Employment Agreement by and between Richard K. Matros and Sabra Health Care REIT



 Exhibit 10.1 
 EMPLOYMENT AGREEMENT 
 THIS EMPLOYMENT AGREEMENT (“Agreement”) is
entered into this 22nd day of November, 2010 (the “Effective Date”), by and between Richard K. Matros (“Mr. Matros”) and Sabra Health Care REIT, Inc., a Maryland corporation (“Sabra” or
“Company”). 
 WHEREAS, Mr. Matros has been appointed to serve as the Chairman of the Board of Directors, Chief
Executive Officer (“CEO”) and President of Sabra. 
 NOW, THEREFORE, in consideration of the above recitals and the
mutual covenants and agreements contained herein, Mr. Matros and Sabra agree as follows: 
 Section 1: Term of
Employment. Sabra agrees to employ Mr. Matros and Mr. Matros agrees to accept employment with Sabra, subject to the terms and conditions of this Agreement. Unless earlier terminated pursuant to the provisions of Sections 4 and 5
hereof, the initial term of employment of Mr. Matros under this Agreement is for a period of three (3) years, commencing on the Effective Date, and terminating on the third anniversary of the Effective Date. On the first anniversary of the
Effective Date, and on each anniversary of the Effective Date thereafter, this Agreement shall be renewed for a one (1) year period (the period from and after the Effective Date until the termination of this Agreement is referred to as the
“Term”) unless (i) earlier terminated pursuant to the provisions of Sections 4 and 5 hereof, or (ii) written notice of non-renewal is given by either party to the other at least 60 days prior to the anniversary of the Effective
Date occurring in any given year, in which case this Agreement shall be terminated on anniversary of the Effective Date occurring in the second year following the year in which such notice of non-renewal was provided. Notwithstanding the foregoing,
the Term shall terminate, at the latest, on the tenth anniversary of the Effective Date. 
 Section 2: Duties and
Responsibilities. Mr. Matros is employed as CEO and is engaged as Chairman of the Board of Directors of Sabra (“Board of Directors”). During the Term, Mr. Matros shall devote his full employment time, efforts, skills and
attention exclusively to advancing and rendering profitable the business interests of Sabra, its direct and indirect subsidiaries and their lines of business; provided, however, that to the extent the following activities do not materially
interfere or conflict with his duties and responsibilities hereunder and as imposed by applicable laws, rules and regulations, Mr. Matros may (i) continue to serve as a member of the boards of directors of the companies previously
disclosed in writing to the Board of Directors, (ii) engage in charitable, civic and religious affairs and (iii) with the prior written consent of the Board of Directors, serve as a member of the board of directors of other companies,
subject to the provisions of Sabra’s Governance Guidelines, as in effect from time to time. Mr. Matros agrees to report to and render such services, commensurate with his positions as Chairman or CEO, as the Board of Directors may from
time to time reasonably direct. In the event that Mr. Matros serves as director or senior executive officer of one or more direct or indirect subsidiaries of Sabra, he shall do so without additional compensation. 







 Section 3: Compensation, Benefits and Related Matters. 

 

	 	a.	Annual Base Salary. Sabra shall pay during the Term to Mr. Matros a base salary at an annual rate of $700,000 (“Base Salary”), such salary
to be payable in accordance with Sabra’s customary payroll practices (but not less frequently than monthly). Annually during the Term, on or prior to each anniversary of the Effective Date, the Board of Directors or the Compensation Committee
of the Board of Directors (the “Compensation Committee”) shall review Mr. Matros’ annual base salary for possible merit increases in its sole discretion, and any increase in Mr. Matros’ annual base salary rate shall
thereafter constitute “Base Salary” for purposes of this Agreement. 

  

	 	b.	Cash Bonus/Incentive Compensation. In addition to the Base Salary provided for in Section 3(a) above, Mr. Matros shall be entitled to receive an
annual bonus (“Bonus”) in accordance with the Sabra Health Care REIT, Inc. Executive Bonus Plan (the “Plan”), as it may be amended from time to time by the Compensation Committee; provided, however, that no amendment shall be
effective if it reduces the percentage of Base Salary that would constitute the target amount of the Bonus as compared to the prior year, unless such amendment has been agreed to in writing by Mr. Matros. The Bonus shall be
payable at the same time as other annual bonuses are paid to senior management personnel with respect to that fiscal year. Notwithstanding the foregoing, but subject to the provisions of Section 5, in order to have earned and to be paid
any such Bonus, Mr. Matros must be employed by Sabra on the date of such payment. 

