with
proceeds of any Excluded Issuance made after the Closing Date (other than (x)
proceeds of any Excluded Issuance made in connection with an exercise of
Ultimate Parent’s Cure Right under Section 7.16(a) and (y) the amount of such
Net Cash Proceeds applied as a mandatory prepayment pursuant to Section 2.8(b)),
(iii) the conversion or exchange into Capital Stock of any Parent Company and
(iv) pursuant to the terms of Indebtedness convertible or exchangeable into, or
by reference to, Capital Stock of Ultimate Parent).

7.10 [Reserved].

7.11 Account Changes; Fiscal Year.  Change its fiscal year or its method for
determining fiscal quarters or fiscal months.

 

7.12 Capital Expenditures. Permit the aggregate amount of Capital Expenditures
made by Ultimate Parent and its Restricted Subsidiaries on a consolidated basis,
in any period set forth below, to exceed the amount set forth below for such
period; provided, that such amount for any fiscal year shall be increased by, to
the extent that a Permitted Acquisition is consummated during or prior to such
fiscal year (but after the Closing Date), an amount equal to $1,000 per licensed
bed of such Acquired Entity or Business (the “Acquired Permitted CapEx Amount”)
(provided, that with respect to the fiscal year during which any such Permitted
Acquisition occurs, the amount of additional Capital Expenditures permitted as a
result of this proviso shall be an amount equal to the product of (x) the
Acquired Permitted CapEx Amount and (y) a fraction, the numerator of which is
the number of days remaining in such fiscal year after the date such Permitted
Acquisition is consummated and the denominator of which is the actual number of
days in such fiscal year):

 

Period

Amount

January 1, 2015 through December 31, 2015

$94,000,000

January 1, 2016 through December 31, 2016

$96,000,000

January 1, 2017 through Scheduled Revolving Credit Termination Date

$98,000,000

 

 

The amount of permitted Capital Expenditures set forth above in respect of any
fiscal year commencing with the fiscal year ending on December 31, 2013, shall
be increased by an amount equal to 50% of the unused permitted Capital
Expenditures for the immediately preceding fiscal year (including the portion
thereof (if any) of the unused permitted Capital Expenditures carried forward to
such preceding fiscal year pursuant to this sentence).

 

7.13 Minimum Fixed Charge Coverage Ratio.  Permit the Fixed Charge Coverage
Ratio as of the last day of each fiscal quarter ending during a period set forth
below to be less than the ratio set forth opposite such period below: 

 

Period

Ratio

January 1, 2015 through March 31, 2015

2.00 to 1.00

April 1, 2015 through June 30, 2015

2.00 to 1.00

July 1, 2015 through September 30, 2015

2.00 to 1.00

October 1, 2015 through March 31, 2016

2.25 to 1.00

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Period

Ratio

April 1, 2016 through December 31, 2016

1.25 to 1.00

January 1, 2017 through December 31, 2017

1.10 to 1.00

January 1, 2018 through June 30, 2018

1.00 to 1.00

July 1, 2018 through December 31, 2018

1.05 to 1.00

January 1, 2019 through December 31, 2019

1.10 to 1.00

January 1, 2020 and thereafter

1.15 to 1.00

 

7.14 Maximum Leverage Ratio.  Permit the Consolidated Total Leverage Ratio as of
the last day of each fiscal quarter ending during a period set forth below to be
greater than the ratio set forth opposite such period below:

 

Period

Ratio

January 1, 2015 through March 31, 2015

4.50 to 1.00

April 1, 2015 through June 30, 2015

4.50 to 1.00

July 1, 2015 through March 31, 2016

4.25 to 1.00

April 1, 2016 through May 5, 2017

6.00 to 1.00

May 5, 2017 through December 31, 2017

7.25 to 1.00

January 1, 2018 through December 31, 2018

9.00 to 1.00

January 1, 2019 through December 31, 2019

8.75 to 1.00

January 1, 2020 and thereafter

8.50 to 1.00

 

7.15 Minimum Interest Coverage Ratio.  Permit the Interest Coverage Ratio as of
the last day of each fiscal quarter ending during a period set forth below to be
less than the ratio set forth opposite such period below: 

 

Period

Amount

January 1, 2015 through March 31, 2015

3.25:1.00

April 1, 2015 through June 30, 2015

3.25:1.00

July 1, 2015 through March 31, 2016

3.50:1.00

April 1, 2016 through December 31, 2016

2.00:1.00

January 1, 2017 through December 31, 2017

1.80:1.00

January 1, 2018 through December 31, 2018

1.70:1.00

January 1, 2019 through December 31, 2019

1.75:1.00

Thereafter

1.80:1.00

 

7.16 Certain Cure Rights.

 

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(a) Notwithstanding anything to the contrary contained herein, in the event
Ultimate Parent fails to comply with the requirements of either covenant as set
forth in Section 7.13, Section 7.14 or Section 7.15 (each, a “Financial Cure
Covenant”) as at the last day of any fiscal quarter (a fiscal quarter ending on
such day, a “Curable Period”), after the Closing Date until the expiration of
the 10th day subsequent to the date the certificate calculating the Financial
Cure Covenants is required to be delivered pursuant to Section 5.1(c) with
respect to the period ending on the last day of such fiscal quarter, Ultimate
Parent shall have the right (the “Cure Right”) to include any cash equity
contribution made to Ultimate Parent or LLC Parent after the beginning of such
fiscal quarter and prior to the end of the Curable Period in the calculation of
Consolidated EBITDA, with respect to Sections 7.13,  7.14 and 7.15, and
unrestricted cash and Cash Equivalents, with respect to Section 7.15 (the “Cure
Amount”).  Upon the receipt by Ultimate Parent or LLC Parent of cash equity
(other than Disqualified Capital Stock) in an amount equal to the Cure Amount
pursuant to the exercise of such Cure Right, the Financial Cure Covenants shall
be recalculated giving effect to the following pro forma adjustments:

(i) Consolidated EBITDA, unrestricted cash or Cash Equivalents, as applicable,
for the Curable Period shall be increased, solely for the purpose of measuring
the Financial Cure Covenants for such fiscal quarter and for applicable
subsequent periods which include such fiscal quarter, and disregarded for any
other purpose under this Agreement (including determining the availability of
any baskets and step-downs), by an amount equal to the Cure Amount; and

(ii) if, after giving effect to the foregoing recalculations, Ultimate Parent
shall then be in compliance with the requirements of the Financial Cure
Covenants, Ultimate Parent shall be deemed to have satisfied the requirements of
the Financial Cure Covenants as of the relevant date of determination with the
same effect as though there had been no failure to comply therewith at such
date, and the applicable breach or default of the Financial Cure Covenants which
had occurred shall be deemed cured for all purposes of this Agreement.

