Document:

EX-10.10

 Exhibit 10.10 

EXECUTION COPY 
  

 
 CREDIT AGREEMENT 

dated as of January 6, 2015 

among 
 NEXPOINT
CAPITAL, INC., 
 STATE STREET BANK AND TRUST COMPANY, 

and the other lending institutions party hereto 

and 
 STATE STREET BANK
AND TRUST COMPANY 
 in its capacity as Agent 
  

 

 TABLE OF CONTENTS 

 

							
	 		 		Page	 
		
	 ARTICLE I. DEFINITIONS
		 	1	  
			
	 SECTION 1.01.
		 Definitions
		 	1	  
			
	 SECTION 1.02.
		 Accounting Terms and Determinations
		 	17	  
		
	 ARTICLE II. THE CREDIT
		 	17	  
			
	 SECTION 2.01.
		 Commitments to Lend
		 	17	  
			
	 SECTION 2.02.
		 Notice of Borrowings
		 	17	  
			
	 SECTION 2.03.
		 Notice to Banks; Funding of Loans
		 	18	  
			
	 SECTION 2.04.
		 Loan Accounts; Notes; Records
		 	19	  
			
	 SECTION 2.05.
		 Mandatory Payments; Optional Prepayments
		 	20	  
			
	 SECTION 2.06.
		 Interest Rates
		 	21	  
			
	 SECTION 2.07.
		 Fees
		 	22	  
			
	 SECTION 2.08.
		 Termination and Reduction of Commitments
		 	22	  
			
	 SECTION 2.09.
		 Extension of Termination Date
		 	23	  
			
	 SECTION 2.10.
		 General Provisions as to Payments
		 	24	  
			
	 SECTION 2.11.
		 Computation of Interest and Fees
		 	26	  
			
	 SECTION 2.12.
		 Withholding Tax Exemption
		 	26	  
			
	 SECTION 2.13.
		 Payment of Other Taxes by the Borrower
		 	28	  
		
	 ARTICLE III. CONDITIONS
		 	28	  
			
	 SECTION 3.01.
		 Effectiveness
		 	28	  
			
	 SECTION 3.02.
		 All Borrowings
		 	29	  
			
	 SECTION 3.03.
		 Security
		 	30	  
		
	 ARTICLE IV. REPRESENTATIONS AND WARRANTIES
		 	30	  
			
	 SECTION 4.01.
		 Existence and Power; Investment Company
		 	30	  
			
	 SECTION 4.02.
		 Authorization; Execution and Delivery, Etc.
		 	30	  
			
	 SECTION 4.03.
		 Noncontravention
		 	30	  
			
	 SECTION 4.04.
		 Governmental Authorizations; Private Authorization
		 	31	  
			
	 SECTION 4.05.
		 Regulations T, U and X
		 	31	  
			
	 SECTION 4.06.
		 Non-Affiliation with Banks
		 	31	  
			
	 SECTION 4.07.
		 Subsidiaries
		 	31	  
			
	 SECTION 4.08.
		 Financial Information
		 	31	  

  
 i 

 TABLE OF CONTENTS 

(continued) 
  

							
	 	  	 	  	Page	 
			
	 SECTION 4.09.
	  	 Litigation
	  	 	32	  
			
	 SECTION 4.10.
	  	 ERISA
	  	 	32	  
			
	 SECTION 4.11.
	  	 Taxes
	  	 	32	  
			
	 SECTION 4.12.
	  	 Compliance
	  	 	32	  
			
	 SECTION 4.13.
	  	 Fiscal Year
	  	 	32	  
			
	 SECTION 4.14.
	  	 Full Disclosure
	  	 	33	  
			
	 SECTION 4.15.
	  	 Account
	  	 	33	  
			
	 SECTION 4.16.
	  	 Sanctions, Etc.
	  	 	33	  
			
	 SECTION 4.17.
	  	 Title to Assets
	  	 	33	  
		
	 ARTICLE V. COVENANTS
	  	 	33	  
			
	 SECTION 5.01.
	  	 Information
	  	 	33	  
			
	 SECTION 5.02.
	  	 Payment of Obligations
	  	 	34	  
			
	 SECTION 5.03.
	  	 Maintenance of Insurance
	  	 	35	  
			
	 SECTION 5.04.
	  	 Conduct of Business and Maintenance of Existence
	  	 	35	  
			
	 SECTION 5.05.
	  	 Compliance with Laws
	  	 	35	  
			
	 SECTION 5.06.
	  	 Inspection of Property, Books and Records
	  	 	36	  
			
	 SECTION 5.07.
	  	 Debt
	  	 	36	  
			
	 SECTION 5.08.
	  	 Liens
	  	 	36	  
			
	 SECTION 5.09.
	  	 Consolidations, Mergers and Sales of Assets
	  	 	37	  
			
	 SECTION 5.10.
	  	 Use of Proceeds
	  	 	37	  
			
	 SECTION 5.11.
	  	 Compliance with Investment Policies and Restrictions
	  	 	37	  
			
	 SECTION 5.12.
	  	 Non-Affiliation with Banks
	  	 	37	  
			
	 SECTION 5.13.
	  	 Regulated Investment Company
	  	 	37	  
			
	 SECTION 5.14.
	  	 [reserved]
	  	 	37	  
			
	 SECTION 5.15.
	  	 ERISA
	  	 	38	  
			
	 SECTION 5.16.
	  	 Fiscal Year
	  	 	38	  
			
	 SECTION 5.17.
	  	 Regulation U
	  	 	38	  
			
	 SECTION 5.18.
	  	 Custodian
	  	 	38	  
			
	 SECTION 5.19.
	  	 Asset Coverage
	  	 	38	  

  
 ii 

 TABLE OF CONTENTS 

(continued) 
  

							
	 	  	 	  	Page	 
			
	 SECTION 5.20.
	  	 Maximum Amount
	  	 	38	  
			
	 SECTION 5.21.
	  	 Negative Pledge
	  	 	38	  
			
	 SECTION 5.22.
	  	 Further Assurances
	  	 	38	  
			
	 SECTION 5.23.
	  	 Sanctions, Etc
	  	 	38	  
		
	 ARTICLE VI. DEFAULTS
	  	 	39	  
			
	 SECTION 6.01.
	  	 Events of Default
	  	 	39	  
			
	 SECTION 6.02.
	  	 Remedies
	  	 	41	  
		
	 ARTICLE VII. THE AGENT
	  	 	41	  
			
	 SECTION 7.01.
	  	 Appointment and Authorization
	  	 	41	  
			
	 SECTION 7.02.
	  	 Action by Agent
	  	 	41	  
			
	 SECTION 7.03.
	  	 Consultation with Experts
	  	 	41	  
			
	 SECTION 7.04.
	  	 Liability of Agent
	  	 	41	  
			
	 SECTION 7.05.
	  	 Indemnification
	  	 	42	  
			
	 SECTION 7.06.
	  	 Credit Decision
	  	 	42	  
			
	 SECTION 7.07.
	  	 Successor Agent
	  	 	42	  
			
	 SECTION 7.08.
	  	 Agent as Bank
	  	 	43	  
			
	 SECTION 7.09.
	  	 Distribution by Agent
	  	 	43	  
			
	 SECTION 7.10.
	  	 Delinquent Banks
	  	 	43	  
		
	 ARTICLE VIII. CHANGE IN CIRCUMSTANCES
	  	 	44	  
			
	 SECTION 8.01.
	  	 Additional Costs; Capital Adequacy
	  	 	44	  
			
	 SECTION 8.02.
	  	 Basis for Determining Interest Rate Inadequate or Unfair
	  	 	45	  
			
	 SECTION 8.03.
	  	 Illegality
	  	 	46	  
			
	 SECTION 8.04.
	  	 Base Rate Loans Substituted for Affected LIBOR Loans
	  	 	46	  
			
	 SECTION 8.05.
	  	 Replacement Banks
	  	 	47	  
			
	 SECTION 8.06.
	  	 Indemnity
	  	 	47	  
			
	 SECTION 8.07.
	  	 Change of Law
	  	 	47	  
		
	 ARTICLE IX. MISCELLANEOUS
	  	 	47	  
			
	 SECTION 9.01.
	  	 Notices
	  	 	47	  
			
	 SECTION 9.02.
	  	 No Waivers
	  	 	48	  

  
 iii 

 TABLE OF CONTENTS 

(continued) 
  

							
	 	  	 	  	Page	 
			
	 SECTION 9.03.
	  	 Expenses; Indemnification
	  	 	48	  
			
	 SECTION 9.04.
	  	 Setoff
	  	 	48	  
			
	 SECTION 9.05.
	  	 Amendments and Waivers
	  	 	49	  
			
	 SECTION 9.06.
	  	 Successors and Assigns
	  	 	49	  
			
	 SECTION 9.07.
	  	 Governing Law; Submission to Jurisdiction
	  	 	51	  
			
	 SECTION 9.08.
	  	 WAIVER OF JURY TRIAL
	  	 	52	  
			
	 SECTION 9.09.
	  	 Confidential Information
	  	 	52	  
			
	 SECTION 9.10.
	  	 USA Patriot Act
	  	 	53	  
			
	 SECTION 9.11.
	  	 Miscellaneous
	  	 	53	  

  

			
	Schedules:	  	
		
	Schedule 1 -	  	Addresses for Notices, Lending Offices, Commitment Amounts and Commitment Percentages
		
	Exhibits:	  	
		
	Exhibit A -	  	Form of Note
	Exhibit B -	  	Form of Notice of Borrowing
	Exhibit C -	  	Form of Notice of Conversion
	Exhibit D -	  	Form of Borrowing Base Report
	Exhibit E -	  	Form of Certificate of No Default
	Exhibit F -	  	Form of Assignment and Acceptance
	Exhibit G -	  	Form of Perfection Certificate

  
 iv 

 CREDIT AGREEMENT 

CREDIT AGREEMENT, dated as of January 6, 2015, by and among NEXPOINT CAPITAL, INC., a Delaware corporation (the
“Borrower”), the Banks (as hereinafter defined) party hereto from time to time and STATE STREET BANK AND TRUST COMPANY as agent for the Banks (in such capacity, the “Agent”). 

The parties hereto hereby agree as follows: 

ARTICLE I. 
 DEFINITIONS

 SECTION 1.01. Definitions. The following terms, as used herein, have the following meanings: 

“Account” means, collectively, the account or the accounts that the Custodian has opened and maintains for the Borrower
pursuant to the terms and conditions of the Custody Agreement. 
 “Act” has the meaning set forth in
Section 9.10 hereof. 
 “Additional Commitment” has the meaning set forth in Section 2.09(b)
hereof. 
 “Additional Commitment Bank” has the meaning set forth in Section 2.09(b) hereof. 

“Adjusted LIBOR Offered Rate” applicable to any Interest Period means a rate per annum equal to the quotient obtained
(rounded upward, if necessary, to the next higher 1/100 of 1%) by dividing (i) the applicable LIBOR Offered Rate by (ii) 1.00 minus the LIBOR Reserve Percentage. The Adjusted LIBOR Offered Rate shall be adjusted automatically on and as of
the effective date of any change in the LIBOR Reserve Percentage. 
 “Adjusted Net Assets” means, as at any date of
determination, an amount equal to (a) the value of the Total Assets of the Borrower minus (b) the Total Liabilities of the Borrower that are not Senior Securities Representing Indebtedness. For purposes of calculating the Adjusted
Net Assets the amount of any liability included in Total Liabilities shall be equal to the greater of (i) the outstanding amount of such liability and (ii) the fair market value of all assets pledged or otherwise segregated to secure such
liability (other than assets pledged or encumbered in favor of the Agent or the Custodian which pledge or encumbrance is permitted by Section 5.08). 

“Adverse Claim” means any Lien or other right or claim in, of or on any Person’s assets or properties (including the
segregation thereof or the deposit thereof to satisfy margin or other requirements, provided that “Adverse Claim” shall not include any segregation which (i) is required to prevent a security of the Borrower from constituting a
senior security for purposes of the Investment Company Act and (ii) is not a pledge or security interest) in favor of any other Person other than, in the case of the Borrower, Liens permitted under Section 5.08(a)(i),
(ii) or (iii) hereof. 
 “Affiliate” means, with respect to any Person (the “First
Person”) any other Person that (a) is an “Affiliated Person” (within the meaning of the Investment Company Act) of such First Person, (b) is an “affiliate” (within the meaning of Section 23A of the Federal
Reserve Act, as amended) of such First Person, or (c) is a Control Affiliate of such First Person. 

 “Agent” has the meaning set forth in the preamble to this Agreement. 

“Aggregate Commitment Amount” means, as of any date, the aggregate of all Commitment Amounts as of such date. On the
Effective Date, the Aggregate Commitment Amount is $25,000,000. 
 “Anti-Corruption Laws” means all laws, rules, and
regulations of any jurisdiction applicable to the Borrower from time to time concerning or relating to bribery or corruption. 

“Applicable Law” means any Law of any Authority, including, without limitation, all federal and state banking or securities
laws, to which the Person in question is subject or by which it or any of its property is bound. 
 “Applicable Lending
Office” means, with respect to any Bank, (a) in the case of its Base Rate Loans, its Domestic Lending Office, and (b) in the case of its LIBOR Loans, its LIBOR Lending Office. 

“Asset Value” means, as of any day of determination in respect of any asset of the Borrower, the Value of such asset computed
in the manner as such Value is required to be computed by the Borrower in accordance with the Borrower’s Valuation Procedures and Applicable Law, including, without limitation, the Investment Company Act; provided that the Asset
Value of any asset shall be net of the Borrower’s liabilities relating thereto, including without limitation all of the Borrower’s obligations to pay any unpaid portion of the purchase price thereof. 

“Assignee” has the meaning set forth in Section 9.06(c) hereof. 

“Assignment and Acceptance” has the meaning set forth in Section 9.06(c) hereof. 

“Authority” means any governmental or quasi-governmental authority (including the Financial Industry Regulatory Authority,
Inc., the stock exchanges, the SEC and any accounting board or authority (whether or not a part of government) which is responsible for the establishment or interpretation of national or international accounting principles, in each case whether
foreign or domestic), whether executive, legislative, judicial, administrative or other, or any combination thereof, including, without limitation, any federal, state, territorial, county, municipal or other government or governmental or
quasi-governmental agency, arbitrator, board, body, branch, bureau, commission, corporation, court, department, instrumentality, master, mediator, panel, referee, system or other political unit or subdivision or other entity of any of the foregoing,
whether domestic or foreign. 
 “Authorized Signatory” means any duly authorized officer or other authorized Person of the
Borrower, provided that the Agent shall have received a manually signed certificate of an officer of the Borrower bearing a manual specimen signature of such officer or other Person. 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 2 

 “Bank” means each of State Street, each lender named on the signature pages
hereof, each Assignee which becomes a Bank pursuant to Section 9.06(c) hereof, and their respective successors. 
 “Base
Rate” means, for any day, the higher of (a) the Overnight LIBOR Rate as in effect on that day plus the Base Rate Margin and (b) the Federal Funds Rate as in effect from time to time plus the Base Rate Margin. 

“Base Rate Loans” means Loans bearing interest calculated by reference to the Base Rate. 

“Base Rate Margin” means 1.25%. 

“Benefit Arrangement” means at any time an employee benefit plan within the meaning of Section 3(3) of ERISA which is
not a Plan or a Multiemployer Plan and which is maintained or otherwise contributed to by any member of the ERISA Group. 

“Borrower” has the meaning set forth in the preamble hereto. 

“Borrowing Base” means, at the relevant time of reference thereto, an amount which is equal to the lesser of (a) 33 1/3%
of the Adjusted Net Assets of the Borrower and (b) the sum of the following items, without duplication (to the extent that they are classified as “assets” on the balance sheet of the Borrower in accordance with Generally Accepted
Accounting Principles): 
 (i) 75% of the aggregate Asset Value of all Eligible Senior Loans which have a market value of at
least 90% of par value and are rated B- or better by S&P or B3 or better by Moody’s; 
 (ii) 60% of the aggregate
Asset Value of all Eligible Senior Loans which have a market value of at least 50% (but lower than 90%) of par value and are rated B- or better by S&P or B3 or better by Moody’s; 

(iii) 30% of the aggregate Asset Value of all Eligible Senior Loans which have a market value of at least 30% of par value and
are rated CCC+ or better by S&P or Caa1 or better by Moody’s; 
 (iv) 90% of the aggregate Asset Value of all
Eligible Commercial Paper rated A1 or better by S&P or P1 or better by Moody’s and all Eligible Government Securities; 

(v) 80% of the aggregate Asset Value of all Eligible Domestic Debt Securities, Eligible OECD Sovereign Debt Securities and
Eligible Guaranteed Debt Securities, in each case rated BBB- or better by S&P or Baa3 or better by Moody’s; 
 (vi)
70% of the aggregate Asset Value of all Eligible Domestic Debt Securities rated BB- or better (but lower than BBB-) by S&P or Ba3 or better (but lower than Baa3) by Moody’s; 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 3 

 (vii) 60% of the aggregate Asset Value of all Eligible Domestic Debt Securities
rated B- or better (but lower than BB-) by S&P or B3 or better (but lower than Ba3) by Moody’s; 
 (viii) 50% of the
aggregate Asset Value of all Eligible Domestic Equity Securities; 
 (ix) 30% of the aggregate Asset Value of all High Yield
Eligible Domestic Debt Securities; and 
 (x) 0% of the aggregate Asset Value of all other assets of the Borrower; 

provided, that: 
 (1) if
any security or loan asset has a lower rating from one agency than from another, the higher rating shall be disregarded for purposes of the foregoing; 

(2) if the sum, without duplication, of (a) all Eligible Commercial Paper, Eligible Domestic Debt Securities, Eligible
Government Securities, Eligible Guaranteed Debt Securities, Eligible OECD Sovereign Debt Securities and Eligible Senior Loans, in each such case which has a market value less than 50% of the par value thereof, (b) all Eligible Senior Loans
(i) that are unsecured loans or other extensions of credit, (ii) that are loans or other extensions of credit secured by a lien that is not a first perfected lien, or (iii) the issuer in respect of which is domiciled (or whose
principal place of business is located) outside the United States, and (c) all High Yield Eligible Domestic Debt Securities, constitutes more than 20% of the Borrowing Base, the amount of such excess shall not be included in the calculation of
the Borrowing Base; 
 (3) if aggregate investments in any one country (other than the United States) constitute more than
10% of the Borrowing Base, the amount of such excess shall not be included in the calculation of the Borrowing Base; 
 (4)
if the securities of any one issuer (other than the Government of the United States) constitute more than 5% of the Borrowing Base, the amount of such excess shall not be included in the calculation of the Borrowing Base; and 

(5) no asset shall be included in the calculation of the Borrowing Base if it constitutes an Illiquid Asset or an asset which
is the subject of a reverse repurchase agreement, dollar roll or securities lending transaction. 
 “Borrowing Base Report”
means a Borrowing Base Report for the Borrower signed by an Authorized Signatory of the Borrower and in substantially the form of Exhibit D attached hereto. 

“Borrowing Date” means the Domestic Business Day or LIBOR Business Day on which Loans are advanced hereunder as specified in
a Notice of Borrowing delivered pursuant to Section 2.02(a) hereof. 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 4 

 “Business Development Company” means a closed-end management investment company
registered as such under the Investment Company Act that has elected, pursuant to Section 54 of the Investment Company Act, to be regulated as a business development company thereunder. 

“Charter Documents” means, collectively, the articles of incorporation, by-laws and other organizational or governing
documents of the Borrower. 
 “Closing Balance Sheet” has the meaning set forth in Section 3.01(e)(iv). 

“Collateral” has the meaning set forth in the Security Agreement. 

“Commitment” means the agreement of each Bank, subject to the terms and conditions of this Agreement, to make Loans to the
Borrower hereunder. 
 “Commitment Amount” means, with respect to each Bank, the amount set forth opposite the name of such
Bank on Schedule 1 attached hereto, as such amount may be reduced from time to time pursuant to Section 2.08 or 9.06(c) hereof or increased from time to time pursuant to Section 9.06(c) hereof. 

“Commitment Percentage” means, with respect to each Bank, the percentage set forth opposite the name of such Bank on
Schedule 1 attached hereto as such Bank’s percentage of the Aggregate Commitment Amounts of all of the Banks. 

“Confidential Material” has the meaning set forth in Section 9.09(a) hereof. 

“Consent Date” has the meaning set forth in Section 2.09(a) hereof. 

“Control Affiliate” of a Person means (a) any other Person directly or indirectly owning, controlling, or holding with
power to vote, greater than 50% of the outstanding voting securities of such Person, (b) any other Person greater than 50% of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by such
Person, or (c) any Person directly or indirectly controlling, controlled by, or under common control with, such other Person. For purposes of this defined term, “control” means the power to exercise a controlling influence over the
management or policies of a company, and “controlling” and “controlled” shall have correlative meanings. 

“Convertible Security” means any debt security (a) issued by an issuer that is convertible, at the option of the holder
thereof, into common equity of such issuer, and (b) traded on a major securities exchange. 
 “Covered Person” has the
meaning set forth in Section 9.03(b) hereof. 
 “Custodian” means State Street Bank and Trust Company. 

“Custody Agreement” means that certain Custodian Agreement dated August 26, 2014, among the Borrower, the Custodian and
the other parties thereto, as the same may be amended and in effect from time to time. 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 5 

 “Debt” of any Person means at any date, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (c) all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of business, (d) all obligations of such Person as lessee which are or are required to be capitalized in accordance with Generally Accepted Accounting Principles,
(e) all Debt of others secured by a Lien on any asset of such Person, whether or not such Debt is assumed or Guaranteed by such Person, (f) all Debt of others Guaranteed by such Person, all obligations to reimburse the issuer in respect of
letters of credit or under performance or surety bonds, or other similar obligations, (g) all obligations of such Person in respect of banker’s acceptances and under reverse repurchase agreements, (h) with respect to any counterparty,
the obligations of such Person to such counterparty in respect of Financial Contract Liabilities, and (i) all obligations that are senior securities for purposes of the Investment Company Act. 

“Default” means any condition or event which constitutes an Event of Default or which with the giving of notice or lapse of
time or both would, unless cured or waived, become an Event of Default. 
 “Delinquent Bank” has the meaning set forth in
Section 7.10(a) hereof. 
 “Dollars” or “$” means dollars in lawful currency of the United
States of America. 
 “Domestic Business Day” means any day (other than a Saturday or Sunday) on which (a) commercial
banks are open for the purpose of transacting business in Boston, Massachusetts and New York, New York and (b) the New York Stock Exchange is open. 

“Domestic Lending Office” means, initially, the office of each Bank designated as such on Schedule 1 attached hereto;
thereafter such other office of such Bank, if any, located in the United States that shall be making or maintaining Base Rate Loans. 

“Effective Date” means the date this Agreement becomes effective in accordance with Section 3.01 hereof. 

“Eligible Commercial Paper” means a note of an issuer having a maturity of 270 days or less and which is free and clear of
any Adverse Claims and in which the Agent has, for the benefit of the Agent and the Banks, a first priority perfected security interest pursuant to the Security Documents (subject to Liens in favor of the Custodian granted pursuant to the Custody
Agreement to secure obligations arising thereunder). 
 “Eligible Domestic Debt Securities” means debt securities of
issuers domiciled, and having their principal place of business, in the United States, including, without limitation, corporate bond obligations, which are free and clear of any Adverse Claims and in which the Agent has, for the benefit of the Agent
and the Banks, a first priority perfected security interest pursuant to the Security Documents (subject to Liens in favor of the Custodian granted pursuant to the Custody Agreement to secure obligations arising thereunder), provided that Eligible
Domestic Debt Securities shall not include (a) any asset that is a direct or indirect participation or subparticipation interest in or assignment or novation of a loan or other extension of credit that is not a corporate bond obligation, or
(b) any Convertible Security. 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 6 

 “Eligible Domestic Equity Securities” means common equity securities, in each
case of issuers domiciled, and having their principal place of business in the United States, which are traded on a major securities exchange and are free and clear of any Adverse Claims, and in which the Agent has, for the benefit of the Agent and
the Banks, a first priority perfected security interest pursuant to the Security Documents (subject to Liens in favor of the Custodian granted pursuant to the Custody Agreement to secure obligations arising thereunder). 

“Eligible Government Securities” means any securities issued or guaranteed as to principal or interest by the Government of
the United States, which are free and clear of any Adverse Claims and in which the Agent has, for the benefit of the Agent and the Banks, a first priority perfected security interest pursuant to the Security Documents (subject to Liens in favor of
the Custodian granted pursuant to the Custody Agreement to secure obligations arising thereunder). 
 “Eligible Guaranteed Debt
Securities” means debt securities guaranteed by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation, which are free and clear of any Adverse Claims and in which the Agent has, for the benefit of the Agent
and the Banks, a first priority perfected security interest pursuant to the Security Documents (subject to Liens in favor of the Custodian granted pursuant to the Custody Agreement to secure obligations arising thereunder). 

“Eligible OECD Sovereign Debt Securities” means the sovereign debt obligations of any country that is a member of the OECD,
which are free and clear of any Adverse Claims and in which the Agent has, for the benefit of the Agent and the Banks, a first priority perfected security interest pursuant to the Security Documents (subject to Liens in favor of the Custodian
granted pursuant to the Custody Agreement to secure obligations arising thereunder). 
 “Eligible Senior Loans” means debt
obligations (other than securities): 
 (i) of issuers domiciled and having their principal place of business in the United
States and OECD member countries; 
 (ii) with respect to which the interest payable on the principal amount thereof by the
related obligor is payable in cash; provided that 10% of such interest may be paid in kind; provided further that such debt security may also provide for additional interest paid in kind to the extent such additional interest paid in kind
(a) was added pursuant to an amendment or supplement to the underlying debt security and (b) is in addition to, and does not reduce, interest payable in cash at the applicable fixed, floating or adjustable interest rate specified for such
debt security; 
 (iii) which have a scheduled final maturity date no later than the tenth anniversary after the related
origination date; 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 7 

 (iv) which are part of a senior credit facility, with respect to which such Loan
Asset is not by its terms subordinated (pursuant to contractual provisions or otherwise) to the prior payment of any other liabilities or any equity interests of the related obligor; 

(v) which are part of a syndicated credit facility where (a) the sum of the aggregate revolving loan commitment amount
plus the aggregate outstanding principal amount of all loans under such facility on the date that the Borrower acquires an interest in such facility is greater than $100,000,000 and (b) the Borrower’s interest in such facility does not
exceed 25% of such sum; 
 (vi) in which the Borrower’s interest in all collateral security therefor, if any, and
principal and interest payments thereunder is no less than pro rata and pari passu with all other lenders in the particular tranche in which the Borrower holds an interest or participates in such tranche, as the case may be; 

(vii) in respect of which the credit rating of the related agent or its controlling affiliate at the time that the Borrower
acquires an interest therein is no less than “A-” from S&P or “A3” from Moody’s; 
 (viii) which
are priced on each Domestic Business Day by Markit Group Limited or Thompson Reuters LPC or their successors; 
 (ix) which
are free and clear of any Adverse Claims; 
 (x) in which the Agent has, for the benefit of the Agent and the Banks, a first
priority perfected security interest pursuant to the Security Documents (subject to Liens in favor of the Custodian granted pursuant to the Custody Agreement to secure obligations arising thereunder); 

(xi) with respect to which the Borrower’s interest is not a sub-participation; and 

(xii) in respect of which, if the Borrower’s interest therein is a participation, the credit rating of the selling
institution is no less than “A-” from S&P or “A3” from Moody’s. 
 “ERISA” means the Employee
Retirement Income Security Act of 1974, as amended, or any successor statute. 
 “ERISA Group” means, with respect to the
Borrower, the Borrower and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with the Borrower, are treated as a single employer under Section 414
of the Internal Revenue Code. 
 “Event of Default” has the meaning set forth in Section 6.01 hereof. 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC thereunder, as
modified or interpreted by orders of the SEC, or other 

  
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interpretative releases or letters issued by the SEC or its staff, all as from time to time in effect, or any successor law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or regulatory provision. 
 “Excluded Taxes” means
(i) net income Taxes (however denominated), franchise Taxes, branch profits Taxes and any other similar Taxes imposed on the Agent or any Bank (or its Applicable Lending Office) by any Authority in the jurisdiction under the laws of which the
Agent or such Bank (or its Applicable Lending Office) is organized or in which its principal office is located or through which it holds the Loans, (ii) any Taxes imposed as a result of a present or former connection between the Agent or any
Bank (or its Applicable Lending Office) and the jurisdiction imposing such Tax, other than a connection arising solely as a result of the Agent or such Bank (or its Applicable Lending Office) having executed, delivered or performed its obligations
or received payments under, or enforced, this Agreement, (iii) any U.S. Federal withholding Taxes imposed under FATCA, (iv) in the case of a Bank (A) withholding Taxes imposed on amounts payable to such Bank at the time such Bank
becomes a party to this Agreement (or designates a new lending office or changes its place of organization or principal office), except to the extent that such Bank’s assignor (if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such Taxes pursuant Section 2.10(c), and (B) Taxes attributable to such Bank’s failure to comply with Section 2.12. 

“Existing Termination Date” has the meaning set forth in Section 2.09(a) hereof. 

“Failure” has the meaning set forth in Section 7.10(b) hereof. 

“FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, as of the Effective Date, (or any amended or successor
version of such law that is substantively comparable and not materially more onerous to comply with), and any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the
Internal Revenue Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such Sections of the Internal Revenue Code. 

“Federal Funds Rate” means for any day, a fluctuating rate per annum equal to the rate appearing on Bloomberg page BTMM as of
9:30 a.m. (Boston time) as the “Federal Funds Ask Rate” (or, if such page is unavailable, on any successor or substitute page of such service, or any successor to or substitute for such service, providing rate quotations comparable to
those currently provided on such page of such service, as determined by the Agent from time to time for purposes of providing quotations or, if such rate is not so published, an interest rate per annum equal to the quotation received by the Agent at
approximately 9:30 a.m. (Boston time) on such date from a federal funds broker of recognized standing selected by the Agent in its sole discretion on overnight federal funds transactions). 

“Financial Contract Liability” means, at any time, with respect to Financial Contracts with any counterparty, the net amount,
if any, that a Person would be obligated, in accordance with such Financial Contracts to which such Person is a party, to pay to such counterparty thereto if such Financial Contracts and all transactions thereunder terminated at such time in

  
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accordance therewith on a complete no-fault basis (including, without limitation, any such amounts that would not be recorded as a liability under Generally Accepted Accounting Principles, such
as fees payable upon early termination of a Financial Contract). 
 “Financial Contracts” means option contracts, options
on futures contracts, futures contracts, forward contracts, options on foreign currencies, reverse repurchase agreements, securities lending agreements, when-issued securities, swap, swaption, floor, cap, or collar agreements, other similar
arrangements and other obligations that would be, but for the segregation of assets thereof, senior securities for purposes of the Investment Company Act. 

“Foreign Bank” means any Bank that is organized under the laws of a jurisdiction other than the United States, which, for
these purposes shall include each state thereof and the District of Columbia. 
 “Generally Accepted Accounting Principles”
has the meaning set forth in Section 1.02 hereof. 
 “Government” means, with respect to any sovereignty, the
government or any agency or instrumentality thereof. 
 “Governmental Authorizations” means all franchises, permits,
licenses, approvals, consents and other authorizations of all Authorities. 
 “Governmental Filings” means all filings,
including franchise and similar tax filings, and the payment of all fees, assessments, interests and penalties associated with such filing, with all Authorities. 

“Guarantee” by any Person means any obligation, contingent or otherwise, of such Person directly or indirectly guaranteeing
any Debt or other obligation of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (a) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation (whether arising by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions
or otherwise) or (b) entered into for the purpose of assuring in any other manner the obligee of such Debt or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part),
provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business. The term “Guarantee” used as a verb has a corresponding meaning. 

“High Yield Eligible Domestic Debt Securities” means all Eligible Domestic Debt Securities rated CCC+ or better (but lower
than B-) by S&P or Caa1 or better (but lower than B3) by Moody’s. 
 “Illiquid Asset” means, as of any date, any
asset for which (a) there is no established public or private institutional trading market, such that such asset may be reasonably expected to be sold in such market within seven (7) days in the ordinary course of business at a price
approximating the Value of such asset on such date subject only to fluctuations in the market price therefor, (b) the fair market value of such asset is not readily ascertainable from recognized independent sources in the market for such
assets, or (c) are otherwise categorized as “illiquid securities” by the Borrower or the Investment Manager. 

  
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INC. CREDIT AGREEMENT 

  
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 “Indemnified Taxes” are (a) any Taxes, other than Excluded Taxes, imposed
on or with respect to any amount payable by the Borrower hereunder or under any of the other Loan Documents, and (b) to the extent not otherwise described in (a), Other Taxes. 

“Interest Period” means, with respect to each LIBOR borrowing, initially the period commencing on the date of such borrowing
and ending one, two or three months thereafter, as the Borrower may elect in the applicable Notice of Borrowing, and thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such borrowing and ending on
the last day of one of the periods set forth above, as the Borrower may elect in the applicable Notice of Conversion, provided that: 

(a) any Interest Period which would otherwise end on a day which is not a LIBOR Business Day shall be extended to the next
succeeding LIBOR Business Day unless such LIBOR Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding LIBOR Business Day; 

(b) any Interest Period which begins on the last LIBOR Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last LIBOR Business Day of a calendar month; 

(c) any Interest Period which would otherwise end after the Termination Date shall end on the Termination Date; and 

(d) all LIBOR Loans outstanding at any time shall end on no more than five different dates. 

“Internal Revenue Code” means the United States Internal Revenue Code of 1986, as amended, or any successor statute and the
Treasury regulations promulgated thereunder. 
 “Investment Company Act” means the Investment Company Act of 1940 as
amended, and the rules and regulations of the SEC thereunder, as modified or interpreted by orders of the SEC, or other interpretative releases or letters issued by the SEC or its staff, all as from time to time in effect, or any successor law,
rules or regulations, and any reference to any statutory or regulatory provision shall be deemed to be a reference to any successor statutory or regulatory provision. 

“Investment Manager” means NexPoint Advisors, L.P., a limited partnership organized under the laws of the State of Delaware.

 “Investment Policies and Restrictions” means, with respect to the Borrower, the provisions dealing with objectives,
policies and restrictions relating to investing and borrowing by the Borrower, as set forth in the Borrower’s Prospectus (as delivered to the Agent on the Effective Date), in each case as such objectives, policies and restrictions were in
effect on the Effective Date, as modified as permitted under this Agreement. 

  
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 11 

 “Law” means any action, code, consent decree, constitution, decree, directive,
enactment, finding, guideline, law, injunction, interpretation, judgment, order, ordinance, policy statement, proclamation, promulgation, regulation, requirement, rule, rule of law, rule of public policy, settlement agreement, statute, or writ, of
any Authority, or any particular section, part or provision thereof. 
 “Liabilities” has the meaning set forth in
Section 7.05 hereof. 
 “LIBOR Business Day” means any Domestic Business Day on which commercial banks are open
for international business (including dealings in dollar deposits) in London. 
 “LIBOR Lending Office” means, initially,
the office of each Bank designated as such in Schedule 1 hereto; and thereafter such other office of such Bank, if any, that shall be making or maintaining LIBOR Loans. 

“LIBOR Loans” means Loans bearing interest calculated by reference to the LIBOR Offered Rate. 

“LIBOR Margin” means 1.15%. 

“LIBOR Offered Rate” means, with respect to any LIBOR Loan for any Interest Period, the higher of (a) 0.001%, and
(b) the rate appearing on the Reuters “LIBOR01” screen displaying interest rates for dollar deposits in the London interbank market (or on any successor or substitute page on such screen) at approximately 11:00 a.m., London time two
LIBOR Business Days prior to the commencement of such Interest Period, as the rate for dollar deposits in the London interbank market with a maturity comparable to such Interest Period, provided that in the event such rate does not appear on
such screen (or on any successor or substitute page on such screen or otherwise on such screen), the “LIBOR Offered Rate” with respect to such LIBOR Loan during such Interest Period shall be determined by reference to such other comparable
publicly available service for displaying interest rates applicable to dollar deposits in the London interbank market as may be reasonably selected by the Agent or, in the absence of such availability, by reference to the rate at which dollar
deposits of $1,000,000 in immediately available funds for a maturity comparable to such Interest Period are offered by the principal office of the Agent to leading banks in the London interbank market at approximately 11:00 a.m., London time, two
LIBOR Business Days prior to the commencement of such Interest Period. 
 “LIBOR Reserve Percentage” means for any day that
percentage (expressed as a decimal) which is in effect on such day, at which any lender subject thereto would be required to maintain reserves under Regulation D of the Board of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against “Eurocurrency Liabilities” (as that term is used in Regulation D), if such liabilities were outstanding. 