  

	 	c.	Restricted Stock and Options. Mr. Matros shall participate in such restricted stock and option plans of the Company as are made available generally
to senior executive officers of the Company. Any grants under such plans shall be made by the Board of Directors (or appropriate committee thereof) in its sole discretion and such plans are subject to change during the Term at the sole discretion of
the Company. 

  

	 	d.	Retirement and Benefit Plans. During the Term, Mr. Matros shall be entitled to participate in all retirement plans, health benefit programs,
insurance programs and other similar employee welfare benefit arrangements available generally to senior executive officers of Sabra from time to time. Such plans, programs and arrangements are subject to change during the Term at the sole
discretion of the Company. 

  

	 	e.	Paid Time Off. During the Term, Mr. Matros shall be entitled to paid time off in accordance with Sabra’s policy for senior executive officers.


  

	 	f.	Indemnification Liability/Insurance. Mr. Matros shall be entitled to indemnification by Sabra to the fullest extent permitted by applicable law and
the charter and bylaws of Sabra. In addition, Sabra shall maintain during Mr. Matros’ employment customary directors’ and officers’ liability insurance and Mr. Matros shall be covered by such insurance.



  
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	 	g.	Taxes. All compensation payable to Mr. Matros shall be subject to withholding for all applicable federal, state and local income taxes, occupational
taxes, Social Security and similar mandatory withholdings. 

  

	 	h.	Expenses. Mr. Matros shall be entitled to reimbursement for expenses incurred by him in connection with the discharge of his duties hereunder. All
such expense reimbursement shall be subject to and shall be submitted, documented and paid in accordance with the expense reimbursement policies of the Company, as such policies may change from time to time. Mr. Matros agrees that he will
provide such documentation to the Company promptly after expenses are incurred. 

 Section 4: Termination.
Sabra may, at any time, in its sole discretion, terminate Mr. Matros as Chairman and CEO and from all other positions with Sabra and its direct and indirect subsidiaries; provided, however, that Sabra shall provide Mr. Matros with at least
five (5) business days prior written notice of such termination and shall make the payments associated with such termination in accordance with Section 5. Notwithstanding any provision in Section 1 hereof, the Term shall end on the
date of Mr. Matros’ termination of employment in accordance with this Agreement. 
  

	 	a.	Termination by Sabra for “Good Cause.” Sabra may at any time, by written notice to Mr. Matros at least five (5) business days prior to
the date of termination specified in such notice and specifying the acts or omissions believed to constitute Good Cause (as defined below), terminate Mr. Matros as Chairman and CEO and from all other positions with Sabra and its direct and
indirect subsidiaries for Good Cause. Sabra may relieve Mr. Matros of his duties and responsibilities pending a final determination of whether Good Cause exists, and such action shall not constitute Good Reason (as defined below) for purposes
of this Agreement. Payment to Mr. Matros upon a termination for Good Cause is set forth in Section 5(a). “Good Cause” for termination shall mean any one of the following: 


 

	 	1.	Any felony criminal conviction (including conviction pursuant to a nolo contendere plea) under the laws of the United States or any state or other political subdivision
thereof which, in the sole discretion of the Board of Directors, renders Mr. Matros unsuitable for the position of either Chairman or CEO; 

  

	 	2.	Any act of financial malfeasance or financial impropriety, as determined by the Board of Directors in good faith; 


 

	 	3.	 Mr. Matros’ continued willful failure to perform the duties reasonably requested by the Board of Directors and commensurate with his
positions as Chairman and CEO (other than any such failure resulting from his incapacity due to his physical or mental condition) after a written demand for substantial performance is delivered to him by the Board of Directors, which demand
specifically identifies the manner in which the Board of Directors believes that he has not substantially performed his duties, and 



  
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which performance is not substantially corrected by him within ten (10) days of receipt of such demand; 



 