(b) Limitations on Exercise of Cure Right, etc.  Notwithstanding anything herein
to the contrary, (A) in no event shall Ultimate Parent be entitled to exercise
the Cure Right more than twice in any consecutive four quarter period or more
than three times during the term of this Agreement; (B) the Cure Amount shall be
no greater than the amount which, if added to Consolidated EBITDA, unrestricted
cash or Cash Equivalents, as applicable, for the Curable Period, would cause
Ultimate Parent to be in compliance with the Financial Cure Covenants for the
relevant determination period ending on the last day of such Curable Period (it
being understood and agreed that for purposes of calculating such amount no
effect shall be given to any pricing, financial ratio-based conditions or any
baskets with respect to covenants under this Agreement on account of receipt of
such proceeds) and (C) such proceeds shall not result in any reduction of
Indebtedness for purposes of calculating compliance with any of the financial
covenants for such fiscal quarter and for applicable subsequent periods which
include such fiscal quarter.  Upon the Administrative Agent’s receipt of an
irrevocable notice from the Borrower that Ultimate Parent intends to exercise
the Cure Right with respect to the Financial Cure Covenants as of the last day
of any fiscal quarter (the “Notice of Intent to Cure”), then, until the 10th day
subsequent to the date the certificate calculating such Financial Cure Covenants
is required to be delivered pursuant to Section 5.1(c) to which such Notice of
Intent to Cure relates, neither the Administrative Agent nor any Lender shall
exercise the right to accelerate the Loans or terminate the Commitments and
neither the Administrative Agent nor any Lender shall exercise any right to
foreclose on or take possession of the Collateral solely on the basis of an
Event of Default having occurred and being continuing under Section 7.13,
 Section 7.14 or Section 7.15, as applicable, in respect of the period ending on
the last day of such fiscal quarter.

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SECTION 8. EVENTS OF DEFAULT

In case of the happening of any of the following events (“Events of Default”):

(a) any representation or warranty made or deemed made in or in connection with
any Loan Document hereunder, or any representation, warranty, statement or
information contained in any report, certificate, financial statement or other
instrument furnished in connection with or pursuant to any Loan Document, shall
prove to have been incorrect, false or misleading in any material respect when
so made, deemed made or furnished;

(b) default shall be made in the payment of any principal of any Loan when and
as the same shall become due and payable, whether at the due date thereof or at
a date fixed for prepayment thereof or by acceleration thereof or otherwise;

(c) default shall be made in the payment of any interest on any Loan or any fee
or any other amount (other than an amount referred to in (b) above) due under
any Loan Document, when and as the same shall become due and payable, and such
default shall continue unremedied for a period of 3 Business Days;

(d) default shall be made in the due observance or performance by any Loan Party
of any covenant, condition or agreement contained in  Section 5.1, Section
5.2(a)(i), Section 6.1 (solely with respect to the Borrower), Section 6.9,
Section 6.14 or in Section 7; 

(e) default shall be made in the due observance or performance by any Loan Party
of any covenant, condition or agreement contained in any Loan Document (other
than those specified in (b), (c) or (d) above or (o) below) and such default
shall continue unremedied for a period of 30 days after the earlier of (i) the
date on which a Responsible Officer of any Loan Party becomes aware of such
failure and (ii) the date on which notice thereof shall have been given to the
Borrower from the Administrative Agent or the Required Lenders;

(f) (i) the Parent Companies, the Borrower or any of the Restricted Subsidiaries
shall fail to pay any principal or interest, regardless of amount, due beyond
any grace period in respect of any Material Indebtedness, when and as the same
shall become due and payable, (ii) an “Event of Default” (as such term is
defined in the ABL Credit Agreement) has occurred under the ABL Credit
Agreement, (iii) an “Event of Default” (as such term is defined in the
applicable Skilled RE Credit Agreement) has occurred under any Skilled RE Credit
Agreement or (iv) any other event or condition occurs that results in any
Material Indebtedness becoming due prior to its scheduled maturity or that
enables or permits (with or without the giving of notice, the lapse of time or
both) the holder or holders of any Material Indebtedness or any trustee or agent
on its or their behalf to cause any Material Indebtedness to become due, or to
require the prepayment, repurchase, redemption or defeasance thereof, prior to
its scheduled maturity; provided that this clause (iv) shall not apply to
secured Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness if such sale or
transfer is permitted hereunder and under the documents providing for such
Indebtedness;

(g) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed in a court of competent jurisdiction seeking (i) relief in
respect of the Parent Companies, the Borrower, or any of the Material Restricted
Subsidiaries, or of a substantial part of the property or assets of the Parent
Companies, the Borrower, or any of the Material Restricted Subsidiaries, under
Title 11 of the Bankruptcy Code, as now constituted or hereafter amended, or any
other federal, state or foreign bankruptcy, insolvency, receivership or similar
law, (ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Parent Companies, the Borrower, or any
of the Material Restricted Subsidiaries or for a substantial part of the
property or assets of the Parent Companies,

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the Borrower, or any of the Material Restricted Subsidiaries or (iii) the
winding-up or liquidation of the Parent Companies, the Borrower, or any of the
Material Restricted Subsidiaries, and in the case of clauses (i), (ii) and
(iii), such proceeding or petition shall continue undismissed or unstayed for 60
days or an order or decree approving or ordering any of the foregoing shall be
entered;

(h) the Parent Companies, the Borrower, or any of the Material Restricted
Subsidiaries shall (i) voluntarily commence any proceeding or file any petition
seeking relief under Title 11 of the Bankruptcy Code, as now constituted or
hereafter amended, or any other federal, state or foreign bankruptcy,
insolvency, receivership or similar law, (ii) consent to the institution of, or
fail to contest in a timely and appropriate manner, any proceeding or the filing
of any petition described in (g) above, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Parent Companies, the Borrower, or any of the Material
Restricted Subsidiaries or for a substantial part of the property or assets of
the Parent Companies, the Borrower, or any of the Material Restricted
Subsidiaries, (iv) file an answer admitting the material allegations of a
petition filed against it in any such proceeding, (v) make a general assignment
for the benefit of creditors, (vi) become unable, admit in writing its inability
or fail generally to pay its debts as they become due or (vii) take any action
for the purpose of effecting any of the foregoing;

(i) one or more judgments, orders or decrees shall be rendered against the
Parent Companies, the Borrower, or any of the Material Restricted Subsidiaries,
or any combination thereof and the same shall remain undischarged for a period
of 60 consecutive days during which execution shall not be effectively vacated,
discharged, bonded or stayed, or any writ or warrant of attachment or similar
process shall be entered or filed upon assets or properties of the Parent
Companies, the Borrower, or any of the Material Restricted Subsidiaries to
enforce any such judgment, order or decree and such judgment, order or decree is
for the payment of money in an aggregate amount in excess of $30,000,000 (net of
any amounts covered by applicable insurance or self-insurance);

(j) an ERISA Event shall have occurred that when taken together with all other
such ERISA Events, could reasonably be expected to result in a  liability of the
Parent Companies, the Borrower or any of the Restricted Subsidiaries in an
aggregate amount exceeding $30,000,000;

(k) except pursuant to a valid, binding and enforceable termination or release
permitted under the Loan Documents and executed by the Administrative Agent or
as otherwise expressly permitted under any Loan Document, (i) other than solely
as the result of an action or failure to act on the part of Administrative
Agent, any material provision of any Loan Document shall, at any time after the
delivery of such Loan Document, fail to be valid and binding on, or enforceable
against, any Loan Party that is a party thereto, (ii) other than solely as the
result of an action or failure to act on the part of Administrative Agent, any
Loan Document purporting to grant a Lien to secure any Obligation shall, at any
time after the delivery of such Loan Document, fail to create a valid and
enforceable Lien on any material portion of the Collateral purported to be
covered thereby or such Lien shall fail or cease to be a perfected Lien with the
priority required in the relevant Loan Document, or (iii) any Loan Party shall
state in writing that any of the events described in clause (i) or (ii) above
shall have occurred;