“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest (statutory or other) or
encumbrance of any kind in respect of such asset, or any preference, priority or other security or preferential arrangement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement or
any financing lease having substantially the same economic effect as any of the foregoing) with respect to such asset. 

  
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 “Loan Documents” means, collectively, this Agreement, the Notes, the Security
Documents hereof and any and all other documents and instruments required to be executed and delivered by the Borrower pursuant to this Agreement, in each case as amended and in effect from time to time. 

“Loans” means the revolving credit loans made or to be made to the Borrower by the Banks pursuant to Section 2.01
hereof. 
 “Margin Stock” has the meaning assigned to such term in Regulation U. 

“Material Adverse Effect” means a material adverse effect on (a) the ability of the Borrower to fully perform its
obligations under this Agreement or any of the other Loan Documents to which it is a party, (b) the Agent’s right, title and interest, on behalf of itself and the Banks, in the collateral pledged to it pursuant to the Security Documents,
or on the rights and remedies of the Agent or any Bank under this Agreement or under any of the other Loan Documents, (c) the validity or enforceability of this Agreement or any of the other Loan Documents, or (d) the business, financial
condition, operations, assets or properties of the Borrower taken as a whole. 
 “Maximum Amount” means, as at any date of
determination, an amount equal to the least of: 
 (a) the maximum amount of Debt that the Borrower would be permitted to
incur pursuant to Applicable Law, including the Investment Company Act, 
 (b) the maximum amount of Debt that the Borrower
would be permitted to incur without violating the limitations on borrowings adopted by the Borrower in its Investment Policies and Restrictions or elsewhere, 

(c) the maximum amount of Debt that the Borrower would be permitted to incur pursuant to any agreements with any Authority, and

 (d) the maximum amount of Debt that the Borrower would be permitted to incur without violating Section 5.19 or
any other provision of this Agreement, 
 in each case, as in effect at the time of determination. 

“Moody’s” means Moody’s Investors Services, Inc., or any successor performing the same function. 

“Multiemployer Plan” means at any time a “multiemployer plan” within the meaning of Section 4001(a)(3) of
ERISA to which any member of the ERISA Group is then making or accruing an obligation to make contributions or has within the preceding five plan years made contributions, including for these purposes any Person which ceased to be a member of the
ERISA Group during such five year period. 

  
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INC. CREDIT AGREEMENT 

  
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 “Non-Extending Bank” has the meaning set forth in Section 2.09(a)
hereof. 
 “Note(s)” has the meaning set forth in Section 2.04(b) hereof. 

“Notice of Borrowing” has the meaning set forth in Section 2.02(a) hereof. 

“Notice of Conversion” has the meaning set forth in Section 2.02(b) hereof. 

“Obligations” means all indebtedness, obligations and liabilities of the Borrower to any of the Banks and the Agent, existing
on the Effective Date or arising thereafter, direct or indirect, absolute or contingent, matured or unmatured, liquidated or unliquidated, secured or unsecured, arising by contract, operation of law or otherwise, arising or incurred under this
Agreement or any of the other Loan Documents or in respect of any of the Loans to the Borrower or any of the Notes or other instruments at any time evidencing any thereof. 

“OECD” means the Organisation for Economic Co-operation and Development or any successor organization. 

“OFAC” has the meaning set forth in Section 4.16 hereof. 

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

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that
arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, other than Taxes that are
Other Connection Taxes imposed with respect to an assignment by a Bank (other than an assignment made pursuant to Section 8.05 hereof. 

“Overnight LIBOR Rate” means, as of any day, the higher of (a) 0.001%, and (b) the rate appearing on the Reuters
“LIBOR01” screen displaying interest rates for dollar deposits in the London interbank market (or on any successor or substitute page on such screen) at approximately 11:00 a.m., London time, as the rate for dollar deposits in the London
interbank market with a maturity of one LIBOR Business Day, provided that in the event such rate does not appear on such screen (or on any successor or substitute page on such screen or otherwise on such screen), the “Overnight LIBOR
Rate” shall be determined by reference to such other comparable publicly available service for displaying interest rates applicable to dollar deposits in the London interbank market as may be reasonably selected by the Agent or, in the absence
of such availability, by reference to the rate at which dollar deposits of $1,000,000 in immediately available funds for a term of one LIBOR Business Day are offered by the principal office of the Agent to leading banks in the London interbank
market at approximately 11:00 a.m., London time, provided further that in the event such day is not a LIBOR Business Day, then Overnight LIBOR Rate shall be such rate as in effect on the immediately preceding LIBOR Business Day. 

  
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INC. CREDIT AGREEMENT 

  
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 “Participant” has the meaning set forth in Section 9.06(b) hereof.

 “Person” means an individual, a corporation, a partnership, an association, a trust (or series thereof) or any other
entity or organization, including a government or political subdivision or an agency or instrumentality thereof. 
 “Plan”
means at any time an employee pension benefit plan (other than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Internal Revenue Code and either (a) is
maintained, or contributed to, by any member of the ERISA Group for employees of any member of the ERISA Group or (b) has at any time within the preceding five years been maintained, or contributed to, by any Person which was at such time a
member of the ERISA Group for employees of any Person which was at such time a member of the ERISA Group. 
 “Private
Authorizations” means all franchises, permits, licenses, approvals, consents and other authorizations of all Persons (other than any Authority) including, without limitation, those of shareholders and creditors and those with respect to
trademarks, service marks, trade names, copyrights, computer software programs, technical and other know-how. 

“Prospectus” means, collectively, the Borrower’s prospectus and statement of additional information, each dated
October 14, 2014, and filed with the SEC pursuant to Rule 497(h) under the Securities Act, as may be supplemented from time to time. 

“Regulation T” means Regulation T of the Board of Governors of the Federal Reserve System, as in effect from time to time,
and all official rulings and interpretations thereunder and thereof. 
 “Regulation U” means Regulation U of the Board of
Governors of the Federal Reserve System, as in effect from time to time, and all official rulings and interpretations thereunder and thereof. 

“Regulation X” means Regulation X of the Board of Governors of the Federal Reserve System, as in effect from time to time,
and all official rulings and interpretations thereunder and thereof. 
 “Replacement Bank” has the meaning set forth in
Section 8.05 hereof. 
 “Representatives” has the meaning set forth in Section 9.09(a) hereof. 

“Required Banks” means at any time Banks holding at least a majority of the aggregate unpaid principal amount of the Loans at
such time or, if no Loans are then outstanding, Banks having at least a majority of the aggregate Commitment Amounts then in effect; provided, however, that for purposes of determining Required Banks, the Commitment Amount or Loans, as
the case may be, of each Delinquent Bank shall be disregarded for so long as such Bank remains a Delinquent Bank. 
 “Revolving
Credit Period” means the period from and including the Effective Date to but excluding the Termination Date. 

  
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 “S&P” means Standard & Poor’s, a division of The McGraw Hill
Companies, Inc., or any successor performing the same function. 
 “Sanctions” has the meaning set forth in
Section 4.16 hereof. 
 “SEC” means the Securities and Exchange Commission or any other Authority of the United
States of America at the time administering the Securities Act, the Investment Company Act or the Exchange Act. 
 “Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC thereunder, as modified or interpreted by orders of the SEC, or other interpretative releases or letters issued by the SEC or its staff, all as from
time to time in effect, or any successor law, rules or regulations, and any reference to any statutory or regulatory provisions shall be deemed to be a reference to any successor statutory or regulatory provision. 

“Security Agreement” means that certain Security Agreement, dated as of the date hereof, between the Borrower and the Agent,
on behalf of itself and the Banks, as the same may be amended, restated, modified or supplemented from time to time. 
 “Security
Documents” means, collectively, the Security Agreement and all other security documents hereafter delivered to the Agent granting a Lien on any property of the Borrower to secure the obligations and liabilities of the Borrower under any
Loan Document. 
 “Senior Securities Representing Indebtedness” has the meaning set forth in Section 18(g) of the
Investment Company Act. 
 “State Street” means State Street Bank and Trust Company in its capacity as a Bank hereunder.

 “Subsidiary” means, with respect to a Person, any corporation or other entity of which securities or other ownership
interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are at the time directly or indirectly owned by such Person. 

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

“Termination Date” means January 5, 2016, or such earlier date on which the Commitments terminate or are terminated
pursuant to the terms hereof, provided that the Termination Date (and some or all of the Banks’ Commitments to make Loans to the Borrower hereunder) may be extended in accordance with Section 2.09 hereof. 

“Total Assets” means, at any date of determination, all assets which in accordance with Generally Accepted Accounting
Principles would be classified as assets upon a balance sheet of the Borrower prepared as of such date, valued in accordance with the methods and procedures described in the Borrower’s Valuation Procedures, provided, however, that
Total Assets shall not include (a) equipment, (b) deferred organizational and offering expenses, or (c)(i) the assets of 

  
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any other Person which in accordance with Generally Accepted Accounting Principles would be consolidated with those of the Borrower on such balance sheet, or (ii) the value of any investment
in any such Person. 
 “Total Liabilities” means, at any date of determination, the sum of all liabilities which in
accordance with Generally Accepted Accounting Principles would be classified as liabilities upon a balance sheet of the Borrower prepared as of such date, plus, without duplication, the aggregate amount of the Borrower’s Debt and
Financial Contract Liability. 
 “Valuation Procedures” means the Borrower’s Valuation Procedures in effect on the
Effective Date, a copy of which was delivered to the Agent prior thereto, or such other valuation policies and procedures as are otherwise consented to in writing by the Agent (such consent not to be unreasonably withheld, conditioned or delayed).

 “Value” has the meaning assigned to such term in Section 2(a)(41) of the Investment Company Act. 

SECTION 1.02. Accounting Terms and Determinations. Unless otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made and all financial statements required to be delivered hereunder shall be prepared in accordance with generally accepted accounting principles as in effect from time to time in the
United States of America (“Generally Accepted Accounting Principles”), applied on a basis consistent (except for changes concurred in by the Borrower’s independent public accountants) with the most recent audited financial
statements of the Borrower delivered to the Banks hereunder. 
 ARTICLE II. 

THE CREDIT 
 SECTION
2.01. Commitments to Lend. Subject to the terms and conditions set forth in this Agreement, each of the Banks severally agrees to lend to the Borrower and the Borrower may borrow, repay and reborrow from time to time during the Revolving Credit
Period, upon notice by the Borrower to the Agent given in accordance with Section 2.02(a) hereof, such sums as are requested by the Borrower up to a maximum aggregate amount outstanding (after giving effect to all amounts outstanding and
all amounts requested) at any one time equal to such Bank’s Commitment Amount, provided that the aggregate principal amount of all Loans outstanding (after giving effect to all amounts requested and the application thereof)
(i) shall not exceed at any time the lesser of (a) the Borrowing Base and (b) the Aggregate Commitment Amount; and (ii) shall not cause the Borrower to have an aggregate amount of Debt outstanding that is in excess of the Maximum
Amount, in each case in effect at such time. Each borrowing under this Section shall be in an aggregate principal amount of $1,000,000 or any integral multiple of $100,000 in excess thereof and shall be made from the several Banks pro
rata in accordance with each Bank’s Commitment Percentage. Each Loan shall mature and become due and payable as provided in Section 2.05 hereof. 

SECTION 2.02. Notice of Borrowings. (a) The Borrower shall give the Agent a notice substantially in the form of Exhibit B
attached hereto (a “Notice of Borrowing”) not later 

  
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than 12:00 noon (Boston time) (or telephonic notice not later than 12:00 noon (Boston time) confirmed in writing substantially in the form of Exhibit B attached hereto not later than 1:00
p.m. (Boston time)) (i) on the Domestic Business Day of each proposed borrowing of a Base Rate Loan and (ii) on the third LIBOR Business Day before each proposed borrowing of a LIBOR Loan, in each case specifying (1) the date of such
borrowing, which shall be a Domestic Business Day in the case of a Base Rate Loan or a LIBOR Business Day in the case of a LIBOR Loan, (2) whether such borrowing shall be of a Base Rate Loan or a LIBOR Loan, (3) the aggregate principal
amount of such borrowing, (4) for a LIBOR Loan only, the applicable Interest Period and (5) if applicable pursuant to Section 2.03(b)(y) hereof, wire instructions. Each Notice of Borrowing or oral request shall constitute a
representation and warranty by the Borrower that the conditions set forth in Section 3.02(a) through (d) hereof (and, in the case of the initial Loan to be made hereunder, Section 3.01(b) through (g), and
(i) through (l) hereof) have been satisfied on the date of such notice and will be satisfied on the date of such borrowing. 

(b) The Borrower may elect from time to time to convert any outstanding Base Rate Loan or LIBOR Loan to a Loan of the other
type, or to roll over any outstanding LIBOR Loan upon the expiration of an Interest Period with respect thereto, by giving a notice to the Agent substantially in the form of Exhibit C attached hereto (a “Notice of
Conversion”) (or telephonic notice confirmed in a writing substantially in the form of Exhibit C attached hereto), provided that (i) with respect to any conversion into or rollover of a LIBOR Loan, the Notice of
Conversion shall be given within the time period for the giving of a Notice of Borrowing for a LIBOR Loan as set forth in Section 2.02(a) hereof, (ii) no Loan may be converted into or rolled over as a LIBOR Loan (1) if the
Interest Period therefor would extend beyond the Termination Date or (2) if an Event of Default has occurred and is continuing (in which case, if the Agent has or the Required Banks have determined in its or their sole discretion not to permit
such continuations, such Loan shall automatically become a Base Rate Loan on the last day of the first Interest Period relating thereto ending during the continuance of such Event of Default), (iii) a LIBOR Loan may be converted into a Base
Rate Loan or rolled over as a LIBOR Loan only on the last day of the Interest Period applicable thereto, and (iv) if the Borrower fails to give a Notice of Conversion for a LIBOR Loan the Borrower shall be deemed to have elected to convert such
Loan to a Base Rate Loan on the last day of the Interest Period applicable thereto. Conversions to and from LIBOR Loans shall be in such amounts and pursuant to such elections so that, after giving effect thereto, the aggregate principal amount of
all LIBOR Loans having the same Interest Period shall equal to $1,000,000 or a larger integral multiple of $100,000. 
 SECTION 2.03.
Notice to Banks; Funding of Loans. (a) Upon receipt of a Notice of Borrowing or an oral request for a borrowing in accordance with Section 2.02(a) hereof, the Agent shall promptly notify each Bank of the contents thereof and of such
Bank’s ratable share of such borrowing. Such Notice of Borrowing or oral request shall not thereafter be revocable by the Borrower and shall obligate the Borrower to accept the Loans requested from the Banks on the date of such borrowing. 

(b) Not later than 2:00 p.m. (Boston time) on the Borrowing Date of each borrowing, each Bank shall make available its share of
such borrowing, in federal or 

  
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other funds immediately available in Boston, to the Agent at its address referred to in Section 9.01 hereof. Unless the Agent determines that any applicable condition specified in
Article III has not been satisfied or waived, the Agent will (x) make its share of such borrowing and the funds so received from the other Banks available to the Borrower at the Agent’s aforesaid address or (y) at the election of
Borrower as set forth in the applicable Notice of Borrowing, as may be reasonably acceptable to the Agent, wire its share of such borrowing and the funds so received from the other Banks to a third party designated by the Borrower in such Notice of
Borrowing, in each case, in federal funds or other funds immediately available to the Borrower or such other third party, as applicable, in each case on the Borrowing Date. The failure or refusal of any Bank to make available to the Agent as
provided herein its share of any borrowing shall not relieve any other Bank from its several obligations hereunder. 
 (c) If
any Bank makes a new Loan hereunder on a day on which the Borrower is to repay the principal amount of an outstanding Loan to such Bank, the Bank shall apply the proceeds of its new Loan to make such repayment and only an amount equal to the
difference (if any) between the amount being borrowed and the amount being repaid shall be made available by the Agent as provided in clause (a) of this Section or remitted by the Borrower to the Bank as provided in Section 2.10
hereof, as the case may be. 
 (d) Unless the Agent shall have received notice from a Bank prior to any Borrowing Date that
such Bank will not make available to the Agent such Bank’s share of such borrowing, the Agent may assume that such Bank has made such share available to the Agent on such date in accordance with clause (b) of this Section and the Agent may
(but it shall not be required to), in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. If and to the extent that such Bank shall not have so made such share available to the Agent, such Bank agrees
to repay to the Agent, upon demand, such amount together with interest thereon, for each day from the date such amount is made available to the Borrower until the date such amount is repaid to the Agent, at the Federal Funds Rate. If such Bank shall
repay to the Agent such amount, such amount so repaid shall constitute such Bank’s Loan included in such borrowing for purposes of this Agreement. If and to the extent that such Bank shall not have so made such share available to the Agent
within three Domestic Business Days after demand by the Agent, the Borrower agrees to repay to the Agent, upon demand, such amount together with interest thereon, for each day from the date such amount is made available to the Borrower until the
date such amount is repaid to the Agent, at a rate per annum equal to the interest rate applicable thereto pursuant to Section 2.06 hereof. The provisions of this Section 2.03(d) shall not relieve any such Bank from any
liability to the Borrower. 
 SECTION 2.04. Loan Accounts; Notes; Records. (a) The Loans made by each Bank to the Borrower shall be
evidenced by one or more loan accounts or records maintained by such Bank in the ordinary course of business. The Borrower irrevocably authorizes each Bank to make or cause to be made, at or about the date of any Loan or at the time of receipt of
any payment of principal of any Loan, an appropriate notation on its loan accounts or records, including computer records, reflecting the making of such Loan or (as the case may be) the 

  
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receipt of such payment. The outstanding amount of the Loans set forth in any such loan accounts or records, including any computer records, maintained by a Bank with respect to the Loans made by
it shall, absent manifest error, be prima facie evidence of the principal amount thereof owing and unpaid to the Bank, but the failure to record, or any error in so recording, any such amount on any such loan account or record shall
not limit or otherwise affect the obligation of the Borrower hereunder or under the other Loan Documents to make payments of principal of and interest on the Loans when due. 

(b) The Borrower hereby agrees that if, in the opinion of any Bank, a promissory note or other evidence of debt is required,
appropriate or desirable to reflect or enforce the Debt of the Borrower resulting from the Loans made, or to be made, by such Bank, then, upon request of such Bank, the Borrower shall promptly execute and deliver to such Bank, a promissory note
(each, a “Note” and, collectively, the “Notes”) substantially in the form of Exhibit A attached hereto, payable to such Bank in an amount equal to such Bank’s Commitment Amount or, if less, the aggregate
unpaid principal amount of such Bank’s Loans, plus interest thereon as provided below, provided, that as a condition to issuing any Note in replacement of a previously issued Note that has been lost, the Borrower may require an
indemnity with respect to lost instruments from such Bank, in form and substance satisfactory to the Borrower and its counsel. 

(c) The Agent’s records with respect to the Loans, the interest rates applicable thereto, each payment by the Borrower of
principal and interest on the Loans and fees, expenses and any other amounts due and payable in connection with this Agreement and the other Loan Documents shall, absent manifest error, be prima facie evidence of the amount of the
Loans and the amount of principal and interest paid by the Borrower in respect of the Loans and as to the other information relating to the Loans and amounts paid and payable by the Borrower hereunder and under the other Loan Documents. 

SECTION 2.05. Mandatory Payments; Optional Prepayments. (a) Each Loan shall mature, and the principal amount thereof shall be due
and payable, on the Termination Date. The Borrower promises to pay on the Termination Date, and there shall become absolutely due and payable on the Termination Date, all of the Loans outstanding on such date, together with all accrued and unpaid
interest thereon and other amounts outstanding hereunder. 
 (b) If at any time the aggregate principal amount of Loans
outstanding to the Borrower exceeds the Borrowing Base, the Borrower shall, within three (3) Domestic Business Days, prepay such principal amount of one or more Loans (together with, in the case of LIBOR Loans, accrued interest thereon and the
amount, if any, payable pursuant to Section 8.06 hereof) as may be necessary so that after such prepayment the aggregate principal amount of Loans outstanding to the Borrower does not exceed the Borrowing Base. 

(c) If at any time the aggregate principal amount of Loans outstanding to the Borrower exceeds the Maximum Amount, the Borrower
shall, within three (3) Domestic Business Days, prepay such principal amount of one or more Loans 

  
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(together with, in the case of LIBOR Loans, accrued interest thereon and the amount, if any, payable pursuant to Section 8.06 hereof) as may be necessary so that after such prepayment
the aggregate principal amount of Loans outstanding to the Borrower does not exceed the Maximum Amount. 
 (d) If at any time
the aggregate principal amount of Loans outstanding to the Borrower exceeds the Aggregate Commitment Amount or the principal amount of Loans outstanding to any one Bank exceeds the Commitment Amount of such Bank, the Borrower shall promptly, but in
any case within one (1) Domestic Business Day, prepay such principal amount of one or more Loans (together with, in the case of LIBOR Loans, accrued interest thereon and the amount, if any, payable pursuant to Section 8.06 hereof)
as may be necessary to eliminate such excess. 
 (e) The Borrower may, with notice to the Agent no later than 11:30 a.m.
(Boston time) on the Domestic Business Day of such payment in the case of Base Rate Loans and upon at least three LIBOR Business Days’ notice of such payment in the case of LIBOR Loans, prepay any Loans in whole at any time, or from time to
time in part in an aggregate principal amount not less than $1,000,000 and in larger integral multiples of $100,000, by paying the principal amount to be prepaid (together with, in the case of LIBOR Loans, accrued interest thereon to the date of
prepayment and the amount, if any, payable pursuant to Section 8.06 hereof). Each notice delivered by the Borrower pursuant to this paragraph shall be irrevocable; provided that a notice of prepayment delivered by the
Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities or the occurrence of other relevant events, in which case such notice may be revoked by the Borrower (by notice to the Agent on or prior to the
specified effective date) if such condition is not satisfied. Each such optional prepayment shall be applied to prepay ratably the Loans of the several Banks included in such borrowing. 

(f) If the Borrower prepays all or any portion of the principal amount of any LIBOR Loan on any day other than the last day of
the Interest Period relating thereto, such prepayment shall include the amounts, if any, payable pursuant to Section 8.06 hereof. 

(g) Upon receipt of a notice of prepayment pursuant to clause (e), the Agent shall promptly notify each Bank of the contents
thereof and of such Bank’s ratable share of such prepayment. 
 (h) Subject to the satisfaction of the conditions set
forth in Section 3.02 hereof, Loans prepaid prior to the Termination Date may be reborrowed prior to the Termination Date. 

SECTION 2.06. Interest Rates. (a) Subject to clause (c) of this Section 2.06, each Base Rate Loan shall bear interest
on the outstanding principal amount thereof, for the period commencing with the date such Loan is made up to but not including the date such Loan is repaid in full, at a rate per annum equal to the Base Rate as in effect from time to time. Interest
on each Base Rate Loan shall be payable in arrears on the first Domestic Business Day of each calendar month and on the Termination Date. 

  
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 (b) Subject to Section 2.06(c) and Section 8.06 hereof,
each LIBOR Loan shall bear interest on the outstanding principal amount thereof, for the period commencing with the date such LIBOR Loan is made or continued through and including the last day of the Interest Period applicable thereto, at a rate per
annum equal to the sum of the LIBOR Margin plus the applicable Adjusted LIBOR Offered Rate. Interest on each LIBOR Loan shall be payable in arrears on the first Domestic Business Day of each calendar month and on the Termination Date. 

(c) Any overdue principal of (whether at stated maturity, by acceleration or otherwise) and (to the extent permitted by
applicable law) interest on the Loans and all other overdue amounts payable hereunder shall bear interest, payable on demand, for each day from and including the date payment thereof was due to but not including the date of actual payment, at a rate
per annum equal to two percent (2%) above (i) in the case of overdue principal, the rate of interest otherwise applicable to such Loans pursuant to this Section 2.06 and (ii) in the case of other amounts, the Base Rate, in
each case until such amount shall be paid in full (after as well as before judgment). 
 (d) The Agent shall determine the
interest rate applicable to the Loans hereunder and its determination thereof shall be conclusive and binding for all purposes in the absence of manifest error. 

SECTION 2.07. Fees. (a) During the Revolving Credit Period, the Borrower shall pay to the Agent for the account of each Bank a
commitment fee at the rate of 0.15% per annum on the daily amount by which such Bank’s Commitment Amount exceeded the aggregate outstanding principal amount of the Loans made by such Bank (including, in the case of a Delinquent Bank, the
principal amount of all Loans with respect to which such Bank is delinquent). Such commitment fee shall accrue from and including the Effective Date to but excluding the Termination Date. Accrued commitment fees payable hereunder shall be payable
quarterly in arrears on the last day of each March, June, September and December, commencing on the first such day after the Effective Date, and on the Termination Date. 

(b) On the Effective Date, the Borrower shall pay to the Agent, for its own account, a non-refundable structuring fee in the
sum of $25,000. 
 SECTION 2.08. Termination and Reduction of Commitments. (a) Each Bank’s Commitment Amount permanently shall
reduce to $0 and each Bank’s Commitment shall terminate on the Termination Date. 
 (b) Subject to
Section 2.05(d) hereof, during the Revolving Credit Period, the Borrower may, upon at least three (3) Domestic Business Days’ prior written notice to the Agent, (i) terminate the Commitments at any time, or
(ii) reduce from time to time the aggregate Commitment Amounts by an aggregate amount of $1,000,000 or integral multiples of $1,000,000 in excess thereof, whereupon the Commitment Amounts of each of the Banks shall be reduced pro
rata in accordance with their 

  
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Commitment Percentage of the amount specified in such notice or, as the case may be, each Bank’s Commitment shall be terminated. Each notice delivered by the Borrower pursuant to this
paragraph shall be irrevocable; provided that a notice of termination of the Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities or the occurrence of other
relevant events, in which case such notice may be revoked by the Borrower (by notice to the Agent on or prior to the specified effective date) if such condition is not satisfied. Promptly after receiving any notice of the Borrower delivered pursuant
to this Section, the Agent will notify the Banks of the substance thereof. Upon the effective date of any such reduction or termination, the Borrower shall pay to the Agent for the respective accounts of the Banks the full amount of any commitment
fee then accrued on the amount of the reduction. No reduction in the Commitment Amounts or termination of the Commitments may be reinstated. 

SECTION 2.09. Extension of Termination Date. (a) The Borrower may, by notice to the Agent (which shall promptly deliver a copy to each
of the Banks) not less than 30 days and not more than 60 days prior to the Termination Date then in effect hereunder (the “Existing Termination Date”), request that the Banks extend the Termination Date for an additional 364 days
from the Existing Termination Date. Each Bank, acting in its sole discretion, shall, by notice to the Borrower and the Agent given on the date (and, subject to the provision below, only on the date) 21 days prior to the Existing Termination Date
(provided, if such date is not a Domestic Business Day, then such notice shall be given on the next succeeding Domestic Business Day) (the “Consent Date”), advise the Borrower whether or not such Bank agrees to such extension;
provided that each Bank that determines not to extend the Termination Date (a “Non-Extending Bank”) shall notify the Agent (who shall notify the Borrower) of such fact promptly after such determination (but in any
event no later than the Consent Date) and any Bank that does not advise the Borrower on or before the Consent Date shall be deemed to be a Non-Extending Bank. The election of any Bank to agree to an extension of the Termination Date shall not
obligate any other Bank to agree to such extension. 
 (b) The Borrower shall have the right on or before the Existing
Termination Date to replace each Non-Extending Bank with, and otherwise add to this Agreement, one or more other commercial banks, which may include any Bank (each, prior to the Existing Termination Date, an “Additional Commitment
Bank”) with the approval of the Agent (which approval shall not be unreasonably delayed or withheld). Each Additional Commitment Bank shall enter into an Assignment and Acceptance pursuant to which such Additional Commitment Bank shall,
effective as of the Existing Termination Date, undertake a Commitment (an “Additional Commitment”). If any such Additional Commitment Bank is a Bank, its Additional Commitment shall be in addition to such Bank’s Commitment
hereunder on such date. 
 (c) If (and only if) Banks with Commitment Amounts that, in the aggregate, together with the
proposed Commitment Amounts of the Additional Commitment Banks that will become effective on the Existing Termination Date, aggregate at least 51% of the aggregate Commitment Amounts (not including the proposed Commitment Amounts of the Additional
Commitment Banks) on the Consent Date shall have agreed to extend the Existing Termination Date, then, 

  
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effective as of the Existing Termination Date, the Existing Termination Date shall be extended to the date which is 364 days after the Existing Termination Date (provided, if such date is
not a Domestic Business Day, then such Termination Date as so extended shall be the next preceding Domestic Business Day) and each Additional Commitment Bank shall thereupon become a “Bank” with a Commitment for all purposes of this
Agreement. 
 (d) Notwithstanding the foregoing, the extension of the Existing Termination Date shall not be effective with
respect to any Bank unless: 
 (i) no Default or Event of Default shall have occurred and be continuing on the date of the
notice requesting such extension, the Consent Date or the Existing Termination Date; 
 (ii) each of the representations and
warranties of the Borrower in Article IV hereof shall be true and correct in all material respects on and as of each of the date of the notice requesting such extension, the Consent Date and the Existing Termination Date with the same force
and effect as if made on and as of each such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date); and 

(iii) each Non-Extending Bank shall have been paid in full by the Borrower all amounts owing to such Bank hereunder on or
before the Existing Termination Date. 
 If the Existing Termination Date is extended as provided in this Section 2.09, (a) the Commitment
of each Non-Extending Bank shall terminate on the Existing Termination Date and (b) from and after the Existing Termination Date, the aggregate Commitment Amounts of the Banks shall not include the Commitment Amounts of the Non-Extending Banks.

 SECTION 2.10. General Provisions as to Payments. (a) The Borrower shall make each payment of principal and interest on the Loans
and of fees hereunder and all other amounts due hereunder not later than 2:00 p.m. (Boston time) on the date when due, in Dollars and in federal or other funds immediately available in Boston, to the Agent at its address referred to in
Section 9.01 hereof. The Agent shall promptly distribute to each Bank its ratable share of each such payment received by the Agent for the account of the Banks. Whenever any payment of principal of, or interest on, Base Rate Loans or of
fees shall be due on a day which is not a Domestic Business Day, the date for payment thereof shall be extended to the next succeeding Domestic Business Day and interest shall accrue during such extension. Except as otherwise provided in the
definition of Interest Period, whenever any payment of principal of, or interest on, LIBOR Loans shall be due on a day which is not a LIBOR Business Day, the date for payment thereof shall be extended to the next succeeding LIBOR Business Day unless
such LIBOR Business Day falls in another calendar month, in which case the date for payment thereof shall be the next preceding LIBOR Business Day. If the date for any payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time. 

  
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 (b) Unless the Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Banks hereunder that the Borrower will not make such payment in full, the Agent may assume that the Borrower has made such payment in full to the Agent on such date and the Agent may (but it shall not be
required to), in reliance upon such assumption, cause to be distributed to each Bank on such due date an amount equal to the amount then due to such Bank. If and to the extent that the Borrower shall not have so made such payment, each Bank shall
repay to the Agent forthwith on demand such amount distributed to such Bank together with interest thereon, for each day from the date such amount is distributed to such Bank until the date such Bank repays such amount to the Agent, at the Federal
Funds Rate. 
 (c) All payments by the Borrower hereunder and under any of the other Loan Documents shall be made in Dollars
without setoff or counterclaim and free and clear of and without deduction for any Taxes, unless the Borrower is required by law (as determined in the good faith discretion of the Borrower or its agent) to make such deduction or withholding. If any
Indemnified Taxes are required to be withheld, the Borrower will pay to the Agent, for the account of the Banks or (as the case may be) the Agent, on the date on which such amount is due and payable hereunder or under such other Loan Document, such
additional amount in Dollars as shall be necessary to enable the Banks or the Agent to receive the same net amount which the Banks or the Agent would have received on such due date had no such Indemnified Taxes been required to be withheld. The
Borrower will deliver promptly to the Agent certificates or other valid vouchers for all Taxes deducted from or paid with respect to payments made by the Borrower hereunder or under such other Loan Document. If the Borrower reasonably believes that
such Indemnified Taxes were not correctly or reasonably asserted, the applicable Bank will use reasonable efforts to cooperate with the Borrower to obtain a refund of such Taxes (which shall be repaid to the Borrower so long as such efforts would
not, in the good faith determination of the Bank, result in any material additional costs, expenses or risks or be otherwise disadvantageous to it). 

(d) [reserved] 

(e) If the Agent or a Bank determines, in its reasonable discretion, that it has received a refund or credit of any Taxes as to
which it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to clause (c) of this Section 2.10, it shall pay over such refund or credit to the Borrower (but only to the
extent of indemnity payments made, or additional amounts paid, by the Borrower under clause (c) of this Section 2.10), net of all out-of-pocket expenses of the Agent or such Bank and without interest (other than any interest paid by
the relevant Authority with respect to such refund or credit); provided, that the Borrower, upon the request of the Agent or such Bank, agrees to repay the amount paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Authority) to the Agent or such Bank in the event the Agent or such Bank is required to repay such refund or credit to such Authority. Each Bank agrees, that upon the occurrence of any event giving rise to a Tax as to which
it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to clause (c) of this Section 2.10, it will use reasonable efforts to mitigate the

  
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continuing effect of any such event, including by completing and delivering or filing any Tax-related forms which would reduce or eliminate such Tax or additional amounts. 

(f) Each Bank agrees to use reasonable efforts to change the jurisdiction of its Applicable Lending Office if such a change
would avoid the need for, or reduce the amount of, any additional amounts payable by the Borrower pursuant to Section 2.10(c) hereof and would not subject the Bank to any out-of-pocket cost or expense or, in the reasonable judgment of the
Bank, be disadvantageous to the Bank in any respect. 
 SECTION 2.11. Computation of Interest and Fees. All interest and fees
hereunder shall be computed on the basis of a year of 360 days and paid for the actual number of days elapsed, except that, with respect to Base Rate Loans the rate of interest on which is calculated on the basis of the prime rate, the interest
thereon shall be calculated on the basis of a 365- (or 366-, as the case may be) day year for the actual days elapsed. The Agent’s determination of interest rates shall be conclusive and binding for all purposes, absent manifest error. 

SECTION 2.12. Withholding Tax Exemption. (a) Each Bank that is not a Foreign Bank shall deliver to the Borrower (with a copy to
the Agent) an original signed, properly completed IRS Form W-9 (or any successor form) certifying that the Bank is not subject to U.S. backup withholding tax, on or prior to the date on which the Bank becomes a Bank under this Agreement, promptly
upon the obsolescence, expiration, or invalidity of any form previously delivered by the Bank, and from time to time thereafter upon the request of the Borrower or Agent. 

(b) Any Foreign Bank that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the
Borrower is resident for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments hereunder or under any other Loan Document shall deliver to the Borrower (with a copy to the Agent), at the time or times prescribed
by applicable law or reasonably requested by the Borrower or the Agent, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced rate of withholding.
In addition, any Bank, if requested by the Borrower or the Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Agent, including without limitation, as will enable the Borrower or
the Agent to determine whether or not the Bank is subject to backup withholding or information reporting requirements. Without limiting the generality of the foregoing, each Foreign Bank shall deliver to the Borrower and the Agent (in such number of
copies as shall be requested by the recipient) on or prior to the date on which such Foreign Bank becomes a Bank under this Agreement (and promptly upon the obsolescence, expiration or invalidity of any form or certificate previously delivered by
such Foreign Bank or from time to time thereafter upon the request of the Borrower or the Agent), whichever of the following is applicable: 

(i) original signed and duly completed copies of Internal Revenue Service Form W-8BEN or Internal Revenue Service Form W-8BEN-E
(or successor form) claiming eligibility for benefits of an income tax treaty to which the United States is a party that reduces or eliminates withholding tax; 

  
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 (ii) original signed and duly completed copies of Internal Revenue Service Form
W-8ECI (or successor form); 
 (iii) in the case of a Foreign Bank claiming the benefits of the exemption for portfolio
interest under Section 881(c) of the Internal Revenue Code, (x) a written certificate that such Foreign Bank is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (B) a
“10 percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code, or (C) a “controlled foreign corporation” receiving interest from a related person within the meaning of
section 881(c)(3)(C) of the Internal Revenue Code (a “U.S. Tax Compliance Certificate”) and (y) original signed and duly completed copies of Internal Revenue Service Form W-8BEN or Internal Revenue Service Form W-8BEN-E (or
successor form); 
 (iv) to the extent a Foreign Bank is not the beneficial owner, original signed and duly completed copies
of Internal Revenue Service Form W-8IMY (or successor form), accompanied by Internal Revenue Service Form W-8ECI (or successor form), Internal Revenue Service From W-8BEN (or successor form), Internal Revenue Service Form W-8BEN-E (or successor
form), a U.S. Tax Compliance Certificate, Internal Revenue Service Form W-9 (or successor form) and/or other certification documents from each beneficial owner, as applicable; provided that if the Bank is a partnership and one or more
direct or indirect partners of the Bank are claiming the portfolio interest exemption, the Bank may provide a U.S. Tax Compliance Certificate on behalf of each such direct and indirect partner; or 

(v) any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in United States federal
withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower to determine the withholding or deduction required to be made. 