	 	4.	Any material workplace misconduct or willful failure to comply with Sabra’s general policies and procedures as they may exist from time to time by Mr. Matros
which, in the good faith determination of the Board of Directors, renders Mr. Matros unsuitable for the position of either Chairman or CEO; 

  

	 	5.	Any material breach by Mr. Matros of the provisions of this Agreement which has not been cured by Mr. Matros thirty (30) days following delivery of
notice to Mr. Matros specifying such material breach, or the repetition of any such material breach after it has been cured; or 

  

	 	6.	Any act of moral turpitude, as determined by the Board of Directors in good faith. 


 

	 	b.	Termination by Sabra without Good Cause. Sabra may at any time, by written notice to Mr. Matros at least five (5) business days prior to the
date of termination specified in such notice, terminate Mr. Matros as Chairman and CEO and from all other positions with Sabra and its direct and indirect subsidiaries. If such termination is made by Sabra other than by reason of
Mr. Matros’ death, Disability (as defined in Section 4(e)) or expiration of the Term, and Good Cause does not exist, such termination shall be treated as a termination without Good Cause and Mr. Matros shall be entitled to
payment in accordance with Section 5(b). 

  

	 	c.	Termination by Mr. Matros for Good Reason. Mr. Matros may, at any time at his option within sixty (60) days following the initial existence
of the particular event or condition that constitutes Good Reason (as defined below), resign for Good Reason as Chairman and CEO and from all other positions with Sabra and its direct and indirect subsidiaries by written notice to Sabra at least
thirty (30) days prior to the date of termination specified in such notice; provided, however, that Sabra has not substantially corrected the event or condition that would constitute Good Reason prior to the date of termination. Payment to
Mr. Matros upon a termination for Good Reason is set forth in Section 5(b). Mr. Matros’ continued employment shall not, by itself, constitute consent to or a waiver of rights with respect to any circumstances constituting Good
Reason hereunder. 

 “Good Reason” shall mean the occurrence of any one of the following events or
conditions without Mr. Matros’ written consent: 
 (i) A meaningful and detrimental reduction in Mr. Matros’
authority, duties or responsibilities or a meaningful and detrimental change in his reporting responsibilities; (ii) A material failure of Sabra to comply with the compensation provisions set forth in Sections 3(a) and 3(b) or benefits
provisions set forth in Sections 3(d)—3(f) (collectively, the “Benefits”) 

  
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(other than a reduction of Benefits uniformly applicable to other members of senior management); or (iii) A material relocation of Mr. Matros’ principal work location from its
current location in Orange County, California; 
 provided that Sabra is provided with notice and opportunity to cure such
breach and Mr. Matros terminates his employment with Sabra, in each case within the time periods prescribed under this Section 4(c). 
  

	 	d.	Voluntary Resignation. Mr. Matros may, at any time at his option with thirty (30) calendar days written notice to Sabra, voluntarily resign
without Good Reason as Chairman and CEO and from all other positions with Sabra and its direct and indirect subsidiaries. Payment to Mr. Matros upon his voluntary resignation without Good Reason is set forth in Section 5(a). Resignation
from Sabra shall automatically constitute resignation from all positions of any subsidiary. 

  

	 	e.	Death or Disability. Mr. Matros’ employment under this Agreement and the Term shall terminate automatically as of the date of
Mr. Matros’ death. Sabra may, at any time by written notice to Mr. Matros at least five (5) business days prior to the date of termination specified in such notice, terminate Mr. Matros as Chairman and CEO and from all other
positions with Sabra and its direct or indirect subsidiaries by reason of his Disability. “Disability” shall mean any physical or mental condition or illness that prevents Mr. Matros from performing his duties hereunder in any
material respect for a period of 120 substantially consecutive calendar days, as determined by a physician selected by Sabra or, if Mr. Matros is incapacitated, reasonably acceptable to the Director of Medicine or equivalent senior physician at
Hoag Hospital. Payment to Mr. Matros upon his termination by reason of his death or Disability is set forth in Section 5(a). 