(l) there shall have occurred a Change of Control;

(m) the formal written revocation or termination by any Governmental Authority
of any Primary License related to Healthcare Facilities to the extent any such
revocations or terminations, in the aggregate, could reasonably be expected to
result in a Material Adverse Effect;  

(n) there shall have occurred any event of default under any Material Master
Lease; or

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(o) default shall be made in the due observance or performance by any Loan Party
of the covenant set forth in Section 6.16 and at such time an Omnibus Event of
Default (as defined in the Omnibus Amendment) has occurred and is continuing.

then, and in every such event (other than an event with respect to the Borrower
described in paragraph (g) or (h) above), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, by notice to the Borrower, take either or both of
the following actions, at the same or different times: (i) terminate forthwith
the Commitments and (ii) declare the Loans then outstanding to be forthwith due
and payable in whole or in part, whereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and any
unpaid accrued fees and all other liabilities of the Borrower accrued hereunder
and under any other Loan Document, shall become forthwith due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived by the Borrower, anything contained herein or
in any other Loan Document to the contrary notwithstanding; and in any event
with respect to the Borrower described in paragraph (g) or (h) above, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and any unpaid accrued fees
and all other liabilities of the Borrower accrued hereunder and under any other
Loan Document, shall automatically become due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by the Borrower, anything contained herein or in any other Loan
Document to the contrary notwithstanding.

SECTION 9. THE AGENTS

9.1 Appointment.  Each Lender hereby irrevocably appoints Welltower Inc. 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.  Welltower Inc. hereby accepts such
appointment.  Each Lender and each Loan Party hereby agrees that at the time
that Welltower Lender has been repaid pursuant to Section 2.14(i) such that the
remaining outstanding balance of the portion of the Loans held by Welltower
Lender is less than 50% of the remaining outstanding balance of the portion of
the Loans held by Omega Lender, Omega Lender shall automatically and without any
further action of the parties replace Welltower Inc. as Administrative Agent
hereunder; provided, that Omega Lender may at such time designate an Affiliate
of Omega Lender to serve as Administrative Agent.  From time to time each of the
Administrative Agent and the Lenders shall execute and deliver, or cause to be
executed and delivered, such additional instruments, certificates or documents,
and take all such actions, as the Administrative Agent and the Lenders shall
reasonably request in furtherance of any change in the Administrative Agent
under the immediately prior sentence of this Section 8.1.  The provisions of
this Article are solely for the benefit of the Agents and the Lenders, 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 any
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 independent contracting parties.

 

9.2 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
Article 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

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connection with the syndication of the Facility as well as activities as the
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 non-appealable judgment that
the Administrative Agent acted with gross negligence or willful misconduct in
the selection of such sub‑agents.

 

9.3 Exculpatory Provisions.   No Agent shall 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, no Agent shall: (i) be subject to any fiduciary or
other implied duties, regardless of whether a Default has occurred and is
continuing; (ii) have any duty to take any discretionary action or exercise any
discretionary powers, except (in the case of the Administrative Agent)
discretionary rights and powers expressly contemplated hereby or by the other
Loan Documents that the Administrative Agent is required to 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; and (iii) except as
expressly set forth herein and in the other Loan Documents, have any duty 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 such Agent or any of its Affiliates in any capacity.

 

(a) The Administrative Agent shall not be liable for any action taken or not
taken by it (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 Section 8 and Section 10.1), or (ii) in the absence
of its own gross negligence or willful misconduct as determined by a court of
competent jurisdiction by final and non-appealable judgment.  The Administrative
Agent shall not be deemed to have knowledge or notice of the occurrence of any
Default unless and until the Administrative Agent shall have received written
notice from a Lender or the Borrower referring to this Agreement, describing
such Default and stating that such notice is a “notice of default.”

(b) No Agent-Related Person shall be responsible for or have any duty 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 4 or elsewhere herein, other than (in the
case of the Administrative Agent) to confirm receipt of items expressly required
to be delivered to it

9.4 Reliance by the Agents.  Each Agent shall be entitled to rely upon, and
shall not incur any liability for relying upon, any notice, request,
certificate, 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.  Each 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 not incur any liability for relying thereon.  In
determining compliance with any condition hereunder to any borrowing that by its
terms shall be fulfilled to the satisfaction of a Lender, the Administrative
Agent may presume that such condition is satisfactory to such Lender unless the
Administrative Agent shall have received notice to the contrary from such Lender
prior

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to any such borrowing.  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.

 

9.5 Non-Reliance on Agents and Other Lenders.  Each Lender expressly
acknowledges that neither the Agents nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates have made any representations
or warranties to it and that no act by the Agents taken on and after the Closing
Date, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender.  Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement.  Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under the applicable Loan Documents, and to make such investigation as it deems
necessary to inform itself as to the business, operations, property, financial
and other condition and creditworthiness of the Loan Parties and their
affiliates.  Except for notices, reports and other documents expressly required
to be furnished to the Lenders by the Agents hereunder, the Agents shall not
have any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of any Loan Party or any affiliate
of a Loan Party that may come into the possession of either Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates.

 

9.6 Indemnification.  Whether or not the transactions contemplated hereby are
consummated, each Lender shall indemnify upon demand each Agent-Related Person
(to the extent not reimbursed by or on behalf of the Borrower and without
limiting the obligations of any Loan Party to do so) on a pro rata basis
(determined as of the time that the applicable payment is sought based on each
Lender’s ratable share at such time) and hold harmless each Agent-Related Person
against any and all Indemnified Liabilities incurred by it; provided that no
Lender shall be liable for payment to any Agent-Related Person of any portion of
such Indemnified Liabilities to the extent determined in a final, non-appealable
judgment of a court of competent jurisdiction to have resulted from such
Agent-Related Person’s own gross negligence or willful misconduct (and no action
taken in accordance with the directions of the Required Lender shall be deemed
to constitute gross negligence or willful misconduct for purposes of this
Section).  In the case of any investigation, litigation or proceeding giving
rise to any Indemnified Liabilities, this Section applies whether any such
investigation, litigation or proceeding is brought by any Lender or any other
Person.  Without limitation of the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including the fees, disbursements and other charges of
counsel) incurred by the Administrative Agent in connection with preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights and responsibilities under, this Agreement, any
other Loan Document, or any document contemplated by or referred to herein, to
the extent that the Administrative Agent is not reimbursed for such costs or
expenses by or on behalf of the Borrower.

 

To the extent required by any applicable Law, the Administrative Agent may
withhold from any payment to any Lender an amount equivalent to any U.S. federal
income Tax.  If the IRS or any other Governmental Authority asserts a claim that
the Administrative Agent did not properly withhold U.S. federal income Tax from
amounts paid to or for the account of any Lender because the appropriate form
was not delivered or was not properly executed or because such Lender failed to
notify the Administrative Agent of a change in circumstance which rendered the
exemption from, or reduction of, U.S. federal income

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Tax ineffective or for any other reason, or if the Administrative Agent
reasonably determines that a payment was made to a Lender pursuant to this
Agreement without deduction of applicable withholding tax from such payment,
such Lender shall indemnify the Administrative Agent fully for all amounts paid,
directly or indirectly, by the Administrative Agent as Tax or otherwise,
including any penalties or interest and together with all reasonable costs and
out-of-pocket expenses (including reasonable fees and expenses of counsel)
incurred in connection therewith.