(c) If a payment made to a Bank under any Loan Document would be subject to U.S. federal withholding tax imposed by FATCA if such Bank were to
fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Internal Revenue Code, as applicable), such Bank shall deliver to the Borrower and the Agent at the time or times
prescribed by law and at such time or times reasonably requested by the Borrower or the Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Internal Revenue Code) and such additional
documentation reasonably requested by the Borrower or the Agent as may be necessary for the Borrower and the Agent to comply with their obligations under FATCA and to determine that such Bank has complied with such Bank’s obligations under
FATCA or to determine the amount to deduct and withhold from such payment. For purposes of this clause (c) of Section 2.12 hereof, “FATCA” shall include any amendments made to FATCA after the Effective Date. 

  
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 SECTION 2.13. Payment of Other Taxes by the Borrower. The Borrower shall timely pay to the
relevant Authority in accordance with applicable law, or at the option of the Agent timely reimburse it for the payment of, any Other Taxes. 

ARTICLE III. 
 CONDITIONS

 SECTION 3.01. Effectiveness. This Agreement shall become effective on the date that each of the following conditions shall
have been satisfied or waived in accordance with Section 9.05 hereof: 
 (a) receipt by the Agent of counterparts
hereof signed by each of the parties hereto; 
 (b) receipt by the Agent of (i) a perfection certificate from the
Borrower substantially in the form of Exhibit G attached hereto, (ii) copies of the results of current UCC lien searches (or the equivalent in the applicable jurisdictions), such results to be in form and substance reasonably
satisfactory to the Agent, (iii) the Security Agreement, and (iv) such other documents, instruments and/or agreements as the Agent may reasonably require to perfect its security interest in the Collateral in the relevant jurisdictions;

 (c) receipt by the Agent of the legal opinion of Dechert LLP, counsel for the Borrower, addressed to the Agent and the
Banks and covering such matters relating to the transactions contemplated hereby as the Agent may reasonably request; 
 (d)
receipt by the Agent of a certificate manually signed by an officer of the Borrower to the effect set forth in clauses (b) (if the Borrower is submitting a Notice of Borrowing on the Effective Date), (c) and (d) of
Section 3.02 hereof, such certificate to be dated the Effective Date and to be in form and substance satisfactory to the Agent; 

(e) receipt by the Agent of a manually signed certificate from the Secretary or Assistant Secretary of the Borrower in form and
substance satisfactory to the Agent and dated the Effective Date as to the incumbency of, and bearing manual specimen signatures of, the Authorized Signatories who are authorized to execute and take actions under the Loan Documents for and on behalf
of the Borrower, and certifying and attaching copies of (i) Charter Documents (other than those delivered pursuant to Section 3.01(g) hereof), with all amendments thereto, (ii) the resolutions of the Borrower’s Board of
Directors authorizing the transactions contemplated hereby, (iii) the investment advisory agreement between the Borrower and the Investment Manager as then in effect, along with any other investment management or submanagement agreements to
which the Borrower is a party as then in effect, (iv) the Prospectus then in effect, and (v) a balance sheet of the Borrower, dated the Effective Date, and prepared in accordance with Generally Accepted Accounting Principles (the
“Closing Balance Sheet”); 

  
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 (f) a legal existence and good standing certificate for the Borrower from the
Secretary of State of the State of Delaware, dated as of a recent date; 
 (g) a copy of the articles of incorporation of the
Borrower, with all amendments, certified as of a recent date by the Secretary of State of the State of Delaware; 
 (h)
receipt by the Agent on behalf of each Bank of a duly completed Form FR U-1 referred to in Regulation U signed by the Borrower; and 

(i) receipt by the Agent of payment of (i) all reasonable fees and expenses (including reasonable fees and disbursements
of special counsel for the Agent) then payable hereunder for which invoices have been presented and (ii) all fees then due and payable pursuant to Section 2.07(b) hereof. 

The Agent shall promptly notify the Borrower and the Banks of the Effective Date, and such notice shall be conclusive and binding on all parties hereto. 

SECTION 3.02. All Borrowings. The obligation of any Bank to make a Loan on the occasion of any borrowing is subject to the satisfaction
of the conditions precedent set forth in Section 3.01 hereof (or such conditions being waived in accordance with Section 9.05 hereof) and the satisfaction of the following conditions: 

(a) receipt by the Agent of a duly completed Notice of Borrowing (together with all attachments referred to therein) as
required by Section 2.02 hereof, along with (i) in the case of the initial Loan made hereunder, a current completed Form FR U-1 referred to in Regulation U signed by the Borrower, and (ii) in the case of all Loans made
hereunder (including such initial Loan), to the extent required by Regulation U, a current completed Form FR U-1 referred to in Regulation U signed by the Borrower and, if reasonably requested by the Agent, such other information with respect to
compliance with Regulation U in form reasonably acceptable to the Agent, including where required by Regulation U a current list of the assets of the Borrower, including all margin stock; 

(b) the fact that, immediately after such borrowing, the aggregate outstanding principal amount of the Loans (i) will not
exceed the lesser of (A) the Borrowing Base and (B) the Aggregate Commitment Amount as in effect on such date; and (ii) will not cause the aggregate amount of the Borrower’s outstanding Debt to exceed the Maximum Amount; 

(c) the fact that, immediately before and after such borrowing, no Default or Event of Default shall have occurred and be
continuing; and 
 (d) the fact that the representations and warranties of the Borrower contained in this Agreement and the
other Loan Documents shall be true and correct in all material respects on and as of the date of such borrowing and with the same force and effect as if made on and as of such date (or, if any such representation or warranty is expressly stated to
have been made as of a specific earlier date, as of such specific date). 

  
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INC. CREDIT AGREEMENT 

  
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 Each borrowing hereunder shall be deemed to be a representation and warranty by the Borrower on the date of such
borrowing as to the facts specified in clauses (b), (c) and (d) of this Section. 
 SECTION 3.03. Security. To
secure the payment and performance in full of all of its Obligations, the Borrower granted to the Agent, for the benefit of itself and the Banks, a security interest in all of the Borrower’s assets pursuant to the terms of the Security
Documents. 
 ARTICLE IV. 

REPRESENTATIONS AND WARRANTIES 

The Borrower represents and warrants that: 

SECTION 4.01. Existence and Power; Investment Company. (a) The Borrower is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has all corporate powers and all authorizations and approvals required to carry on its business as now conducted. The Borrower is duly qualified to do business and is in good standing in each
jurisdiction in which the nature of its business, assets, and properties, including without limitation, the performance of the Borrower’s Obligations, requires such qualification, except where failure to be so qualified or in good standing
would not be reasonably expected to have a Material Adverse Effect. 
 (b) The Borrower is a Business Development Company,
and the outstanding shares of each class of its stock (i) have been duly issued and are fully paid and non-assessable, (ii) have been duly registered under the Securities Act or sold in transactions exempt from registration under the
Securities Act, and (iii) have been sold only in states or other jurisdictions in which all filings required to be made under applicable state securities laws have been made. 

SECTION 4.02. Authorization; Execution and Delivery, Etc. The execution and delivery by the Borrower of, and the performance by the
Borrower of its obligations under this Agreement and each of the other Loan Documents are within its corporate powers, and have been duly authorized by all requisite corporate action by the Borrower. This Agreement and each of the other Loan
Documents have been duly executed and delivered by the Borrower, and constitute the legal, valid and binding obligations of the Borrower enforceable against the Borrower in accordance with their respective terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by
proceedings in equity or at law) and an implied covenant of good faith and fair dealing. 
 SECTION 4.03. Noncontravention. Neither
the execution and delivery by the Borrower of this Agreement, the other Loan Documents nor the consummation of the transactions herein or therein contemplated, nor compliance with the terms, conditions and provisions hereof or thereof by the
Borrower will (a) conflict with, or result in a breach or 

  
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violation of, or constitute a default under any of the Charter Documents, (b) conflict with, or result in a violation of, any of the Borrower’s Investment Policies and Restrictions,
(c) conflict with or contravene (i) any Applicable Law, (ii) any contractual restriction binding on or affecting the Borrower or any of its assets, or (iii) any order, writ, judgment, award, injunction or decree binding on or
affecting the Borrower or any of its assets, (d) result in a breach or violation of, or constitute a default under, or permit the acceleration of any obligation or liability in, or but for any requirement of the giving of notice or the passage
of time (or both) would constitute such a conflict with, breach or violation of, or default under, or permit any such acceleration in, any contractual obligation or any agreement or document to which the Borrower is a party or by which it or any of
its properties is bound (or to which any such obligation, agreement or document relates), or (e) result in any Adverse Claim upon any asset of the Borrower. 

SECTION 4.04. Governmental Authorizations; Private Authorization. The Borrower has obtained all necessary Governmental Authorizations
and Private Authorizations, and made all Governmental Filings necessary for the execution and delivery by the Borrower of, and the performance by the Borrower of its obligations under, this Agreement and each of the other Loan Documents and no
Governmental Authorization, Private Authorization or Governmental Filing which has not been obtained or made, is required to be obtained or made by the Borrower in connection with the execution and delivery by the Borrower of, or the performance of
its obligations under, this Agreement or any of the other Loan Documents. 
 SECTION 4.05. Regulations T, U and X. The execution,
delivery and performance by the Borrower of this Agreement, the Notes and the other Loan Documents and the transactions contemplated hereunder and thereunder will not violate any provision of Regulation T, Regulation U or Regulation X. 

SECTION 4.06. Non-Affiliation with Banks. None of the Borrower or any Affiliate of the Borrower is an Affiliate of any Bank or any
Affiliate of any Bank known to the Borrower. 
 SECTION 4.07. Subsidiaries. The Borrower has no Subsidiaries. 

SECTION 4.08. Financial Information. (a) The Closing Balance Sheet presents fairly, and each financial statement delivered by the
Borrower to the Banks in accordance with Section 5.01 hereof, together with the notes and schedules thereto, when delivered in accordance therewith, will present fairly, in all material respects, in conformity with Generally Accepted Accounting
Principles, the financial position of the Borrower as of the date thereof. 
 (b) Since the date of the Closing balance
Sheet, there has been no material adverse change in the business, assets or financial condition of the Borrower. 
 (c) Each
of the financial statements of the Borrower (whether audited or unaudited) delivered to the Banks under the terms of this Agreement fairly present all material contingent liabilities in accordance with Generally Accepted Accounting Principles. 

  
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 SECTION 4.09. Litigation. There is no action, suit, proceeding or investigation of any
kind pending against, or to the knowledge of the Borrower, threatened against or affecting, the Borrower before any court or arbitrator or any Authority which could reasonably be expected to have a Material Adverse Effect. 

SECTION 4.10. ERISA. (a) The Borrower has no material liability in respect of any Benefit Arrangement, Plan or Multiemployer Plan
subject to ERISA. 
 (b) Assuming that the sources of the funds for the Loans do not constitute “plan assets”
subject to ERISA, no Loan will constitute a “prohibited transaction” under Section 406(a) of ERISA or Section 4975(c)(1)(A)-(D) of the Internal Revenue Code for which an exemption is not available. 

SECTION 4.11. Taxes. The Borrower has elected to be treated and qualifies as a “regulated investment company” within the
meaning of the Internal Revenue Code. The Borrower has timely filed all United States federal income Tax returns and all other material Tax returns which are required to be filed by it, if any, and has paid all Taxes due pursuant to such returns, if
any, or pursuant to any assessment received by the Borrower, except for any Taxes or assessments which are being contested in good faith by appropriate proceedings and with respect thereto adequate reserves have been established in accordance with
Generally Accepted Accounting Principles consistently applied, and the charges, accruals and reserves on the books of the Borrower in respect of Taxes, if any, are adequate. No Liens for Tax have been filed against the Borrower or any of its
property. 
 SECTION 4.12. Compliance. (a) The Borrower is in compliance with the Investment Company Act in all material respects
except where the necessity of compliance therewith is being contested in good faith by appropriate proceedings or exemptive relief has been obtained therefrom and remains in effect. The Borrower is in compliance with all other Applicable Laws and
all of the terms of any applicable licenses and permits issued by, any Authority except where the necessity of compliance therewith is being contested in good faith by appropriate proceedings or exemptive relief has been obtained therefrom and
remains in effect or where noncompliance therewith would not be reasonably expected to have a Material Adverse Effect. The Borrower is in compliance with all agreements and instruments to which it is a party or to which any of its properties may be
bound, in each case where the violation thereof would be reasonably expected to have a Material Adverse Effect. The Borrower is in compliance in all material respects with all of its Investment Policies and Restrictions. 

(b) No Default or Event of Default has occurred and is continuing. 

(c) The Borrower is not subject to any Applicable Law (other than the Investment Company Act) which limits its ability to incur
Debt hereunder. The Borrower has not entered into any agreement with any Authority limiting its ability to incur Debt hereunder. 

SECTION 4.13. Fiscal Year. The Borrower has a fiscal year which is twelve calendar months ending on December 31 of each year. 

  
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 SECTION 4.14. Full Disclosure. All information heretofore furnished by the Borrower to the
Agent and the Banks for purposes of or in connection with this Agreement or any of the other Loan Documents or any transaction contemplated hereby or thereby is, and all such information hereafter furnished by the Borrower to the Agent or the Banks
in connection with this Agreement or any of the other Loan Documents will be, when delivered, true and accurate in all material respects on the date as of which such information is stated or certified, and such information does not contain, or will
not contain, when delivered, when taken as a whole, any material misrepresentation or any omission to state therein, in light of the circumstances in which they were made, matters necessary to make the statements made therein not misleading in any
material respect. The Borrower has disclosed to the Banks in writing all facts which, to the best of the Borrower’s knowledge after due inquiry (to the extent the Borrower can now reasonably foresee), may give rise to the reasonable possibility
of a Material Adverse Effect. 
 SECTION 4.15. Account. All assets of the Borrower that are included in the calculation of the
Borrowing Base are held in or credited to the Account. 
 SECTION 4.16. Sanctions, Etc. (i) Neither the Borrower nor any
director, officer, employee, agent or Affiliate of the Borrower is a Person that is, or is owned or controlled by Persons that are (x) the subject or target of any sanctions administered or enforced by the U.S. Department of the Treasury’s
Office of Foreign Assets Control (“OFAC”), the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively,
“Sanctions”) or (y) located, organized or resident of a country or territory that is, or whose government is, the subject of Sanctions (currently Cuba, Iran, North Korea, Sudan and Syria); (ii) the Borrower has implemented
and maintains in effect policies and procedures designed to ensure compliance by the Borrower and its directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and (iii) the Borrower and its officers and
directors and to the knowledge of the Borrower its employees and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects. 

SECTION 4.17. Title to Assets. The Borrower has good and marketable title to all properties, assets and rights, except where failure to
have such title would not reasonably be expected to have a Material Adverse Effect. 
 ARTICLE V. 

COVENANTS 
 The Borrower
agrees that, so long as any Bank has any Commitment hereunder or any amount payable hereunder or under any Note remains unpaid: 

SECTION 5.01. Information. The Borrower will deliver to the Agent (along with copies for each of the Banks if such information is not
delivered in electronic form): 
 (a) as soon as available and in any event within 90 days after the end of each fiscal year
of the Borrower, a statement of assets and liabilities of the Borrower, including the portfolio of investments, as of the end of such fiscal year, and the related 

  
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statements of operations and changes in net assets of the Borrower for such fiscal year, together with an audit report thereon issued by McGladrey LLP or other independent public accountants of
nationally recognized standing; 
 (b) as soon as available and in any event within 90 days after the end of the first
semi-annual period of each fiscal year of the Borrower, a statement of assets and liabilities of the Borrower, including the portfolio of investments, as of the end of such period, and the related statements of operations and changes in net assets
of the Borrower of such period, all in reasonable detail, prepared in accordance with Generally Accepted Accounting Principles, consistently applied; 

(c) as soon as available and in any event not later than the second Domestic Business Day after the end of each calendar month,
a Borrowing Base Report as of the close of business on the last Domestic Business Day of such calendar month; 
 (d)
simultaneously with the delivery of each set of financial statements referred to in clauses (a) and (b) above and each Borrowing Base Report delivered pursuant to clause (c) above, a certificate of an Authorized Signatory in
substantially the form of Exhibit E attached hereto stating whether any Default or Event of Default exists on the date of such certificate and, if any Default or Event of Default then exists, setting forth the details thereof and the action
which the Borrower is taking or proposes to take with respect thereto; 
 (e) promptly (and in any event within three
(3) Domestic Business Days) after any officer of the Borrower obtains knowledge of any Default or Event of Default, if such Default or Event of Default is then continuing, a certificate of an Authorized Signatory setting forth the details
thereof and the action which the Borrower is taking or proposes to take with respect thereto; 
 (f) promptly upon the filing
thereof with the SEC or the mailing thereof to shareholders of the Borrower, copies of all annual and semi-annual reports to shareholders, amendments and supplements to the Borrower’s registration statement, the Prospectus, non-routine proxy
statements, financial statements and other materials of a financial or otherwise material nature; 
 (g) promptly upon any
officer of the Borrower becoming aware of any action, suit or proceeding of the type described in Section 4.09 hereof, notice and a description thereof and copies of any filed complaint relating thereto; 

(h) notice in reasonable detail of each change to the Investment Policies and Restrictions at least thirty (30) days prior
to the effective date of such change; and 
 (i) from time to time such additional information regarding the financial
position or business of the Borrower, including without limitation, listing and valuation reports, as the Agent, at the request of any Bank, may reasonably request. 

SECTION 5.02. Payment of Obligations. The Borrower will pay and discharge, at or before maturity, all of the Borrower’s material
obligations, including, without limitation, Tax 

  
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liabilities, except where the same may be contested in good faith by appropriate proceedings, and where reserves, in accordance with Generally Accepted Accounting Principles, have been provided
on the books of the Borrower. 
 SECTION 5.03. Maintenance of Insurance. The Borrower will maintain with financially sound and
reputable insurance companies, policies with respect to its assets and property and business of the Borrower against at least such risks and contingencies (and with no greater risk retentions) and in at least such amounts as are required by the
Investment Company Act and, in addition, as are customary in the case of registered closed-end investment companies; and will furnish to the Agent, upon request, information presented in reasonable detail as to the insurance so carried. 

SECTION 5.04. Conduct of Business and Maintenance of Existence. (a) The Borrower will continue to engage in business of the same
general type as now conducted by it. 
 (b) The Borrower will preserve and keep in full force and effect its existence as a
Delaware corporation. The Borrower will preserve, renew and keep in full force and effect its rights, privileges and franchises necessary in the normal conduct of its business except where failure to do so would not be reasonably expected to have a
Material Adverse Effect. The Borrower will maintain in full force and effect its status as a Business Development Company. 

(c) The Borrower will not amend, terminate, supplement or otherwise modify any of its Charter Documents if such amendment,
termination, supplement or modification would reasonably be expected to have a Material Adverse Effect. The Borrower will provide copies to the Agent of all amendments, supplements, terminations and other modifications of any of its Charter
Documents, in each case prior to the effective date of any such amendment, supplement, termination or other modification. The Borrower will comply in all material respects with its Charter Documents. 

(d) The Borrower will, subject to the provisions of the Security Agreement, at all times place and maintain the Collateral in
the custody of the Custodian. 
 SECTION 5.05. Compliance with Laws. The Borrower will comply in all material respects with the
Investment Company Act and the requirements of any Authority having jurisdiction over the Borrower with respect thereto except where the necessity of compliance therewith is being contested in good faith by appropriate proceedings or exemptive
relief has been obtained therefrom and remains in effect. The Borrower will comply in all material respects with all other Applicable Laws and requirements of any Authority having jurisdiction over the Borrower except where the necessity of
compliance therewith is contested in good faith by appropriate proceedings, exemptive relief has been obtained therefrom and remains in effect or where noncompliance therewith would not reasonably be expected to have a Material Adverse Effect. The
Borrower will file all material federal and other material Tax returns, reports and declarations required by all relevant jurisdictions on or before the due dates for such returns, reports and declarations and will pay all Taxes due pursuant to such
returns and other material governmental assessments and charges as and when they become due (except those that are being contested in good faith by the Borrower and as to which the Borrower has established appropriate reserves on its books and
records). 

  
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 SECTION 5.06. Inspection of Property, Books and Records. The Borrower will keep proper
books of record and account in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities in accordance with Applicable Law, including the Investment Company Act, and will, upon
three Domestic Business Days advance notice and during normal business hours, permit representatives of the Agent, at the Agent’s expense, to visit and inspect any of its offices, to examine and make abstracts from any of its books and records
and to discuss its affairs, finances and accounts with its officers, employees and independent public accountants, at a frequency not more than once every calendar year; provided that, during the continuance of an Event of Default, the
Borrower will permit representatives of the Agent, or any Bank designated by the Agent, to conduct such examinations, at any time during business hours and with reasonable advance notice, with any reasonable frequency. The right of inspection
described in this Section 5.06 shall not apply to any information regarding shareholders of the Borrower to the extent the Borrower is prohibited from providing such information by Regulation S-P, 17 CFR Part 248. 

SECTION 5.07. Debt. The Borrower will not create, assume or suffer to exist any Debt other than: 

(a) Debt arising under this Agreement, the Notes and the other Loan Documents; 

(b) Debt in favor of the Custodian and incurred in the ordinary course of business for (i) the purpose of clearing and
settling the purchase and sale of securities, (ii) temporary or emergency purposes, or (iii) in connection with foreign exchange transactions relating to the clearing and settling of purchases and sales of securities; 

(c) Debt in respect of judgments or awards that do not constitute an Event of Default, including any unsecured performance bond
in respect of such judgments or awards; and 
 (d) Debt arising in connection with portfolio investments and investment
techniques arising in the ordinary course of the Borrower’s business to the extent that such Debt is permissible under the Investment Company Act and consistent with the Borrower’s Investment Policies and Restrictions, including, without
limitation, any Debt arising under reverse repurchase agreements and derivative transactions; 
 provided that the Borrower will not at any time
issue or have outstanding any preferred stock. 
 SECTION 5.08. Liens. (a) The Borrower will not create, assume, incur or suffer to
exist any Lien on any of its assets (including the income and profits thereof) whether such asset is now owned or hereafter acquired, except (i) Liens in favor of the Agent, for the benefit of itself and the Banks, securing the obligations of
the Borrower under the Loan Documents, (ii) Liens for Taxes, the payment of which is not at the time required or which are being contested in good faith by the Borrower and as to which the Borrower has established appropriate reserves on

  
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its books and records, (iii) Liens in favor of the Custodian granted pursuant to the Custody Agreement to secure obligations arising under such custody agreement, and (iv) encumbrances
created in connection with the Borrower’s portfolio investments and investment techniques to the extent not prohibited by the Borrower’s Investment Policies and Restrictions, Section 5.07 hereof or the Investment Company Act.

 (b) The Borrower will not create, assume, incur or suffer to exist any Lien on any of the Collateral except (i) Liens of the Agent,
on behalf of itself and the Banks, created by or pursuant to any of the Security Documents or any of the other Loan Documents and (ii) Liens permitted under Section 5.08(a)(ii) and (iii) hereof. 

SECTION 5.09. Consolidations, Mergers and Sales of Assets. The Borrower will not consolidate or merge with or into any other Person,
nor will the Borrower sell, lease or otherwise transfer, directly or indirectly, all or any substantial part of its assets to any other Person (in each case, whether in one transaction or a series of related transactions), except (i) for
mergers in which the Borrower is the surviving entity, provided that the Agent shall have received prior written notice thereof and such documents evidencing the continued enforceability of the Loan Documents (and continued perfection and
priority of the Lien created by the Security Agreement) against the Borrower as the Agent may have reasonably requested in connection therewith, and (ii) that the Borrower may sell its assets in the ordinary course of business. The Borrower
will not invest all of its investable assets in any other closed-end management investment company or otherwise employ a master-feeder or fund of funds investment structure or any other multiple investment company structure in respect of investments
of all its investable assets. 
 SECTION 5.10. Use of Proceeds. Proceeds of Loans may be used only to leverage the Borrower’s
investment portfolio and for temporary liquidity needs of the Borrower, in each case in accordance with its registration statement, the Prospectus and Applicable Law and regulations, including, without limitation, Regulation U. Each Loan shall be
made in compliance with, and subject to, such Regulation U and no portion of any proceeds of any Loan shall be used directly or indirectly in violation of any provision of any statute, regulation, order or restriction applicable to any Bank or the
Borrower. 
 SECTION 5.11. Compliance with Investment Policies and Restrictions. The Borrower will at all times comply in all
material respects with the Investment Policies and Restrictions. 
 SECTION 5.12. Non-Affiliation with Banks. The Borrower will not
at any time become an Affiliate of any Bank or any Affiliate of any Bank known to the Borrower. 
 SECTION 5.13. Regulated Investment
Company. The Borrower will use reasonable best efforts to maintain its status as a “regulated investment company” under the Internal Revenue Code at all times and will use reasonable best efforts to make sufficient distributions to
qualify to be taxed as a “regulated investment company” pursuant to subchapter M of the Internal Revenue Code. 
 SECTION 5.14.
[reserved]. 

  
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 SECTION 5.15. ERISA. The Borrower will not have any material liability in respect of any
Benefit Arrangement, Plan or Multiemployer Plan subject to ERISA. 
 SECTION 5.16. Fiscal Year. The Borrower will not, without the
consent of the Agent (not to be unreasonably withheld) change its fiscal year from that set forth in Section 4.13 hereof. 

SECTION 5.17. Regulation U. The Borrower shall deliver to the Agent from time to time, at the Agent’s reasonable request, such
documents or information, including a current completed Form FR U-1 referred to in Regulation U and a current list of assets, in each case as reasonably required in order for the Banks to comply with Regulation U. 

SECTION 5.18. Custodian. State Street (or any Control Affiliate thereof) will at all times be the custodian of the Borrower’s
assets. If ever a Control Affiliate of the Custodian becomes the custodian of the Borrower’s assets, prior to or simultaneously with such Control Affiliate becoming the custodian of the Borrower’s assets, the Borrower shall have caused
such Control Affiliate to enter into a control agreement for the benefit of the Agent and the Banks in form and substance satisfactory to the Agent. 

SECTION 5.19. Asset Coverage. The Borrower will not at any time permit the aggregate amount of Total Liabilities that are Senior
Securities Representing Indebtedness to exceed 33 1/3% of its Adjusted Net Assets. 
 SECTION 5.20. Maximum Amount. The Borrower will
not at any time permit the aggregate amount of its outstanding Debt to exceed the Maximum Amount for more than three Domestic Business Days after the occurrence of such event or such shorter time as may be required by Applicable Law. 

SECTION 5.21. Negative Pledge. The Borrower will not enter into any agreement prohibiting or limiting the Borrower from encumbering any
of its assets, other than (a) this Agreement and the other Loan Documents and (b) any documents or agreements evidencing or governing any Debt permitted by Section 5.07(d) hereof (in which case, any such prohibition or
limitation shall not apply to any of the Collateral). 
 SECTION 5.22. Further Assurances. The Borrower shall execute and deliver all
such documents and instruments, and take all such actions, as the Agent may from time to time reasonably request with respect to the transactions contemplated hereunder or under any of the other Loan Documents. 

SECTION 5.23. Sanctions, Etc. The Borrower: 

(a) shall not, directly or indirectly use the proceeds of the Loans, or lend, contribute or otherwise make available such
proceeds to any subsidiary, joint venture partner or other Person, (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any
Anti-Corruption Laws, (ii) to fund any activities or business of or with any Person, or in any country or territory that, at the time of such funding, is, or whose government is, the subject of Sanctions, or (iii) in any other manner that
would result in a violation of Sanctions by any Person (including any Person participating in the Loans, whether as underwriter, advisor, investor or otherwise); and 

(b) shall maintain in effect and enforce policies and procedures designed to ensure compliance by the Borrower and its
directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions. 

  
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 ARTICLE VI. 

DEFAULTS 
 SECTION 6.01.
Events of Default. If one or more of the following events (each an “Event of Default”) shall have occurred and be continuing: 

(a) the Borrower shall fail to pay when due (whether at maturity or any accelerated date of maturity or any other date fixed
for payment or prepayment) (i) any principal of any Loan or (ii) any interest on any Loan provided such interest remains owing and unpaid for a period of three Domestic Business Days or (iii) any fees or any other amount payable
hereunder or under any of the other Loan Documents; or 
 (b) the Borrower shall fail to observe or perform any covenant
contained in Section 5.01(a), (b), (c) or (d), 5.04(b), 5.07, 5.08, 5.09, 5.10, 5.12, 5.14, 5.15, 5.16, 5.17, 5.18, 5.19,
5.20, 5.21 or 5.23 hereof; or 
 (c) the Borrower shall fail to observe or perform any covenant or
agreement contained in this Agreement or any Loan Document (other than those covered by clauses (a) or (b) above) and such failure shall continue unremedied for a period of thirty (30) days after the occurrence thereof; or 

(d) any representation, warranty, certification or statement made (or deemed made) by the Borrower in this Agreement or any
other Loan Document or in any certificate, financial statement or other document delivered pursuant to this Agreement or any other Loan Document shall prove to have been incorrect in any material respect when made (or deemed made); or 

(e) the Borrower shall fail to make any payment in respect of any Debt of the Borrower in an aggregate amount equal to or in
excess of 5% of the Borrower’s then-current Total Assets; or 
 (f) any event or condition shall occur which results in
the acceleration of the maturity of any Debt of the Borrower which Debt in the aggregate is at least 5% of the Borrower’s then-current Total Assets, or enables the holder of such Debt (or any Person acting on such holder’s behalf) to
accelerate the maturity thereof or, in the case of a Financial Contract, (i) enables the non-defaulting party to terminate the contract evidencing such Debt and (ii) such event or condition shall not have been waived or cured by the holder
of such Debt within five (5) Domestic Business Days; or 

  
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 (g) the Borrower shall seek the appointment of a trustee, receiver, liquidator,
custodian or other similar official for it or any substantial part of its property, or shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or any of its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator or other similar official for it or any substantial part of its property, or shall consent to any such relief or to
the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it, or the Borrower shall make a general assignment for the benefit of creditors, or shall fail generally (or admit in writing
its inability) to pay its debts as they become due, or shall take any action to authorize any of the foregoing; or 
 (h) an
involuntary case or other proceeding shall be commenced against the Borrower seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it, and such involuntary case or other proceeding shall remain undismissed and unstayed for a period of sixty (60) days; or an order for relief
shall be entered against the Borrower under the federal bankruptcy laws as now or hereafter in effect; or 
 (i) a judgment
or order for the payment of money (not paid or, in the reasonable determination of the Agent, fully covered by insurance or other indemnity from a third party) shall be rendered against the Borrower, provided that (i) such judgment or order
shall be in excess of 5% of the Borrower’s then-current Total Assets or more and (ii) and such judgment or order shall continue unsatisfied or unstayed for a period of thirty (30) days; or 

(j) any investment advisory agreement or management agreement with the Investment Manager which was in effect on the Effective
Date for the Borrower shall terminate, or the Investment Manager shall cease to be the Investment Manager to the Borrower unless the successor thereto is a Control Affiliate of the Investment Manager; or 

(k) a Person other than the Custodian (or any Affiliate thereof) or State Street Bank and Trust Company (or any Affiliate
thereof) shall be the custodian for the assets of the Borrower; or 
 (l) the Agent for any reason shall cease to have a
valid and perfected first priority security interest in the Collateral, free and clear of all Adverse Claims other than Liens permitted under Section 5.08 hereof; 

then, and in every such event, the Agent shall (i) if requested by Banks constituting Required Banks by notice to the Borrower terminate the Commitments,
and they shall thereupon terminate, and (ii) if requested by Banks constituting Required Banks by notice to the Borrower declare the Loans (together with accrued interest thereon) to be, and the Loans (together with accrued interest thereon)
shall thereupon become, immediately due and payable without 

  
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presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; provided that in the case of any of the Events of Default specified in
clause (g) or (h) above with respect to the Borrower, automatically without any notice to the Borrower or any other act by the Agent or any Bank, the Commitments shall thereupon terminate and the Loans (together with accrued interest
thereon) shall become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower. 

SECTION 6.02. Remedies. No remedy herein conferred upon the Banks is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or any other provision of law. In the case any one or more of the Events of Default shall have
occurred and be continuing, and whether or not the Banks shall have accelerated the maturity of the Loans pursuant to Section 6.01 hereof, each Bank, if owed any amount with respect to the Loans may, with the consent of the Required
Banks but not otherwise, proceed to protect and enforce its rights by suit in equity, action at law or other appropriate proceeding, for the specific performance of any covenant or agreement contained in this Agreement or any of the other Loan
Documents, including as permitted by applicable law the obtaining of the ex parte appointment of a receiver, and, if such amount shall have become due, by declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Bank. 
 ARTICLE VII. 

THE AGENT 
 SECTION
7.01. Appointment and Authorization. Each Bank irrevocably appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers under this Agreement, the Notes and the other Loan Documents as are delegated to
the Agent by the terms hereof or thereof, together with all such powers as are reasonably incidental thereto. Any reference to an agent for the Banks in, or in connection with, any Loan Document shall be a reference to the Agent. 

SECTION 7.02. Action by Agent. The duties and responsibilities of the Agent hereunder are only those expressly set forth herein. The
relationship between the Agent and the Banks is and shall be that of agent and principal only, and nothing contained in this Agreement or any of the other Loans Documents shall be construed to constitute the Agent as a trustee for any Bank. Without
limiting the generality of the foregoing, the Agent shall not be required to take any action with respect to any Default or Event of Default except as expressly provided in Article VI. 

SECTION 7.03. Consultation with Experts. The Agent may consult with legal counsel, independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be taken by it in good faith in accordance with the advice of such counsel, accountants or experts. 

SECTION 7.04. Liability of Agent. Neither the Agent nor any of its directors, officers, agents or employees shall be liable for any
action taken or not taken by it in connection 

  
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herewith (i) with respect to liability to one or more Banks only, with the consent or at the request of the Required Banks, or (ii) in the absence of its own gross negligence, bad faith
or willful misconduct. Neither the Agent nor any of its directors, officers, agents or employees shall be responsible for or have any duty to ascertain, inquire into or verify (a) any statement, warranty or representation made in connection
with this Agreement or any borrowing hereunder; (b) the performance or observance of any of the covenants or agreements of the Borrower; (c) the satisfaction of any condition specified in Article III, except receipt of items
required to be delivered to it; or (d) the validity, enforceability, effectiveness or genuineness of this Agreement, the Notes, the other Loan Documents or any other instrument or writing furnished in connection herewith or therewith. The Agent
shall not incur any liability by acting in reliance upon any notice, consent, certificate, statement or other writing (which may be a bank wire, telex or similar writing) believed by it to be genuine or to be signed by the proper party or parties.

 SECTION 7.05. Indemnification. Each Bank shall, ratably in accordance with its Commitment Percentage, indemnify the Agent and its
affiliates, officers, directors and employees (to the extent not reimbursed by the Borrower) for all claims, liabilities, losses, damages, costs, penalties, actions, judgments and expenses and disbursements of any kind or nature whatsoever,
including, without limitation, the reasonable fees and disbursements of counsel (collectively, the “Liabilities”) that such Person may suffer or incur in connection with this Agreement or any of the other Loan Documents or any
action taken or omitted by such Person hereunder or thereunder, provided that no Bank shall have any obligation to indemnify any such Person against any Liabilities that are determined in a final, nonappealable judgment by a court of
competent jurisdiction to have resulted from such Person’s gross negligence, bad faith or willful misconduct, provided, however, that no action taken in accordance with the directions of the Required Banks shall be deemed to
constitute gross negligence, bad faith or willful misconduct for purposes of this Section. 
 SECTION 7.06. Credit Decision. Each
Bank acknowledges that it has, independently and without reliance upon the Agent or any other Bank, and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.
Each Bank also acknowledges that it will, independently and without reliance upon the Agent or any other Bank, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking
or not taking any action under this Agreement. 
 SECTION 7.07. Successor Agent. The Agent may resign at any time by giving written
notice thereof to the Banks and the Borrower. Upon any resignation of the Agent, the Required Banks shall have the right to appoint a successor Agent with, if no Event of Default has occurred and is continuing, the prior written consent of the
Borrower, which consent shall not be unreasonably withheld or delayed. If no successor Agent shall have been so appointed by the Required Banks within 30 days after the retiring Agent gives notice of resignation, then the retiring Agent may, on
behalf of the Banks, appoint a successor Agent, which shall be a commercial bank organized or licensed under the laws of the United States of America or of any State thereof and having a combined capital and surplus of at least $500,000,000. Upon
the acceptance of its appointment as Agent hereunder by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights and duties of the retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations hereunder. After any retiring Agent’s resignation hereunder as Agent, the provisions of this Article shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent. 