 Section 5: Payments Upon Termination. 
  

	 	a.	 Payment Upon Termination for Good Cause, Resignation without Good Reason, Death or Disability. In the event of termination of employment
during the Term pursuant to Sections 4(a), 4(d) or 4(e), Mr. Matros, or his estate where applicable, shall be paid any earned but unpaid Base Salary through the date of Mr. Matros’ separation from service with Sabra (the
“Severance Date”) and any accrued and unused paid time off through the Severance Date, which shall be paid to Mr. Matros or his estate or beneficiary, as applicable, in a lump sum in cash upon or promptly following (and in all events
within 30 days after) the Severance Date (collectively, the “Accrued Obligations”). In addition, in the case of a termination of employment pursuant to Sections 4(e), but not Sections 4(a) or 4(d), Mr. Matros or his estate shall be
paid (i) any accrued and unpaid Bonus for any prior fiscal year, which shall be paid to Mr. Matros or his estate or beneficiary, as applicable, in a lump sum in cash at the time that annual bonuses are paid to senior management personnel
with respect to that fiscal year, but in any event within seventy-four (74) days after the Severance Date, and (ii) a pro 



  
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rata portion (based on the number of days of employment in the fiscal year of termination divided by 365 or 366, as applicable) of the Bonus, if any, for the fiscal year in which the termination
occurs, which shall be paid at the time that annual bonuses are paid to senior management personnel with respect to that fiscal year, but in any event within seventy-four (74) days after the conclusion of the fiscal year to which such Bonus
relates. Mr. Matros shall also receive his vested benefits in accordance with the terms of Sabra’s compensation and benefit plans, and his participation in such plans and all other perquisites shall cease as of the Severance Date, except
to the extent Mr. Matros may elect to continue coverage under any welfare benefit plans as required by Part 6, Title I of the Employee Retirement Income Security Act of 1974, as amended. Upon a termination under Section 4(a), 4(d) or 4(e),
Mr. Matros shall not be entitled to any compensation or benefits under this Agreement except as set forth in this Section 5(a). 


  

	 	b.	Payment Upon Termination by Sabra without Good Cause or by Mr. Matros for Good Reason. In the event of a termination of Mr. Matros’
employment during the Term pursuant to Sections 4(b) or 4(c), subject to the provisions of Section 7(f): 

  

	 	1.	Mr. Matros shall be entitled to a severance benefit in an amount equal to (i) Mr. Matros’ then current annual Base Salary multiplied by 2.25, plus
(ii) any accrued and unpaid Bonus for any prior fiscal year, plus (iii) a pro rata portion of the Bonus for the fiscal year in which the termination occurs (determined by multiplying the Bonus Mr. Matros would have received based upon
actual performance had his employment continued through the end of the fiscal year by a fraction, the numerator of which is the number of days during the year of termination that Mr. Matros is employed by the Company and the denominator of
which is 365 or 366, as applicable). The amount payable pursuant to clause (i) above shall be paid to Mr. Matros in a lump sum cash payment in the month immediately following the month in which the Severance Date occurs. The amount payable
pursuant to clause (ii) above shall be paid to Mr. Matros at the time that annual bonuses are paid to senior management personnel with respect to the applicable fiscal year, but in any event within seventy-four (74) days after the
Severance Date. The amount payable pursuant to clause (iii) shall be paid to Mr. Matros at the time that annual bonuses are paid to senior management personnel with respect to the applicable fiscal year in which the Severance Date occurs,
but in any event within seventy-four (74) days after the conclusion of such fiscal year. 

  

	 	2.	 In the event such termination occurs on or within two years following the date of a Change in Control, Mr. Matros shall not be entitled to the
amount described in Section 5(b)(1) above but shall instead be entitled to an amount equal to (i) the sum of his then current annual Base Salary and his target Bonus for the then current fiscal year multiplied by 2, plus
(ii) any accrued and unpaid Bonus for any prior fiscal year, plus (iii) a pro rata 



  
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portion of the target Bonus for the fiscal year in which the termination occurs (assuming the Company achieves 100% of the financial performance target or targets for such fiscal year that are
utilized in determining the amount of the Bonus and determined by multiplying the amount Mr. Matros would have received had his employment continued through the end of the fiscal year by a fraction, the numerator of which is the number of days
during the performance year of termination that Mr. Matros is employed by the Company and the denominator of which is 365 or 366, as applicable). The amounts payable pursuant to clauses (i) and (iii) above shall be paid to
Mr. Matros in a lump sum in the month immediately following the month in which the Severance Date occurs. The amount payable pursuant to clause (ii) above shall be paid to Mr. Matros at the time that annual bonuses are paid to senior
management personnel with respect to the applicable fiscal year, but in any event within seventy-four (74) days after the Severance Date. 