9.7 Agent in Its Individual Capacity.  Any Agent 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 an Agent hereunder, and the term “Lender” or “Lenders”
shall, unless otherwise expressly indicated or unless the context otherwise
requires, include the Person serving as such 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, Ultimate Parent
or any Subsidiary or other Affiliate thereof as if such Person were not an Agent
hereunder and without any duty to account therefor to the Lenders.

 

9.8 Successor Agents.  The Administrative Agent may resign as Administrative
Agent upon 30 days’ notice to the Lenders and the Borrower.  Upon receipt of any
such notice of resignation, the Required Lenders shall appoint from among the
Lenders a successor agent (which may be an Affiliate of a Lender), with the
consent of the Borrower at all times other than during the existence of an Event
of Default under Sections 8.1(b), (c), (g) or (h) (which consent shall not be
unreasonably withheld or delayed).  If no such successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment prior
to the effective date of the resignation of the Administrative Agent, then the
Administrative Agent may (but shall not be obligated to), on behalf of the
Lenders, 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 such effective date,
where (i) the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder and under the other Loan Documents (except that in the
case of any collateral security held by the Administrative Agent on behalf of
the Lenders under any of the Loan Documents, the retiring Administrative Agent
may (but shall not be obligated to) continue to hold such collateral security
until such time as a successor Administrative Agent is appointed) and (ii) 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
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 Administrative Agent, and the retiring 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 Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this Section and Section 9.3 shall continue in
effect for the benefit of such retiring 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 Administrative Agent was acting as
Administrative Agent.

 

9.9 Authorization to Release Liens and Guarantees.  The Agents are hereby
irrevocably authorized by each of the Lenders to effect any release or
subordination of Liens or Guarantee Obligations contemplated by Section 10.15
without further action or consent by the Lenders.  The Agents are hereby
irrevocably authorized by each of the Lenders to (and to execute any documents
or instruments necessary to) enter into any intercreditor agreement contemplated
by the terms hereof (including, without limitation, the Intercreditor Agreement
and the Material Master Lease Intercreditor Agreements) (and in the case of any
such intercreditor agreement entered into prior to the Closing Date, the Lenders
hereby ratify and

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confirm such authority), and the parties hereto acknowledge that such
intercreditor agreements are binding upon them.  Each Lender (a) hereby agrees
that it will be bound by and will take no actions contrary to the provisions of
any such intercreditor agreement, (b) hereby authorizes and instructs the Agents
to enter into any such intercreditor agreement and to subject the Liens on the
Collateral securing the Obligations to the provisions thereof and (c) without
any further consent of the Lenders, hereby authorizes and instructs the Agents
to negotiate, execute and deliver on behalf of the Secured Parties any
intercreditor agreement or any amendment to (or amendment and restatement of)
the Security Documents. In addition, each Lender hereby authorizes the Agents to
enter into (i) any amendments to any intercreditor agreement, and (ii) any other
intercreditor arrangement, in the case of clauses (i) and (ii), to the extent
required to give effect to the establishment of intercreditor rights and
privileges as contemplated and required or permitted pursuant to this Agreement.
Each Lender waives any conflict of interest, contemplated as of the Closing Date
or arising thereafter, in connection therewith and agrees not to assert against
any Agent or any of its affiliates any claims, causes of action, damages or
liabilities of whatever kind or nature relating thereto.

 

9.10 Administrative Agent May 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 Loan 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 (but
not obligated) 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 Loans 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 the Lenders, and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders, and the Administrative Agent and
their respective agents and counsel and all other amounts due to the Lenders,
and the Administrative Agent under Sections 2.6 and 10.5(a)) allowed in such
judicial proceeding; and

(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 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, 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 2.6 and 10.5(a).

SECTION 10. MISCELLANEOUS

10.1 Amendments and Waivers.

 

(a) Neither this Agreement, any other Loan Document, nor any terms hereof or
thereof may be amended, supplemented or modified except in accordance with the
provisions of this Section.  The Required Lenders and each Loan Party to the
relevant Loan Document may, or, with the written consent of the Required
Lenders, the Administrative Agent and each Loan Party to the relevant Loan
Document may, from time to time, (a) enter into written amendments, supplements
or modifications hereto and to the other Loan Documents for the purpose of
adding or deleting any provisions to this Agreement or the other Loan Documents
or otherwise changing in any manner the rights or obligations of the Agents, the
Lenders or of the Loan Parties hereunder or thereunder or (b) waive, on such
terms and

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conditions as the Required Lenders or the Administrative Agent may specify in
such instrument, any of the requirements of this Agreement or the other Loan
Documents or any Default or Event of Default and its consequences; provided,
 however, that no such waiver and no such amendment, supplement or modification
shall (i) forgive or reduce the principal amount or extend the final scheduled
date of maturity of any Loan, extend the scheduled date or reduce the amount of
any amortization payment in respect of any Loan, reduce the stated rate of any
interest or fee payable hereunder (except that any amendment or modification of
defined terms used in the financial ratios in this Agreement, waiver (or
amendment to the terms) of any mandatory prepayment or waiver of post-default
rates of interest shall not constitute a reduction in the rate of interest or
fees or the forgiveness or reduction of principal or interest for purposes of
this clause (i)) or extend the scheduled date of any payment thereof, in each
case without the written consent of each Lender directly and adversely affected
thereby; (ii) eliminate or reduce the voting rights of any Lender under this
Section without the written consent of such Lender; (iii) reduce any percentage
specified in the definition of “Required Lenders”, consent to the assignment or
transfer by the Borrower of any of its rights and obligations under this
Agreement and the other Loan Documents, release all or substantially all of the
Collateral or release all or substantially all of the Guarantors from their
obligations under the Guarantee and Collateral Agreement, in each case without
the written consent of all Lenders; (iv) amend, modify or waive any provision of
paragraph (a) or (b) of Section 2.14 without the written consent of each Lender
directly and adversely affected thereby; (v) amend, modify or waive any
provision of Section 9 without the written consent of the Agents; or (vi) amend
the assignment provisions of Section 10.6 to make such provisions more
restrictive without the written consent of each Lender directly and adversely
affected thereby.

(b) Each waiver or consent under any Loan Document shall be effective only in
the specific instance and for the specific purpose for which it was given.  No
notice to or demand on any Loan Party shall entitle any Loan Party to any notice
or demand in the same, similar or other circumstances.  No failure on the part
of any Secured Party to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right preclude any other or further exercise thereof or the
exercise of any other right.