  
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 SECTION 7.08. Agent as Bank. In its individual capacity, State Street and any other Bank
that serves as a successor Agent hereunder shall have the same obligations and the same rights, powers and privileges in respect of its Commitment and the Loans made by it as it would have were it not also the Agent. 

SECTION 7.09. Distribution by Agent. If in the opinion of the Agent the distribution of any amount received by it in such capacity
hereunder, under the Notes or under any of the other Loan Documents might involve it in liability, it may refrain from making such distribution until its right to make such distribution shall have been adjudicated by a court of competent
jurisdiction. If a court of competent jurisdiction shall adjudge that any amount received and distributed by the Agent is to be repaid, each Person to whom any such distribution shall have been made shall either repay to the Agent its proportionate
share of the amount so adjudged to be repaid or shall pay over the same in such manner and to such Persons as shall be determined by such court. 

SECTION 7.10. Delinquent Banks. (a) Notwithstanding anything to the contrary contained in this Agreement or any of the other Loan
Documents, any Bank that (i) willfully does not or (ii) does not as a result of a Failure (as defined below) (A) make available to the Agent its pro rata share of any Loan, or (B) comply with the provisions of
Section 9.04 hereof with respect to making dispositions and arrangements with the other Banks, where such Bank’s share of any payment received, whether by setoff or otherwise, is in excess of its pro rata share of such
payments due and payable to all of the Banks, in each case as, when and to the full extent required by the provisions of this Agreement, shall be deemed delinquent (a “Delinquent Bank”) and shall be deemed a Delinquent Bank until
such time as such delinquency is satisfied. A Delinquent Bank shall be deemed to have assigned any and all payments due to it from the Borrower, whether on account of outstanding Loans, interest, fees or otherwise, to the remaining nondelinquent
Banks for application to, and reduction of, their respective pro rata shares of all outstanding Loans. The Delinquent Bank hereby authorizes the Agent to distribute such payments to the nondelinquent Banks in proportion to their
respective pro rata shares of all outstanding Loans. A Delinquent Bank shall be deemed to have satisfied in full a delinquency when and if, as a result of application of the assigned payments to all outstanding Loans of the
nondelinquent Banks, the Banks’ respective pro rata shares of all outstanding Loans have returned to those in effect immediately prior to such delinquency and without giving effect to the nonpayment causing such delinquency. The
provisions of this Section 7.10 shall not affect the rights of the Borrower against any such Delinquent Bank. 

(b) For purposes of this Section 7.10, a “Failure” of a Bank shall mean (i) it shall seek the
appointment of a trustee, receiver, liquidator, custodian or other similar official for it or any substantial part of its property, or shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator or other similar official for it or any substantial part of its property,
or shall consent to any such relief or to the appointment of or taking possession by any such official in an 

  
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involuntary case or other proceeding commenced against it, or (ii) it makes a general assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due, or
shall take any corporate action to authorize any of the foregoing, or (iii) an involuntary case or other proceeding shall be commenced against it seeking liquidation, reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it, or (iv) an order for relief shall be entered against it under the
bankruptcy laws as now or hereafter in effect. 
 ARTICLE VIII. 

CHANGE IN CIRCUMSTANCES 

SECTION 8.01. Additional Costs; Capital Adequacy. (a) If any new law, rule or regulation, or any change after the Effective Date
in the interpretation or administration of any applicable law, rule or regulation by any Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any Bank (or its Applicable Lending
Office) with any request or directive (whether or not having the force of law) of any such authority, central bank or comparable agency in connection therewith issued, promulgated or enacted after the Effective Date shall: 

(i) subject any Bank (or its Applicable Lending Office) to any Tax with respect to its Loans, its Note or its Commitment,
except for Excluded Taxes; or 
 (ii) impose, modify or deem applicable any reserve (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve System), special deposit, insurance assessment or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Bank (or its Applicable
Lending Office) or shall impose on any Bank (or its Applicable Lending Office) any other condition affecting its Loans, its Note or its Commitment; or 

(iii) impose on any Bank any other conditions or requirements with respect to this Agreement, the other Loan Documents, the
Loans or such Bank’s Commitment; 
 and the result of any of the foregoing is to increase the cost to such Bank (or its Applicable Lending Office) of
making, funding, issuing, renewing, extending or maintaining any Loan or such Bank’s Commitment, or to reduce the amount of any sum received or receivable by such Bank (or its Applicable Lending Office) under this Agreement or under its Note
with respect thereto, by an amount deemed by such Bank to be material, then, promptly upon demand by such Bank (and in any event within thirty (30) days after demand by such Bank) and delivery to the Borrower of the certificate required by
clause (c) hereof (with a copy to the Agent), the Borrower shall pay to such Bank the additional amount or amounts as will compensate such Bank for such increased cost or reduction. 

(b) If any Bank shall determine that any change after Effective Date in any existing applicable law, rule or regulation or any
new law, rule or regulation regarding liquidity or capital adequacy, or any change therein, or any change after the Effective 

  
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Date in the interpretation or administration thereof by any Authority, central bank or comparable agency charged with the interpretation or administration thereof, or any new request or directive
of general applicability regarding liquidity or capital adequacy (whether or not having the force of law) of any such authority, central bank or comparable agency issued, promulgated or enacted after the Effective Date, has or would have the effect
of reducing the rate of return on capital of such Bank (or its parent corporation) as a consequence of such Bank’s obligations hereunder to a level below that which such Bank (or its parent corporation) could have achieved but for such law,
change, request or directive (taking into consideration its policies with respect to liquidity and capital adequacy) by an amount deemed by such Bank to be material, then from time to time, promptly upon demand by such Bank (with a copy to the
Agent) (and in any event within thirty (30) days after demand by such Bank) the Borrower shall pay to such Bank such additional amount or amounts as will compensate such Bank (or its parent corporation) for such reduction. 

(c) Each Bank will promptly notify the Borrower and the Agent of any event of which it has knowledge, occurring after the
Effective Date, which will entitle such Bank to compensation pursuant to this Section and will designate a different Applicable Lending Office if such designation will avoid the need for, or reduce the amount of, such compensation and will not, in
the judgment of such Bank, be otherwise disadvantageous to such Bank; provided that the Borrower shall not be required to compensate a Bank pursuant to this Section for any amounts incurred more than three months prior to the date that
such Bank notifies the Borrower of such Bank’s intention to claim compensation therefor; and provided further that, if the circumstances giving rise to such claim have a retroactive effect, then such three-month period
shall be extended to include the period of such retroactive effect. A certificate of any Bank claiming compensation under this Section and setting forth in reasonable detail the additional amount or amounts to be paid to it hereunder and the
calculations used in determining such additional amount or amounts shall be conclusive in the absence of manifest error. In determining such amount, such Bank may use any reasonable averaging and attribution methods. 

SECTION 8.02. Basis for Determining Interest Rate Inadequate or Unfair. If, on or prior to the first day of any Interest Period for any
borrowing of LIBOR Loans, the Agent shall determine or be notified by the Required Banks that: 
 (a) adequate and reasonable
methods do not exist for ascertaining the interest rate applicable for such Interest Period on the basis provided for in the definition of LIBOR Offered Rate, or 

(b) the Adjusted LIBOR Offered Rate as determined by the Agent will not adequately and fairly reflect the cost to the Banks of
funding their LIBOR Loans for such Interest Period, 
 the Agent shall forthwith give notice of such determination (which shall be conclusive and binding on
the Borrower and the Banks) to the Borrower and the Banks. In such event, until the Agent notifies the Borrower and the Banks that the circumstances giving rise to such suspension 

  
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no longer exist, (i) any Notice of Borrowing or Notice of Conversion with respect to LIBOR Loans shall be automatically withdrawn and shall be deemed to be a request for a Base Rate Loan,
(ii) each LIBOR Loan will automatically, on the last day of the then current Interest Period relating thereto, become a Base Rate Loan, and (iii) the obligations of the Banks to make LIBOR Loans shall be suspended until the Agent or the
Required Banks determine that the circumstances giving rise to such suspension no longer exist, whereupon the Agent or, as the case may be, the Agent at the instruction of the Required Banks, shall so notify the Borrower and the Banks. 

SECTION 8.03. Illegality. If any future applicable law, rule, regulation, treaty or directive, or any change in any present or future
applicable law, rule, regulation, treaty or directive, or any change in the interpretation or administration of any present or future applicable law, rule, regulation, treaty or directive by any Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Bank (or its LIBOR Lending Office) with any new request or new directive (whether or not having the force of law) of any such authority, central bank or comparable agency shall
make it unlawful or impossible for any Bank (or its LIBOR Lending Office) to make, maintain or fund its LIBOR Loans and such Bank shall so notify the Agent, the Agent shall forthwith give notice thereof to the other Banks and the Borrower, whereupon
until such Bank notifies the Borrower and the Agent that the circumstances giving rise to such suspension no longer exist, (a) the commitment of such Bank to make LIBOR Loans or convert Base Rate Loans to LIBOR Loans shall forthwith be
suspended, and (b) such Bank’s Loans then outstanding as LIBOR Loans, if any, shall be converted automatically to Base Rate Loans on the last day of the Interest Period applicable to such LIBOR Loans or within such earlier period as may be
required by law. Before giving any notice to the Agent pursuant to this Section, such Bank shall designate a different LIBOR Lending Office if such designation will avoid the need for giving such notice and will not, in the reasonable judgment of
such Bank, be otherwise disadvantageous to such Bank. If such Bank shall reasonably determine that it may not lawfully continue to maintain and fund any of its outstanding LIBOR Loans to maturity and shall so specify in such notice, the Borrower
shall promptly prepay in full the then outstanding principal amount of each such LIBOR Loan, together with accrued interest thereon and any amount payable by the Borrower pursuant to Section 8.06 hereof. Concurrently with prepaying each
such LIBOR Loan, the Borrower shall borrow a Base Rate Loan in an equal principal amount from such Bank (on which interest and principal shall be payable contemporaneously with the related LIBOR Loans of the other Banks), and such Bank shall make
such a Base Rate Loan. 
 SECTION 8.04. Base Rate Loans Substituted for Affected LIBOR Loans. If (a) the obligation of any Bank
to make LIBOR Loans has been suspended pursuant to Section 8.03 hereof or (b) any Bank has demanded compensation under Section 8.01(a) hereof with respect to LIBOR Loans and the Borrower shall, by at least two LIBOR
Business Days’ prior notice to such Bank through the Agent, have elected that the provisions of this Section shall apply to such Bank, then, unless and until such Bank notifies the Borrower that the circumstances giving rise to such suspension
or demand for compensation no longer apply: 
 (a) all Loans which would otherwise be made by such Bank as LIBOR Loans shall
be made instead as Base Rate Loans, and 
 (b) after each of its LIBOR Loans has been repaid, all payments of principal which
would otherwise be applied to repay such LIBOR Loans shall be applied to repay its Base Rate Loans instead. 

  
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 SECTION 8.05. Replacement Banks. Upon (a) the election of any Bank to request
reimbursement by the Borrower for amounts due under Sections 8.01 or 8.03 hereof, (b) the suspension of any Bank’s obligation to make, convert to or continue LIBOR Loans or (c) any Bank becoming a Delinquent Bank, the
Borrower may, upon prior written notice to the Agent and such Bank, request that the Agent find a replacement Bank which shall be reasonably satisfactory to the Agent and the Borrower (a “Replacement Bank”). Each Bank agrees that,
should it be identified for replacement pursuant to this Section 8.05, it will promptly execute and deliver all documents and instruments reasonably required by the Borrower to assign such Bank’s Loans and Commitment to the
applicable Replacement Bank. The Agent shall cooperate with the Borrower in seeking a Replacement Bank and shall use its best efforts to identify a Replacement Bank and complete the assignment to such Replacement Bank of such Loans and Commitment
within 45 days of said written notice. 
 SECTION 8.06. Indemnity. The Borrower agrees to indemnify each Bank and to hold each Bank
harmless from and against any loss, cost or expense (excluding, however, the LIBOR Margin) that such Bank shall sustain or incur as a consequence of (a) default by the Borrower in payment of the principal amount of any LIBOR Loans as and when
due and payable, including any such loss or expense arising from interest or fees payable by such Bank to lenders of funds obtained by it in order to maintain its LIBOR Loans, (b) default by the Borrower in making a borrowing or conversion
after the Borrower has given (or is deemed to have given) a Notice of Borrowing or a Notice of Conversion relating thereto in accordance with Section 2.02 hereof or (c) the making of any payment of a LIBOR Loan or the making of any
conversion of any such Loan to a Base Rate Loan on a day that is not the last day of the applicable Interest Period with respect thereto, including interest or fees payable by such Bank to lenders of funds obtained by it in order to maintain any
such Loans. 
 SECTION 8.07. Change of Law. For the avoidance of doubt and notwithstanding anything herein to the contrary, for all
purposes of this Credit Agreement, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) and all requests, rules, regulations, guidelines, interpretations or directives thereunder or issued in
connection therewith (whether or not having the force of law) and (ii) all requests, rules, regulations, guidelines, interpretations 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 (whether or not having the force of law). For the purposes of this Section 8.07, any such directive or issuance pursuant to Dodd-Frank or Basel III
shall be deemed to be a change in law regardless of the date enacted, adopted, issued, promulgated or implemented. 
 ARTICLE IX. 

MISCELLANEOUS 
 SECTION
9.01. Notices. All notices, requests, consents and other communications to any party hereunder shall be in writing (including facsimile transmission or similar writing) 

  
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and shall be given to such party at its address or telex number or facsimile number set forth on Schedule 1 attached hereto. Each such notice, request, consent or other communication shall
be effective (a) if given by facsimile, when such facsimile is transmitted to the facsimile number specified in this Section and the appropriate confirmation is received, (b) if given by mail, 72 hours after such communication is deposited
in the mails with first class postage prepaid, addressed as aforesaid or (c) if given by any other means, when delivered at the address specified in this Section; provided that notices to the Agent under Article II or Article
VII shall not be effective until received. 
 SECTION 9.02. No Waivers. No failure or delay by the Agent or any Bank in
exercising any right, power or privilege hereunder or under any Notes shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. 

SECTION 9.03. Expenses; Indemnification. (a) The Borrower shall promptly pay (i) all reasonable and documented out-of-pocket expenses of the Agent, including reasonable fees and disbursements of special counsel for the Agent, in connection with the preparation, negotiation and closing
of this Agreement and the Loan Documents, the syndication of the facility established hereby, any waiver or consent hereunder or any amendment hereof or thereof or any waiver of any Default or Event of Default or alleged Default or Event of Default
hereunder, and any amendment or termination hereof or thereof and (ii) if a Default or an Event of Default occurs, all reasonable out-of-pocket expenses incurred by the Agent and each Bank, including reasonable fees and disbursements of outside
legal counsel, in connection with such Default or Event of Default and collection, bankruptcy, insolvency and other enforcement proceedings resulting therefrom. For the avoidance of doubt, the Borrower shall not be obligated to pay any amounts
pursuant to this Section 9.03(a) on account of Taxes. 
 (b) The Borrower agrees to indemnify the Agent, each
Bank and each of their affiliates, officers, directors and employees (each, a “Covered Person”) and hold each Covered Person harmless from and against any and all Liabilities which may be incurred by or asserted or awarded against
such Covered Person, in each case arising out of or in connection with any investigative, administrative or judicial proceeding (whether or not such Covered Person shall be designated a party thereto) relating to or arising out of this Agreement or
the Loan Documents or any actual or proposed use of proceeds of Loans hereunder, provided that no Covered Person shall have the right to be indemnified hereunder for Liabilities that are determined in a final, nonappealable judgment by a
court of competent jurisdiction to have resulted from such Covered Person’s gross negligence, bad faith or willful misconduct. This Section 9.03(b) shall not apply with respect to Taxes other than any Taxes that represent losses,
claims, damages, or other such amounts arising from any non-Tax claim. 
 SECTION 9.04. Setoff. During the continuance of any Event
of Default, any deposits or other sums credited by or due from any of the Banks to the Borrower (subject, in the case of State Street, to any agreements or limitations applicable to the Custodian’s rights with respect to any such deposits which
are contained in, and solely to the extent that such deposits constitute collateral subject to, any control agreement (i) entered into prior to the date hereof 

  
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among the Custodian, the Borrower and one or more third parties or (ii) entered into hereafter among the Custodian, the Borrower and one or more third parties that does not contain a waiver
or prohibition of State Street’s right of setoff with respect to such deposits) may be applied to or setoff by such Bank against the payment of the Obligations of the Borrower to such Bank. Each of the Banks agrees with each other Bank that if
such Bank shall receive from the Borrower whether by voluntary payment, exercise of the right of setoff, counterclaim, cross action, or enforcement of a claim based on the Obligations owing to such Bank by proceedings against the Borrower at law or
in equity or by proof thereof in bankruptcy, reorganization, liquidation, receivership or similar proceedings, or otherwise, and shall retain and apply to the payment of the Obligations owing to such Bank any amount in excess of its ratable portion
of the payments received by all of the Banks with respect to the Obligations owed to all of the Banks, such Bank will make such disposition and arrangements with the other Banks with respect to such excess, either by way of distribution, pro tanto
assignment of claims, subrogation or otherwise as shall result in each Bank receiving in respect of the Obligations owing to it its proportionate payment as contemplated by this Agreement; provided that if all or any part of such excess payment is
thereafter recovered from such Bank, such disposition and arrangements shall be rescinded and the amount restored to the extent of such recovery, but without interest. 

SECTION 9.05. Amendments and Waivers. Any provision of this Agreement or any of the other Loan Documents may be amended or waived if,
but only if, such amendment or waiver is in writing and is signed by the Borrower and the Required Banks (and, if the rights or duties of the Agent are affected thereby, by the Agent); provided that no such amendment or waiver shall, unless
signed by each affected Bank (a) increase the Commitment Amount of any Bank (except as provided in Section 9.06(c) hereof) or subject any Bank to any additional obligation, (b) reduce or forgive the principal of or rate of
interest on any Loan or any fees to the Banks hereunder (other than the application of the default rate of interest pursuant to Section 2.06(c) hereof), (c) postpone the date fixed for any payment of principal of or interest on any Loan
or any fees to the Banks hereunder or for the termination of the Commitments (other than pursuant to Section 2.08(b) hereof), or (d) change the percentage of the Commitment Amounts or of the aggregate unpaid principal amount of the
Loans, or the number of Banks, which shall be required for the Banks or any of them to take any action under this Section or any other provision of this Agreement. No delay or omission on the part of any Bank or any holder hereof in exercising any
right hereunder shall operate as a waiver of such right or of any other rights of such Bank or such holder, nor shall any delay, omission or waiver on any one occasion be deemed a bar or waiver of the same or any other right on any further occasion.

 SECTION 9.06. Successors and Assigns. (a) The provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns, except that the Borrower may not assign or otherwise transfer any of its rights under this Agreement without the prior written consent of all of the Banks 

(b) Subject to clause (f) below, any Bank may at any time grant to one or more commercial banks (each a
“Participant”) participating interests in its Commitment or all of its Loans. In the event of any such grant by a Bank of a participating interest to a Participant, whether or not upon notice to the Borrower and the Agent, such Bank
shall remain responsible for the performance of its obligations hereunder, and the Borrower and the Agent shall continue to deal solely and directly 

  
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with such Bank in connection with such Bank’s rights and obligations under this Agreement. Any agreement pursuant to which any Bank may grant such a participating interest shall provide that
such Bank shall retain the sole right and responsibility to enforce the obligations of the Borrower hereunder, including, without limitation, the right to approve any amendment, modification or waiver of any provision of this Agreement;
provided that such participation agreement may provide that such Bank will not agree to any modification, amendment or waiver of this Agreement described in clause (a), (b), (c) or (d) of Section 9.05 hereof without the
consent of the Participant. The Borrower agrees that each Participant shall, to the extent provided in its participation agreement, be entitled to the benefits of Article VIII with respect to its participating interest; provided that
no Participant shall be entitled to receive an amount greater than its pro rata share of any amount the selling Bank would have received hereunder had no participation been sold (and each Participant shall be required to satisfy any
requirements the selling Bank is required to satisfy to receive such benefits). An assignment or other transfer which is not permitted by clause (c) or (d) below shall be given effect for purposes of this Agreement only to the extent of a
participating interest granted in accordance with this clause (b). Each Bank that sells a participation, acting for this purpose as an agent of the Borrower, shall maintain a register for the recordation of the names and addresses of each
Participant, and the Commitment of, and principal amount (and stated interest) of the Loans owing to, each Participant pursuant to the terms hereof (the “Participant Register”). The entries in the Participant Register shall be
conclusive in the absence of manifest error, and the Borrower, the Agent and the Banks may treat each Person whose name is recorded in the Participant Register pursuant to the terms hereof as the owner of such participation for all purposes of this
Agreement, notwithstanding notice to the contrary. 
 (c) Subject to clause (f) below, any Bank may at any time assign
to one or more banks (each an “Assignee”) all, or a proportionate amount of at least $5,000,000 of all, of its rights and obligations under this Agreement and the Notes, and such Assignee shall assume such rights and obligations,
pursuant to an Assignment and Acceptance (each an “Assignment and Acceptance”) in substantially the form of Exhibit F attached hereto executed by such Assignee and such transferor Bank, with, if no Event of Default has
occurred and is continuing, the written consent of the Borrower, which consent shall not be unreasonably withheld or delayed, and of the Agent, which consent shall not be unreasonably withheld or delayed; provided that no such consent of the
Borrower or the Agent shall be required if the Assignee is a Control Affiliate of the transferor Bank. Upon execution and delivery of such instrument and payment by such Assignee to such transferor Bank of an amount equal to the purchase price
agreed between such transferor Bank and such Assignee with respect to the interest assigned, such Assignee shall be a Bank party to this Agreement (in addition to any interest of such Bank held prior to such assignment) and shall have all the rights
and obligations of a Bank with the Commitment Amount as set forth in such instrument of assumption (in addition to any interest of such Bank held prior to such assignment), and the transferor Bank shall be released from its obligations hereunder to
a corresponding extent, and no further consent or action by any party shall be required. Upon the consummation of any assignment pursuant to this clause (c), the transferor Bank, the Agent and the Borrower shall make appropriate

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 50 

 
arrangements so that, if required, new Notes are issued to the Assignor and the Assignee, and the Agent shall be authorized to revise Schedule 1 to reflect such assignment and to circulate
such revised Schedule 1 to the Banks and the Borrower, which revised Schedule 1 shall be deemed to be a part hereof and shall be incorporated by reference herein. In connection with any such assignment, the transferor Bank shall pay to
the Agent an administrative fee for processing such assignment in the amount of $3,000. The Assignee shall, prior to the date of consent of the Borrower to the assignment, deliver to the Borrower and the Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in accordance with Section 2.12 hereof (and shall thereafter be subject to the requirements thereof). 

(d) Without notice to or consent of any Person, any Bank may at any time assign all or any portion of its rights under this
Agreement, and its Note, to a Federal Reserve Bank. No such assignment shall release the transferor Bank from its obligations hereunder. 

(e) No Assignee, Participant or other transferee of any Bank’s rights shall be entitled to receive any greater payment
under Section 2.10(c) or Section 8.01 hereof than such Bank would have been entitled to receive with respect to the rights transferred, unless such transfer is made with the Borrower’s prior written consent. 

(f) No bank may become an Assignee pursuant to clause (c) above or an Additional Commitment Bank pursuant to
Section 2.09 hereof unless such bank constitutes a “bank” (as such term is used in Section 18(f)(1) of the Investment Company Act) in the reasonable judgment of the Borrower and the Agent. No Person may become a
Participant or an Assignee pursuant to clause (b) or (c) above or an Additional Commitment Bank pursuant to Section 2.09 hereof if that Person is an Affiliate of the Borrower. 

(g) The Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Banks, and the Commitment of, and principal amount of (and stated interest on) the Loans owing to, each Bank pursuant to the terms hereof
from time to time (the “Register”). The entries in the Register shall be conclusive in the absence of manifest error, and the Borrower, the Agent and the Banks may treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Bank hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and the Banks, at any reasonable time and from time to time upon
reasonable prior notice. 
 SECTION 9.07. Governing Law; Submission to Jurisdiction. This Agreement and each of the other loan
documents are contracts under the laws of The Commonwealth of Massachusetts and shall for all purposes be construed in accordance with and governed by the laws of said Commonwealth of Massachusetts (excluding the laws applicable to conflicts of
law). The Borrower agrees that any suit for the enforcement of this agreement or any of the other Loan Documents or any other action brought by such person arising hereunder or in any 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 51 

 
way related to this agreement or any of the other Loan Documents whether sounding in contract, tort, equity or otherwise, shall be brought in the courts of The Commonwealth of Massachusetts or
the federal court sitting therein, and consents to the exclusive jurisdiction of such court and the service of process in any suit being made upon such person by mail at the address specified in Section 9.01 hereof. The Borrower hereby
waives any objection that it may now or hereafter have to the venue of any suit brought in Suffolk County, Massachusetts or any court sitting therein or that a suit brought therein is brought in an inconvenient court. Nothing in this Agreement or in
any other Loan Document shall affect any right that the Agent or any Bank 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. 
 SECTION 9.08. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. Except as prohibited by law, the Borrower hereby waives any right it may have to claim or recover in any
litigation referred to in the preceding sentence any special, exemplary, punitive or consequential damages or any damages other than, or in addition to, actual damages. The Borrower (a) certifies that no representative, agent or attorney of any
Bank or the Agent has represented, expressly or otherwise, that such Bank or the Agent would not, in the event of litigation, seek to enforce the foregoing waivers and (b) acknowledges that the Agent and the Banks have been induced to enter
into this Agreement and the other Loan Documents to which it is a party by, among other things, the waivers and certifications contained herein. 

SECTION 9.09. Confidential Information. (a) Each Bank agrees that any information, documentation or materials provided by the
Borrower or the Borrower’s Affiliates, employees, agents or representatives (“Representatives”) disclosing the portfolio holdings of the Borrower or disclosing other non-public information pursuant to this Agreement or the Loan
Documents (“Confidential Material”), whether before or after the date of this Agreement, shall be treated confidentially, using the same degree of care that such Bank uses to protect its own similar material. 

(b) Such Confidential Material may be disclosed to Representatives of each Bank who need to know such information in connection
with the transactions contemplated herein or in connection with managing the relationship of such Bank or its Affiliates with the Borrower (it being understood that the Bank will inform such Representatives when such disclosure is made of the
confidential nature of such information and will cause such Representatives to comply with the provisions of this Section 9.09) but shall not be disclosed to any third party and may not be used for purposes unrelated to the transactions
contemplated by the Loan Documents, including without limitation for the purposes of buying or selling securities, including shares issued by the Borrower; provided, however, that the Banks may disclose Confidential Material to
(i) the Federal Reserve Board pursuant to applicable rules and regulations promulgated by the Federal Reserve Board (which, as of the Effective Date, require a filing of a list of all Margin Stock which directly or indirectly secures a Loan),
(ii) the extent required by statute, rule, regulation or judicial process, (iii) counsel for any of the Banks or the Agent in connection with this Agreement or any of the other Loan 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 52 

 
Documents, (iv) bank examiners, auditors and accountants, or (v) any Assignee or Participant (or prospective Assignee or Participant) as long as such Assignee or Participant (or
prospective Assignee or Participant) first agrees to be bound by the provisions of this Section 9.09. 
 Each Bank agrees to
promptly provide such information as is reasonably requested by the Borrower in order for the Borrower to monitor (as required by applicable law) whether the Bank’s use of Confidential Material complies with this Section 9.09.
Notwithstanding the foregoing, nothing in this Agreement or the Loan Documents shall prevent any of the parties hereto and their respective directors, officers, employees, agents and advisors from disclosing to any and all Persons the tax treatment
and tax structure of the transactions contemplated by this Agreement. 
 SECTION 9.10. USA Patriot Act. Each Bank that is subject to
the Act (as hereinafter defined) and the Agent (for itself and not on behalf of any Bank) hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the “Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Bank or the Agent, as
applicable, to identify the Borrower in accordance with the Act. 
 SECTION 9.11. Miscellaneous. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Delivery of an executed signature page of this Agreement by email or facsimile transmission shall
be effective as delivery of a manually executed counterpart hereof. This Agreement and each of the other Loan Documents constitute the entire agreement and understanding among the parties hereto and supersede any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof. The provisions of this Agreement are severable and if any one clause or provision hereof shall be held invalid or unenforceable in whole or in part in any jurisdiction, then
such invalidity or unenforceability shall affect only such clause or provision, or part thereof, in such jurisdiction, and shall not in any manner affect such clause or provision in any other jurisdiction, or any other clause or provision of this
Agreement in any jurisdiction. 
 [the remainder of this page has been intentionally left blank] 

  
 NEXPOINT CAPITAL,
INC. CREDIT AGREEMENT 

  
 53 

 IN WITNESS WHEREOF, the parties hereto, intending this Agreement to take effect as a
sealed instrument, have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written. 
  

					
	NEXPOINT CAPITAL, INC.
		
	By:		

			Name:		Brian Mitts
			Title:		Vice President and Chief Financial Officer
	
	STATE STREET BANK AND TRUST COMPANY, individually and as Agent
		
	By:		 
			Name:		James H. Reichert
			Title:		Vice President

  
 NEXPOINT CAPITAL, INC.
CREDIT AGREEMENT 

 IN WITNESS WHEREOF, the parties hereto, intending this Agreement to take effect as a
sealed instrument, have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written. 
  

					
	NEXPOINT CAPITAL, INC.
		
	By:		 
			Name:		
			Title:		
	
	STATE STREET BANK AND TRUST COMPANY, individually and as Agent
		
	By:		

			Name:		James H. Reichert
			Title:		Vice President

  
 NEXPOINT CAPITAL, INC.
CREDIT AGREEMENT 

 SCHEDULE 1 

BORROWER: 
 NEXPOINT CAPITAL, INC. 

300 Crescent Court, Suite 700 
 Dallas, Texas 75201 

Attention: Brian Mitts 
 Phone: 972-419-2556 

Email: bmitts@highlandfunds.com 

  
 SCHEDULE I 

									
	 BANKS:
	  	COMMITMENT
AMOUNT	 	  	COMMITMENT
PERCENTAGE	 
			
	 STATE STREET BANK AND TRUST COMPANY
	  	$	25,000,000	  	  	 	100	% 

 For funding or payment notices: 

Domestic Lending Office: 
 Mutual Fund Lending Department 

100 Huntington Avenue 
 Copley Place, Tower 2 

Boston, MA 02116 
 Attn. Peter J. Connolly, Assistant Vice
President 
 - CSU Manager 
 Tel: (617) 662-8588 

Fax: (617) 988-6677 
 Email: ais-loanops-csu@statestreet.com,
and 
 LIBOR Lending Office: 
 Mutual Fund Lending Department

 100 Huntington Avenue 
 Copley Place, Tower 2 

Boston, MA 02116 
 Attn. Peter J. Connolly, Assistant Vice
President 
 - CSU Manager 
 Tel: (617) 662-8588 

Fax: (617) 988-6677 
 Email: ais-loanops-csu@statestreet.com,
and 
 For all other notices: 
 Mutual Fund Lending Department

 100 Huntington Avenue 
 Copley Place Tower 2 

Boston, MA 02116 
 Attn: James Reichert 

Tel: (617) 662-8620 
 Fax: (617) 662-8665 

  
 SCHEDULE I 

 EXHIBIT A 

FORM OF NOTE 
  

			
	U.S. $[            ]		            , 20    

 FOR VALUE RECEIVED, NEXPOINT CAPITAL, INC., a Delaware corporation (the “Borrower”),
hereby promises to pay to [INSERT NAME OF BANK] (the “Bank”) at the head office of the Agent (as defined below) at Copley Place Tower 2, Boston, Massachusetts 02116: 

(a) on the Termination Date (as defined in the Credit Agreement referred to below) the principal amount of [INSERT
COMMITMENT AMOUNT] (U.S. $        ) or, if less, the aggregate unpaid principal amount of Loans advanced by the Bank to the Borrower pursuant to the Credit Agreement, dated as of January 6, 2015 (as
amended and in effect from time to time, the “Credit Agreement”), among the Borrower, the Bank, other banks parties thereto and State Street Bank and Trust Company, as agent (the “Agent”); 

(b) the principal outstanding hereunder from time to time at the times provided in the Credit Agreement; and 

(c) interest on the principal balance hereof from time to time outstanding from the Effective Date (as defined in the Credit
Agreement) through and including the Termination Date at the times and at the rates provided in the Credit Agreement. 
 This Note evidences
borrowings under and has been issued by the Borrower in accordance with the terms of the Credit Agreement. The Bank and any permitted holder hereof are entitled to the benefits of the Credit Agreement and the other Loan Documents, and may enforce
the agreements of the Borrower contained therein, and any permitted holder hereof may exercise the respective remedies provided for thereby or otherwise available in respect thereof, all in accordance with the respective terms thereof. All
capitalized terms used in this Note and not otherwise defined herein shall have the same meanings herein as in the Credit Agreement. 
 The
Borrower irrevocably authorizes the Bank to make or cause to be made, at or about the date of any Loan or at the time of receipt of any payment of principal of this Note, an appropriate notation on the grid attached to this Note, or the continuation
of such grid, or any other similar record, including computer records, reflecting the making of such Loan or (as the case may be) the receipt of such payment. The outstanding amount of the Loans set forth on the grid attached to this Note, or the
continuation of such grid, or any other similar record, including computer records, maintained by the Bank with respect to any Loans shall, absent manifest error, be prima facie evidence of the principal amount thereof owing and unpaid
to the Bank, but the failure to record, or any error in so recording, any such amount on any such grid, continuation or other record shall not limit or otherwise affect the obligation of the Borrower hereunder or under the Credit Agreement to make
payments of principal of and interest on this Note when due. 
 The Borrower has the right in certain circumstances and the obligation under
certain other circumstances to prepay the whole or part of the principal of this Note on the terms and conditions specified in the Credit Agreement. 

  
 EXHIBIT A – FORM OF
NOTE 

 If any one or more of the Events of Default shall occur and be continuing, the entire unpaid
principal amount of this Note and all of the unpaid interest accrued thereon may become or be declared due and payable in the manner and with the effect provided in the Credit Agreement. 

No delay or omission on the part of the Bank or any holder hereof in exercising any right hereunder shall operate as a waiver of such right or
of any other rights of the Bank or such holder, nor shall any delay, omission or waiver on any one occasion be deemed a bar or waiver of the same or any other right on any further occasion. 

The Borrower and every endorser and guarantor of this Note or the obligation represented hereby waives presentment, demand, notice, protest
and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note, and assents to any extension or postponement of the time of payment or any other indulgence, to any substitution,
exchange or release of collateral and to the addition or release of any other party or person primarily or secondarily liable. 

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE CREDIT AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND
IN ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 9.06 OF THE CREDIT AGREEMENT. 
 THIS NOTE AND THE OBLIGATIONS OF THE
BORROWER HEREUNDER SHALL FOR ALL PURPOSES BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE COMMONWEALTH OF MASSACHUSETTS (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE BORROWER AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS NOTE MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE EXCLUSIVE JURISDICTION OF SUCH COURT AND THE SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE
BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN SECTION 9.01 OF THE CREDIT AGREEMENT. THE BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT BROUGHT IN SUFFOLK COUNTY, MASSACHUSETTS OR ANY SUCH COURT
SITTING IN SUFFOLK COUNTY, MASSACHUSETTS OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT. NOTHING IN THIS NOTE SHALL AFFECT ANY RIGHT THAT THE BANK MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS NOTE AGAINST THE BORROWER
OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION. 
 [the remainder of this page has been intentionally left blank] 

  
 EXHIBIT A – FORM OF
NOTE 

 IN WITNESS WHEREOF, the undersigned, intending this Note to take effect as a sealed
instrument, has caused this Note to be signed as a as a document under seal in its name by its duly authorized officer as of the day and year first above written. 