  

	 	3.	Mr. Matros’ participation in any other retirement and benefit plans and perquisites shall cease as of the Severance Date, except Sabra shall pay premiums
pursuant to COBRA for continuing coverage under Sabra’s health plans for Mr. Matros and his eligible dependents (as determined under Sabra’s health plans), or, at Mr. Matros’ option (which shall be communicated by written
notice to Sabra prior to the month such election is to take effect), provide a separate cash payment monthly equal to the amount of the COBRA premium until the earlier of (i) the twenty-four-month anniversary of the last day of the month in
which the Severance Date occurs or (ii) the date of Mr. Matros becomes eligible to participate in a plan of another employer or (iii), as to any of his eligible dependents, the date on which the eligible dependent becomes eligible to
participate in a plan of another employer. Any cash payment due to Mr. Matros pursuant to this Section 5(b)(3) shall be paid by Sabra not later than the end of the month to which such payment relates. 


 

	 	4.	Upon any such termination, Mr. Matros shall be entitled to receive any Accrued Obligations payable to Mr. Matros as set forth in Section 5(a).


  

	 	5.	Notwithstanding the foregoing, Mr. Matros’ right to receive the severance payments described in this Section 5(b) shall be and is conditioned upon his
execution and delivery of (and not revoking) a general release in favor of Sabra, which shall not be inconsistent with the terms of this Agreement, and such other documents and instruments as are reasonably required by Sabra, each of which
Mr. Matros shall deliver to Sabra within twenty-one (21) days following the Severance Date. 

 A
termination of Mr. Matros’ employment during the Term without Good Cause (other than by reason of his death or Disability) within six (6) months preceding a Change in Control shall be treated as if such termination occurred on the
date of such Change in Control if it is reasonably demonstrated that the termination was 

  
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at the request of the third party who has taken steps reasonably calculated to effect such Change in Control or otherwise arose in connection with or in anticipation of such Change in Control. In
such case, Mr. Matros shall be entitled (in addition to the benefits described in Section 5(b)(1) which were triggered in connection with the original Severance Date) to the difference between the non-discounted present value of the
benefits described in Section 5(b)(2) above less the non-discounted present value of the benefits described in Section 5(b)(1) above (each determined as of the Severance Date), which difference shall be paid to Mr. Matros upon or
within thirty (30) days following the occurrence of such Change in Control. 
  

	 	c.	“Change in Control.” For purposes of this Section 5, a “Change in Control” shall be deemed to have occurred if any of the
following events occurs: 

  

	 	1.	Any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “1934
Act”)), other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company (an “Acquiring Person”), is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act),
directly or indirectly, of more than 33 1/3% of the then outstanding voting stock of the Company; 

  

	 	2.	A merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 51% of the combined voting power of the voting securities of the Company or
surviving entity outstanding immediately after such merger or consolidation; 

  

	 	3.	A sale or other disposition by the Company of all or substantially all of the Company’s assets; 


 

	 	4.	During any period of not more than one (1) year (beginning on or after the Effective Date), individuals who at the beginning of such period constitute the Board of
Directors and any new director (other than a director who is a representative or nominee of an Acquiring Person) whose election by the Board of Directors or nomination for election by the Company’s shareholders was approved by a vote of at
least a majority of the directors then still in office who either were directors at the beginning of the period or whose election or nomination was previously so approved, no longer constitute a majority of the Board of Directors;


 provided, however, in no event shall any acquisition of securities, a change in the composition of
the Board of Directors or a merger or other consolidation pursuant to a plan of reorganization under chapter 11 of the Bankruptcy Code with respect to the Company (“Chapter 11 Plan”), or a liquidation under the Bankruptcy Code


  
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constitute a Change in Control and provided further that in no event shall any transaction be considered a Change in Control if it does not constitute a change in the ownership or
effective control of Sabra or a change in the ownership of a substantial portion of Sabra’s assets, each within the meaning of Section 409A of the United States Internal Revenue Code of 1986, as amended (the “Code”) and the
Treasury Regulations promulgated thereunder (“Section 409A”). In addition, notwithstanding Sections 5(c)(1), 5(c)(2), 5(c)(3) and 5(c)(4), a Change in Control shall not be deemed to have occurred in the event of a sale or conveyance in
which the Company continues as a holding company of an entity or entities that conduct the business or businesses formerly conducted by the Company, or any transaction undertaken for the purpose of reincorporating the Company under the laws of
another jurisdiction, if such transaction does not materially affect the beneficial ownership of the Company’s capital stock. A Change in Control shall not, by itself, constitute Good Reason hereunder. 