(c) Any such waiver and any such amendment, supplement or modification shall
apply equally to each of the Lenders and shall be binding upon the Loan Parties,
the Lenders, the Agents and all future holders of the Loans.  In the case of any
waiver, the Loan Parties, the Lenders and the Agents shall be restored to their
former position and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing unless limited by the terms of such waiver, but no such waiver shall
extend to any subsequent or other Default or Event of Default, or impair any
right consequent on any such subsequent or other Default or Event of Default

(d) Notwithstanding the foregoing, this Agreement may be amended upon the
request of the Borrower, and without the consent of any other Lender to provide
for relevant Replacement Loans (as defined below) in order to permit the
refinancing of all outstanding Loans (“Refinanced Loans”) with a replacement
term loan tranche hereunder (“Replacement Loans”); provided that (i) the
aggregate principal amount of such Replacement Loans shall not exceed the
aggregate principal amount of such Refinanced Loans plus interest and fees and
the amount of any reasonable fees and expenses incurred in connection with such
refinancing, (ii) the interest rate for such Replacement Loans during the period
prior to the maturity of such Refinanced Loans shall not be higher than the
interest rate for such Refinanced Loans, (iii) the Weighted Average Life to
Maturity of such Replacement Loans shall not be shorter than the Weighted
Average Life to Maturity of such Refinanced Loans at the time of such
refinancing, (iv) until the non-extended Loans have been paid in full, all other
terms applicable to such Replacement Loans shall be substantially identical to,
or less favorable to the Lenders providing such Replacement Loans than, those
applicable to such Refinanced Loans, except to the extent necessary to provide
for covenants and other terms applicable to any period after the latest final
maturity of the Loans in effect immediately

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prior to such refinancing (and subject to the terms of the Intercreditor
Agreement) and (v) each Lender under the applicable tranche or tranches of Loans
being extended shall have the opportunity to participate in such extension on
the same terms and conditions as each other Lender in such tranche or tranches;
provided that no existing Lender will have any obligation to commit to any such
extension.

(e) In addition, notwithstanding anything in this Section to the contrary, if
the Administrative Agent and the Borrower shall 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 or provision, and, in each
case, such amendment shall become effective without any further action or
consent of any other party to any Loan Document if the same is not objected to
in writing by the Required Lenders to the Administrative Agent within 10
Business Days following receipt of notice thereof.

10.2 Notices.  All notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including by telecopy), and,
unless otherwise expressly provided herein, shall be deemed to have been duly
given or made when delivered, or 3 Business Days after being deposited in the
mail, postage prepaid, or, in the case of telecopy notice or, subject to the
last sentence of this Section, email notice, when received, addressed as follows
in the case of the Parent Companies, the Borrower, the Agents, and as set forth
in an administrative questionnaire delivered to the Administrative Agent in the
case of the Lenders, or to such other address as may be hereafter notified by
the respective parties hereto:

 

The Parent Companies and the Borrower:

FC-GEN Operations Investment, LLC

101 East State Street

Kennett Square, PA 19348 USA

Attention:  Michael Sherman, Senior Vice President and General Counsel

Telephone: 610-444-6350

Facsimile: 484-733-5449

E-mail: michael.sherman@genesishcc.com

Administrative Agent and Collateral Agent:

Welltower Inc.

4500 Dorr Street

Toledo, Ohio 43615-4040

Attention: Evelyn Evans-Eck, Risk Manager

Telephone: 419-247-2836

Email: eevans@welltower.com

 

provided that any notice, request or demand to or upon the Agents, the Lenders,
the Parent Companies or the Borrower shall not be effective until received.

Notices and other communications to the Lenders hereunder may be delivered or
furnished by electronic communications pursuant to procedures approved by the
Agents; provided that the foregoing shall not apply to notices pursuant to
Section 2 unless otherwise agreed by the Agents and the applicable Lender.  Each
of the Agents may, in their 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.

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10.3 No Waiver; Cumulative Remedies.  No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege.  The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.

 

10.4 Survival of Representations and Warranties.  All representations and
warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans and other extensions of credit hereunder.

 

10.5 Payment of Expenses; Indemnification; Limitation of Liability.   The
Borrower agrees (i) to pay or reimburse each Agent for all their respective
reasonable and documented out-of-pocket costs and expenses incurred in
connection with the syndication of the Facility (other than fees payable to
syndicate members) and the development, preparation, execution and delivery of
this Agreement and the other Loan Documents and any other documents prepared in
connection herewith or therewith and any amendment, supplement or modification
thereto, and, as to the Agents only, the administration of the transactions
contemplated hereby and thereby, including, without limitation, the reasonable
and documented fees and disbursements and other charges of counsel to the Agents
(including one primary counsel and such local counsel as the Agents may
reasonably require in connection with collateral matters, but no more than one
counsel in any jurisdiction) in connection with all of the foregoing, (ii) to
pay or reimburse each Lender and the Agents for all their documented
out-of-pocket costs and expenses incurred in connection with the enforcement of
any rights under this Agreement, the other Loan Documents and any such other
documents, including, without limitation, the fees and disbursements of one
primary counsel to each Lender and the Agents, taken as a whole (and, if
necessary, one firm of local counsel in each appropriate jurisdiction (which may
include a single special counsel acting in multiple jurisdictions) and in the
case of an actual or perceived conflict of interest, of another firm of counsel
for such affected Person), and other advisors and professionals engaged by the
Administrative Agent in connection with enforcement proceedings, (iii) to pay,
indemnify, or reimburse each Lender and the Agents for, and hold each Lender and
the Agents harmless from, any and all recording and filing fees and any and all
liabilities with respect to, or resulting from any delay in paying, stamp,
excise and similar other Taxes, if any, which may be payable or determined to be
payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents and (iv)
to pay, indemnify or reimburse each Lender, each Agent and their respective
affiliates, and their respective officers, directors, trustees, employees,
advisors, agents and controlling Persons (each, an “Indemnitee”) for, and hold
each Indemnitee harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, costs, expenses or disbursements
arising out of any actions, judgments or suits of any kind or nature whatsoever,
arising out of or in connection with any actual or prospective claim, action or
proceeding (including any investigation of, preparation for, or defense of any
pending or threatened claim, action or proceeding) relating to or otherwise with
respect to the execution, delivery, enforcement, performance and administration
of this Agreement, the other Loan Documents and any such other documents,
including, without limitation, any of the foregoing relating to the making of
any Loan, the use of proceeds of the Loans, the violation of, noncompliance with
or liability under, any Environmental Law applicable to, or any Environmental
Claims or any Environmental Liabilities related to, the operations of the Parent
Companies, the Borrower, any of their Subsidiaries or any of the Properties and
the fees and disbursements and other charges of one legal counsel for all such
Indemnitees, taken as a whole (and, if necessary, one firm of local counsel in
each appropriate jurisdiction (which may include a single special counsel acting
in multiple jurisdictions) and in the case of an actual or perceived conflict of
interest, of another firm of counsel for such affected Indemnitee) in connection
therein (all the foregoing in

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this clause (iv), collectively, the “Indemnified Liabilities”) regardless of
whether such Indemnitee is a party thereto, and whether or not any such claim,
litigation, investigation or proceeding is brought by the Borrower, their equity
holders, their respective Affiliates, their respective creditors or any other
Person; provided that neither the Parent Companies nor the Borrower shall have
any obligation hereunder to any Indemnitee with respect to Indemnified
Liabilities to the extent such Indemnified Liabilities have resulted from gross
negligence or willful misconduct of such Indemnitee or material breach in bad
faith of this Agreement by such Indemnitee, in each case, as determined in a
final non-appealable judgment of a court of competent jurisdiction.  All amounts
due under this Section shall be payable promptly after receipt of a reasonably
detailed invoice therefor.  Statements payable by the Borrower pursuant to this
Section shall be submitted to the Borrower at the address thereof set forth in
Section 10.2, or to such other Person or address as may be hereafter designated
by the Borrower in a written notice to the Administrative Agent.  The agreements
in this Section shall survive repayment of the Obligations.