 

			
	NEXPOINT CAPITAL, INC.
		
	By:		  

			Name:
			Title:

  
 EXHIBIT A – FORM OF
NOTE 

											
	 Date
	  	Amount
of Loan	  	Type
of Loan	  	Amount of
Principal Paid
or Prepaid	  	Balance of
Principal
Unpaid	  	Notation
Made By:
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	
		  		  		  		  		  	

 EXHIBIT B 

FORM OF 
 NOTICE OF
BORROWING 
  

			
	DATE:		
		
	TO:		STATE STREET BANK AND TRUST COMPANY, as Agent
		
	ATTN:		Peter J. Connolly
			Assistant Vice President - CSU Manager
			Tel: (617) 662-8588
			Fax: (617) 988-6677
			Email: ais-loanops-csu@statestreet.com and
		
	FROM:		[             ]

 Reference is hereby made to that certain Credit Agreement, dated as of January 6, 2015 (such agreement,
as amended and in effect from time to time, the “Credit Agreement”), among NEXPOINT CAPITAL, INC., a Delaware corporation, the lending institutions referred to therein as Banks, and State Street Bank and Trust Company, as
Agent. Capitalized terms which are used herein without definition and which are defined in the Credit Agreement shall have the same meanings herein as in the Credit Agreement. 

Pursuant to Section 2.02(a) of the Credit Agreement, please make the Loans described below. 

 

					
	 [Domestic][LIBOR] Business Day of proposed borrowing:
				
		
	 Amount of Loan requested:
		$	            	  
		
	 Aggregate amount of Loans outstanding (after giving effect to the Loan requested hereby):
		$	            	  
		
	 Maximum Loans per attached Borrowing Base Report:
		$	            	  
		
	 [Interest Period:]
				
		
	 [Instructions for Wire to Third Party/Paying Agent:]
				
			 	             	  
			 	             	  
			 	             	  

  
 EXHIBIT B – FORM OF
NOTICE OF BORROWING 

 Attached hereto is a Borrowing Base Report dated as of
                    . 
 The undersigned
hereby certifies that: (a) on the date of this notice and immediately after giving effect to the borrowing of the Loan(s) as set forth herein, the aggregate outstanding principal amount of the Loans do not and will not exceed the least of the
Borrowing Base, the Aggregate Commitment Amount and the Maximum Amount, (b) the representations and warranties of the Borrower in Article IV of the Credit Agreement are true and correct in all material respects as of the date hereof and
will be true and correct in all material respects immediately after giving effect to the borrowing of the Loan(s) as set forth herein, in each case except to the extent such representations and warranties expressly are expressly stated to have been
made as of a specific earlier date, in which case such representations and warranties shall have been true and correct in all material respects as of such specific date, and (c) no Default or Event of Default has occurred and is continuing or
will occur immediately after giving effect to the borrowing, as set forth herein. 
  

			
	NEXPOINT CAPITAL, INC.
		
	By:		  

			Name:
			Title:

  
 EXHIBIT B – FORM OF
NOTICE OF BORROWING 

 EXHIBIT C 

FORM OF NOTICE OF CONVERSION 
  

			
	DATE:	  	
		
	TO:	  	STATE STREET BANK AND TRUST COMPANY, as Agent
		
	ATTN:	  	Peter J. Connolly
		  	Assistant Vice President - CSU Manager
		  	Tel: (617) 662-8588
		  	Fax: (617) 988-6677
		  	Email: ais-loanops-csu@statestreet.com and
		
	FROM:	  	[            ]

 Reference is hereby made to that certain Credit Agreement, dated as of January 6, 2015 (such agreement,
as amended and in effect from time to time, the “Credit Agreement”), among NEXPOINT CAPITAL, INC., a Delaware corporation, the lending institutions referred to therein as Banks, and State Street Bank and Trust Company, as
Agent. Capitalized terms which are used herein without definition and which are defined in the Credit Agreement shall have the same meanings herein as in the Credit Agreement. 

Pursuant to Section 2.02(b) of the Credit Agreement, please convert or continue the following Loan as set forth below 

 

															
	Existing Loan	 	  	New Loan
						
	 Type
	  	Amount	 	  	 Continue As/Convert to
	  	Amount	 	  	Date*	  	Interest Period
	 LIBOR
	  	$	            	  	  	LIBOR	  	$	            	  	  		  	
	 Base Rate
	  	$	            	  	  	Base Rate	  	$	            	  	  		  	N/A
	 If LIBOR, last day of current Interest Period is:
                    
	    
	  		  				  		  	

 The undersigned hereby certifies that: (a) on the date of this notice and immediately after giving effect to the
conversion or continuation of the Loan(s) as set forth herein, the aggregate outstanding principal amount of the Loans do not and will not exceed the least of the Aggregate Commitment Amounts, the Borrowing Base and the Maximum Amount, and
(b) no Default or Event of Default has occurred and is continuing under the Credit Agreement or any of the other Loan Documents or will occur under the Credit Agreement or any of the other Loan Documents immediately after giving effect to the
conversion or continuation of the Loan(s) as set forth herein. 

  
 EXHIBIT C – FORM OF
NOTICE OF CONVERSION 

 
			
	NEXPOINT CAPITAL, INC.
		
	By:		  

			Name:
			Title:

  

	*	Must be a Domestic Business Day or a LIBOR Business Day, as applicable. 

  
 EXHIBIT C – FORM OF
NOTICE OF CONVERSION 

 EXHIBIT D 

FORM OF BORROWING BASE REPORT 

Date                      

To each of the Banks referred 
 to below 

c/o State Street Bank and 
 Trust Company, as Agent 

100 Huntington Avenue 
 Boston, Massachusetts 02116 

Attention: 
 Ladies and Gentlemen: 

Reference is hereby made to the Credit Agreement, dated as of January 6, 2015 (as amended and in effect from time to time, the
“Credit Agreement”), by and among NEXPOINT CAPITAL, INC., a Delaware corporation (the “Borrower”), the lending institutions referred to therein as Banks (collectively, the “Banks”), and State
Street Bank and Trust Company, as agent for the Banks. Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement. 

This Borrowing Base Report is delivered to you [as part of a Notice of Borrowing] [pursuant to Section 5.01(c) of
the Credit Agreement]. The undersigned hereby certifies to you that (a) Annex 1 is a true and accurate calculation of the Borrowing Base as at the end of [INSERT DATE], determined in accordance with the requirements of the
Credit Agreement, and (b) Annex 2 is a true and accurate list of assets owned by the Borrower as of the date hereof which, pursuant to the provisions of this Section 2.3 of the Security Agreement, do not constitute
Collateral. 
  

			
	NEXPOINT CAPITAL, INC.
		
	By:		  

			Name:
			Title:

  
 EXHIBIT D – FORM OF
BORROWING BASE REPORT 

 Annex 1 

to Borrowing Base Report 

As of:                      

 

					
	 a) Total Assets
		$	            	  
		
	 Total liabilities
		$	            	  
	 Plus: Fair market value of assets pledged in excess of stated liability
		$	            	  
	 Plus: Financial Contract Liability (without duplication)
		$	            	  
	 Plus: Debt (without duplication)
		$	            	  
	 Less: Senior Securities Representing Indebtedness
		($	            	) 
		
	 b) Total Liabilities:
		$	            	  
		
	 Adjusted Net Assets (a minus b)
		$	            	  
		
	 Borrowing Base shall equal the lesser of:
				
		
	 (i) 33 1/3% of Adjusted Net Assets
		$	            	  
		
	 Or
				
		
	 (ii) The sum of:
				
		
	 Senior Loans:
				
		
	 75% of Eligible Senior Loans rated B- / B3 or better, trading 3 90% of par
		$	            	  
		
	 60% of Eligible Senior Loans rated B- / B3 or better, trading 3 50% but < 90% of
par
		$	            	  
		
	 30% of Eligible Senior Loans rated CCC+ /Caa1 or better, trading 3 30% but < 90% of
par
		$	            	  
		
	 All other asset types:
				
		
	 90% of the sum of (i) Eligible Government Securities plus (ii) Eligible Commercial Paper rated A1 / P1 or better
		$	            	  
		
	 80% of Eligible Domestic Debt Securities rated BBB- / Baa3 or better
		$	            	  
		
	 80% of Eligible OECD Sovereign Debt Securities rated BBB- / Baa3 or better
		$	            	  
		
	 80% of Eligible Guaranteed Debt Securities rated BBB- / Baa3 or better
		$	            	  
		
	 70% of Eligible Domestic Debt Securities rated BB- / Ba3 or better (but below BBB- / Baa3)
		$	            	  
		
	 60% of Eligible Domestic Debt Securities rated B- / B3 or better (but below BB- / Ba3)
		$	            	  
		
	 50% of Eligible Common Securities
		$	            	  
		
	 30% of High Yield Eligible Domestic Debt Securities
		$	            	  
		
	 Sub-total
		$	            	  

  
 ANNEX I TO BORROWING BASE
REPORT 

					
		
	 Exclusions:
				
		
	 Highly Speculative Investments
				
		
	 (i) 20% of sub-total above
		$	            	  
		
	 (ii) total market value of the sum of (a) all Eligible Commercial Paper, Eligible Domestic Debt Securities, Eligible Government
Securities, Eligible Guaranteed Debt Securities, Eligible OECD Sovereign Debt Securities and Eligible Senior Loans, in each such case which has a market value less than 50% of the par value thereof, (b) all Eligible Senior Loans (i) that
are unsecured loans or other extensions of credit, (ii) that are loans or other extensions of credit secured by a lien that is not a first perfected lien, or (iii) the issuer in respect of which is domiciled (or whose principal place of
business is located) outside the United States, and (c) all High Yield Eligible Domestic Debt Securities
		$	            	  
		
	 If (ii) is greater than (i), excess amount to be excluded from sub-total above
		($	            	) 
		
	 Single Non-U.S. Country
				
		
	 (i) 10% of sub-total above
		$	            	  
		
	 (ii) total market value of investments in any single non-U.S. country included in sub-total above
		$	            	  
		
	 If (ii) is greater than (i), excess amount to be excluded from sub-total above
		($	            	) 
		
	 Single Issuer
				
		
	 (i) 5% of sub-total above
		$	            	  
		
	 (ii) total market value of securities attributable to any single issuer included in sub-total above
		$	            	  
		
	 If (ii) is greater than (i), excess amount to be excluded from sub-total above
		($	            	) 
		
	 Sum:
		$	            	  

 All terms as defined in the credit agreement. 
  

	*	No asset shall be included in the calculation of the Borrowing Base if it constitutes an Illiquid Asset or an asset which is the subject of a reverse repurchase agreement, dollar roll or securities lending transaction.

	**	Should any security or loan have multiple ratings, the lower rating shall prevail. 

  
 ANNEX I TO BORROWING BASE
REPORT 

 Annex 2 

to Borrowing Base Report 

As of:                      

  
 ANNEX II TO BORROWING
BASE REPORT 

 EXHIBIT E 

FORM OF 
 CERTIFICATE OF
NO DEFAULT 
 Date:
                     
 Reference is
made to the certain Credit Agreement, dated as of January 6, 2015 (as amended and in effect from time to time, the “Credit Agreement”), by and among NEXPOINT CAPITAL, INC., a Delaware corporation (the
“Borrower”), the lending institutions referred to therein as Banks (collectively, the “Banks”), and State Street Bank and Trust Company, as agent for the Banks. 

The undersigned officer of the Borrower hereby certifies as of the date hereof that he/she is an Authorized Signatory of the Borrower, and
that, as such he/she is authorized to execute and deliver this Certificate to the Banks, and that: 
 The undersigned has reviewed and is
familiar with the terms of the Credit Agreement and has made, or has caused to be made under his/her supervision a detailed review of the transactions and conditions (financial or otherwise) of the Borrower during the accounting period covered by
the attached financial statements and/or Borrowing Base Report. 
 To the best of the undersigned’s knowledge, the Borrower during such
period has observed, performed or satisfied all of its covenants and other agreements and satisfied every condition in the Credit Agreement to be observed, performed or satisfied by the Borrower and the undersigned has no knowledge of any Default or
Event of Default. 
 IN WITNESS HEREOF, the undersigned has executed this Certificate as of
                    . 
  

					
	By:		  

			Name:		
			Title:		

  
 EXHIBIT E – FORM OF
CERTIFICATE OF NO DEFAULT 

 EXHIBIT F 

FORM OF 
 ASSIGNMENT AND
ACCEPTANCE 
 Dated as of
                     
 Reference is
made to the Credit Agreement, dated as of January 6, 2015 (as from time to time amended and in effect, the “Credit Agreement”), by and among NEXPOINT CAPITAL, INC., a Delaware corporation (the
“Borrower”), the lending institutions referred to therein as Banks (collectively, the “Banks”) and State Street Bank and Trust Company, as agent (in such capacity, the “Agent”) for the Banks.
Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement. 

                       
                  (the “Assignor”) and
                                         (the
“Assignee”) hereby agree as follows: 
 §1. Assignors. Subject to the terms and conditions of this
Assignment and Acceptance, the Assignor hereby sells and assigns to the Assignee, and the Assignee hereby purchases and assumes without recourse to the Assignor, a [$        ] interest in and to
the rights, benefits, indemnities and obligations of the Assignor under the Credit Agreement equal to [    %] in respect of the Assignor’s Commitment Amount immediately prior to the Effective Date (as
hereinafter defined). 
 §2. Assignor’s Representations. The Assignor (a) represents and warrants that
(i) it is legally authorized to enter into this Assignment and Acceptance, (ii) as of the date hereof, its Commitment Amount is [$        ], its Commitment Percentage is
[    %], the aggregate outstanding principal balance of its Loans equals [$        ], (in each case before giving effect to the assignment contemplated hereby
and without giving effect to any contemplated assignments which have not yet become effective), and (iii) immediately after giving effect to all assignments which have not yet become effective, the Assignor’s Commitment Percentage will be
sufficient to give effect to this Assignment and Acceptance, (b) makes no representation or warranty, express or implied, and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with
the Credit Agreement or any of the other Loan Documents or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement, any of the other Loan Documents or any other instrument or document furnished
pursuant thereto or the attachment, perfection or priority of any security interest or mortgage, other than that it is the legal and beneficial owner of the interest being assigned by it hereunder free and clear of any claim or encumbrance;
(c) makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Borrower or any other Person primarily or secondarily liable in respect of any of the Loans, or the performance or observance
by the Borrower or any other Person primarily or secondarily liable in respect of any of the Loans of any of its obligations under the Credit Agreement or any of the other Loan Documents or any other instrument or document delivered or executed
pursuant thereto; and (d) attaches hereto the Note delivered to it under the Credit Agreement. 

  
 EXHIBIT F – FORM OF
ASSIGNMENT AND ACCEPTANCE 

 [The Assignor requests that the Borrower exchange the Assignor’s Note for new Notes payable
to the Assignor and the Assignee as follows:] 
  

					
	[Notes Payable to:	  	Amount of Note:	 
		
	 Assignor
	  	$	            	  
	 Assignee
	  	$	            	] 

 §3. Assignee’s Representations. The Assignee (a) represents and warrants
that (i) it is duly and legally authorized to enter into this Assignment and Acceptance, (ii) the execution, delivery and performance of this Assignment and Acceptance do not conflict with any provision of law or of the charter or by-laws
of the Assignee, or of any agreement binding on the Assignee, (iii) all acts, conditions and things required to be done and performed and to have occurred prior to the execution, delivery and performance of this Assignment and Acceptance, and
to render the same the legal, valid and binding obligation of the Assignee, enforceable against it in accordance with its terms, have been done and performed and have occurred in due and strict compliance with all applicable laws; (b) confirms
that it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and Acceptance; (c) agrees that it will, independently and without reliance upon the Assignor, the Agent or any other Bank and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (d) appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such
powers under the Credit Agreement and the other Loan Documents as are delegated to the Agent by the terms thereof, together with such powers as are reasonably incidental thereto; (e) agrees that it will perform in accordance with their terms
all the obligations which by the terms of the Credit Agreement are required to be performed by it as a Bank; and (f) attaches hereto the form(s) required to be delivered by it pursuant to Section 2.12 of the Credit Agreement. 

§4. Effective Date. The effective date for this Assignment and Acceptance shall be
[                    ] (the “Effective Date”). Following the execution of this Assignment and Acceptance each party hereto
shall deliver its duly executed counterpart hereof to the Agent for consent by the Agent (and the Borrower, if required by the Credit Agreement) and recording in the register by the Agent. Schedule 1 to the Credit Agreement shall
thereupon be replaced as of the Effective Date by the Schedule 1 annexed hereto. 
 §5. Rights Under
Credit Agreement. Upon such acceptance and recording, from and after the Effective Date, (a) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Acceptance, have the rights
and obligations of a Bank thereunder, provided that, without the Borrower’s prior written consent, the Assignee shall not be entitled to receive any greater payment under Section 2.10(c) or Section 8.01 of the
Credit Agreement than the Assignor would have been entitled to receive with respect to the rights transferred, and (b) the Assignor shall, with respect to that portion of its interest under the Credit Agreement assigned hereunder, relinquish
its rights and be released from its obligations under the Credit Agreement; provided, however, that the Assignor shall retain its rights to be indemnified pursuant to Section 9.03 of the Credit Agreement with respect to any
claims or actions arising prior to the Effective Date. 

  
 EXHIBIT F – FORM OF
ASSIGNMENT AND ACCEPTANCE 

 §6. Payments. Upon such acceptance of this Assignment and Acceptance by the
Agent and such recording, from and after the Effective Date, the Agent shall make all payments in respect of the rights and interests assigned hereby (including payments of principal, interest, fees and other amounts) to the Assignee. The Assignor
and the Assignee shall make any appropriate adjustments in payments for periods prior to the Effective Date by the Agent or with respect to the making of this assignment directly between themselves. 

§7. Governing Law. THIS ASSIGNMENT AND ACCEPTANCE IS INTENDED TO TAKE EFFECT AS A SEALED INSTRUMENT TO BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS (WITHOUT REFERENCE TO CONFLICT OF LAWS). 
 §8.
Counterparts. This Assignment and Acceptance may be executed in any number of counterparts which shall together constitute but one and the same agreement. 

IN WITNESS WHEREOF, intending to be legally bound, each of the undersigned has caused this Assignment and Acceptance to be executed on
its behalf by its officer thereunto duly authorized, as of the date first above written. 
  

					
	[ASSIGNOR]
		
	By:		  

			Name:		
			Title:		
	
	[ASSIGNEE]
		
	By:		  

			Name:		
			Title:		

  
 EXHIBIT F – FORM OF
ASSIGNMENT AND ACCEPTANCE 

					
	CONSENTED TO:
	
	[NEXPOINT CAPITAL, INC.
		
	By:		  

			Name:		
			Title:]		
	
	STATE STREET BANK AND TRUST COMPANY, as Agent
		
	By:		  

			Name:		
			Title:		

  
 EXHIBIT F – FORM OF
ASSIGNMENT AND ACCEPTANCE 

 EXHIBIT G 

FORM OF 
 PERFECTION
CERTIFICATE 
 The undersigned, the
                                         of
NEXPOINT CAPITAL, INC., a Delaware Corporation (the “Company”), hereby certifies, with reference to a certain Security Agreement dated as of January 6, 2015 (terms defined in such Security Agreement having the same
meanings herein as specified therein), between the Company and STATE STREET BANK AND TRUST COMPANY, in its capacity as agent (in such capacity, the “Agent”), to the Agent as follows: 

 

	1.	Name. 

 The exact legal name of the Company as that name appears on its [FORMATION
DOCUMENT] is as follows: 
  

					
		 	Source:	 	UCC § 9-503(a).

  

	2.	Other Identifying Factors. 

 (a) The following is the mailing address of the
Company: 
  

					
		 	Source:	 	UCC § 9-516(b)(5)(A).

 (b) If different from its mailing address, the Company’s place of business or, if more than one, its
chief executive office is located at the following address: 
  

					
	 Address
	  	 County
	  	 State

		  		  	
		  		  	
		  		  	
		  		  	
		  		  	

  

					
		 	Source:	 	UCC §§ 9-301(1) and 9-307; former UCC §§ 9-103(3), 9-103(4), 9- 401(6).

 (c) The following is the type of organization of the Company: 

 

					
		 	Source:	 	UCC § 9-516(b)(5)(C).

 (d) The following is the jurisdiction of the Company’s organization: 

 

					
		 	Source:	 	UCC § 9-516(b)(5)(C).

 (e) The following is the Company’s state issued organizational identification number [state
“None” if the state does not issue such a number]: 
  

					
		 	Source:	 	UCC § 9-9-516(b)(5)(C).

  
 EXHIBIT G – FORM OF
PERFECTION CERTIFICATE 

	3.	Other Names, Etc. 

 (a) The following is a list of all other names (including
trade names or similar appellations) used by the Company, or any other business or organization to which the Company became the successor by merger, consolidation, acquisition, change in form, nature or jurisdiction of organization or otherwise, now
or at any time during the past five years: 
  

					
		 	Source:	 	UCC § 9-507(c); former UCC § 9-402(7) (second and third sentences).

 (b) Attached hereto as Schedule 3 is the information required in § 2 for any other business or
organization to which the Company became the successor by merger, consolidation, acquisition, change in form, nature or jurisdiction of organization or otherwise, now or at any time during the past five years: 

 

					
		 	Source:	 	UCC § 9-316; former UCC § 9-402(7) (second and third sentences).

  

	4.	Other Current Locations. 

 (a) The following are all other locations in the United
States of America in which the Company maintains any books or records relating to any of the Collateral: 
  

					
	 Address
	  	 County
	  	 State

		  		  	
		  		  	
		  		  	
		  		  	
		  		  	

  

					
		 	Source:	 	UCC §§ 9-301(2) and (3); former UCC §§ 9-103(3), 9-103(4), 9-401(6).

 (b) The following are all other places of business of the Company in the United States of America: 

 

					
	 Address
	  	 County
	  	 State

		  		  	
		  		  	
		  		  	
		  		  	
		  		  	

  

					
		 	Source:	 	UCC §§ 9-301(2) and (3); former UCC §§ 9-103(1) and 9-401(1) (Third Alternative).

  
 EXHIBIT G – FORM OF
PERFECTION CERTIFICATE 

 (c) The following are the names and addresses of all persons or entities other than the Company
which have possession or are intended to have possession of any of the Collateral consisting of instruments or chattel paper: 
  

					
		  		  	
		  		  	
		  		  	
		  		  	
		  		  	
		  		  	
		  		  	

  

					
		 	Source:	 	UCC §§ 9-301(2) and (3), 9-312 and 9-313; former UCC §§ 9-103(1), 9- 103(4), 9-304(2) and 9-304(3); see also former UCC §§ 2-326(3), 9-114, 9-305, 9-308 and 9-408.

  

	5.	Prior Locations. 

 (a) Set forth below is the information required by § 4(a)
or (b) with respect to each location or place of business previously maintained by the Company at any time during the past five years in a state in which the Company has previously maintained a location or place of business at any time during
the past four months: 
  

					
	 Address
	  	 County
	  	 State

		  		  	
		  		  	
		  		  	
		  		  	
		  		  	
		  		  	
		  		  	

  

					
		 	Source:	 	Former UCC §§ 9-103(3)(e) and 9-401(3).

 IN WITNESS WHEREOF, I have hereunto signed this Certificate on
[                    ]. 
  

	
	  

	Name:
	Title:

  
 EXHIBIT G – FORM OF
PERFECTION CERTIFICATEEx 4.2 HealthSouthFifthSupplementalIndenturefinal31015

Exhibit 4.2
FIFTH SUPPLEMENTAL INDENTURE
HEALTHSOUTH CORPORATION
5.125% SENIOR NOTES DUE 2023
WELLS FARGO BANK,
NATIONAL ASSOCIATION,
as Trustee
Dated as of March 12, 2015

TABLE OF CONTENTS
	
		
	

	Page

	ARTICLE I
Establishment of New Series
	 

	SECTION 1.01.    Establishment of New Series
	1

	ARTICLE II
Definitions
	 

	SECTION 2.01.    Definitions
	2

	ARTICLE III
The Securities
	 

	SECTION 3.01.    Form
	22

	ARTICLE IV
Amendment Of Base Indenture
	 

	SECTION 4.01.    Amendment of Article I of Base Indenture
	23

	SECTION 4.02.    Amendment of Article III of Base Indenture
	23

	SECTION 4.03.    Amendment of Article IV of Base Indenture
	23

	SECTION 4.04.    Amendment of Article V of Base Indenture
	23

	SECTION 4.05.    Amendment of Article VI of Base Indenture
	24

	SECTION 4.06.    Amendments of Article VII of Base Indenture
	36

	SECTION 4.07.    Amendment of Article XI of Base Indenture
	38

	SECTION 4.08.    Amendment of Article XII of Base Indenture
	38

	SECTION 4.09.    Amendment of Article XIII of Base Indenture
	41

	SECTION 4.10.    Amendment of Article XIV of Base Indenture
	41

	ARTICLE V
Subsidiary Guarantees
	 

	SECTION 5.01.    Guarantees
	43

	SECTION 5.02.    Limitation on Liability
	44

	SECTION 5.03.    Successors and Assigns
	44

	SECTION 5.04.    No Waiver
	45

	SECTION 5.05.    Modification
	45

	SECTION 5.06.    Release of Subsidiary Guarantor
	45

	SECTION 5.07.    Contribution
	45

	ARTICLE VI
Miscellaneous
	 

	SECTION 6.01.    Integral Part
	46

	SECTION 6.02.    Adoption, Ratification and Confirmation
	46

	SECTION 6.03.    Counterparts
	46

	SECTION 6.04.    Severability
	46

	SECTION 6.05.    Governing Law
	46

	SECTION 6.06.    Trustee Makes No Representation
	46

	SECTION 6.07.    Damages Limitation
	46

	SECTION 6.08.    U.S.A. PATRIOT Act
	46

i

EXHIBIT A:  Form of Security
EXHIBIT B:  Form of Guaranty Agreement

ii

FIFTH SUPPLEMENTAL INDENTURE dated as of March 12, 2015 (this “Supplemental Indenture”), between HEALTHSOUTH CORPORATION, a Delaware corporation (the “Company”), the SUBSIDIARY GUARANTORS (as defined herein) party hereto and WELLS FARGO BANK, NATIONAL ASSOCIATION, as trustee (the “Trustee”).
W I T N E S S E T H:
WHEREAS the Company has heretofore entered into a senior indenture, dated as of December 1, 2009 (the “Base Indenture”), with the Trustee;
WHEREAS the Base Indenture, as supplemented by this Supplemental Indenture, is herein called the “Indenture”;
WHEREAS, pursuant to Section 3.01 of the Indenture, the form and terms of a new series of Securities may at any time be established by a supplemental indenture executed by the Company and the Trustee;
WHEREAS the Company proposes to create under the Indenture a new series of Securities;
WHEREAS additional Securities of this series and other series hereafter established, except as may be limited in the Indenture as at the time supplemented and modified, may be issued from time to time pursuant to the Indenture as at the time supplemented and modified; and
WHEREAS all conditions necessary to authorize the execution and delivery of this Supplemental Indenture and to make it a valid and binding obligation of the Company and the Subsidiary Guarantors have been done or performed.
NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
ESTABLISHMENT OF NEW SERIES
SECTION 1.01.    Establishment of New Series.  (a)  There is hereby established a new series of Securities to be issued under the Indenture, to be designated as the Company’s 5.125% Senior Notes due 2023 (the “Securities”).
(b)    On the Issue Date, the Trustee shall authenticate and deliver $300,000,000 of the Securities and, at any time and from time to time thereafter, the Trustee shall authenticate and deliver Additional Securities for original issue in accordance with Section 3.14 of the Indenture in an aggregate principal amount specified in the applicable resolution of the Board of Directors and Officers’ Certificate.  Further, from time to time after the original issue date, Securities shall be authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of other Securities as set forth in the Indenture.
(c)    The Securities shall be issued initially in the form of one or more Global Securities in substantially the form set out in Exhibit A hereto.  The Depositary with respect to the Securities shall be The Depository Trust Company.  The Company initially appoints the Trustee to act as the Registrar and Paying Agent and to act as custodian with respect to the Global Securities. The Company has entered into a letter of representations with the Depositary in the form provided by the Depositary and the Trustee and each agent are hereby authorized to act in accordance with such letter and applicable Depositary procedures.
(d)    Each Security shall be dated the date of authentication thereof and shall bear interest as provided in the form of Security in Exhibit A hereto.  The date on which principal is payable on the Securities shall be as provided in the form of Security in Exhibit A hereto.

1

(e)    The record dates for the Securities and the manner of payment of principal and interest on the Securities shall be as provided in the form of Security in Exhibit A hereto.
(f)    If and to the extent that the provisions of the Base Indenture are duplicative of, or in contradiction with, the provisions of this Supplemental Indenture, the provisions of this Supplemental Indenture shall govern, but solely with respect to the Securities.
ARTICLE II
DEFINITIONS
SECTION 2.01.    Definitions.  For purposes of the Indenture, but only with respect to the Securities, and the Securities, the following terms have the meanings indicated below.  All capitalized terms used herein and not otherwise defined below shall have the meanings ascribed thereto in the Base Indenture.
“Additional Assets” means (1) any property or assets used in a Related Business; (2) the Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock by the Company or another Restricted Subsidiary; or (3) Capital Stock constituting a minority interest in any Person that at such time is a Restricted Subsidiary; provided, however, that any such Restricted Subsidiary described in clause (2) or (3) above is primarily engaged in a Related Business.
“Additional Securities” means Securities issued under the terms of this Indenture subsequent to the Issue Date, and in compliance with Sections 3.14 and 6.03, it being understood that any Securities issued in exchange for or replacement of any Security issued on the Issue Date shall not be an Additional Security.
“Adjusted Treasury Rate” means, with respect to any redemption date, (1) the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication that is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after March 15, 2018, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month) or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per year equal to the semiannual equivalent yield to maturity of the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date, in each case calculated on the third Business Day immediately preceding the redemption date, and in each case of (1) and (2), plus 0.50%.
“Affiliate” of any specified Person means any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing. No Person (other than the Company or any Subsidiary of the Company) in whom a Receivables Entity makes an Investment in connection with a Qualified Receivables Transaction will be deemed to be an Affiliate of the Company or any of its Subsidiaries solely by reason of such Investment.
“Applicable Premium” means, with respect to a Security at any redemption date, the greater of (1) 1.00% of the principal amount of such Security and (2) the excess of (A) the present value at such redemption date of (i) the redemption price of such Security on March 15, 2018 (such redemption price being set forth in paragraph 5 of such Security, exclusive of any accrued interest), plus (ii) all required remaining scheduled interest payments due on such Security through March 15, 2018 (but excluding accrued and unpaid interest to the redemption date), computed using 

2

a discount rate equal to the Adjusted Treasury Rate, over (B) the principal amount of such Security on such redemption date.
“Asset Disposition” means any sale, lease, transfer or other disposition (or series of related sales, leases, transfers or dispositions) by the Company or any Restricted Subsidiary, including any disposition by means of a merger, consolidation or similar transaction (each referred to for the purposes of this definition as a “disposition”), of:
(1)    any shares of Capital Stock of a Restricted Subsidiary (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than the Company or a Restricted Subsidiary);
(2)    all or substantially all the assets of any division or line of business of the Company or any Restricted Subsidiary; or
(3)    any other assets of the Company or any Restricted Subsidiary outside of the ordinary course of business of the Company or such Restricted Subsidiary;
other than, in the case of clauses (1), (2) and (3) above,
(A)    a disposition by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to a Restricted Subsidiary;
(B)    for purposes of Section 6.06 only, a disposition that constitutes a Restricted Payment (or would constitute a Restricted Payment but for the exclusions from the definition thereof) that is not prohibited by Section 6.04 or that constitutes a Permitted Investment;
(C)    a disposition of all or substantially all the assets of the Company in accordance with Section 5.01;
(D)    a disposition of Capital Stock or other assets with a Fair Market Value of less than or equal to $10,000,000;
(E)    sales of damaged, worn-out or obsolete equipment or assets in the ordinary course of business that, in the Company’s reasonable judgment, are no longer either used or useful in the business of the Company or its Subsidiaries;
(F)    the sale or discount, in each case without recourse, of accounts receivable arising in the ordinary course of business, but only in connection with the compromise or collection thereof;
(G)    sales of accounts receivable and related assets of the type specified in the definition of “Qualified Receivables Transaction” to a Receivables Entity;
(H)    transfers of accounts receivable and related assets of the type specified in the definition of “Qualified Receivables Transaction” (or a fractional undivided interest therein) by a Receivables Entity in a Qualified Receivables Transaction;
(I)    leases or subleases to third Persons in the ordinary course of business that do not interfere in any material respect with the business of the Company or any of its Restricted Subsidiaries;
(J)    a disposition of cash or Temporary Cash Investments; and
(K)    the creation of a Lien (but not the sale or other disposition of the property subject to such Lien).