 

	 	d.	Cooperation. Following the expiration or a termination of this Agreement for any reason, Mr. Matros shall provide such cooperation as is reasonably
required by the Company, including, without limitation, consulting with the Company with respect to litigation and/or matters that relate to facts and circumstances that occurred during the term of his employment by the Company, and executing such
documents and instruments relating to such term of employment as are reasonably requested by Sabra. 

 Section 6:
Reduction in Compensation to Avoid Excise Tax. Notwithstanding anything herein to the contrary, if the excise tax imposed by Section 4999 of the Code or any similar or successor tax (the “Excise Tax”) applies to any
payments, benefits and/or amounts received (or otherwise to be received) by Mr. Matros pursuant to Section 5(b) or otherwise, including, without limitation, amounts received or deemed received, within the meaning of any provision of the
Code, by Mr. Matros as a result of (and not by way of limitation) any automatic vesting, lapse of restrictions and/or accelerated target or performance achievement provisions, or otherwise, applicable to outstanding grants or awards to
Mr. Matros under any of Sabra’s incentive plans (collectively, the “Total Payments”), then the Total Payments shall be reduced (but not below zero) so that the maximum amount of the Total Payments (after reduction) shall be one
dollar ($1.00) less than the amount which would cause the Total Payments to be subject to the Excise Tax; provided that such reduction to the Total Payments shall be made only if the total after-tax benefit to Mr. Matros is greater after giving
effect to such reduction than if no such reduction had been made. If such a reduction is required, the Company shall reduce or eliminate the Total Payments by first reducing or eliminating any accelerated vesting of stock options that then have a
term of one year or less and are then under-water, then by reducing or eliminating any cash severance benefits, then by reducing or eliminating any accelerated vesting of any other stock options, then by reducing or eliminating any accelerated
vesting of other equity awards, and then by reducing or eliminating any other remaining Total Payments, in each case in reverse order beginning with the payments which are to be paid the farthest in time from the date of the related change in
control event. The preceding provisions of this Section 6 shall take precedence over the provisions of any other plan, arrangement or agreement governing Mr. Matros’ rights and entitlements to any benefits or compensation. The Company
agrees that, prior to and in connection with any Change in Control, the Company will reasonably consider alternatives (if 

  
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any) Mr. Matros may have to eliminate or mitigate the impact of any Excise Tax on his Total Payments. 
  

	 	a.	Determination of Reduction. The amount of the reduction in compensation shall be determined by an accounting firm retained by Sabra (the “Accounting
Firm”) using such formulas as the Accounting Firm deems appropriate. No compensation to Mr. Matros shall be reduced pursuant to the provisions of this Section 6 if the Accounting Firm determines that the payments to Mr. Matros
are not subject to an Excise Tax. 

  

	 	b.	Payment of Excise Tax. If a reduction in compensation that results in no Excise Tax being payable does not result in Mr. Matros having a more
positive after-tax financial position than he would have enjoyed without the reduction but with the resulting application of the Excise Tax, then, at the option of Mr. Matros, he can choose to pay the amount of the Excise Tax and avoid the
reduction in compensation. The amount of the Excise Tax shall be determined by the Accounting Firm using such formulas as the Accounting Firm deems appropriate. In the event the Mr. Matros chooses to pay the Excise Tax, he will have no right of
reimbursement or payment of additional compensation from the Company. 

 Section 7: Protection of Sabra’s Interests.

  

	 	a.	Ownership of Property. Mr. Matros acknowledges and agrees that any and all property developed, discovered or created by him during the pendency of
his employment by the Company, including, without limitation, any and all copyrights, trademarks, trade secrets or other intellectual property is and shall remain the sole and exclusive property of the Company and Mr. Matros hereby sells,
assigns and otherwise transfers all of his right, title and interest in and to such property, if any, to the Company. 