 

(a) In no event shall any Agent-Related Person have any liability to any Loan
Party, any Lender, or any other Person for losses, claims, damages, liabilities
or expenses of any kind (whether in tort or contract or otherwise) arising out
of any Loan Party’s or any Agent-Related Person’s transmission of approved
electronic communications through the internet or any use of any E-System,
except to the extent such liability of any Agent-Related Person is found in a
final non-appealable judgment by a court of competent jurisdiction to have
resulted primarily from such Agent-Related Person’s gross negligence or willful
misconduct; provided that in no event shall any party hereto have any liability
to any other Person for indirect, special, incidental, consequential damages or
punitive damages (as opposed to direct or actual damages); provided,  further,
that the foregoing shall not limit the Borrower’s indemnification obligations to
the Indemnitees pursuant to Section 10.5(a) in respect of damages incurred or
paid by an Indemnitee to a third party.  .

10.6 Successors and Assigns; Participations and Assignments.   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
(i) the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any
attempted assignment or transfer by the Borrower without such consent shall be
null and void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section.

 

(a)  Subject to the conditions set forth in paragraphs (b)(ii) and (c) below,
any Lender may assign to one or more Eligible Assignees (any Person to whom such
an assignment and delegation is to be made being herein called an “Assignee”),
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitments and the Loans at the time owing to it) with
the prior written consent (such consent not to be unreasonably withheld or
delayed) of:

(A) the Lenders; provided that no consent of the Lenders shall be required for
an assignment to a Lender, an Affiliate of a Lender, an Approved Fund (as
defined below); and

(B) the Administrative Agent; provided that no consent of the Administrative
Agent shall be required for an assignment to a Lender, an Affiliate of a Lender
or an Approved Fund (provided that the Administrative Agent shall acknowledge
any such assignment).

(iii) Assignments shall be subject to the following additional conditions:

(A) except in the case of an assignment to a Lender, an Affiliate of a Lender or
an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitments or Loans under the Facility, the amount of the
Commitments or Loans of the assigning Lender subject to each such

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assignment (determined as of (I) the date the Assignment and Assumption with
respect to such assignment is delivered to the Administrative Agent or (II) if
earlier, the “trade date” (if any) specified in such Assignment and Assumption)
shall not be less than $1,000,000 in the case of any assignment in respect of
the Facility, unless the Borrower and the Administrative Agent otherwise
consent; provided that such amounts shall be aggregated in respect of each
Lender and its Affiliates or Approved Funds, if any;

(B) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500 (which shall not be payable by the Parent
Companies or any of their Affiliates); provided that only one such fee shall be
payable in the case of contemporaneous assignments to or by two or more related
Approved Funds; and

(C) the Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an administrative questionnaire.

For the purposes of this Section, “Approved Fund” means any Person (other than a
natural person) that is engaged in making, purchasing, holding or investing in
bank loans and similar extensions of credit in the ordinary course and that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) (i)
an entity or an Affiliate of an entity that administers or manages a Lender or
(ii) an entity or an Affiliate of an entity that is the investment advisor to a
Lender.

(iv) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
below, from and after the effective date specified in each Assignment and
Assumption the Assignee thereunder shall be a party hereto 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 2.15,
2.16, 2.17 and 10.5(a)).  Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 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 (c) of
this Section.

(v) (i) The Administrative Agent, acting as agent of the Borrower shall
establish and maintain at its address referred to in Section 10.2 (or at such
other address as the Administrative Agent may notify the Borrower) (A) a record
of ownership (the “Register”) in which the Administrative Agent agrees to
register by book entry the interests (including any rights to receive payment
hereunder) of the Administrative Agent and each Lender in the Obligations, each
of their obligations under this Agreement to participate in each Loan and any
assignment of any such interest, obligation or right and (B) accounts in the
applicable Register in accordance with its usual practice in which it shall
record (1) the names and addresses of the Lenders (and each change thereto
pursuant to Section 2.20 and Section 10.6), (2) the Commitments of each
applicable Lender, (3) the amount of each Loan and each funding of any
participation described in clause (A) above, (4) the amount of any principal or
interest due and payable or paid with respect to Loans recorded in the
applicable Register and (5) any other payment received by the Administrative
Agent from the Borrower and its application to the Obligations.

(vi) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and an Assignee, the Assignee’s completed administrative

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questionnaire (unless the Assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall accept such Assignment and Assumption
and record the information contained therein in the Register.  No assignment
shall be effective for purposes of this Agreement unless it has been recorded in
the Register as provided in this paragraph.  This Section 10.06(b) shall be
construed so that the Loans are at all times maintained in registered form under
Section 5f.103-1(c) of the United States Treasury Regulations.

(b) [reserved];

(c) [reserved];

(d) [reserved];

(e) [reserved];

(f) [reserved];

(g) Any Lender may, without the consent of the Borrower or the Administrative
Agent sell participations to one or more banks or other entities (a
“Participant”), but in any event not to the Borrower or any of its Affiliates or
Subsidiaries, or certain Persons identified to the Administrative Agent by the
Borrower prior to the Closing Date, in all or a portion of such Lender’s rights
and obligations under this Agreement (including all or a portion of its
Commitments and the Loans owing to it); provided that such Lender’s obligations
under this Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Administrative Agent, and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement.  Any agreement 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 may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver that (1) requires
the consent of each Lender directly and adversely affected thereby pursuant to
the proviso to the second sentence of Section 10.1 and (2) directly affects such
Participant.  Subject to paragraph (c)(ii) of this Section, the Borrower agrees
that each Participant shall be entitled to the benefits of Sections 2.15, 2.16
and 2.17 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to paragraph (b) of this Section (but, with respect to
any particular Participant, to no greater extent than the Lender that sold the
participation to such participant except to the extent such participation is
made with the Borrower’s prior written consent).  Each Lender having sold a
participation shall maintain a register on which it records the name and address
of each Participant and the amounts of such Participant’s participation interest
in the Loan and/or the Commitment.

(i) A Participant shall not be entitled to receive any greater payment under
Sections 2.15 or 2.16 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior
written consent to such greater amounts.  No Participant shall be entitled to
the benefits of Section 2.16 unless such Participant complies with Section
2.16(d) or (e), as (and to the extent) applicable, as if such Participant were a
Lender.

(ii) Each Lender that sells a participation shall, acting solely for this
purpose as a non-fiduciary agent of the Borrower, maintain a register on which
it enters the

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name and address of each Participant and the principal amounts (and stated
interest) of each Participant’s interest in the 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.

(h) Any Lender may, without the consent of or notice to the Administrative Agent
or the Borrower, 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 (i) a Federal
Reserve Bank or (ii) any holder of, or trustee for the benefit of the holders
of, such Lender’s Capital Stock, voting trust certificates, bonds, debentures,
instruments and other evidence of Indebtedness, and all warrants, options and
other rights to acquire the foregoing, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or Assignee for such Lender
as a party hereto.  The Borrower, upon receipt of written notice from the
relevant Lender, agrees to issue Notes to any Lender requiring Notes to
facilitate transactions of the type described in this paragraph (i).

