EXHIBIT 10.4

ADDENDUM #5 TO MASTER LEASE AND SECURITY AGREEMENT

This ADDENDUM #5 TO MASTER LEASE AND SECURITY AGREEMENT (this “Addendum”) is
made and entered into as of March 14, 2016, by and between the parties signatory
hereto, as lessors (collectively, “Lessor”) and HCR III Healthcare, LLC, as
lessee (“Lessee”).

RECITALS

A.     Lessor is the current “Lessor” and Lessee is the current “Lessee”
pursuant to that certain Master Lease and Security Agreement dated as of April
7, 2011 (as the same may have been amended, restated or otherwise modified prior
to the date hereof, the “Master Lease”). Capitalized terms not otherwise defined
herein shall have the meanings ascribed to them in the Master Lease.

B.     Lessee’s obligations under the Master Lease are guaranteed by HCR
ManorCare, Inc., a Delaware corporation, successor in interest to HCR ManorCare,
LLC, a Delaware limited liability company, pursuant to that certain Guaranty of
Obligations dated as of April 7, 2011 (as the same may heretofore have been or
may hereafter be further amended, modified or reaffirmed from time to time in
accordance with the terms thereof, the “Guaranty”).

C.     Pursuant to Section 12 of that certain Tenth Amendment to Master Lease
and Security Agreement, dated as of March 29, 2015 and effective as of April 1,
2015 (the “Tenth Amendment”), by and among Lessor, Lessee and Guarantor, Lessor,
Lessee and Guarantor desire to add the real property more particularly described
on Exhibit A attached hereto (the “Additional Facility”) to the Leased Property
under the Master Lease.  HCP Properties, LP, one of the entities comprising
Lessor, leases the Additional Facility from HCR Lacey WA Property, LLC, pursuant
to a Lease Agreement of even date (the “Lacey Superior Lease”).

AGREEMENT

NOW THEREFORE, in consideration of the foregoing Recitals and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Lessor and Lessee hereby agree as follows:

1.     Lessee’s Representations and Warranties.  Lessee hereby represents and
warrants to Lessor that the Additional Facilities Owners have delivered to
Lessor the materials and documentation required pursuant to Section 12 of the
Tenth Amendment and that, to Lessee’s knowledge, (i) all such materials and
documentation were true, correct and complete at the time delivered and (ii)
there have been no changes affecting any such materials or documentation or any
information disclosed thereby, that would interfere with or materially adversely
affect the consummation of the transactions contemplated hereby, that have not
been previously disclosed by Lessee or Guarantor to Lessor in writing.

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2.     Additional Facility. The Master Lease is hereby amended to modify the
“Pool 4 Facilities” to add the Additional Facility thereto and Lessor hereby
leases to Lessee, and Lessee hereby leases from Lessor, as part of the Leased
Property, all of Lessor’s right, title and interest in and to the Additional
Facility, including any improvements currently and to be located thereon,
subject to all of the terms, conditions and provisions of the Master Lease, as
it is hereby, and may be hereafter, amended, supplemented, restated or otherwise
modified, subject to all of the terms, conditions and provisions of the Lacey
Superior Lease.  Notwithstanding that the Lacey Superior Lease is not a ground
lease, Lessor and Lessee hereby agree that each shall be considered a “Superior
Lease” as defined and used in the Master Lease.  The foregoing notwithstanding,
to the extent that discrepancies exist between Lessee’s obligations under the
Master Lease and the Lacey Superior Lease, Lessee’s obligations under the Master
Lease shall control.

3.     Lacey Superior Lease.  Lessor hereby confirms that the Lacey Superior
Lease is intended to be a short term lease which will be terminated as soon as
practicable after one or more of the entities comprising Lessor or an affiliate
of Lessor purchases the fee interest, directly or indirectly, in the Additional
Facility.  Concurrently with the termination of the Lacey Superior Lease, the
parties agree to enter into an addendum or amendment to the Master Lease in
order to add such fee owner of the Additional Facility as “Lessor” under the
Master Lease.