  

	 	b.	Confidentiality. Mr. Matros agrees that he will not at any time, during or after the term of this Agreement, except in performance of his obligations
to Sabra hereunder or with the prior written consent of the Board of Directors, directly or indirectly disclose to any person or organization any secret or “Confidential Information” that Mr. Matros may learn or has learned by reason
of his association with Sabra and its direct and indirect subsidiaries. For purposes of all of this Section 7 only, “Sabra” shall also include Sabra’s direct and indirect subsidiaries. The term “Confidential
Information” means any information not previously disclosed to the public or to the trade by Sabra’s management with respect to Sabra’s products, services, business practices, facilities and methods, salary and benefit information,
trade secrets and other intellectual property, systems, procedures, manuals, confidential reports, product price lists, pricing information, customer lists, financial information (including revenues, costs or profits associated with any of
Sabra’s products or lines of business), business plans, prospects or opportunities. 


  
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	 	c.	Exclusive Property. Mr. Matros confirms that all Confidential Information is and shall remain the exclusive property of Sabra. All business records,
papers and documents kept or made by Mr. Matros relating to the business of Sabra shall be and remain the property of Sabra. Upon the expiration or termination of Mr. Matros’ employment with Sabra for any reason or upon the request of
Sabra at any time, Mr. Matros shall promptly deliver to Sabra, and shall not without the consent of the Board of Directors, retain copies of, Confidential Information, or any written materials not previously made available to the public, or
records and documents made by Mr. Matros or coming into Mr. Matros’ possession concerning the business or affairs of Sabra. 

  

	 	d.	Nonsolicitation. Mr. Matros shall not, during his employment under this Agreement, and for two (2) years following the termination of this
Agreement, for whatever reason or cause, in any manner induce, attempt to induce, or assist others to induce, or attempt to induce, any employee, agent, representative or other person associated with Sabra or any customer, patient or client of Sabra
to terminate his or her association or contract with Sabra, nor in any manner, directly or indirectly, interfere with the relationship between Sabra and any of such persons or entities. 


 

	 	e.	Non-Disparagement. Mr. Matros shall not during his employment under this Agreement and for two (2) years following termination of the Agreement,
for whatever reason, make any statements that are intended to or that would reasonably be expected to harm Sabra or any of its subsidiaries or affiliates, their respective predecessors, successors, assigns and employees and their respective past,
present or future officers, directors, shareholders, employees, trustees, fiduciaries, administrators, agents or representatives. Sabra and its officers and directors will not make any statements that are intended to or that would reasonably be
expected to harm Mr. Matros or his reputation or that reflect negatively on Matros’ performance, skills or ability. 

  

	 	f.	Violation of Covenants. 

  

	 	1.	Without intending to limit the remedies available to Sabra, Mr. Matros acknowledges that a breach of any of the covenants in this Section 7 may result in
material irreparable injury to Sabra for which there is no adequate remedy at law, that it will not be possible to measure damages for such injuries precisely and that, in the event of such a breach or threat thereof, Sabra shall be entitled to
obtain a temporary restraining order and/or a preliminary or permanent injunction restraining Mr. Matros from engaging in activities prohibited by this Section 7 or such other relief as may be required to specifically enforce any of the
covenants in this Section 7. 

  

	 	2.	 In the event that Mr. Matros breaches any of the covenants in this Section 7, Sabra shall be entitled to cease payment of any further
compensation or benefits pursuant to Section 5(b) or otherwise (other than compensation payable pursuant to Section 5(b)(1)(ii)) and recover from Mr. Matros any




  
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amounts paid to him pursuant to the provisions of Section 5(b)(1)(i), Section 5(b)(2)(i) or Section 5(b)(2)(iii). 



Section 8: Miscellaneous Provisions. 
  

	 	a.	Amendments, Waivers, Etc. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by both parties. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver
of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. 

  

	 	b.	Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of
this Agreement, which shall remain in full force and effect. 

  

	 	c.	Entire Agreement. This Agreement sets forth the entire agreement and understanding of the parties hereto with respect to the matters covered hereby. No
agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement and this Agreement shall supersede all prior
agreements, negotiations, correspondence, undertakings and communications of the parties, oral or written, with respect to the subject matter hereof. 