10.7 Adjustments; Set-off.   Except to the extent that this Agreement provides
for payments to be allocated to a particular Lender or to the Lenders under a
particular Facility, if any Lender (a “Benefited Lender”) shall at any time
receive any payment of all or part of the Obligations owing to it, or receive
any collateral in respect thereof (whether voluntarily or involuntarily, by
setoff, pursuant to events or proceedings of the nature referred to in Sections
8(g) or (h), or otherwise), other than in connection with assignments hereunder,
in a greater proportion than any such payment to or collateral received by any
other Lender, if any, in respect of such other Lender’s Obligations, such
Benefited Lender shall purchase for cash from the other Lenders a participating
interest in such portion of each such other Lender’s Obligations, or shall
provide such other Lenders with the benefits of any such collateral, as shall be
necessary to cause such Benefited Lender to share the excess payment or benefits
of such collateral ratably with each of the Lenders; provided,  however, that if
all or any portion of such excess payment or benefits is thereafter recovered
from such Benefited Lender, such purchase shall be rescinded, and the purchase
price and benefits returned, to the extent of such recovery, but without
interest.

 

(a) In addition to any rights and remedies of the Lenders provided by law, each
Lender shall have the right after an Event of Default has occurred and is
continuing, without prior notice to the Borrower, any such notice being
expressly waived by the Borrower to the extent permitted by applicable law, upon
any amount becoming due and payable by the Borrower hereunder (whether at the
stated maturity, by acceleration or otherwise) after the expiration of any cure
or grace periods, to set off and appropriate and apply against such amount any
and all deposits (general or special, time or demand, provisional or final but
excluding trust accounts, employee benefit accounts, payroll, petty cash, tax
and withholding accounts and the like), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender or any branch or agency thereof to or for the credit or the
account of

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the Borrower.   Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such setoff and application made by such
Lender.  Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such setoff and application made by such Lender;
provided that the failure to give such notice shall not affect the validity of
such setoff and application.

10.8 Counterparts.  This Agreement may be executed by one or more of the parties
to this Agreement on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.  Delivery of an executed signature page of this Agreement by
facsimile transmission or by electronic mail in “portable document format” shall
be effective as delivery of a manually executed counterpart hereof.  A set of
the copies of this Agreement signed by all the parties shall be lodged with the
Borrower and the Administrative Agent.

 

10.9 Severability.  Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

 

10.10 Integration.  This Agreement and the other Loan Documents represent the
entire agreement of the Parent Companies, the Borrower, the Agents and the
Lenders with respect to the subject matter hereof and thereof, excluding, for
the avoidance of doubt, the Omnibus Agreement.  Notwithstanding this Agreement
or any other Loan Document, the Parent Companies, the Borrower, the Agents and
the Lenders agree that the Omnibus Agreement shall remain in full force and
effect and shall remain enforceable in accordance with their terms; provided,
that the provisions therein defining “New Capital” and “Trigger Event” shall be
deemed to be updated and conformed to the corresponding definitions herein.

 

10.11 GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

10.12 Submission to Jurisdiction; Waivers.  Each of the Parent Companies and the
Borrower hereby irrevocably and unconditionally:

 

(a) agrees that it will not commence any action, litigation or proceeding of any
kind or description, whether in law or equity, whether in contract or tort or
otherwise, against the Administrative Agent, any Lender, any Related Party of
any of the foregoing, in any way relating to this Agreement or any other Loan
Document or the transactions relating hereto or thereto, in a forum other than
the courts of the State of New York sitting in New York County, and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, and each of the parties hereto irrevocably and
unconditionally submits to the jurisdiction of such courts and agrees that all
claims in respect of any such action, litigation or proceeding may be heard and
determined in such New York State court or, to the fullest extent permitted by
applicable Law, in such Federal court.  Each of the parties hereto agrees that a
final judgment in any such action, litigation or proceeding shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in any
other manner provided by Law.  Nothing in this Agreement or in any other Loan
Document shall affect any right that the Administrative Agent, the Collateral
Agent, any Lender may otherwise have to bring any action or proceeding relating
to this Agreement or any other Loan Document against the Borrower or its
properties in the courts of any jurisdiction;

(b) waives, to the fullest extent permitted by applicable Law, any objection
that it may now or hereafter have to the laying of venue of any action or
proceeding arising out of or relating to this Agreement or any other Loan
Document in any court referred to in paragraph (a) of this Section.  Each

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of the parties hereto hereby irrevocably waives, to the fullest extent permitted
by applicable Law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court;

(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to it at its address set
forth in Section 10.2 or at such other address of which the Administrative Agent
shall have been notified pursuant thereto;

(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and

(e) waives, to the maximum extent not prohibited by law, any right it may have
to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.

10.13 Acknowledgments.  Each of the Parent Companies and the Borrower hereby
acknowledges that:

 

(a) it has been advised by counsel in the negotiation, execution and delivery of
this Agreement and the other Loan Documents;

(b) (i) neither the Agents nor any Lender has any fiduciary relationship with or
duty to either the Parent Companies or the Borrower arising out of or in
connection with this Agreement or any of the other Loan Documents, (ii) the
relationship between the Agents and Lenders, on one hand, and the Parent
Companies and the Borrower, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor and (iii) waives, to the fullest
extent permitted by applicable law, any claims it may have against any Agent or
Lender in respect of such fiduciary relationship claim; and

(c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Parent Companies, the Borrower and the Lenders.

10.14 Confidentiality.  The Agents and the Lenders agree to treat any and all
information, regardless of the medium or form of communication, that is
disclosed, provided or furnished, directly or indirectly, by or on behalf of the
Parent Companies or any of their affiliates, whether in writing, orally, by
observation or otherwise and whether furnished before or after the Closing Date
(“Confidential Information”), strictly confidential.  Without limiting the
foregoing, each Agent and each Lender agrees to maintain the confidentiality of
all Confidential Information, and each Agent and each Lender agrees not to
disclose Confidential Information, at any time, in any manner whatsoever,
directly or indirectly, to any other Person whomsoever, except (1) to its
directors, officers, employees, counsel, trustees, agents and other advisors
(collectively, the “Representatives”), (2) to prospective Lenders and
participants in connection with the syndication (including secondary trading) of
the Facility and Commitments and Loans hereunder, in each case who are informed
of the confidential nature of the information and agree to observe and be bound
by standard confidentiality terms, (3) upon the request or demand of any
Governmental Authority having or purporting to have jurisdiction over it, (4) in
response to any order of any Governmental Authority or as may otherwise be
required pursuant to any Requirement of Law, (5) in connection with any
litigation or similar proceeding among the Loan Parties and Affiliates, on one
hand, and the Agents and the Lenders and each of their respective Affiliates, on
the other hand, (6) that has been publicly disclosed other than in breach of
this Section, (7) to any nationally recognized rating agency that requires
access to information about a Lender’s investment portfolio in connection with
ratings issued with respect to such Lender, (8) to the extent necessary or
customary for inclusion in league table measurements, (9) to the extent
reasonably required or necessary, in connection with the exercise of any remedy
under the Loan

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Documents or (10) to the extent such Confidential Information was acquired by
the Administrative Agent or such Lender in their capacity as landlord or any
other role between the Administrative Agent or such Lender on one hand and the
Parent Companies or any of their affiliates on the other.  Notwithstanding the
foregoing provisions herein to the contrary, no protected health information, as
defined under HIPAA, shall be used or disclosed hereunder in violation of the
HIPAA.