4.     Opco Sublease:  Schedule 4 to the Master Lease is hereby amended to add
the following operating sublease thereto: 

Manor Care of Lacey WA, LLC d/b/a ManorCare Health Services – Lacey

5.     Effect of Addendum. All references in the Master Lease to “this Lease”
shall be deemed to be references to the Master Lease as amended hereby.

6.     Full Force and Effect; Acknowledgement. The Master Lease, as hereby
amended, shall remain and continue in full force and effect.

7.     Counterparts; Facsimile or Electronically Transmitted Signatures. This
Addendum may be executed in any number of counterparts, all of which shall
constitute one and the same instrument. Signatures transmitted by facsimile or
other electronic means may be used in place of original signatures on this
Addendum, and Lessor and Lessee both intend to be bound by the signatures on the
document transmitted by facsimile or such other electronic means.

[NO FURTHER TEXT ON THIS PAGE]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be executed
as of the day and year first written above.

 

 

“Lessor”

HCP PROPERTIES, LP, a Delaware limited partnership

By:    HCP I-B Properties, LLC, a Delaware limited liability company, its
General Partner

HCP WEST VIRGINIA PROPERTIES, LLC, a Delaware limited liability company

HCP PROPERTIES OF ALEXANDRIA VA, LLC, a Delaware limited liability company

HCP PROPERTIES OF ARLINGTON VA, LLC, a Delaware limited liability company

HCP PROPERTIES OF MIDWEST CITY OK, LLC, a Delaware limited liability company

HCP PROPERTIES OF OKLAHOMA CITY (NORTHWEST), LLC, a Delaware limited liability
company

HCP PROPERTIES OF OKLAHOMA CITY (SOUTHWEST), LLC, a Delaware limited liability
company

HCP PROPERTIES OF TULSA OK, LLC, a Delaware limited liability company

HCP PROPERTIES-ARDEN COURTS OF ANNANDALE VA, LLC, a Delaware limited liability
company

HCP PROPERTIES-CHARLESTON OF HANAHAN SC, LLC, a Delaware limited liability
company

HCP PROPERTIES-COLUMBIA SC, LLC, a Delaware limited liability company

 

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HCP PROPERTIES-FAIR OAKS OF FAIRFAX VA, LLC, a Delaware limited liability
company

HCP PROPERTIES-IMPERIAL OF RICHMOND VA, LLC, a Delaware limited liability
company

HCP PROPERTIES-LEXINGTON SC, LLC, a Delaware limited liability company

HCP PROPERTIES-MEDICAL CARE CENTER-LYNCHBURG VA, LLC, a Delaware limited
liability company

HCP PROPERTIES-OAKMONT EAST-GREENVILLE SC, LLC, a Delaware limited liability
company

HCP PROPERTIES-OAKMONT OF UNION SC, LLC, a Delaware limited liability company

HCP PROPERTIES-OAKMONT WEST-GREENVILLE SC, LLC, a Delaware limited liability
company

HCP PROPERTIES-STRATFORD HALL OF RICHMOND VA, LLC, a Delaware limited liability
company

HCP PROPERTIES-WEST ASHLEY-CHARLESTON SC, LLC, a Delaware limited liability
company

HCP MARYLAND PROPERTIES, LLC, a Delaware limited liability company

HCP PROPERTIES-SALMON CREEK WA,  LLC, a Delaware limited liability company

HCP PROPERTIES-WINGFIELD HILLS NV, LLC, a Delaware limited liability company

 

 

 

 

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HCP PROPERTIES-UTICA RIDGE  IA, LLC, a Delaware limited liability company

HCR TWINSBURG OH PROPERTY, LLC, a Delaware limited liability company

 

By:

/s/ Darren Kowalske

Name:

Darren Kowalske

Title:

EVP

 

 

 

HCR STERLING HEIGHTS MI PROPERTY, LLC, a Delaware limited liability company

By:HCR Schoenherr Road Property, LLC, a Delaware limited liability company, its
sole member

By:HCP Properties, LP, a Delaware limited partnership, its sole member

By:HCP I-B Properties, LLC, a Delaware limited liability company, its General
Partner

 

By:

/s/ Darren Kowalske

Name:

Darren Kowalske

Title:

EVP

 

 

 

 

 

 

 

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ACKNOWLEDGMENT

 

A notary public or other officer completing this certificate verifies only the
identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or validity of that document.