  

	 	d.	Resolution of Disputes. Any disputes arising under or in connection with this Agreement may, at the election of Mr. Matros or Sabra, be resolved by
binding arbitration, to be held in Orange County, California in accordance with the rules and procedures of the American Arbitration Association. If arbitration is elected, Mr. Matros and Sabra shall mutually select the arbitrator. If
Mr. Matros and Sabra cannot agree on the selection of an arbitrator, each party shall select an arbitrator and the two arbitrators shall select a third arbitrator who shall resolve the dispute. Judgment upon the award rendered by the arbitrator
may be entered in any court having jurisdiction thereof. Nothing herein shall limit the ability of Sabra to obtain the injunctive relief described in Section 7(f) pending final resolution of matters that are sent to arbitration.


  

	 	e.	 Attorneys’ Fees. Sabra shall pay or reimburse Mr. Matros on an after-tax basis for all costs and expenses (including, without
limitation, court costs, costs of arbitration and reasonable legal fees and expenses which reflect common practice with respect to the matters involved) incurred by Mr. Matros if Mr. Matros prevails on the merits of any claim, action or
proceeding (i) contesting or otherwise relating to the existence of Good Cause in the event of Mr. Matros’ termination of employment during the Term for Good Cause; (ii) enforcing any right, benefit or obligation under this
Agreement, or otherwise enforcing the terms of this Agreement or any provision thereof; or (iii) asserting or otherwise relating 



  
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to the existence of Good Reason in the event of Mr. Matros’ termination of employment during the Term for Good Reason. 



 

	 	f.	Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of California.


  

	 	g.	Notice. For the purpose of this Agreement, notice, demands and all other communication provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered by hand delivery or overnight courier or mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed as follows or to other addresses as each party may have
furnished to the other: 

 To Sabra: 
 Sabra Health Care REIT, Inc. 
 Attention: Board of Directors 

18500 Von Karman, Suite 550 
 Irvine, California 92612 
 To Mr. Matros: 

At the address last shown on the Company’s records 
  

	 	h.	Section 409A. 

  

	 	1.	If Mr. Matros is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of Mr. Matros’
separation from service (within the meaning of Treasury Regulation Section 1.409A-1(h)(1), without regard to the optional alternative definitions available thereunder) and any payment or benefit provided in Section 5 hereof constitutes a
“deferral of compensation” within the meaning of Section 409A, Mr. Matros shall not be entitled to any such payment or benefit until the earlier of: (i) the date which is six (6) months after his separation from service
for any reason other than death, or (ii) the date of his death. The provisions of this paragraph shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Section 409A. Any amounts
otherwise payable to Mr. Matros upon or in the six (6) month period following his separation from service that are not so paid by reason of this Section 8(h)(1) shall be paid (without interest) as soon as practicable (and in all
events within thirty (30) days) after the date that is six (6) months after Mr. Matros’ separation from service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of his
death). 

  

	 	2.	 To the extent that any reimbursements pursuant to Sections 3(h), 5(b)(3) and 8(e) are taxable to Mr. Matros, any reimbursement payment due to
Mr. Matros pursuant to such provision shall be paid to Mr. Matros on or 



  
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before the last day of Mr. Matros’ taxable year following the taxable year in which the related expense was incurred. The benefits and reimbursements pursuant to Sections 3(h), 5(b)(3)
and 8(e) are not subject to liquidation or exchange for another benefit and the amount of such benefits and reimbursements that Mr. Matros receives in one taxable year shall not affect the amount of such benefits and reimbursements that
Mr. Matros receives in any other taxable year. 


  

	 	3.	It is intended that any amounts payable under this Agreement and Sabra’s and Mr. Matros’ exercise of authority or discretion hereunder shall comply with
and avoid the imputation of any tax, penalty or interest under Section 409A. This Agreement shall be construed and interpreted consistent with that intent. 


The parties hereto have executed this Agreement as of the date first above written. 

 

	
	 RICHARD K. MATROS

	
	 /s/ Richard K. Matros

	
	 SABRA HEALTH CARE REIT, INC.

	
	 /s/ Talya Nevo-Hacohen

	 Its Executive Vice President




  
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