 

10.15 Release of Collateral and Guarantee Obligations; Subordination of Liens. 
 Notwithstanding anything to the contrary contained herein or in any other Loan
Document, (i) in connection with any Disposition of Property permitted by the
Loan Documents or permitted by the Required Lenders the security interest in any
Collateral being Disposed of in such Disposition under clause (a)(i) shall be
automatically released, (ii) in connection with any transaction permitted by the
Loan Documents, which results in any Subsidiary Guarantor becoming a HUD
Sub-Facility Entity and/or a HUD RE Entity, in each case, to the extent
necessary to comply with requirements of Law related to HUD, the security
interest in any Collateral owned by such Subsidiary Guarantor and any pledge of
Capital Stock of such Subsidiary Guarantor shall be automatically released (and
its Guarantee Obligations shall be terminated) and (iii) upon the request of the
Borrower, the Collateral Agent shall (without notice to, or vote or consent of,
any Lender, any Hedge Counterparty that is a party to any Specified Hedge
Agreement or any Cash Management Counterparty that is a party to any Cash
Management Document) take such additional actions as shall be required to
evidence release of its security interest in any Collateral being released
pursuant to this Section 10.15, and to release any Guarantee Obligations under
any Loan Document of any Person being Disposed of in such Disposition under
clause (a)(i), to the extent necessary to permit consummation of such
Disposition.  Any execution and delivery of documents pursuant to the preceding
sentence of this Section 10.15 shall be without recourse to or warranty by the
Administrative Agent (other than as to the Administrative Agent’s authority to
execute and deliver such documents).  Any representation, warranty or covenant
contained in any Loan Document relating to any such Property so Disposed of
(other than Property Disposed of to Ultimate Parent or any of its Subsidiaries)
shall no longer be deemed to be repeated once such Property is so Disposed of.

 

(a) Notwithstanding anything to the contrary contained herein or any other Loan
Document, when all Obligations (other than (x) obligations in respect of any
Specified Hedge Agreement or Cash Management Document and (y) any contingent or
indemnification obligations not then asserted or due) have been paid in full,
all Commitments have terminated or expired, the security interest in the
Collateral and the Guarantee Obligations under the Loan Document shall be
automatically released and, upon request of the Borrower, the Collateral Agent
shall (without notice to, or vote or consent of, any Lender, or any affiliate of
any Lender that is a party to any Specified Hedge Agreement or Cash Management
Document) take such actions as shall be required to evidence the release of its
security interest in all Collateral, and the release of all Guarantee
Obligations under any Loan Document, whether or not on the date of such release
there may be outstanding Obligations in respect of Specified Hedge Agreements or
Cash Management Documents or contingent or indemnification obligations not then
asserted or due.  Any such release of Guarantee Obligations shall be deemed
subject to the provision that such Guarantee Obligations shall be reinstated if
after such release any portion of any payment in respect of the Obligations
guaranteed thereby shall be rescinded or must otherwise be restored or returned
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payment had not been made.

(b) Notwithstanding anything to the contrary contained herein or any other Loan
Document, upon the closing of the MidCap RE Credit Agreements on the MidCap RE
Closing Date and the execution of an amendment and restatement of the
Intercreditor Agreement in form and substance reasonably satisfactory to the
Administrative Agent and the Lenders (i) the MidCap RE Borrowers shall

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be automatically released from their Guarantee Obligations under the Loan
Documents and (ii) any security interest granted by the MidCap RE Borrowers in
the Collateral shall be automatically released.  Upon the request of the
Borrower, the Collateral Agent shall (without notice to, or vote or consent of,
any Lender, any Hedge Counterparty that is a party to any Specified Hedge
Agreement or any Cash Management Counterparty that is a party to any Cash
Management Document) take such actions as shall be required to evidence the
release of its security interest in any Collateral being released pursuant to
this Section 10.15(c)  and to release any Guarantee Obligations of the MidCap RE
Borrowers under any Loan Document being released pursuant to this Section
10.15(c).  Any execution and delivery of documents pursuant to the preceding
sentence shall be without recourse to or warranty by the Collateral Agent (other
than as to the Collateral Agent’s authority to execute and deliver such
documents). 

10.16 Accounting Changes.  In the event that any Accounting Change (as defined
below) shall occur and such change results in a change in the method of
calculation of the financial ratios, standards or terms in this Agreement, then
the Parent Companies, the Borrower and the Agents agree to enter into
negotiations in order to amend such provisions of this Agreement so as to
equitably reflect such Accounting Changes with the desired result that the
criteria for evaluating the Parent Companies’ financial condition shall be the
same after such Accounting Changes as if such Accounting Changes had not been
made.  Until such time as such an amendment shall have been executed and
delivered by the Parent Companies, the Borrower, the Agents and the Required
Lenders, the financial ratios and all standards and terms in this Agreement
shall continue to be calculated or construed as if such Accounting Changes had
not occurred.  “Accounting Changes” refers to changes in accounting principles
required by the promulgation of any rule, regulation, pronouncement or opinion
by the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants or, if applicable, the SEC and shall include
changes in the determination of whether a lease is a capital lease or an
operating lease under GAAP.

 

10.17 WAIVERS OF JURY TRIAL.  EACH OF the Parent Companies, the Borrower, THE
AGENTS AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY
JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

10.18 USA PATRIOT ACT.  Each Lender hereby notifies the Loan Parties that
pursuant to the requirements of the PATRIOT Act, it is required to obtain,
verify and record information that identifies the Loan Parties, which
information includes the name and address of the Borrower and other information
that will allow such Lender to identify the Loan Parties in accordance with the
Act.

 

10.19 Acknowledgement and Consent to Bail-In of EEA Financial
Institution.  Notwithstanding anything to the contrary in any Loan Document or
in any other agreement, arrangement or understanding among the parties to any
such Loan Document, each party hereto 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:

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(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

(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.

[REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

 

GENESIS HEALTHCARE, INC.,
as Ultimate Parent

 

By: __________________
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

 

FC-GEN OPERATIONS INVESTMENT, LLC,

as Borrower and LLC Parent

 

By:
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

 

GEN OPERATIONS I, LLC,

as Parent

 

By:
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

 

GEN OPERATIONS II, LLC,
as Holdings

 

By:
Name:Michael S. Sherman
Title:Senior Vice President, Secretary and Assistant Treasurer

 

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WELLTOWER INC.,
as Administrative Agent and Collateral Agent

 

By:
Name:Justin Skiver
Title:Authorized Signatory

 

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HCRI TUCSON PROPERTIES, INC.,
as Initial Lender

 

By:
Name:Justin Skiver
Title:Authorized Signatory

 

 

 

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OHI MEZZ LENDER, LLC,
as Initial Lender

 

By:
Name:Daniel J. Booth
Title:COO

 

 

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