3

“Attributable Debt” in respect of a Sale/Leaseback Transaction means, as at the time of determination, the present value (discounted at the interest rate implicit in the lease, compounded annually) of the total obligations of the lessee for rental payments during the remaining term of the lease included in such Sale/Leaseback Transaction (including any period for which such lease has been extended); provided, however, that if such Sale/Leaseback Transaction results in a Capital Lease Obligation, the amount of Indebtedness represented thereby shall be determined in accordance with the definition of “Capital Lease Obligation.”
“Average Life” means, as of the date of determination, with respect to any Indebtedness, the quotient obtained by dividing:
(1)    the sum of the products of the numbers of years from the date of determination to the dates of each successive scheduled principal payment of or redemption or similar payment with respect to such Indebtedness multiplied by the amount of such payment by
(2)    the sum of all such payments.
“Capital Lease Obligation” means an obligation that is required to be classified and accounted for as a capital lease for financial reporting purposes in accordance with GAAP, and the amount of Indebtedness represented by such obligation shall be the capitalized amount of such obligation determined in accordance with GAAP; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be terminated by the lessee without payment of a penalty.  For purposes of Section 6.09, a Capital Lease Obligation shall be deemed to be secured by a Lien on the property being leased.
“Capital Markets Indebtedness” means any Indebtedness:
(1)    in the form of, or represented by, bonds (other than surety bonds, indemnity bonds, performance bonds or bonds of a similar nature) or other securities or any Guarantee thereof; and 
(2)    that is, or may be, quoted, listed or purchased and sold on any stock exchange, automated trading system or over-the-counter or other securities market (including, without prejudice to the generality of the foregoing, the market for securities eligible for resale pursuant to Rule 144A under the Securities Act).
“Captive Insurance Subsidiary” means HCS, Ltd., a Cayman Islands entity, and any successor to it, and any other Subsidiary formed for the purpose of facilitating self-insurance programs of the Company and its Subsidiaries.
“Change of Control” means the occurrence of any of the following events:
(1)    the Company becomes aware that any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or has become the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that for purposes of this clause (1) such person shall be deemed to have “beneficial ownership” of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 50% of the total voting power of the Voting Stock of the Company;
(2)    at any time during any period of up to 24 consecutive months, commencing on the Issue Date, individuals who at the beginning of such period constituted the Board of Directors (together with any new directors whose election by such Board of Directors or whose nomination for election by the shareholders of the Company was approved by a vote of a majority of the directors of the Company then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office;
(3)    the Company is liquidated or dissolved or adopts a plan of liquidation or dissolution; or
(4)    the merger or consolidation of the Company with or into another Person or the merger of another Person with or into the Company, or the sale of all or substantially all the assets of the Company (determined on a 

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consolidated basis) to another Person, other than a transaction following which (i) in the case of a merger or consolidation transaction, holders of securities that represented 100% of the Voting Stock of the Company immediately prior to such transaction (or other securities into which such securities are converted as part of such merger or consolidation transaction) own directly or indirectly at least a majority of the voting power of the Voting Stock of the surviving Person in such merger or consolidation transaction immediately after such transaction and (ii) in the case of a sale of assets transaction, each transferee becomes an obligor in respect of the Securities and a Subsidiary of the transferor of such assets.
“Code” means the Internal Revenue Code of 1986, as amended, and any applicable Treasury Regulations promulgated thereunder.
“Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Securities from the redemption date to March 15, 2018, that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of a maturity most nearly equal to March 15, 2018.
“Comparable Treasury Price” means, with respect to any redemption date, if clause (2) of the Adjusted Treasury Rate is applicable, the average of two, or if not possible, such lesser number as is obtained by the Company, Reference Treasury Dealer Quotations for such redemption date.
“Consolidated Amortization Expense” means, for any Person for any period, the amortization expense of such Person and its Restricted Subsidiaries for such period (to the extent included in the computation of Consolidated Net Income of such Person), determined on a consolidated basis in accordance with GAAP, excluding amortization expense attributable to a prepaid item that was paid in cash in a prior period.
“Consolidated Coverage Ratio” as of any date of determination means the ratio of (a) the aggregate amount of EBITDA for the period of the most recent four consecutive fiscal quarters ending at least 45 days prior to the date of such determination to (b) Consolidated Interest Expense for such four fiscal quarters; provided, however, that:
(1)    if the Company or any Restricted Subsidiary has Incurred any Indebtedness since the beginning of such period that remains outstanding or if the transaction giving rise to the need to calculate the Consolidated Coverage Ratio is an Incurrence of Indebtedness, or both, EBITDA and Consolidated Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Indebtedness (and the application of the proceeds thereof) as if such Indebtedness had been Incurred on the first day of such period;
(2)    if the Company or any Restricted Subsidiary has repaid, repurchased, defeased or otherwise discharged any Indebtedness since the beginning of such period or if any Indebtedness is to be repaid, repurchased, defeased or otherwise discharged (in each case other than Indebtedness Incurred under any revolving credit facility unless such Indebtedness has been permanently repaid and has not been replaced) on the date of the transaction giving rise to the need to calculate the Consolidated Coverage Ratio, EBITDA and Consolidated Interest Expense for such period shall be calculated on a pro forma basis as if such discharge had occurred on the first day of such period and as if the Company or such Restricted Subsidiary had not earned the interest income actually earned during such period in respect of cash or Temporary Cash Investments used to repay, repurchase, defease or otherwise discharge such Indebtedness;
(3)    if since the beginning of such period the Company or any Restricted Subsidiary shall have made any Asset Disposition, EBITDA for such period shall be reduced by an amount equal to EBITDA (if positive) directly attributable to the assets which are the subject of such Asset Disposition for such period, or increased by an amount equal to EBITDA (if negative), directly attributable thereto for such period and Consolidated Interest Expense for such period shall be reduced by an amount equal to the Consolidated Interest Expense directly attributable to any Indebtedness of the Company or any Restricted Subsidiary repaid, repurchased, defeased or otherwise discharged with respect to the Company and its continuing Restricted Subsidiaries in connection with such Asset Disposition for such period (or, if the Capital Stock of any Restricted Subsidiary is sold, the Consolidated Interest Expense for such period directly 

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attributable to the Indebtedness of such Restricted Subsidiary to the extent the Company and its continuing Restricted Subsidiaries are no longer liable for such Indebtedness after such sale);
(4)    if since the beginning of such period the Company or any Restricted Subsidiary (by merger or otherwise) shall have made an Investment in any Restricted Subsidiary (or any Person that becomes a Restricted Subsidiary) or an acquisition of assets, including any acquisition of assets occurring in connection with a transaction requiring a calculation to be made hereunder, that constitutes a hospital or other health care-related business or all or substantially all of an operating unit of a business, EBITDA and Consolidated Interest Expense for such period shall be calculated after giving pro forma effect thereto (including the Incurrence of any Indebtedness) as if such Investment or acquisition had occurred on the first day of such period; and
(5)    if since the beginning of such period any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Company or any Restricted Subsidiary since the beginning of such period) shall have made any Asset Disposition, any Investment or acquisition of assets that would have required an adjustment pursuant to clause (3) or (4) above if made by the Company or a Restricted Subsidiary during such period, EBITDA and Consolidated Interest Expense for such period shall be calculated after giving pro forma effect thereto as if such Asset Disposition, Investment or acquisition had occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be given to an acquisition of assets, the amount of income or earnings relating thereto and the amount of Consolidated Interest Expense associated with any Indebtedness Incurred in connection therewith, the pro forma calculations shall be determined in good faith by a responsible financial or accounting Officer of the Company (and shall include any applicable Pro Forma Cost Savings).  If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account any Interest Rate Agreement applicable to such Indebtedness).
If any Indebtedness is incurred under a revolving credit facility and is being given pro forma effect, the interest on such Indebtedness shall be calculated based on the average daily balance of such Indebtedness for the four fiscal quarters subject to the pro forma calculation to the extent that such Indebtedness was incurred solely for working capital purposes.
“Consolidated Depreciation Expense” means, for any Person for any period, the depreciation expense of such Person and its Restricted Subsidiaries for such period (to the extent included in the computation of Consolidated Net Income of such Person), determined on a consolidated basis in accordance with GAAP.
“Consolidated Income Tax Expense” means, for any Person for any period, the provision for taxes based on income and profits of such Person and its Restricted Subsidiaries to the extent such provision for income taxes was deducted in computing Consolidated Net Income of such Person for such period, determined on a consolidated basis in accordance with GAAP.
“Consolidated Interest Expense” means, for any period, the total interest expense of the Company and its consolidated Restricted Subsidiaries, net of interest income of the Company and its consolidated Restricted Subsidiaries (other than interest income of any Captive Insurance Subsidiary that is a Restricted Subsidiary), plus, to the extent not included in the calculation of total interest expense, and to the extent incurred by the Company or its Restricted Subsidiaries, without duplication:
(1)    interest expense attributable to Capital Lease Obligations;
(2)    amortization of debt discount;
(3)    capitalized interest;
(4)    non-cash interest expense;

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(5)    commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing;
(6)    net payments made or received pursuant to Hedging Obligations;
(7)    dividends accrued in respect of all Disqualified Stock of the Company and all Preferred Stock of any Restricted Subsidiary, in each case held by Persons other than the Company or a Wholly Owned Subsidiary (other than dividends payable solely in Capital Stock (other than Disqualified Stock) of the Company); provided, however, that such dividends shall be multiplied by a fraction the numerator of which is one and the denominator of which is one minus the effective combined tax rate of the issuer of such Preferred Stock (expressed as a decimal) for such period (as estimated by the chief financial officer of the Company in good faith);
(8)    interest accruing on any Indebtedness of any other Person to the extent such Indebtedness is Guaranteed by (or secured by the assets of) the Company or any Restricted Subsidiary; and
(9)    the cash contributions to any employee stock ownership plan or similar trust to the extent such contributions are used by such plan or trust to pay interest or fees to any Person (other than the Company) in connection with Indebtedness Incurred by such plan or trust.
“Consolidated Net Income” means, for any period, the net income of the Company and its consolidated Subsidiaries; provided, however, that there shall not be included in such Consolidated Net Income:
(1)    any net income of any Person (other than the Company) if such Person is not a Restricted Subsidiary, except that:
(A)    subject to the exclusion contained in clause (4) below, the Company’s equity in the net income of any such Person for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed by such Person during such period to the Company or a Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution paid to a Restricted Subsidiary, to the limitations contained in clause (3) below); and
(B)    the Company’s equity in a net loss of any such Person for such period shall be included in determining such Consolidated Net Income to the extent such loss has been funded with cash from the Company or a Restricted Subsidiary;
(2)    any net income (or loss) of any Person acquired by the Company or a Subsidiary in a pooling of interests transaction (or any transaction accounted for in a manner similar to a pooling of interests) for any period prior to the date of such acquisition;
(3)    any net income of any Restricted Subsidiary if such Restricted Subsidiary is subject to restrictions, directly or indirectly, on the payment of dividends or the making of distributions by such Restricted Subsidiary, directly or indirectly, to the Company, except that:
(A)    subject to the exclusion contained in clause (4) below, the Company’s equity in the net income of any such Restricted Subsidiary for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash that could have been distributed by such Restricted Subsidiary during such period to the Company or another Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution paid to another Restricted Subsidiary, to the limitation contained in this clause); and
(B)    the Company’s equity in a net loss of any such Restricted Subsidiary for such period shall be included in determining such Consolidated Net Income;

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(4)    any gain (or loss) realized upon the sale or other disposition of any assets of the Company, its consolidated Subsidiaries or any other Person (including pursuant to any sale-and-leaseback arrangement) which is not sold or otherwise disposed of in the ordinary course of business and any gain (or loss) realized upon the sale or other disposition of any Capital Stock of any Person;
(5)    any net income or net losses from discontinued operations;
(6)    extraordinary gains or losses; and
(7)    the cumulative effect of a change in accounting principles,
in each case, for such period.  Notwithstanding the foregoing, for the purposes of Section 6.04 only, there shall be excluded from Consolidated Net Income any repurchases, repayments or redemptions of Investments, proceeds realized on the sale of Investments or return of capital to the Company or a Restricted Subsidiary to the extent such repurchases, repayments, redemptions, proceeds or returns increase the amount of Restricted Payments permitted under clause (a)(3)(D) or (a)(3)(E) of Section 6.04.
“Consolidated Secured Debt Ratio” as of any date of determination, means the ratio of (a) Indebtedness of the Company and its Restricted Subsidiaries, determined on a consolidated basis, secured by Liens, to (b) the aggregate amount of EBITDA for the period of the most recent four consecutive fiscal quarters ending at least 45 days prior to the date of such determination, in each case with such pro forma adjustments to consolidated total Indebtedness and EBITDA as are appropriate and consistent with the pro forma adjustment provisions set forth in the definition of “Consolidated Coverage Ratio.”
“Consolidated Tangible Assets” as of any date means the total assets of the Company and its Restricted Subsidiaries (excluding any assets that would be classified as “intangible assets” under GAAP) on a consolidated basis at such date, as determined in accordance with GAAP, less (i) all write-ups subsequent to the Issue Date in the book value of any asset owned by the Company or any of its Restricted Subsidiaries and (ii) Investments in and assets of Unrestricted Subsidiaries.
“Consolidated Total Indebtedness” of any Person as of any date means (a) all Indebtedness (including Capital Lease Obligations but excluding (i) Hedging Obligations and (ii) to the extent they constitute Indebtedness, contingent reimbursement obligations in respect of undrawn amounts of letters of credit) minus (b) the aggregate amount of cash and cash equivalents of such Person and its Subsidiaries (other than Restricted Cash and Cash Equivalents) as of such date in an amount not to exceed $75,000,000.
“Convertible Preferred Stock” means the Company’s Series A Convertible Perpetual Preferred Stock issued and outstanding on the Issue Date.
“Corporate Trust Office” shall be the office of the Trustee at which this Indenture shall be principally administered, which at the Issue Date is 150 East 42nd Street, 40th Floor, New York, New York 10017, Attn: Corporate, Municipal and Escrow Services, and with respect to Paying Agent and Registrar services such office shall also mean the office or agency of the Trustee located at 608 Second Avenue South, N9303-121, Minneapolis, MN 55479, Attn: Corporate Trust Operations, or such other address as to which the Trustee may give notice to the Company.
“Credit Agreement” means the Credit Agreement dated as of March 10, 2006, as amended as of August 10, 2012, by and among the Company, as borrower, JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders and agents party thereto from time to time, together with the related documents thereto (including the term loans and revolving loans thereunder, any guarantees and security documents), as amended, extended, renewed, restated, supplemented or otherwise modified (in whole or in part, and without limitation as to amount, terms, conditions, covenants and other provisions) from time to time, and any agreement (and related document) governing Indebtedness incurred to Refinance, in whole or in part, the borrowings and commitments then outstanding or permitted to be outstanding under such Credit Agreement or a successor Credit Agreement, whether by the same or any other lender or group of lenders (including by means of sales of debt securities to institutional investors).

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“Currency Agreement” means any foreign exchange contract, currency swap agreement or other similar agreement with respect to currency values.
“Designated Noncash Consideration” means noncash consideration received by the Company or one of its Restricted Subsidiaries in connection with an Asset Disposition that is designated by the Company as Designated Noncash Consideration, less the amount of cash or cash equivalents received in connection with a subsequent sale of such Designated Noncash Consideration, which cash and cash equivalents shall be considered Net Available Cash received as of such date and shall be applied pursuant to Section 6.06.
“Disqualified Stock” means, with respect to any Person, 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 at the option of the holder) or upon the happening of any event:
(1)    matures or is mandatorily redeemable (other than redeemable only for Capital Stock of such Person which is not itself Disqualified Stock) pursuant to a sinking fund obligation or otherwise;
(2)    is convertible or exchangeable at the option of the holder for Indebtedness or Disqualified Stock; or
(3)    is mandatorily redeemable or must be purchased upon the occurrence of certain events or otherwise, in whole or in part;
in each case on or prior to the date that is 91 days after the Stated Maturity of the Securities; provided, however, that any Capital Stock that would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require such Person to purchase or redeem such Capital Stock upon the occurrence of an “asset sale” or “change of control” occurring prior to the date that is 91 days after the Stated Maturity of the Securities shall not constitute Disqualified Stock if the “asset sale” or “change of control” provisions applicable to such Capital Stock are not more favorable to the holders of such Capital Stock than the terms applicable to the Securities under Sections 6.06 and 6.08.
The amount of any Disqualified Stock that does not have a fixed redemption, repayment or repurchase price shall be calculated in accordance with the terms of such Disqualified Stock as if such Disqualified Stock were redeemed, repaid or repurchased on any date on which the amount of such Disqualified Stock is to be determined pursuant to this Indenture; provided, however, that if such Disqualified Stock could not be required to be redeemed, repaid or repurchased at the time of such determination, the redemption, repayment or repurchase price shall be the book value of such Disqualified Stock as reflected in the most recent financial statements of such Person.  The Convertible Preferred Stock, based on the terms thereof in effect on the Issue Date, shall not be Disqualified Stock.
“EBITDA” of any Person for any period means Consolidated Net Income of such Person for such period plus, without duplication, the sum for such Person of the following to the extent deducted in calculating Consolidated Net Income for such period:
(1)    Consolidated Income Tax Expense,
(2)    Consolidated Depreciation Expense,
(3)    Consolidated Amortization Expense,
(4)    Consolidated Interest Expense,
(5)    all other non-cash items or non-recurring non-cash items reducing Consolidated Net Income of such Person and its Subsidiaries, determined on a consolidated basis in accordance with GAAP (including non-cash charges incurred as a result of the application of FASB Accounting Standard Codification 718, Compensation—Stock Compensation); provided that cash expenditures made in respect of items to which the charges referred to in this clause (5) relate in an aggregate amount in excess of $10,000,000 for any period of four consecutive fiscal quarters shall be deducted in determining EBITDA for the period during which such expenditures are made,

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(6)    any restructuring charges in respect of legal fees associated with the government, class-action and shareholder derivative litigation described in the Company’s Report on Form 10-K for the fiscal year ended December 31, 2009,
(7)    fees, costs and expenses related to the offering of the Securities and the other Refinancing Transactions,
(8)    any losses from discontinued operations and closed locations, and
(9)    costs and expenses related to the settlement of the Shareholder Litigation,
in each case determined on a consolidated basis in accordance with GAAP, less all unusual noncash items or nonrecurring noncash items to the extent increasing Consolidated Net Income of such Person and its Subsidiaries, determined on a consolidated basis in accordance with GAAP, in each case for such period.  Notwithstanding the foregoing, the provision for taxes based on the income or profits of, and the depreciation and amortization and noncash charges of, a Restricted Subsidiary shall be added to Consolidated Net Income to compute EBITDA only to the extent (and in the same proportion, including by reason of minority interests) that the net income or loss of such Restricted Subsidiary was included in calculating Consolidated Net Income and only if a corresponding amount would be permitted at the date of determination to be dividended to the Company by such Restricted Subsidiary without prior approval (that has not been obtained), pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to such Restricted Subsidiary or its stockholders.
“Equity Offering” means any public or private sale of Capital Stock (other than Disqualified Stock) of the Company, other than public offerings with respect to the Company’s common stock registered on Form S-8 under the Securities Act and other than issuances to any Subsidiary of the Company.
“Fair Market Value” means, with respect to any asset or property, the price that could be negotiated in an arm’s-length, free market transaction, for cash, between a willing and able buyer and an unaffiliated willing seller, neither of whom is under undue pressure or compulsion to complete the transaction, as such price is determined in good faith by (1) the Chief Financial Officer, the Treasurer or the Chief Accounting Officer of the Company (unless otherwise provided in this Indenture) for transactions valued at, or below, $10,000,000, or (2) the Board of Directors of the Company (unless otherwise provided in this Indenture) for transactions valued in excess of $10,000,000.
“Guarantee” means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any Person and any obligation, direct or indirect, contingent or otherwise, of such Person:
(1)    to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services, to take-or-pay or to maintain financial statement conditions or otherwise); or
(2)    entered into for the purpose of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part);
provided, however, that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.  The term “Guarantee” used as a verb has a corresponding meaning.
“Guaranty Agreement” means an agreement, in substantially the form of Exhibit B hereto or another form satisfactory to the Trustee, pursuant to which a Subsidiary Guarantor guarantees the Company’s obligations with respect to the Securities on the terms provided for in this Indenture.
“Hedging Obligations” of any Person means the obligations of such Person pursuant to any Interest Rate Agreement or Currency Agreement.

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“Incur” means issue, assume, Guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a Restricted Subsidiary.  The term “Incurrence” when used as a noun shall have a correlative meaning.  Solely for purposes of determining compliance with Section 6.03:
(1)    amortization of debt discount or the accretion of principal with respect to a noninterest bearing or other discount security;
(2)    the payment of regularly scheduled interest in the form of additional Indebtedness of the same instrument or the payment of regularly scheduled dividends on Capital Stock in the form of additional Capital Stock of the same class and with the same terms; and
(3)     the obligation to pay a premium in respect of Indebtedness arising in connection with the issuance of a notice of redemption or making of a mandatory offer to purchase such Indebtedness
will not be deemed to be the Incurrence of Indebtedness.
“Indebtedness” means, with respect to any Person on any date of determination (without duplication):
(1)    the principal in respect of (A) indebtedness of such Person for money borrowed and (B) indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment of which such Person is responsible or liable, including, in each case, any premium on such indebtedness to the extent such premium has become due and payable;
(2)    all Capital Lease Obligations of such Person and all Attributable Debt in respect of Sale/Leaseback Transactions entered into by such Person;
(3)    all obligations of such Person issued or assumed as the deferred purchase price of property, all conditional sale obligations of such Person and all obligations of such Person under any title retention agreement (but excluding any accounts payable or other liability to trade creditors arising in the ordinary course of business);
(4)    all obligations of such Person for the reimbursement of any obligor on any letter of credit, bankers’ acceptance or similar credit transaction (other than obligations with respect to letters of credit securing obligations (other than obligations described in clauses (1) through (3) above) entered into in the ordinary course of business of such Person to the extent such letters of credit are not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no later than the tenth Business Day following payment on the letter of credit);
(5)    the amount of all obligations of such Person with respect to the redemption, repayment or other repurchase of any Disqualified Stock of such Person or, with respect to any Preferred Stock of any Subsidiary of such Person, the principal amount of such Preferred Stock to be determined in accordance with this Indenture (but excluding, in each case, any accrued dividends);
(6)    all obligations of the type referred to in clauses (1) through (5) of other Persons and all dividends of other Persons for the payment of which, in either case, such Person is responsible or liable, directly or indirectly, as obligor, guarantor or otherwise, including by means of any Guarantee;
(7)    all obligations of the type referred to in clauses (1) through (6) of other Persons secured by any Lien on any property or asset of such Person (whether or not such obligation is assumed by such Person), the amount of such obligation being deemed to be the lesser of the Fair Market Value of such property or assets and the amount of the obligation so secured; and
(8)    to the extent not otherwise included in this definition, Hedging Obligations of such Person.

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Notwithstanding the foregoing, in connection with the purchase by the Company or any Restricted Subsidiary of any business, the term “Indebtedness” will exclude indemnification, purchase price adjustment, holdback and contingency payment obligations to which the seller may become entitled to the extent such payment is determined by a final closing balance sheet or such payment depends on the performance of such business after the closing; provided, however, that, at the time of closing, the amount of any such payment is not determinable and, to the extent such payment thereafter becomes fixed and determined, the amount is paid within 60 days thereafter.
The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all obligations as described above; provided, however, that in the case of Indebtedness sold at a discount, the amount of such Indebtedness at any time will be the accreted value thereof at such time.
“Independent Qualified Party” means an investment banking firm, accounting firm or appraisal firm of national standing; provided, however, that such firm is not an Affiliate of the Company.
“Interest Rate Agreement” means any interest rate swap agreement, interest rate cap agreement or other financial agreement or arrangement with respect to exposure to interest rates.
“Investment” in any Person means any direct or indirect advance, loan (other than advances to customers in the ordinary course of business that are recorded as accounts receivable on the balance sheet of the lender) or other extensions of credit (including by way of Guarantee or similar arrangement) or capital contribution to (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others), or any purchase or acquisition of Capital Stock, Indebtedness or other similar instruments issued by such Person.  If the Company or any Restricted Subsidiary issues, sells or otherwise disposes of any Capital Stock of a Person that is a Restricted Subsidiary such that, after giving effect thereto, such Person is no longer a Restricted Subsidiary, any Investment by the Company or any Restricted Subsidiary in such Person remaining after giving effect thereto will be deemed to be a new Investment at such time.  The acquisition by the Company or any Restricted Subsidiary of a Person that holds an Investment in a third Person shall be deemed to be an Investment by the Company or such Restricted Subsidiary in such third Person at such time.  Except as otherwise provided for herein, the amount of an Investment shall be its Fair Market Value at the time the Investment is made and without giving effect to subsequent changes in value.
For purposes of the definition of “Unrestricted Subsidiary”, the definition of “Restricted Payment” and Section 6.04:
(1)    “Investment” shall include the portion (proportionate to the Company’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of any Subsidiary of the Company at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Company shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary equal to an amount (if positive) equal to (A) the Company’s “Investment” in such Subsidiary at the time of such redesignation less (B) the portion (proportionate to the Company’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time of such redesignation; and
(2)    any property transferred to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value at the time of such transfer.
“Issue Date” means March 12, 2015.
“Leverage Ratio” means, at any date, the ratio of (a) Consolidated Total Indebtedness of the Company and its Restricted Subsidiaries on such date to (b) EBITDA of the Company and its Restricted Subsidiaries for the period of four consecutive fiscal quarters ending at least 45 days prior to such date, in each case with such pro forma adjustments as are appropriate and consistent with the pro forma adjustment provisions set forth in the definition of “Consolidated Coverage Ratio.”

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“Lien” means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof).
“Moody’s” means Moody’s Investors Service, Inc., and any successor to its rating agency business.
“Net Available Cash” from an Asset Disposition means cash payments received therefrom (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise and proceeds from the sale or other disposition of any securities received as consideration, but only as and when received, but excluding any other consideration received in the form of assumption by the acquiring Person of Indebtedness or other obligations relating to such properties or assets or received in any other non-cash form), in each case net of:
(1)    all legal, title and recording tax expenses, commissions and other fees and expenses incurred (including legal, accounting and investment banking fees and commissions), and all Federal, state, provincial, foreign and local taxes required to be accrued as a liability under GAAP, as a consequence of such Asset Disposition;
(2)    all payments made on any Indebtedness which is secured by any assets subject to such Asset Disposition, in accordance with the terms of any Lien upon or other security agreement of any kind with respect to such assets, or which must by its terms, or in order to obtain a necessary consent to such Asset Disposition, or by applicable law, be repaid out of the proceeds from such Asset Disposition;
(3)    all distributions and other payments required to be made to minority interest holders in Restricted Subsidiaries as a result of such Asset Disposition;
(4)    the deduction of appropriate amounts provided by the seller as a reserve, in accordance with GAAP, against any liabilities associated with the property or other assets disposed in such Asset Disposition and retained by the Company or any Restricted Subsidiary after such Asset Disposition; and
(5)    any portion of the purchase price from an Asset Disposition placed in escrow, whether as a reserve for adjustment of the purchase price, for satisfaction of indemnities in respect of such Asset Disposition or otherwise in connection with that Asset Disposition; provided, however, that upon the termination of that escrow, Net Available Cash shall be increased by any portion of funds in the escrow that are released to the Company or any Restricted Subsidiary.
“Net Cash Proceeds”, with respect to any issuance or sale of Capital Stock or Indebtedness, means the cash proceeds of such issuance or sale net of attorneys’ fees, accountants’ fees, underwriters’ or placement agents’ fees, discounts or commissions and brokerage, consultant and other fees actually incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof.
“Obligations” means, with respect to any Indebtedness, all obligations for principal, premium, interest, penalties, fees, indemnifications, reimbursements, and other amounts payable pursuant to the documentation governing such Indebtedness.
“Officer” means the Chairman of the Board of Directors, the Chief Executive Officer, the President, the Chief Financial Officer, any Vice President, the Treasurer or the Secretary of the Company.
“Officer’s Certificate” means a certificate signed by an Officer and delivered to the Trustee and “Officers’ Certificate” means a certificate signed by two Officers and delivered to the Trustee.  Each such certificate shall include the statements provided for in Section 16.01 if and to the extent required by the provisions of such Section.
“Permitted Investment” means an Investment by the Company or any Restricted Subsidiary in:
(1)    the Company, a Restricted Subsidiary or a Person that shall, upon the making of such Investment, become a Restricted Subsidiary; provided, however, that the primary business of such Restricted Subsidiary is a Related Business;

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(2)    another Person if, as a result of such Investment, such other Person is merged or consolidated with or into, or transfers or conveys all or substantially all its assets to, the Company or a Restricted Subsidiary; provided, however, that such Person’s primary business is a Related Business;
(3)    cash and Temporary Cash Investments;
(4)    receivables owing to the Company or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Company or any such Restricted Subsidiary deems reasonable under the circumstances;
(5)    payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;
(6)    loans or advances to officers, directors and employees made in the ordinary course of business of the Company or such Restricted Subsidiary;
(7)    stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to the Company or any Restricted Subsidiary or in satisfaction of judgments;
(8)    any Person to the extent such Investment represents the non-cash portion of the consideration received for (A) an Asset Disposition as permitted pursuant to Section 6.06 or (B) a disposition of assets not constituting an Asset Disposition;
(9)    any Person where such Investment was acquired by the Company or any of its Restricted Subsidiaries (A) in exchange for any other Investment or accounts receivable held by the Company or any such Restricted Subsidiary in connection with or as a result of a bankruptcy, workout, reorganization or recapitalization of the issuer of such other Investment or accounts receivable or (B) as a result of a foreclosure by the Company or any of its Restricted Subsidiaries with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;
(10)    any Person to the extent such Investments consist of prepaid expenses, negotiable instruments held for collection and lease, utility and workers’ compensation, performance and other similar deposits made in the ordinary course of business by the Company or any Restricted Subsidiary;
(11)    any Person to the extent such Investments consist of Hedging Obligations otherwise permitted under Section 6.03;
(12)    any Person to the extent such Investment exists on the Issue Date, and any extension, modification or renewal of any such Investments existing on the Issue Date, but only to the extent not involving additional advances, contributions or other Investments of cash or other assets or other increases thereof (other than as a result of the accrual or accretion of interest or original issue discount or the issuance of pay-in-kind securities, in each case, pursuant to the terms of such Investment as in effect on the Issue Date);
(13)    Investments made by the Captive Insurance Subsidiary in the ordinary course of business and in accordance with applicable law;
(14)    a Receivables Entity, or any Investment by a Receivables Entity in any other Person in connection with a Qualified Receivables Transaction, including Investments of funds held in accounts permitted or required by the arrangements governing such Qualified Receivables Transaction or any related Indebtedness; provided, however, that any Investment in a Receivables Entity is in the form of a purchase money note, contribution of additional receivables or an equity interest; or
(15)    Persons to the extent such Investments, when taken together with all other Investments made pursuant to this clause (15) and outstanding on the date such Investment is made, do not exceed 10% of Consolidated Tangible 

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Assets, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter ending at least 45 days prior thereto.
“Permitted Liens” means, with respect to any Person:
(1)    pledges or deposits by such Person under worker’s compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person or deposits of cash or United States government bonds to secure surety or appeal bonds to which such Person is a party, performance bonds or obligations of a like nature or deposits as security for contested taxes or import duties or for the payment of rent, in each case Incurred in the ordinary course of business;
(2)    Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens, in each case for sums not yet due or being contested in good faith by appropriate proceedings or other Liens arising out of judgments or awards against such Person with respect to which such Person shall then be proceeding with an appeal or other proceedings for review and Liens arising solely by virtue of any statutory or common law provision relating to banker’s Liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a creditor depository institution; provided, however, that (A) such deposit account is not a dedicated cash collateral account and is not subject to restrictions against access by the Company in excess of those set forth by regulations promulgated by the Federal Reserve Board and (B) such deposit account is not intended by the Company or any Restricted Subsidiary to provide collateral to the depository institution;
(3)    Liens for taxes, assessments or other governmental charges or claims, in each case not yet subject to penalties for non-payment or which are being contested in good faith by appropriate proceedings;
(4)    Liens in favor of issuers of surety bonds or letters of credit issued pursuant to the request of and for the account of such Person in the ordinary course of its business; provided, however, that such letters of credit do not constitute Indebtedness;
(5)    minor survey exceptions, minor encumbrances, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real property or Liens incidental to the conduct of the business of such Person or to the ownership of its properties which were not Incurred in connection with Indebtedness and which do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;
(6)    Liens securing Indebtedness Incurred to finance the construction, purchase or lease of, or repairs, improvements or additions to, property, plant or equipment of such Person; provided, however, that the Lien may not extend to any other property owned by such Person or any of its Restricted Subsidiaries at the time the Lien is Incurred (other than assets and property affixed or appurtenant thereto), and the Indebtedness (other than any interest thereon) secured by the Lien may not be Incurred more than 180 days after the later of the acquisition, completion of construction, repair, improvement, addition or commencement of full operation of the property subject to the Lien;
(7)    Liens to secure Indebtedness permitted pursuant to Section 6.03(b)(1); provided, however, that if (x) on the date the secured Indebtedness is Incurred, and after giving pro forma effect to the Incurrence thereof, the Incurrence of such Indebtedness would result in the Consolidated Secured Debt Ratio exceeding 3.75 to 1.0, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter ending at least 45 days prior thereto, then (y) the total amount of Indebtedness that may be secured pursuant to this clause (7) shall not exceed the greater of (i) the maximum amount of Indebtedness that could be Incurred on such date without such ratio being so exceeded and (ii) an amount equal to the maximum amount of Indebtedness that could then be incurred pursuant to Section 6.03(b)(1), less the amount of Indebtedness secured by Liens Incurred pursuant to clause (18) below and outstanding on such date;
(8)    Liens existing on the Issue Date (other than Liens referred to in the foregoing clause (7));

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(9)    Liens on property or shares of Capital Stock of another Person at the time such other Person becomes a Subsidiary of such Person; provided, however, that the Liens may not extend to any other property owned by such Person or any of its Restricted Subsidiaries (other than assets and property affixed or appurtenant thereto);
(10)    Liens on property at the time such Person or any of its Subsidiaries acquires the property, including any acquisition by means of a merger or consolidation with or into such Person or a Subsidiary of such Person; provided, however, that the Liens may not extend to any other property owned by such Person or any of its Restricted Subsidiaries (other than assets and property affixed or appurtenant thereto);
(11)    Liens securing Indebtedness or other obligations of a Subsidiary of such Person owing to such Person or a Wholly Owned Subsidiary of such Person;
(12)    Liens securing Hedging Obligations so long as such Hedging Obligations are permitted to be Incurred under this Indenture;
(13)    any Lien on accounts receivable and related assets of the types specified in the definition of “Qualified Receivables Transaction” incurred in connection with a Qualified Receivables Transaction;
(14)    Liens in favor of the Company or the Subsidiary Guarantors;
(15)    leases, subleases, licenses or sublicenses granted to third parties entered into in the ordinary course of business which do not materially interfere with the conduct of the business of the Company and the Restricted Subsidiaries and which do not secure any Indebtedness;
(16)    Liens securing judgments, decrees, orders or awards for the payment of money not constituting an Event of Default in respect of which the Company shall in good faith be prosecuting an appeal or proceedings for review, which appeal or proceedings shall not have been finally terminated, or in respect of which the period within which such appeal or proceedings may be initiated shall not have expired;
(17)    Liens to secure any Refinancing (or successive Refinancings) as a whole, or in part, of any Indebtedness secured by any Lien referred to in the foregoing clause (6), (8), (9) or (10); provided, however, that:
(A)    such new Lien shall be limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Indebtedness (plus improvements and accessions to, such property or proceeds or distributions thereof); and
(B)    the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (i) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clause (6), (8), (9) or (10) at the time the original Lien became a Permitted Lien and (ii) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing, refunding, extension, renewal or replacement;
(18)    other Liens securing Indebtedness (other than Subordinated Obligations) to the extent the Incurrence of such Indebtedness, when taken together with all other Indebtedness secured by Liens Incurred pursuant to this clause (18) and outstanding on the date such other Lien is Incurred, and after giving pro forma effect to the Incurrence of such Indebtedness, would not result in the Consolidated Secured Debt Ratio exceeding 3.75 to 1.0, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter ending at least 45 days prior thereto; provided, however, notwithstanding whether this clause (18) would then be available to secure Indebtedness, any Lien securing Indebtedness originally secured pursuant to this clause (18) may secure Refinancing Indebtedness in respect of such Indebtedness, as long as such Lien does not extend to any property other than all or part of the same property and assets that secured or, under the written agreements pursuant to which such original Lien arose, could have secured the original Indebtedness (plus improvements and accessions to, such property or proceeds or distributions thereof), and such Refinancing Indebtedness shall be deemed to have been secured pursuant to this clause (18); and

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(19)    other Liens securing Indebtedness; provided that the aggregate principal amount of Indebtedness secured by such Liens shall not exceed the greater of (A) $100,000,000 and (B) 3.0% of Consolidated Tangible Assets, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter ending at least 45 days prior thereto (as of the date of granting such Liens and after giving pro forma effect to the Incurrence of such Indebtedness and the application of the net proceeds thereof).
Notwithstanding the foregoing, “Permitted Liens” will not include any Lien described in clause (6), (9) or (10) above to the extent such Lien applies to any Additional Assets acquired directly or indirectly from Net Available Cash pursuant to Section 6.06.  For purposes of this definition, the term “Indebtedness” shall be deemed to include interest on such Indebtedness.
“Person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.
“principal” of a Security means the principal of the Security plus the premium, if any, payable on the Security which is due or overdue or is to become due at the relevant time.
“Pro Forma Cost Savings” means, with respect to any period, the reduction in costs that were:
(1)    directly attributable to an asset acquisition and calculated on a basis that is consistent with Regulation S-X under the Securities Act in effect and applied as of the Issue Date, or
(2)    implemented by the business that was the subject of any such asset acquisition within the six months prior to or following the date of the asset acquisition and that are supportable and quantifiable by the underlying accounting records of such business, as if, in the case of each of clause (1) and (2), all such reductions in costs had been effected as of the beginning of such period.
“Prospectus Supplement” means the Prospectus Supplement dated March 9, 2015, and used in connection with the offering of the Securities.
“Purchase Money Indebtedness” means Indebtedness (1) consisting of the deferred purchase price of property, conditional sale obligations, obligations under any title retention agreement, other purchase money obligations and obligations in respect of industrial revenue bonds or similar Indebtedness, in each case where the maturity of such Indebtedness does not exceed the anticipated useful life of the asset being financed, and (2) Incurred to finance the acquisition by the Company or a Restricted Subsidiary of such asset, including additions and improvements, in the ordinary course of business, provided, however, that any Lien arising in connection with any such Indebtedness shall be limited to the specific asset being financed or, in the case of real property or fixtures, including additions and improvements, the real property on which such asset is attached; provided, further, however, that such Indebtedness is Incurred within 180 days after such acquisition of such assets.
“Qualified Receivables Transaction” means any transaction or series of transactions that may be entered into by the Company or any of its Restricted Subsidiaries pursuant to which the Company or any of its Restricted Subsidiaries may sell, convey or otherwise transfer to:
(1)    a Receivables Entity (in the case of a transfer by the Company or any of its Restricted Subsidiaries) or
(2)    any other Person (in the case of a transfer by a Receivables Entity),
or may grant a security interest in, any accounts receivable (whether now existing or arising in the future) of the Company or any of its Restricted Subsidiaries, and any assets related thereto, including all collateral securing such accounts receivable, all contracts and all Guarantees or other obligations in respect of such accounts receivable, proceeds of such accounts receivable and other assets which are customarily transferred or in respect of which security interests are 

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customarily granted in connection with asset securitization transactions involving accounts receivable; provided, however, that the financing terms, covenants, termination events and other provisions thereof shall be market terms (as determined in good faith by the chief financial officer of the Company).
The grant of a security interest in any accounts receivable of the Company or any of its Restricted Subsidiaries to secure Indebtedness permitted pursuant to Section 6.03(b)(1) shall not be deemed a Qualified Receivables Transaction.
“Quotation Agent” means the Reference Treasury Dealer selected by the Company.
“Receivables Entity” means (a) a Wholly Owned Subsidiary of the Company that is designated by the Board of Directors (as provided below) as a Receivables Entity or (b) another Person engaging in a Qualified Receivables Transaction with the Company, which Person engages in the business of the financing of accounts receivable, and in either of clause (a) or (b):
(1)    no portion of the Indebtedness or any other obligations (contingent or otherwise) of such entity
(A)    is Guaranteed by the Company or any Subsidiary of the Company (excluding Guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings),
(B)    is recourse to or obligates the Company or any Subsidiary of the Company in any way (other than pursuant to Standard Securitization Undertakings), or
(C)    subjects any property or asset of the Company or any Subsidiary of the Company, directly or indirectly, contingently or otherwise, to the satisfaction thereof (other than pursuant to Standard Securitization Undertakings);
(2)    the entity is not an Affiliate of the Company or is an entity with which neither the Company nor any Subsidiary of the Company has any material contract, agreement, arrangement or understanding other than on terms that the Company reasonably believes to be no less favorable to the Company or such Subsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Company; and
(3)    is an entity to which neither the Company nor any Subsidiary of the Company has any obligation to maintain or preserve such entity’s financial condition or cause such entity to achieve certain levels of operating results.
Any such designation by the Board of Directors shall be evidenced to the Trustee by filing with the Trustee a certified copy of the resolution of the Board of Directors giving effect to such designation and an Officers’ Certificate certifying that such designation complied with the foregoing conditions.
“Reference Treasury Dealer” means each of Citigroup Global Markets Inc. and Barclays Capital Inc. and their respective successors and assigns.
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Company, of the bid and asked prices for the Comparable Treasury Issue, expressed in each case as a percentage of its principal amount, quoted in writing to the Company by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day immediately preceding such redemption date.
“Refinance” means, in respect of any Indebtedness, to refinance, extend, renew, refund, repay, prepay, purchase, redeem, defease or retire, or to issue other Indebtedness in exchange or replacement for, such Indebtedness.  “Refinanced” and “Refinancing” shall have correlative meanings.