 

 

 

 

STATE OF CALIFORNIA

)

 

) SS:

COUNTY OF LOS ANGELES

)

 

 

On March 9, 2016, before me, Claudia M. Adair, a Notary Public, personally
appeared Darren Kowalske, who proved to me on the basis of satisfactory evidence
to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and
that by his signature on the instrument the person, or the entity upon behalf of
which the person acted, executed the instrument.

 

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

 

 

 

 

 

 

 

[NOTARY STAMP & SEAL]

/s/ Claudia M. Adair

 

Notary Public

 

 

 

 

 

 

 

My Commission Expires

December 7, 2018

 

 

 

 

 

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ACKNOWLEDGMENT

 

A notary public or other officer completing this certificate verifies only the
identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or validity of that document.

 

 

 

 

 

STATE OF CALIFORNIA

)

 

) SS:

COUNTY OF LOS ANGELES

)

 

On March 9, 2016, before me, Claudia M. Adair, a Notary Public, personally
appeared Darren Kowalske, who proved to me on the basis of satisfactory evidence
to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and
that by his signature on the instrument the person, or the entity upon behalf of
which the person acted, executed the instrument.

 

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

 

 

 

 

 

 

 

[NOTARY STAMP & SEAL]

/s/ Claudia M. Adair

 

Notary Public

 

 

 

 

 

 

 

My Commission Expires

December 7, 2018

 

 

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be executed
as of the day and year first written above.

 

“Lessee”

HCR III HEALTHCARE, LLC, a Delaware limited liability company

 

 

 

By:

/s/ Martin D. Allen

Name:

Martin D. Allen

Title:

Vice President

 

 

 

 

STATE OF OHIO

)

 

) ss:

COUNTY OF LUCAS

)

 

 

Before me, a Notary Public in and for said County and State, personally
appeared   Martin D. Allen, who proved to me on the basis of satisfactory
evidence to be the person whose name is subscribed within the instrument and
acknowledged to me that he/she executed the same in his/her authorized capacity,
and that by his/her signature on the instrument the person, or the entity upon
behalf of which the person acted, executed this instrument.

 

I certify under PENALTY OF PERJURY under the law of the State of Ohio that the
forgoing paragraph is true and correct.

 

Witness my hand and official seal.

 

 

 

 

 

 

[NOTARY STAMP & SEAL]

/s/ Meredith Decker

 

Printed Name: 

Meredith Decker

 

Notary Public,

Lucas

County,

Ohio

 

My Commission Expires:

N/A

 

 

Acting in the County of

Lucas

 

 

 

 

 

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Addendum #5

CONSENT, REAFFIRMATION AND AGREEMENT OF GUARANTOR

Guarantor hereby (i) reaffirms all of its obligations under the Guaranty, (ii)
consents to the foregoing Addendum and (iii) agrees that its obligations under
the Guaranty shall extend to Lessee’s duties, covenants and obligations pursuant
to the Master Lease, as amended or modified pursuant to the foregoing Addendum.

 

 

 

HCR MANORCARE, INC., a Delaware corporation

 

By:

/s/ Daniel H. Kight

Name:

Daniel H. Kight

Title:

Vice President & Treasurer

 

 

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EXHIBIT A

Legal Description of Additional Property

Lot 28 of the Replat of Lacey Corporate Center, according to the Plat recorded
in Volume 24 of Plats at Pages 67 and 68, in Thurston County, Washington;

Except that portion conveyed to the City of Lacey by Deed recorded under
recording no. 4239618.

 

 

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