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“Refinancing Indebtedness” means Indebtedness that Refinances any Indebtedness of the Company or any Restricted Subsidiary existing on the Issue Date or Incurred in compliance with this Indenture, including Indebtedness that Refinances Refinancing Indebtedness; provided, however, that:
(1)    such Refinancing Indebtedness has a Stated Maturity no earlier than the Stated Maturity of the Indebtedness being Refinanced;
(2)    such Refinancing Indebtedness has an Average Life at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Average Life of the Indebtedness being Refinanced;
(3)    such Refinancing Indebtedness has an aggregate principal amount (or if Incurred with original issue discount, an aggregate issue price) that is equal to or less than the aggregate principal amount (or if Incurred with original issue discount, the aggregate accreted value) then outstanding (plus fees and expenses, including any premium and defeasance costs) under the Indebtedness being Refinanced; and
(4)    if the Indebtedness being Refinanced is subordinated in right of payment to the Securities, such Refinancing Indebtedness is subordinated in right of payment to the Securities at least to the same extent as the Indebtedness being Refinanced;
provided, further, however, that Refinancing Indebtedness shall not include (A) Indebtedness of a Subsidiary that is not a Subsidiary Guarantor that Refinances Indebtedness of the Company or a Subsidiary Guarantor or (B) Indebtedness of the Company or a Restricted Subsidiary that Refinances Indebtedness of an Unrestricted Subsidiary.
“Refinancing Transactions” means the initial offering of the Securities and the use of the proceeds thereof to redeem the Company’s 8.125% Senior Notes due 2020.  
“Related Business” means any business in which the Company or any of the Restricted Subsidiaries was engaged on the Issue Date and any business related, ancillary or complementary to such business.
“Restricted Cash and Cash Equivalents” means, as of any date, the cash and cash equivalents (a) held by any Captive Insurance Subsidiary and committed to third-party administrators for payment of the Company’s insurance claims, (b) held by Syndicated Persons to the extent that such cash and cash equivalents are required by the owners of such Syndicated Persons to be held in separate accounts and not otherwise commingled with the assets of the Company, (c) held by any Restricted Subsidiary to the extent that, and for so long as, such cash and cash equivalents may not be distributed to the owner or owners of the equity interests in such Restricted Subsidiary under the terms of such Restricted Subsidiary’s charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Restricted Subsidiary, and (d) the cash collateral deposited by the Company pursuant to Section 2.05(c) or Section 2.05(l) of the Credit Agreement.
“Restricted Payment” with respect to any Person means:
(1)    the declaration or payment of any dividends or any other distributions of any sort in respect of its Capital Stock (including any payment in connection with any merger or consolidation involving such Person) or similar payment to the direct or indirect holders of its Capital Stock (other than (A) dividends or distributions payable solely in its Capital Stock (other than Disqualified Stock), (B) dividends or distributions payable solely to the Company or a Restricted Subsidiary and (C) pro rata dividends or other distributions made by a Subsidiary that is not a Wholly Owned Subsidiary to minority stockholders (or owners of an equivalent interest in the case of a Subsidiary that is an entity other than a corporation));
(2)    the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value of any Capital Stock of the Company held by any Person (other than by a Restricted Subsidiary) or of any Capital Stock of a Restricted Subsidiary held by any Affiliate of the Company (other than by a Restricted Subsidiary), including in connection with any merger or consolidation);

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(3)    the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value, prior to scheduled maturity, scheduled repayment or scheduled sinking fund payment of any Subordinated Obligations of the Company or any Subsidiary Guarantor (other than (A) from the Company or a Restricted Subsidiary or (B) the purchase, repurchase, redemption, defeasance or other acquisition or retirement of Subordinated Obligations purchased in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of such purchase, repurchase, redemption, defeasance or other acquisition or retirement); or
(4)    the making of any Investment (other than a Permitted Investment) in any Person.
“Restricted Subsidiary” means any Subsidiary of the Company that is not an Unrestricted Subsidiary.
“Sale/Leaseback Transaction” means an arrangement relating to property owned by the Company or a Restricted Subsidiary on the Issue Date or thereafter acquired by the Company or a Restricted Subsidiary whereby the Company or a Restricted Subsidiary transfers such property to a Person and the Company or a Restricted Subsidiary leases it from such Person, other than leases between the Company and a Restricted Subsidiary or between Restricted Subsidiaries.
“Senior Indebtedness” means with respect to any Person:
(1)    Indebtedness of such Person, whether outstanding on the Issue Date or thereafter Incurred; and
(2)    all other Obligations of such Person (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to such Person whether or not post-filing interest is allowed in such proceeding) in respect of Indebtedness described in clause (1) above
unless, in the case of clauses (1) and (2), in the instrument creating or evidencing the same or pursuant to which the same is outstanding, it is provided that such Indebtedness or other obligations are subordinate in right of payment to the Securities or the Subsidiary Guarantee of such Person, as the case may be; provided, however, that Senior Indebtedness shall not include:
(A)    any obligation of such Person to the Company or any Subsidiary;
(B)    any liability for Federal, state, local or other taxes owed or owing by such Person;
(C)    any accounts payable or other liability to trade creditors arising in the ordinary course of business;
(D)    any Indebtedness or other Obligation of such Person which is subordinate or junior in any respect to any other Indebtedness or other Obligation of such Person; or
(E)    that portion of any Indebtedness which at the time of Incurrence is Incurred in violation of this Indenture.
“Shareholder Litigation” means the Federal securities class actions and the derivative actions brought against the Company and/or certain of its former directors and officers and certain other parties in the United States District Court for the Northern District of Alabama and the Circuit Court in Jefferson County, Alabama relating to financial reporting and related activity that occurred at the Company during periods ended in March 2003.
“Significant Subsidiary” means any Restricted Subsidiary that would be a “Significant Subsidiary” of the Company within the meaning of Rule 1-02 under Regulation S-X promulgated by the SEC.
“Standard & Poor’s” means Standard & Poor’s Financial Services LLC, a subsidiary of The McGraw-Hill Companies, Inc., and any successor to its rating agency business.

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“Standard Securitization Undertakings” means representations, warranties, covenants and indemnities entered into by the Company or any Subsidiary of the Company that, taken as a whole, are customary in an accounts receivable transaction.
“Stated Maturity” means, with respect to any security, the date specified in such security as the fixed date on which the final payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency unless such contingency has occurred).
“Subordinated Obligation” means, with respect to a Person, any Indebtedness of such Person (whether outstanding on the Issue Date or thereafter Incurred) which is subordinate or junior in right of payment to the Securities or a Subsidiary Guarantee of such Person, as the case may be, pursuant to a written agreement to that effect.
“Subsidiary Guarantee” means a Guarantee by a Subsidiary Guarantor of the Company’s obligations with respect to the Securities.
“Subsidiary Guarantor” means each Subsidiary of the Company that executes this Indenture as a guarantor on the Issue Date and each other Subsidiary of the Company that thereafter guarantees the Securities pursuant to the terms of this Indenture.
“Syndicated Person” means a Person the equity interests of which constitute Syndicated Interests.
“Syndication” means the sale of partnership or other equity interests (“Syndicated Interests”) in Subsidiaries of the Company or other Persons controlled by the Company that own or operate health care facilities to (i) participating physicians, radiologists and other specialists, (ii) professional corporations and other legal entities owned or controlled by such participating physicians, radiologists and other specialists and (iii) participating hospitals and other health care providers.  For purposes of this definition, “controlled” shall have the meaning set forth in the definition of “Affiliate.”
“Temporary Cash Investments” means any of the following:
(1)    any investment in direct obligations of the United States of America or any agency thereof or obligations guaranteed by the United States of America or any agency thereof;
(2)    investments in demand and time deposit accounts, certificates of deposit and money market deposits maturing within 180 days of the date of acquisition thereof issued by a bank or trust company which is organized under the laws of the United States of America, any State thereof or any foreign country recognized by the United States of America, and which bank or trust company has capital, surplus and undivided profits aggregating in excess of $250,000,000 (or the foreign currency equivalent thereof) or any money-market fund sponsored by a registered broker dealer or mutual fund distributor;
(3)    repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (1) above entered into with a bank meeting the qualifications described in clause (2) above;
(4)    investments in commercial paper, maturing not more than 270 days after the date of acquisition, issued by a corporation (other than an Affiliate of the Company) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of “P-1” (or higher) according to Moody’s or “A-1” (or higher) according to Standard and Poor’s;
(5)    investments in securities issued or fully guaranteed by any state, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least “A” by Standard & Poor’s or “A2” by Moody’s;

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(6)    eligible banker’s acceptances, repurchase agreements and tax-exempt municipal bonds having a maturity of less than one year, in each case having a rating of, or evidencing the full recourse obligation of a person whose senior debt is rated, at least “A” by Standard & Poor’s and at least “A2” by Moody’s; and
(7)    investments in money market funds that invest substantially all their assets in securities of the types described in clauses (1) through (6) above.
“Uniform Commercial Code” means the New York Uniform Commercial Code as in effect from time to time.
“Unrestricted Subsidiary” means:
(1)    any Subsidiary of the Company that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors in the manner provided below; and
(2)    any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors may designate any Subsidiary of the Company (including any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of, or holds any Lien on any property of, the Company or any other Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so designated; provided, however, that either (A) the Subsidiary to be so designated has total assets of $1,000 or less or (B) if such Subsidiary has assets greater than $1,000, such designation would be permitted under Section 6.04.
The Board of Directors may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that immediately after giving effect to such designation (A) the Company could Incur $1.00 of additional Indebtedness under Section 6.03(a) and (B) no Default shall have occurred and be continuing.  Any such designation by the Board of Directors shall be evidenced to the Trustee by promptly filing with the Trustee a certified copy of the resolution of the Board of Directors giving effect to such designation and an Officers’ Certificate certifying that such designation complied with the foregoing provisions.
“Voting Stock” of a Person means all classes of Capital Stock of such Person then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof.
“Wholly Owned Subsidiary” means a Restricted Subsidiary all the Capital Stock of which (other than directors’ qualifying shares) is owned by the Company or one or more other Wholly Owned Subsidiaries.
ARTICLE III
THE SECURITIES
SECTION 3.01.    Form.  Provisions relating to the Securities are set forth in Exhibit A hereto, which is hereby incorporated in and expressly made a part of this Supplemental Indenture.  The Securities and the Trustee’s certificate of authentication thereto shall be substantially in the form of Exhibit A, which is hereby incorporated in and expressly made a part of this Supplemental Indenture.  The Securities may have notations, legends or endorsements required by law, stock exchange rule, agreements to which the Company is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Company).  Each Security shall be dated the date of its authentication.  The Securities shall be issuable only in registered form without interest coupons and only in denominations of $2,000 and integral multiples of $1,000.  The terms of the Securities set forth in Exhibit A are part of the terms of this Supplemental Indenture.

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ARTICLE IV
AMENDMENT OF BASE INDENTURE
SECTION 4.01.    Amendment of Article I of Base Indenture.  Section 1.01 of the Base Indenture is hereby amended, but only with respect to the Securities, by the deletion of the definitions of the following terms: “Indebtedness,” “Mandatory Sinking Fund Payment,” “Officer’s Certificate,” “Optional Sinking Fund Payment,” “Person,” “Record Date,” “Senior Indebtedness” and “Stated Maturity”.
SECTION 4.02.    Amendment of Article III of Base Indenture.  Article III of the Base Indenture is hereby amended, but only with respect to the Securities, by the addition of the following new Section 3.14 at the end thereof:
“SECTION 3.14.  Issuance of Additional Securities.  After the Issue Date, the Company shall be entitled, subject to its compliance with Section 6.03, to issue Additional Securities under this Indenture, which Securities shall have identical terms as the Securities issued on the Issue Date, other than with respect to the date of issuance and issue price and first payment of interest.  All the Securities issued under this Indenture shall be treated as a single class for all purposes of this Indenture, including waivers, amendments, redemptions and offers to purchase.
With respect to any Additional Securities, the Company shall set forth in a resolution of the Board of Directors and an Officers’ Certificate, a copy of each of which shall be delivered to the Trustee, the following information:
(1)    the aggregate principal amount of such Additional Securities to be authenticated and delivered pursuant to this Indenture and the provision of Section 6.03 that the Company is relying on to issue such Additional Securities; and
(2)    the issue price, the issue date, the CUSIP number and the ISIN of such Additional Securities; provided, however, that no Additional Securities may be issued at a price that would cause such Additional Securities to have “original issue discount” within the meaning of Section 1273 of the Code.”
SECTION 4.03.    Amendment of Article IV of Base Indenture.  Section 4.02(a) of the Base Indenture is hereby amended, but only with respect to the Securities, by deleting the words “the Trustee shall select, by lot or in such other manner as the Trustee shall deem appropriate”, and replacing such deleted words with “if the Securities are Global Securities, the Securities to be redeemed will be selected by the Depository in accordance with applicable Depository procedures, and if the Securities to be redeemed are not Global Securities, the Trustee shall select, on a pro rata basis to the extent practicable”.
SECTION 4.04.    Amendment of Article V of Base Indenture.  Article V of the Base Indenture is hereby amended and restated, but only with respect to the Securities, to read in its entirety as follows:
“ARTICLE V
SUCCESSOR COMPANY
SECTION 5.01.  When Company May Merge or Transfer Assets.  The Company shall not consolidate with or merge with or into, or convey, transfer or lease, in one transaction or a series of transactions, directly or indirectly, all or substantially all its assets to, any Person, unless:
(1)    the resulting, surviving or transferee Person (the “Successor Company”) shall be a Person organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and the Successor Company (if not the Company) shall expressly assume, by a supplemental indenture hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, all the obligations of the Company under the Securities and this Indenture;

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(2)    immediately after giving pro forma effect to such transaction (and treating any Indebtedness which becomes an obligation of the Successor Company or any Subsidiary thereof as a result of such transaction as having been Incurred by the Successor Company or such Subsidiary at the time of such transaction), no Default shall have occurred and be continuing;
(3)    immediately after giving pro forma effect to such transaction, (A) the Successor Company would be able to Incur an additional $1.00 of Indebtedness pursuant to Section 6.03(a) or (B) the Consolidated Coverage Ratio for the Successor Company would be equal to or greater than such ratio for the Company and its Restricted Subsidiaries immediately prior to such transaction; and
(4)    the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with this Indenture,
provided, however, that clause (3) shall not be applicable to (A) a Restricted Subsidiary consolidating with, merging into or transferring all or part of its properties and assets to the Company (so long as no Capital Stock of the Company is distributed to any Person) or (B) the Company merging with an Affiliate of the Company solely for the purpose and with the sole effect of reincorporating the Company in another jurisdiction.
For purposes of this Section 5.01, the sale, lease, conveyance, assignment, transfer or other disposition of all or substantially all of the properties and assets of one or more Subsidiaries of the Company, which properties and assets, if held by the Company instead of such Subsidiaries, would constitute all or substantially all of the properties and assets of the Company on a consolidated basis, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Company.
The Successor Company shall be the successor to the Company and shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture, and the predecessor Company, except in the case of a lease, shall be released from the obligation to pay the principal of and interest on the Securities.
SECTION 4.05.    Amendment of Article VI of Base Indenture.
(a)    Article VI of the Base Indenture is hereby amended, but only with respect to the Securities, by the addition of the following new Sections 6.02, 6.03, 6.04, 6.05, 6.06, 6.07, 6.08, 6.09, 6.10 and 6.11:
“SECTION 6.02.  SEC Reports.  Whether or not the Company is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company shall file with the SEC (subject to the next sentence), and provide the Trustee and Holders with, such annual and other reports as are specified in Sections 13 and 15(d) of the Exchange Act and applicable to a U.S. corporation subject to such Sections, such reports to be so filed and provided at the times specified for the filings of such reports under such Sections and containing all the information, audit reports and exhibits required for such reports.  If, at any time, the Company is not subject to the periodic reporting requirements of the Exchange Act for any reason, the Company shall nevertheless continue filing the reports specified in the preceding sentence with the SEC within the time periods required unless the SEC will not accept such a filing.  Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely on Officer’s Certificates).  The Company agrees that it shall not take any action for the purpose of causing the SEC not to accept such filings.  If, notwithstanding the foregoing, the SEC will not accept such filings for any reason, the Company shall post the reports specified in the preceding sentence on its website within the time periods that would apply if the Company were required to file such reports with the SEC.  At any time that any of the Company’s Subsidiaries are Unrestricted Subsidiaries, then the quarterly and annual financial information required by this paragraph shall include a reasonably detailed presentation, either on the face of the financial statements or in the footnotes thereto, of the financial condition and results of operations of the Company and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Company.

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The Company also shall comply with the other provisions of Section 314(a) of the TIA.
SECTION 6.03.  Limitation on Indebtedness.  (a)  The Company shall not, and shall not permit any Restricted Subsidiary to, Incur, directly or indirectly, any Indebtedness; provided, however, that the Company and the Subsidiary Guarantors shall be entitled to Incur Indebtedness if, on the date of such Incurrence and after giving effect thereto on a pro forma basis the Consolidated Coverage Ratio exceeds 2.0 to 1.0.
(b)    Notwithstanding the foregoing paragraph (a), the Company and the Restricted Subsidiaries shall be entitled to Incur any or all of the following Indebtedness:
(1)    Indebtedness Incurred pursuant to the Credit Agreement; provided, however, that, immediately after giving effect to any such Incurrence, the aggregate principal amount of all Indebtedness Incurred under this clause (1) and then outstanding does not exceed $1,551,000,000 less the sum of all principal payments with respect to such Indebtedness made pursuant to Section 6.06(a)(3)(A) and in satisfaction of Section 6.06;
(2)    Indebtedness owed to and held by the Company or a Restricted Subsidiary; provided, however, that (A) any subsequent issuance or transfer of any Capital Stock that results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of such Indebtedness (other than to the Company or a Restricted Subsidiary) shall be deemed, in each case, to constitute the Incurrence of such Indebtedness by the obligor thereon, (B) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations with respect to the Securities, and (C) if a Subsidiary Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations of such Subsidiary Guarantor with respect to its Subsidiary Guarantee;
(3)    the Securities (excluding any Additional Securities);
(4)    Indebtedness outstanding on the Issue Date (other than Indebtedness described in clause (1), (2) or (3) of this Section 6.03(b));
(5)    Indebtedness of a Restricted Subsidiary Incurred and outstanding on or prior to the date on which such Subsidiary was acquired by the Company (other than Indebtedness Incurred in connection with, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Subsidiary became a Subsidiary or was acquired by the Company); provided, however, that on the date of such acquisition and after giving pro forma effect thereto, the Company would have been entitled to Incur at least $1.00 of additional Indebtedness pursuant to Section 6.03(a);
(6)    Refinancing Indebtedness in respect of Indebtedness Incurred pursuant to Section 6.03(a) or pursuant to clause (3), (4) or (5) or this clause (6) of this Section 6.03(b);
(7)    Hedging Obligations directly related to Indebtedness permitted to be Incurred by the Company and its Restricted Subsidiaries pursuant to this Indenture or entered into in the ordinary course of business and not for speculative purposes;
(8)    obligations in respect of performance, bid and surety bonds and completion guarantees provided by the Company or any Restricted Subsidiary in the ordinary course of business;
(9)    Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within three Business Days of its Incurrence;

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(10)    Indebtedness consisting of the Subsidiary Guarantee of a Subsidiary Guarantor and any Guarantee by the Company or a Subsidiary Guarantor of Indebtedness or other obligations of the Company or any Restricted Subsidiary (other than Indebtedness Incurred pursuant to clause (5) of this Section 6.03(b)) so long as the Incurrence of such Indebtedness or other obligations by the Company or such Restricted Subsidiary is permitted under the terms of this Indenture;
(11)    (A) Purchase Money Indebtedness, (B) Capital Lease Obligations and (C) Attributable Debt, and Refinancing Indebtedness in respect thereof, in an aggregate principal amount on the date of Incurrence that, when added to all other Indebtedness Incurred pursuant to this clause (11) and then outstanding, does not exceed 15% of Consolidated Tangible Assets, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter ending at least 45 days prior thereto;
(12)    Indebtedness Incurred by a Receivables Entity in a Qualified Receivables Transaction;
(13)    Preferred Stock issued by any Restricted Subsidiary formed to operate a single health care facility; provided that the amount of such Preferred Stock, when added to the aggregate amount of all other such Preferred Stock of Restricted Subsidiaries then outstanding, does not exceed 1% of Consolidated Tangible Assets, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter ending at least 45 days prior thereto; and
(14)    Indebtedness of the Company or of any of its Restricted Subsidiaries in an aggregate principal amount that, when taken together with all other Indebtedness of the Company and its Restricted Subsidiaries outstanding on the date of such Incurrence (other than Indebtedness permitted by clauses (1) through (13) of this Section 6.03(b) or by Section 6.03(a)) does not exceed the greater of (A) $300,000,000 and (B) 7.5% of Consolidated Tangible Assets, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter ending at least 45 days prior thereto.
(c)    Notwithstanding the foregoing, neither the Company nor any Subsidiary Guarantor shall incur any Indebtedness pursuant to Section 6.03(b) if the proceeds thereof are used, directly or indirectly, to Refinance any Subordinated Obligations of the Company or any Subsidiary Guarantor unless such Indebtedness shall be subordinated to the Securities or the applicable Subsidiary Guarantee to at least the same extent as such Subordinated Obligations.
(d)    For purposes of determining compliance with this Section 6.03:
(1)    all Indebtedness outstanding under the Credit Agreement on the Issue Date shall be treated as Incurred under clause (b)(1) of this Section 6.03;
(2)    in the event that an item of Indebtedness (or any portion thereof) meets the criteria of more than one of the types of Indebtedness described above, the Company, in its sole discretion, shall classify such item of Indebtedness (or any portion thereof) at the time of Incurrence and shall only be required to include the amount and type of such Indebtedness in one of the above clauses (provided that any Indebtedness originally classified as Incurred pursuant to any of clauses (b)(2) through (b)(14) of this Section 6.03 may later be reclassified as having been Incurred pursuant to paragraph (a) or any other of clauses (b)(2) through (b)(14) of this Section 6.03 to the extent that such reclassified Indebtedness could be Incurred pursuant to paragraph (a) or one of clauses (b)(2) through (b)(14) of this Section 6.03, as the case may be, if it were Incurred at the time of such reclassification); and
(3)    the Company shall be entitled to divide and classify an item of Indebtedness in more than one of the types of Indebtedness described above.

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SECTION 6.04.    Limitation on Restricted Payments.
(a)    The Company shall not, and shall not permit any Restricted Subsidiary, directly or indirectly, to make a Restricted Payment if at the time the Company or such Restricted Subsidiary makes such Restricted Payment:
(1)    a Default shall have occurred and be continuing (or would result therefrom);
(2)    the Company is not entitled to Incur an additional $1.00 of Indebtedness pursuant to Section 6.03(a); or
(3)    the aggregate amount of such Restricted Payment and all other Restricted Payments since the Issue Date would exceed the sum of (without duplication):
(A)    50% of the Consolidated Net Income accrued during the period (treated as one accounting period) from and including July 1, 2006 to the end of the most recent fiscal quarter ending at least 45 days prior to the date of such Restricted Payment (or, in case such Consolidated Net Income shall be a deficit, minus 100% of such deficit); plus
(B)    100% of the aggregate Net Cash Proceeds received by the Company from the issuance or sale of its Capital Stock (other than Disqualified Stock) subsequent to the Issue Date (other than an issuance or sale to a Subsidiary of the Company and other than an issuance or sale to an employee stock ownership plan or to a trust established by the Company or any of its Subsidiaries for the benefit of their employees) and 100% of any cash capital contribution received by the Company from its shareholders subsequent to the Issue Date; plus
(C)    the amount by which Indebtedness of the Company is reduced on the Company’s balance sheet upon the conversion or exchange subsequent to the Issue Date of any Indebtedness of the Company convertible or exchangeable for Capital Stock (other than Disqualified Stock) of the Company (less the amount of any cash, or the fair value of any other property, distributed by the Company upon such conversion or exchange); provided, however, that the foregoing amount shall not exceed the Net Cash Proceeds received by the Company or any Restricted Subsidiary from the sale of such Indebtedness (excluding Net Cash Proceeds from sales to a Subsidiary of the Company or to an employee stock ownership plan or to a trust established by the Company or any of its Subsidiaries for the benefit of their employees); plus
(D)    an amount equal to the net reduction in the Investments (other than Permitted Investments) made by the Company or any Restricted Subsidiary in any Person resulting from repurchases, repayments or redemptions of such Investments by such Person, proceeds realized on the sale of such Investment and proceeds representing the return of capital (excluding dividends and distributions), in each case received by the Company or any Restricted Subsidiary; provided, however, that the foregoing sum shall not exceed, in the case of any such Person, the amount of Investments (excluding Permitted Investments) previously made (and treated as a Restricted Payment) by the Company or any Restricted Subsidiary in such Person; plus
(E)    in the case of the redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, the portion (proportionate to the Company’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Unrestricted Subsidiary at the time such Unrestricted Subsidiary is redesignated as a Restricted Subsidiary, except to the extent that the Investment in such Unrestricted Subsidiary was made by the Company or a Restricted Subsidiary pursuant to Section 6.04(b)(11) or to the extent that such Investment constituted a Permitted Investment; plus
(F)    $50,000,000.

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(b)    The preceding provisions shall not prohibit:
(1)    any Restricted Payment made out of the Net Cash Proceeds of the substantially concurrent sale of, or made by exchange for, Capital Stock of the Company (other than Disqualified Stock and other than Capital Stock issued or sold to a Subsidiary of the Company or an employee stock ownership plan or to a trust established by the Company or any of its Subsidiaries for the benefit of their employees) or a substantially concurrent cash capital contribution received by the Company from its shareholders; provided, however, that (A) such Restricted Payment shall be excluded from the calculation of the amount of Restricted Payments and (B) the Net Cash Proceeds from such sale or such cash capital contribution (to the extent so used for such Restricted Payment) shall be excluded from the calculation of amounts under Section 6.04(a)(3)(B);
(2)    any purchase, repurchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Obligations of the Company or a Subsidiary Guarantor made by exchange for, or out of the proceeds of the substantially concurrent Incurrence of, Indebtedness of such Person that is permitted to be Incurred pursuant to Section 6.03; provided, however, that such purchase, repurchase, redemption, defeasance or other acquisition or retirement for value shall be excluded from the calculation of the amount of Restricted Payments;
(3)    dividends paid within 60 days after the date of declaration thereof if at such date of declaration such dividend would have complied with this Section 6.04; provided, however, that such dividend shall be included in the calculation of the amount of Restricted Payments;
(4)    so long as no Default has occurred and is continuing, the purchase, redemption or other acquisition of shares of Capital Stock of the Company or any of its Subsidiaries from employees, former employees, directors or former directors of the Company or any of its Subsidiaries (or permitted transferees of such employees, former employees, directors or former directors), pursuant to the terms of the agreements (including employment agreements) or plans (or amendments thereto) approved or ratified by the Board of Directors under which such individuals purchase or sell or are granted the option to purchase or sell, shares of such Capital Stock; provided, however, that the aggregate amount of such Restricted Payments (excluding amounts representing cancellation of Indebtedness) shall not exceed $10,000,000 in any calendar year (provided that (A) if the Company and its Restricted Subsidiaries make less than $10,000,000 in the aggregate of such Restricted Payments in any calendar year, the unused amount for such calendar year may be carried over to the next succeeding calendar year (but not any other calendar year thereafter) and (B) the amount payable in any calendar year may be increased by an amount up to the sum of (i) the amount of cash proceeds from the sale of Capital Stock (other than Disqualified Stock) of the Company to employees, former employees, directors or former directors of the Company or any of its Subsidiaries, to the extent that the cash proceeds from the sale of such Capital Stock have not otherwise been applied to the payment of Restricted Payments by virtue of Section 6.04(a)(3)(B), plus (ii) the cash proceeds of key man life insurance policies received by the Company or its Restricted Subsidiaries after the Issue Date, less (iii) the amount of repurchases and other acquisitions previously made with the cash proceeds described in clauses (i) and (ii) above); provided further, however, that (x) such repurchases and other acquisitions shall be excluded from the calculation of the amount of Restricted Payments and (y) cash proceeds referred to in clause (B)(i) above used to make Restricted Payments under this Section 6.04(b)(4) shall be excluded from the calculation of amounts under Section 6.04(a)(3)(B);
(5)    (A) the declaration and payment of dividends on the Convertible Preferred Stock, and other cash payments at any time to reduce any accretion in the liquidation preference resulting from previously unpaid dividends on the Convertible Preferred Stock, in each case in accordance with the terms thereof in effect on the Issue Date and (B) the declaration and payments of dividends on Disqualified Stock issued pursuant to Section 6.03; provided, however, in each case, that at the time of payment of such dividend or other cash payment, no Default shall have occurred and be continuing (or result therefrom); provided further, however, that dividends and cash payments referred to in this clause (5) shall be excluded from the calculation of the amount of Restricted Payments;

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(6)    repurchases of Capital Stock deemed to occur upon exercise of stock options if such Capital Stock represents a portion of the exercise price of such options; provided, however, that such Restricted Payments shall be excluded from the calculation of the amount of Restricted Payments;
(7)    cash payments in lieu of the issuance of fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Capital Stock of the Company; provided, however, that any such cash payment shall not be for the purpose of evading the limitation of this Section 6.04; provided further, however, that such payments shall be excluded from the calculation of the amount of Restricted Payments;
(8)    in the event of a Change of Control, and if no Default shall have occurred and be continuing, the payment, purchase, redemption, defeasance or other acquisition or retirement of Subordinated Obligations of the Company or any Subsidiary Guarantor, in each case, at a purchase price not greater than 101% of the principal amount of such Subordinated Obligations, plus any accrued and unpaid interest thereon; provided, however, that prior to such payment, purchase, redemption, defeasance or other acquisition or retirement, the Company (or a third party to the extent permitted by this Indenture) has made a Change of Control Offer with respect to the Securities as a result of such Change of Control and has repurchased all Securities validly tendered and not withdrawn in connection with such Change of Control Offer; provided further, however, that such payments, purchases, redemptions, defeasances or other acquisitions or retirements shall be excluded from the calculation of the amount of Restricted Payments;
(9)    payments of intercompany subordinated Indebtedness, the Incurrence of which was permitted under Section 6.03(b)(2); provided, however, that no Default has occurred and is continuing or would otherwise result therefrom; provided further, however, that such payments shall be excluded from the calculation of the amount of Restricted Payments; 
(10)    any Restricted Payment, so long as the Leverage Ratio is no more than 3.0 to 1.0, both as of the date thereof and on a pro forma basis after giving effect to such Restricted Payment; provided, however, that (A) at the time of each such Restricted Payment, no Default shall have occurred and be continuing (or result therefrom) and (B) such payments shall be excluded from the calculation of the amount of Restricted Payments;
(11)    Restricted Payments in an amount that, when taken together with all Restricted Payments made pursuant to this clause (11), does not exceed the greater of (A) $200,000,000 and (B) 5.0% of Consolidated Tangible Assets, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter ending at least 45 days prior thereto; provided, however, that (I) at the time of each such Restricted Payment, no Default shall have occurred and be continuing (or result therefrom) and (II) such payments shall be excluded from the calculation of the amount of Restricted Payments;
(12)    any payments of cash and/or Capital Stock of the Company to a holder of the 2.00% Convertible Senior Subordinated Notes due 2043 (the “Convertible Notes”) and/or the Convertible Preferred Stock upon the conversion of such holder’s Convertible Notes or Convertible Preferred Stock, as applicable, in accordance with the terms of the Convertible Notes or Convertible Preferred Stock, as applicable; or
(13)    any purchase or other acquisition or retirement for value of shares of Capital Stock of HealthSouth Home Health Holdings, Inc. held by any Person other than the Company or any of its Subsidiaries on the Issue Date.
The amount of any Restricted Payment that is not made in cash shall be determined in a manner consistent with the determination of the amount of an Investment as set forth in the final sentence of the first paragraph of the definition of “Investment”.
SECTION 6.05.    Limitation on Restrictions on Distributions from Restricted Subsidiaries.  The Company shall not, and shall not permit any Restricted Subsidiary to, create or otherwise cause or permit to exist 

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or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to (a) pay dividends or make any other distributions on its Capital Stock to the Company or a Restricted Subsidiary or pay any Indebtedness owed to the Company, (b) make any loans or advances to the Company or (c) transfer any of its property or assets to the Company, except:
(1)    with respect to clauses (a), (b) and (c),
(A)    any encumbrance or restriction pursuant to applicable law, rule, regulation or order or an agreement in effect at or entered into on the Issue Date;
(B)    any encumbrance or restriction with respect to a Restricted Subsidiary pursuant to an agreement relating to any Indebtedness Incurred by such Restricted Subsidiary on or prior to the date on which such Restricted Subsidiary was acquired by the Company (other than Indebtedness Incurred as consideration in, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Restricted Subsidiary became a Restricted Subsidiary or was acquired by the Company) and outstanding on such date;
(C)    any encumbrance or restriction pursuant to any amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing of an agreement referred to in clause (A) or (B) above; provided, however, that such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing is no more restrictive, as reasonably determined by the Company, with respect to such encumbrances and other restrictions taken as a whole than those prior to such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing;
(D)    any encumbrance or restriction with respect to a Restricted Subsidiary imposed pursuant to an agreement entered into for the sale or disposition of all or substantially all the Capital Stock or assets of such Restricted Subsidiary pending the closing of such sale or disposition;
(E)    restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business;
(F)    any limitation or prohibition on the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, stock sale agreements and other similar agreements, which limitation or prohibition is applicable only to the assets that are the subject of such agreements;
(G)    any encumbrance or restriction existing under or by reason of contractual requirements of a Receivables Entity in connection with a Qualified Receivables Transaction provided that such restrictions apply only to such Receivables Entity;
(H)    any encumbrance or restriction arising in the ordinary course of business, not relating to any Indebtedness, that does not, individually or in the aggregate, materially detract from the value of the property or assets of the Company and its Restricted Subsidiaries, taken as whole, or adversely affect the Company's ability to make principal and interest payments on the Securities, in each case, as determined in good faith by the Company; and
(2)    with respect to clause (c) only,
(A)    any encumbrance or restriction consisting of customary nonassignment provisions in leases governing leasehold interests to the extent such provisions restrict the transfer of the lease or the property leased thereunder; and

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(B)    any encumbrance or restriction contained in Capital Lease Obligations, any agreement governing Purchase Money Indebtedness, security agreements or mortgages securing Indebtedness of a Restricted Subsidiary to the extent such encumbrance or restriction restricts the transfer of the property subject to such Capital Lease Obligations, Purchase Money Indebtedness, security agreements or mortgages.
SECTION 6.06.    Limitation on Sales of Assets and Subsidiary Stock.  (a)  The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
(1)    the Company or such Restricted Subsidiary receives consideration at the time of such Asset Disposition at least equal to the Fair Market Value (including as to the value of all non-cash consideration) of the shares and assets subject to such Asset Disposition;
(2)    at least 75% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents; and
(3)    an amount equal to 100% of the Net Available Cash from such Asset Disposition, other than any Asset Disposition that constitutes a Syndication or a resyndication transaction in the ordinary course of business, is applied by the Company (or such Restricted Subsidiary, as the case may be)
(A)    to the extent the Company elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem or purchase Senior Indebtedness of the Company or a Subsidiary Guarantor or Indebtedness (other than any Disqualified Stock) of a Restricted Subsidiary that is not a Subsidiary Guarantor (in each case other than Indebtedness owed to the Company or an Affiliate of the Company) within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash;
(B)    to the extent the Company elects (including with respect to the balance of such Net Available Cash after application (if any) in accordance with clause (A)), to acquire Additional Assets within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; and
(C)    to the extent of the balance of such Net Available Cash after application (if any) in accordance with clauses (A) and (B), to make an offer to the Holders of the Securities (and to holders of other Senior Indebtedness of the Company designated by the Company) to purchase Securities (and such other Senior Indebtedness of the Company) pursuant to and subject to the conditions contained in this Indenture;
provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness made to satisfy clause (A) or (C) above, the Company or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased.
Notwithstanding the foregoing provisions of this Section 6.06, the Company and the Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section 6.06 except to the extent that the aggregate Net Available Cash from all Asset Dispositions which is not applied in accordance with this Section 6.06 exceeds $50,000,000.  Pending application of Net Available Cash pursuant to this Section 6.06, such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily reduce revolving credit indebtedness.

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For the purposes of this Section 6.06, the following are deemed to be cash or cash equivalents:
(1)    the assumption or discharge of any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) of the Company or such Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Securities) that are assumed by the transferee of such assets and for which the Company and all of the Restricted Subsidiaries have been released by all creditors in writing;
(2)    securities received by the Company or any Restricted Subsidiary from the transferee that are converted by the Company or such Restricted Subsidiary within 180 days into cash, to the extent of cash received in that conversion;
(3)    all Temporary Cash Investments; and
(4)    any Designated Noncash Consideration having an aggregate Fair Market Value that, when taken together with all other Designated Noncash Consideration previously received and then outstanding, does not exceed at the time of the receipt of such Designated Noncash Consideration (with the Fair Market Value of each item of Designated Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value) $30,000,000.
(b)    In the event of an Asset Disposition that requires the purchase of Securities (and other Senior Indebtedness of the Company) pursuant to Section 6.06(a)(3)(C), the Company shall purchase Securities tendered pursuant to an offer by the Company for the Securities (and such other Senior Indebtedness) (the “Offer”) at a purchase price of 100% of their principal amount (or, in the event such other Senior Indebtedness of the Company was issued with significant original issue discount, 100% of the accreted value thereof) without premium, plus accrued but unpaid interest (or, in respect of such other Senior Indebtedness of the Company, such lesser price, if any, as may be provided for by the terms of such Senior Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture.  If the aggregate purchase price of the securities tendered pursuant to the Offer exceeds the Net Available Cash allotted to their purchase, the Company shall select the securities to be purchased on a pro rata basis but in round denominations, which in the case of the Securities will be denominations of $2,000 principal amount or any greater integral multiple of $1,000.  The Company shall not be required to make such an Offer to purchase Securities (and other Senior Indebtedness of the Company) pursuant to this Section 6.06 if the Net Available Cash available therefor is less than $20,000,000 (which lesser amount shall be carried forward for purposes of determining whether such an offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).  Upon completion of such an Offer, Net Available Cash shall be deemed to be reduced by the aggregate amount of such Offer.
(c)    (i)  Promptly, and in any event within 10 days after the Company becomes obligated to make an Offer, the Company shall deliver to the Trustee and send, by first-class mail (or with respect to Global Securities, to the extent permitted or required by applicable Depositary procedures or regulations, send electronically) to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as described in Section 6.06(b) in the event the Offer is oversubscribed) in amounts of $2,000 and any greater integral multiple of $1,000 of principal amount at the applicable purchase price.  The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the “Purchase Date”).
(ii)    Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided below, the Company shall deliver to the Trustee an Officers’ Certificate as to (A) the amount of the Offer (the “Offer Amount”), including information as to any other Senior Indebtedness included in the Offer for repurchase, (B) the allocation of the Net Available Cash from the Asset Dispositions pursuant to which such Offer is being made and (C) the compliance of such allocation with the provisions of Section 6.06(a).  By 11:00 a.m. New York City time on the Purchase Date, the Company shall irrevocably deposit with the Trustee or with a Paying Agent (or, if the Company or a Wholly Owned Subsidiary is acting as Paying Agent, segregate and hold in trust) an 

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amount equal to the Offer Amount to be held for payment in accordance with the provisions of this Section 6.06.  Upon the expiration of the period for which the Offer remains open (the “Offer Period”), the Company shall deliver to the Trustee for cancellation the Securities or portions thereof which have been properly tendered to and are to be accepted by the Company.  The Trustee (or the Paying Agent, if not the Trustee) shall, on the Purchase Date, mail or deliver payment (or cause the delivery of payment) to each tendering Holder in the amount of the purchase price.  In the event that the aggregate purchase price of the Securities delivered by the Company to the Trustee is less than the Offer Amount applicable to the Securities, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section 6.06.
(iii)    Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date.  A Holder shall be entitled to withdraw its election if the Trustee or the Company receives, not later than one Business Day prior to the Purchase Date, a telex, facsimile transmission or letter setting forth the name of such Holder, the principal amount of the Security that was delivered for purchase by such Holder and a statement that such Holder is withdrawing its election to have such Security purchased.  Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered.
(iv)    At the time the Company delivers Securities to the Trustee which are to be accepted for purchase, the Company shall also deliver an Officers’ Certificate stating that such Securities are to be accepted by the Company pursuant to and in accordance with the terms of this Section 6.06.  A Security shall be deemed to have been accepted for purchase at the time the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(d)    The Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Securities pursuant to this Section 6.06.  To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 6.06, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Section 6.06 by virtue of its compliance with such securities laws or regulations.
SECTION 6.07.  Limitation on Transactions with Affiliates.  (a)  The Company shall not, and shall not permit any Restricted Subsidiary to, enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property, employee compensation arrangements or the rendering of any service) with, or for the benefit of, any Affiliate of the Company (an “Affiliate Transaction”) unless:
(1)    the terms of the Affiliate Transaction are no less favorable to the Company or such Restricted Subsidiary than those that could be obtained at the time of the Affiliate Transaction in arm’s-length dealings with a Person who is not an Affiliate; and
(2)    if such Affiliate Transaction involves an amount in excess of $50,000,000, the terms of the Affiliate Transaction are set forth in writing and a majority of the non-employee directors of the Company disinterested with respect to such Affiliate Transaction have determined in good faith that the criteria set forth in clause (1) are satisfied and have approved the relevant Affiliate Transaction as evidenced by a resolution of the Board of Directors.
 (b)    The provisions of Section 6.07(a) shall not prohibit:
(1)    any Investment (other than a Permitted Investment) or other Restricted Payment, in each case permitted to be made pursuant to Section 6.04;

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(2)    any employment or consulting agreement, employee benefit plan, officer or director indemnification agreement or any similar arrangement entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business or approved by the Board of Directors, and payments pursuant thereto;
(3)    loans or advances to employees in the ordinary course of business of the Company or its Restricted Subsidiaries, but in any event not to exceed $10,000,000 in the aggregate outstanding at any one time;
(4)    the payment of reasonable fees or other reasonable compensation to, or the provision of customary benefits or indemnification arrangements to, directors of the Company and its Restricted Subsidiaries;
(5)    any transaction with the Company, a Restricted Subsidiary or any Person that would constitute an Affiliate Transaction solely because the Company or a Restricted Subsidiary owns an equity interest in or otherwise controls such Restricted Subsidiary or Person;
(6)    the issuance or sale of any Capital Stock (other than Disqualified Stock) of the Company;
(7)    any agreement as in effect on the Issue Date or any renewals or extensions of any such agreement (so long as such renewals or extensions are not less favorable in any material respect to the Company or the Restricted Subsidiaries) and the transactions evidenced thereby;
(8)    the provision of services to directors or officers of the Company or any of its Restricted Subsidiaries of the nature provided by the Company or any of its Restricted Subsidiaries to customers in the ordinary course of business; 
(9)    transactions effected as a part of a Qualified Receivables Transaction;
(10)    any transaction entered into by a Person prior to the time such Person becomes a Restricted Subsidiary or is merged or consolidated into the Company or a Restricted Subsidiary (provided such transaction is not entered into in contemplation of such event); and
(12)    any transaction with the Company’s or any Restricted Subsidiary’s customers, clients, suppliers, landlords, lessors, or purchasers or sellers of goods or services, in each case, in the ordinary course of business and otherwise in compliance with the terms of the Indenture that are fair to the Company, or are on terms at least as favorable as would reasonably have been entered into at such time with a Person who is not an Affiliate of the Company (as determined in good faith by the Board of Directors or senior management of the Company).
SECTION 6.08.  Change of Control.  (a)  Upon the occurrence of a Change of Control, each Holder shall have the right to require that the Company purchase all or any part of such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof on the date of purchase plus accrued and unpaid interest, if any, to the date of purchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date), in accordance with Section 6.08(b).
(b)    Within 30 days following any Change of Control, the Company shall mail (or with respect to Global Securities, to the extent permitted or required by applicable Depositary procedures or regulations, send electronically) a notice to each Holder with a copy to the Trustee (the “Change of Control Offer”) stating:
(i)    that a Change of Control has occurred and that such Holder has the right to require the Company to purchase such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof on the date of purchase, plus accrued and unpaid interest, if any, to the date 

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of purchase (subject to the right of Holders of record on the relevant record date to receive interest on the relevant interest payment date);
(ii)    the circumstances and relevant facts and financial information regarding such Change of Control;
(iii)    the purchase date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is sent); and
(iv)    the instructions, as determined by the Company, consistent with this Section 6.08, that a Holder must follow in order to have its Securities purchased.
(c)    The Company shall not be required to make a Change of Control Offer following a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Indenture applicable to a Change of Control Offer made by the Company and purchases all Securities validly tendered and not withdrawn under such Change of Control Offer.
(d)    The Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Securities pursuant to this Section 6.08.  To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 6.08, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Section 6.08 by virtue thereof.
(e)    Holders electing to have a Security purchased will be required to surrender the Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the purchase date.  Holders will be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the purchase date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security which was delivered for purchase by the Holder and a statement that such Holder is withdrawing his election to have such Security purchased.
(f)    On the purchase date, all Securities purchased by the Company under this Section 6.08 shall be delivered by the Company to the Trustee for cancellation, and the Company shall pay the purchase price plus accrued and unpaid interest, if any, to the Holders entitled thereto.
SECTION 6.09.  Limitation on Liens.  The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, Incur or permit to exist any Lien (the “Initial Lien”) of any nature whatsoever on any of its properties (including Capital Stock of a Restricted Subsidiary), whether owned at the Issue Date or thereafter acquired, securing any Indebtedness, other than Permitted Liens, without effectively providing that the Securities shall be secured equally and ratably with (or prior to) the obligations so secured for so long as such obligations are so secured.
Any Lien created for the benefit of the Holders of the Securities pursuant to the preceding sentence shall provide by its terms that such Lien shall be automatically and unconditionally released and discharged upon the release and discharge of the Initial Lien.
SECTION 6.10.  Limitation on Sale/Leaseback Transactions.  The Company shall not, and shall not permit any Restricted Subsidiary to, enter into any Sale/Leaseback Transaction with respect to any property unless:
(1)    the Company or such Restricted Subsidiary would be entitled to (A) Incur Indebtedness in an amount equal to the Attributable Debt with respect to such Sale/Leaseback Transaction pursuant to Section 6.03 and (B) create a Lien on such property securing such Attributable Debt without equally and ratably securing the Securities pursuant to Section 6.09;

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(2)    the gross proceeds received by the Company or any Restricted Subsidiary in connection with such Sale/Leaseback Transaction are at least equal to the Fair Market Value of such property; and
(3)    the Company applies the proceeds of such transaction in compliance with Section 6.06.
SECTION 6.11.  Future Guarantors.  (a) The Company shall cause each Restricted Subsidiary that Guarantees any Indebtedness of the Company or any Subsidiary Guarantor in respect of the Credit Agreement or Capital Markets Indebtedness (or Incurs any such Indebtedness) to, at the same time, execute and deliver to the Trustee a Guaranty Agreement pursuant to which such Restricted Subsidiary will Guarantee payment of the Securities on the same terms and conditions as those set forth in Article V of the Supplemental Indenture.”
(b)    Sections 6.04 and 6.06 of the Base Indenture are hereby deleted in their entirety, but only with respect to the Securities.
(c)    Sections 6.02, 6.03, 6.05 and 6.07 of the Base Indenture are hereby amended, but only with respect to the Securities, by renumbering such Sections 6.12, 6.13, 6.14, and 6.15, respectively.
SECTION 4.06.    Amendments of Article VII of Base Indenture.  (%3)  Section 7.01(b) of the Base Indenture is hereby amended and restated, but only with respect to the Securities, to read in its entirety as follows:
“(b)    the Company (A) defaults in the payment of principal of any Security when the same becomes due and payable at its Stated Maturity, upon optional redemption, upon declaration of acceleration or otherwise or (B) fails to purchase Securities when required pursuant to this Indenture or the Securities;”
(b)    Section 7.01(c) the Base Indenture is hereby amended and restated, but only with respect to the Securities, to read in its entirety as follows:
“(c)    the Company fails to comply with Section 5.01;”.
(c)    Sections 7.01(d), (e) and (f) of the Base Indenture are hereby amended and restated, but only with respect to the Securities, to read in their entirety as follows:
“(d)    the Company or any Subsidiary Guarantor fails to comply with any of its agreements contained in the Securities or this Indenture (other than those referred to in (a), (b) or (c) above) and such failure continues for 60 days after the notice from the Trustee or the Holders specified below;
(e)    the Company, any Subsidiary Guarantor or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:
(A)    commences a voluntary case;
(B)    consents to the entry of an order for relief against it in an involuntary case;
(C)    consents to the appointment of a Custodian of it or for any substantial part of its property; or
(D)    makes a general assignment for the benefit of its creditors;
or takes any comparable action under any foreign laws relating to insolvency;
(f)    a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(A)    is for relief against the Company, any Subsidiary Guarantor or any Significant Subsidiary in an involuntary case;

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(B)    appoints a Custodian of the Company, any Subsidiary Guarantor or any Significant Subsidiary or for any substantial part of its property; or
(C)    orders the winding up or liquidation of the Company, any Subsidiary Guarantor or any Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order or decree remains unstayed and in effect for 60 days;”
Section 7.01 of the Base Indenture is hereby amended, but only with respect to the Securities, by the addition of the following new Sections 7.01(g), (h) and (i) as follows:
“(g)    Indebtedness of the Company, any Subsidiary Guarantor or any Significant Subsidiary is not paid within any applicable grace period after final maturity or is accelerated by the holders thereof because of a default and the total amount of such Indebtedness unpaid or accelerated exceeds $50,000,000 or its foreign currency equivalent at the time;
(h)    any judgment or decree for the payment of money in excess of $50,000,000 (or its foreign currency equivalent at the time) is entered against the Company, any Subsidiary Guarantor or any Significant Subsidiary, remains outstanding for a period of 60 consecutive days following the entry of such judgment or decree and is not discharged, waived or effectively stayed;
(i)    any Subsidiary Guarantee ceases to be in full force and effect (other than in accordance with the terms of such Subsidiary Guarantee) or any Subsidiary Guarantor denies or disaffirms its obligations under its Subsidiary Guarantee; or”.
(d)    Section 7.01(g) of the Base Indenture is hereby amended, but only with respect to the Securities, by renumbering such section 7.01(j) and by replacing the semi-colon at the end of such section with a period.
(e)    The paragraph immediately following Section 7.01(g) of the Base Indenture and the last paragraph of Section 7.01 of the Base Indenture are hereby deleted, but only with respect to the Securities, and replaced with the following:
“The foregoing shall constitute Events of Default whatever the reason for any such Event of Default and whether such Event of Default is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.
However, a default under Section (d) of this Section 7.01 will not constitute an Event of Default until the Trustee or the Holders of 25% in principal amount of the outstanding Securities notify the Company of the default and the Company does not cure such default within the time specified after receipt of such notice.
The term “Bankruptcy Law” means Title 11, United States Code, or any similar Federal or state law for the relief of debtors.  The term “Custodian” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
The Company shall deliver to the Trustee, within 30 days after the occurrence thereof, written notice in the form of an Officers’ Certificate of any Event of Default under clause (g) or (i) and any event which with the giving of notice or the lapse of time or both would become an Event of Default under clause (d) or (h), its status and what action the Company is taking or proposes to take with respect thereto.”

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(f)    Section 7.02 of the Base Indenture is hereby amended, but only with respect to the Securities, by adding the following sentences to end of the Section:
“The Holders of a majority in principal amount of the Securities by notice to the Trustee may rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal or interest that has become due solely because of acceleration. No such rescission shall affect any subsequent Default or impair any right consequent thereto.
In the case of any Event of Default occurring by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Company with the intention of avoiding payment of the premium that the Company would have had to pay if the Company then had elected to redeem the Securities pursuant to the optional redemption provisions hereof, an equivalent premium shall also become and be immediately due and payable to the extent permitted by law upon the acceleration of the Securities.”
(g)    Section 7.07 the Base Indenture is hereby amended and restated, but only with respect to the Securities, to read in its entirety as follows:
“SECTION 7.07.  Limitation on Suits.  Except to enforce the right to receive payment of principal, premium (if any) or interest when due, no Holder may pursue any remedy with respect to this Indenture or the Securities unless:
(a)    the Holder gives to the Trustee written notice stating that an Event of Default is continuing;
(b)    the Holders of at least 25% in principal amount of the outstanding Securities make a written request to the Trustee to pursue the remedy;
(c)    such Holder or Holders offer to the Trustee satisfactory security or indemnity against any loss, liability or expense;
(d)    the Trustee does not comply with the request within 60 days after receipt of the request and the offer of security or indemnity; and
(e)    the Holders of a majority in principal amount of the outstanding Securities do not give the Trustee a direction inconsistent with the request during such 60-day period.
A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder. In the event that the definitive Securities are not issued to any beneficial owner promptly after the Registrar has received a request from the Holder of a Global Security to issue such definitive Securities to such beneficial owner or its nominee, the Company expressly agrees and acknowledges, with respect to the right of any Holder to pursue a remedy pursuant to this Indenture, the right of such beneficial holder of Securities to pursue such remedy with respect to the portion of the Global Security that represents such beneficial holder’s Securities as if such definitive Securities had been issued.
SECTION 4.07.    Amendment of Article XI of Base Indenture.
Section 11.03 of the Base Indenture is hereby amended, but only with respect to the Securities, by deleting the words “Responsible Officer or” and replacing such deleted words with “committee of”.
SECTION 4.08.    Amendment of Article XII of Base Indenture.
Article XII of the Base Indenture is hereby amended and restated, but only with respect to the Securities, to read in its entirety as follows:

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“ARTICLE XII
Discharge of Indenture; Defeasance
SECTION 12.01.  Discharge of Liability on Securities; Defeasance.
(a)    When (1) the Company delivers to the Trustee all outstanding Securities (other than Securities replaced pursuant to Section 3.07) for cancellation or (2) all outstanding Securities have become due and payable, whether at maturity or on a redemption date as a result of the mailing or sending of a notice of redemption pursuant to Article IV hereof and the Company irrevocably deposits with the Trustee funds in an amount sufficient, or U.S. Government Obligations the principal of and interest on which will be sufficient, or a combination thereof sufficient, to pay at maturity or upon redemption all outstanding Securities, including interest thereon to maturity or such redemption date (other than Securities replaced pursuant to Section 3.07), and if in either case the Company pays all other sums payable hereunder by the Company, then this Indenture shall, subject to Section 12.01(c), cease to be of further effect.  The Trustee shall acknowledge satisfaction and discharge of this Indenture on demand of the Company accompanied by an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent set forth herein relating to the satisfaction and discharge of this Indenture have been satisfied, and at the cost and expense of the Company.
(b)    Subject to Sections 12.01(c) and 12.02, the Company at any time may terminate (1) all its obligations under the Securities and this Indenture (“legal defeasance option”) or (2) its obligations under Sections 6.02, 6.03, 6.04, 6.05, 6.06, 6.07, 6.08, 6.09, 6.10 and 6.11 and the operation of Sections 7.01(e), 7.01(f), 7.01(g) and 7.01(h) (but, in the case of Sections 7.01(e) and (f), with respect to Subsidiary Guarantors and Significant Subsidiaries only) and the limitations contained in Section 5.01(a)(3) (“covenant defeasance option”).  The Company may exercise its legal defeasance option notwithstanding its prior exercise of its covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the Securities may not be accelerated because of an Event of Default with respect thereto.  If the Company exercises its covenant defeasance option, payment of the Securities may not be accelerated because of an Event of Default specified in Sections 7.01(e), 7.01(f), 7.01(g) or 7.01(h) (but, in the case of Sections 7.01(e) and (f), with respect to Subsidiary Guarantors and Significant Subsidiaries only) or because of the failure of the Company to comply with Section 5.01(a)(3).  If the Company exercises its legal defeasance option or its covenant defeasance option, each Subsidiary Guarantor, if any, shall be released from all of its obligations with respect to its Subsidiary Guarantee.
Upon satisfaction of the conditions set forth herein and upon request of the Company, the Trustee shall acknowledge in writing the discharge of those obligations that the Company terminates.
(c)    Notwithstanding clauses (a) and (b) above, the Company’s obligations in Sections 3.04, 3.06, 3.07 and 6.12 and in this Article XII shall survive until the Securities have been paid in full.  Thereafter, the Company’s obligations in Sections 11.01, 12.04 and 12.05 shall survive.
SECTION 12.02.  Conditions to Defeasance.  The Company may exercise its legal defeasance option or its covenant defeasance option only if:
(1)    the Company irrevocably deposits in trust with the Trustee money or U.S. Government Obligations, or a combination thereof, for the payment of the principal of and interest on the Securities to redemption or maturity, as the case may be;
(2)    the Company delivers to the Trustee a certificate from a nationally recognized firm of independent accountants expressing their opinion that the payments of principal and interest when due and without reinvestment on the deposited U.S. Government Obligations plus any deposited money without investment will provide cash at such times and in such amounts as will be sufficient to pay principal of and interest when due on all the Securities to maturity or redemption, as the case may be;

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(3)    123 days pass after the deposit is made and during the 123 day period no Default specified in Section 7.01(e) or (f) with respect to the Company occurs which is continuing at the end of the period;
(4)    the deposit does not constitute a default under any other agreement binding on the Company;
(5)    the Company delivers to the Trustee an Opinion of Counsel to the effect that the trust resulting from the deposit does not constitute, or is qualified as, a regulated investment company under the Investment Company Act of 1940;
(6)    in the case of the legal defeasance option, the Company shall have delivered to the Trustee an Opinion of Counsel stating that (A) the Company has received from, or there has been published by, the Internal Revenue Service a ruling, or (B) since the date of this Indenture there has been a change in the applicable Federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders will not recognize income, gain or loss for Federal income tax purposes as a result of such deposit and defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred;
(7)    in the case of the covenant defeasance option, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders will not recognize income, gain or loss for Federal income tax purposes as a result of such covenant defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred; and
(8)    the Company delivers to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent to the defeasance and discharge of the Securities as contemplated by this Article XII have been complied with.
Before or after a deposit, the Company may make arrangements satisfactory to the Trustee for the redemption of Securities at a future date in accordance with Article IV.
SECTION 12.03.  Application of Trust Money.  The Trustee shall hold in trust money or U.S. Government Obligations deposited with it pursuant to this Article XII.  It shall apply the deposited money and the money from U.S. Government Obligations through the Paying Agent and in accordance with this Indenture to the payment of principal of and interest on the Securities.
SECTION 12.04.  Repayment to Company.  The Trustee and the Paying Agent shall promptly turn over to the Company upon request any excess money or securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and the Paying Agent shall pay to the Company upon request any money held by them for the payment of principal or interest that remains unclaimed for two years, and, thereafter, Holders entitled to the money must look to the Company for payment as general creditors.
SECTION 12.05.  Indemnity for Government Obligations.  The Company shall pay and shall indemnify the Trustee against any tax, fee or other charge imposed on or assessed against deposited U.S. Government Obligations or the principal and interest received on such U.S. Government Obligations.
SECTION 12.06.  Reinstatement.  If the Trustee or Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with this Article XII by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s and each Subsidiary Guarantor’s obligations under this Indenture, each Subsidiary Guarantee and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to this Article XII until such time as the Trustee or Paying Agent is permitted to apply all such money or U.S. Government Obligations in accordance with this Article XII; provided, however, that, if the Company has made any payment of principal of or 

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interest on any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money or U.S. Government Obligations held by the Trustee or Paying Agent.”
SECTION 4.09.    Amendment of Article XIII of Base Indenture.
Section 13.01 of the Base Indenture is hereby amended and restated, but only with respect to the Securities, to read in its entirety as follows:
“SECTION 13.01.  No Personal Liability.  No director, officer, employee, incorporator or stockholder of the Company or any Subsidiary Guarantor shall have any liability for any obligations of the Company or any Subsidiary Guarantor under the Securities, any Subsidiary Guarantee or this Indenture or for any claim based on, in respect of, or by reason of such obligations or their creation.  By accepting a Security, each Holder shall waive and release all such liability.  The waiver and release shall be part of the consideration for the issue of the Securities.”
SECTION 4.10.    Amendment of Article XIV of Base Indenture.  (a)  Sections 14.01 and 14.02 of the Base Indenture are hereby amended and restated, but only with respect to the Securities, to read in their entirety as follows:
“SECTION 14.01.  Without Consent of Holders.  The Company, the Subsidiary Guarantors and the Trustee may amend this Indenture or the Securities without notice to or consent of any Holder:
(1)  to cure any ambiguity, omission, defect or inconsistency;
(2)  to comply with Article V;
(3)  to provide for uncertificated Securities in addition to or in place of certificated Securities; provided, however, that the uncertificated Securities are issued in registered form for purposes of Section 163(f) of the Code or in a manner such that the uncertificated Securities are described in Section 163(f)(2)(B) of the Code;
(4)  to add Guarantees with respect to the Securities, including any Subsidiary Guaranties, or to secure the Securities;
(5)  to add to the covenants of the Company or a Subsidiary Guarantor for the benefit of the Holders or to surrender any right or power herein conferred upon the Company or a Subsidiary Guarantor;
(6)  to make any change that does not adversely affect the rights of any Holder;
(7)  to conform the text of this Indenture or the Securities to any provision of the “Description of Notes” section of the Prospectus Supplement to the extent that such provision of the “Description of Notes” section of the Prospectus Supplement was intended to be a verbatim recitation of a provision of this Indenture or the Securities;
(8)  to comply with any requirement of the SEC in connection with qualifying, or maintaining the qualification of, this Indenture under the TIA; or
(9)  to make any amendment to the provisions of this Indenture relating to the transfer and legending of Securities; provided, however, that (A) compliance with this Indenture as so amended would not result in Securities being transferred in violation of the Securities Act or any other applicable securities law and (B) such amendment does not materially and adversely affect the rights of Holders to transfer Securities.

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After an amendment under this Section 14.01 becomes effective, the Company shall mail (or with respect to Global Securities, to the extent permitted or required by applicable Depositary procedures or regulations, send electronically) to Holders a notice briefly describing such amendment.  The failure to give such notice to all Holders, or any defect therein, shall not impair or affect the validity of an amendment under this Section 14.01.
SECTION 14.02.  With Consent of Holders.  (a)  The Company, the Subsidiary Guarantors and the Trustee may amend this Indenture, but only with respect to the Securities, or the Securities with the written consent of the Holders of at least a majority in principal amount of the Securities then outstanding (including consents obtained in connection with a purchase of, or tender offer or exchange for, the Securities) and any past Default or compliance with any provisions may also be waived with the consent of the Holders of at least a majority in principal amount of the Securities then outstanding.  Notwithstanding the foregoing, without the consent of each Holder affected thereby, an amendment or waiver may not:
(1)  reduce the amount of Securities whose Holders must consent to an amendment;
(2)  reduce the rate of or extend the time for payment of interest on any Security;
(3)  reduce the principal of or change the Stated Maturity of any Security;
(4)  (i) reduce the amount payable upon the redemption of any Security or (ii) change the time at which any Security may be redeemed, in each case in accordance with Article IV;
(5)  make any Security payable in money other than that stated in the Security;
(6)  impair the right of any Holder of the Securities to receive payment of principal of and interest on such Holder’s Securities on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder’s Securities;
(7)  make any change in the amendment provisions that require each Holder’s consent or in the waiver provisions;
(8)  make any change in the ranking or priority of any Security that would adversely affect the Securityholders; or
(9)  make any change in, or release other than in accordance with this Indenture, any Subsidiary Guarantee that would adversely affect the Securityholders.
(b)  It shall not be necessary for the consent of the Holders under this Section 14.02 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section 14.02 becomes effective, the Company shall mail (or with respect to Global Securities, to the extent permitted or required by applicable Depositary procedures or regulations, send electronically) to Holders a notice briefly describing such amendment.  The failure to give such notice to all Holders, or any defect therein, shall not impair or affect the validity of an amendment under this Section 14.02.”
(b)    Article XIV of the Base Indenture is hereby amended, but only with respect to the Securities, by the addition of the following new Sections 14.07 and 14.08:
“SECTION 14.07.  Revocation and Effect of Consents and Waivers.  A consent to an amendment or a waiver by a Holder of a Security shall bind the Holder and every subsequent Holder of that Security or portion of the Security that evidences the same debt as the consenting Holder’s Security, even if 

42

notation of the consent or waiver is not made on the Security. However, any such Holder or subsequent Holder may revoke the consent or waiver as to such Holder’s Security or portion of the Security if the Trustee receives the notice of revocation before the date on which the amendment or waiver becomes effective. After an amendment or waiver becomes effective, it shall bind every Holder. An amendment or waiver becomes effective upon execution of such amendment or waiver by the Trustee.
The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to give their consent or take any other action described above or required or permitted to be taken pursuant to this Indenture.  If a record date is fixed, then notwithstanding the immediately preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to give such consent or to revoke any consent previously given or to take any such action, whether or not such Persons continue to be Holders after such record date.  No such consent shall be valid or effective for more than 120 days after such record date.
SECTION 14.08.  Payment for Consent.  Neither the Company nor any Affiliate of the Company shall, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or otherwise, to any Holder for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Securities unless such consideration is offered to all Holders and is paid to all Holders that so consent, waive or agree to amend in the time frame set forth in solicitation documents relating to such consent, waiver or agreement.”
SECTION 4.11. Amendment of Base Indenture.  The Base Indenture is hereby amended, but only with respect to the Securities, (a) by replacing cross-references to Sections and Articles therein to reflect the re-numbering of such Sections and Articles as amended herein and (b) so that any definitions, and any definitions included exclusively within such definitions, in the Base Indenture shall be deemed deleted or amended when all references in the Base Indenture to such definitions would be eliminated or amended as a result of the amendments effected by this Supplemental Indenture.
ARTICLE V
SUBSIDIARY GUARANTEES
SECTION 5.01.    Guarantees.  (a)  Each Subsidiary Guarantor hereby unconditionally and irrevocably guarantees, jointly and severally, to each Holder and to the Trustee and its successors and assigns (i) the full and punctual payment of principal of and interest on the Securities when due, whether at maturity, by acceleration, by redemption or otherwise, and all other monetary obligations of the Company under the Indenture and the Securities and (ii) the full and punctual performance within applicable grace periods of all other obligations of the Company under the Indenture and the Securities (all the foregoing being hereinafter collectively called the “Guaranteed Obligations”).  Each Subsidiary Guarantor further agrees that the Guaranteed Obligations may be extended or renewed, in whole or in part, without notice or further assent from such Subsidiary Guarantor and that such Subsidiary Guarantor will remain bound under this Article V notwithstanding any extension or renewal of any Obligation.
(b)    Each Subsidiary Guarantor waives presentation to, demand of, payment from and protest to the Company of any of the Guaranteed Obligations and also waives notice of protest for nonpayment.  Each Subsidiary Guarantor waives notice of any default under the Securities or the Guaranteed Obligations.  The obligations of each Subsidiary Guarantor hereunder shall not be affected by (1) the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or remedy against the Company or any other Person (including any Subsidiary Guarantor) under the Indenture, the Securities or any other agreement or otherwise; (2) any extension or renewal of any thereof; (3) any rescission, waiver, amendment or modification of any of the terms or provisions of the Indenture, the Securities or any other agreement; (4) the release of any security held by any Holder or the Trustee for the Guaranteed Obligations or any of them; (5) the failure of any Holder or the Trustee to exercise any right or remedy against any other guarantor of the Guaranteed Obligations; or (6) except as set forth in Section 5.06, any change in the ownership of such Subsidiary Guarantor.

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Each Subsidiary Guarantor further agrees that its Subsidiary Guarantee herein constitutes a guarantee of payment, performance and compliance when due (and not a guarantee of collection) and waives any right to require that any resort be had by any Holder or the Trustee to any security held for payment of the Guaranteed Obligations.
(c)    Except as expressly set forth in Sections 5.02, 5.05, 5.06 and 12.01(b), the obligations of each Subsidiary Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guaranteed Obligations or otherwise.  Without limiting the generality of the foregoing, the obligations of each Subsidiary Guarantor herein shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under the Indenture, the Securities or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of such Subsidiary Guarantor or would otherwise operate as a discharge of such Subsidiary Guarantor as a matter of law or equity.
(d)    Each Subsidiary Guarantor further agrees that its Subsidiary Guarantee herein shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal of or interest on any Obligation is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Company or otherwise.
In furtherance of the foregoing and not in limitation of any other right which any Holder or the Trustee has at law or in equity against any Subsidiary Guarantor by virtue hereof, upon the failure of the Company to pay the principal of or interest on any Obligation when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, or to perform or comply with any other Obligation, each Subsidiary Guarantor hereby promises to and shall, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal to the sum of (A) the unpaid amount of such Guaranteed Obligations, (B) accrued and unpaid interest on such Guaranteed Obligations (but only to the extent not prohibited by law) and (C) all other monetary Guaranteed Obligations of the Company to the Holders and the Trustee.
(e)    Each Subsidiary Guarantor agrees that it shall not be entitled to any right of subrogation in respect of any Obligations guaranteed hereby until payment in full of all Obligations.  Each Subsidiary Guarantor further agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (A) the maturity of the Guaranteed Obligations guaranteed hereby may be accelerated as provided in Article VII of the Indenture for the purposes of any Subsidiary Guarantee herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Guaranteed Obligations guaranteed hereby, and (B) in the event of any declaration of acceleration of such Guaranteed Obligations as provided in Article VII of the Indenture, such Guaranteed Obligations (whether or not due and payable) shall forthwith become due and payable by such Subsidiary Guarantor for the purposes of this Section 5.01.
(f)    Each Subsidiary Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys’ fees and expenses) incurred by the Trustee or any Holder in enforcing any rights under this Section 5.01.
SECTION 5.02.    Limitation on Liability.  Any term or provision of the Indenture to the contrary notwithstanding, the maximum aggregate amount of the Guaranteed Obligations guaranteed hereunder by any Subsidiary Guarantor shall not exceed the maximum amount that can be hereby guaranteed without rendering the Indenture, as it relates to such Subsidiary Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally.
SECTION 5.03.    Successors and Assigns.  This Article V shall be binding upon each Subsidiary Guarantor and its successors and assigns and shall inure to the benefit of the successors and assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and privileges conferred upon that party in the Indenture and in the Securities shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions of the Indenture.

44

SECTION 5.04.    No Waiver.  Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or privilege under this Article V shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this Article V at law, in equity, by statute or otherwise.
SECTION 5.05.    Modification.  No modification, amendment or waiver of any provision of this Article V, nor the consent to any departure by any Subsidiary Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  No notice to or demand on any Subsidiary Guarantor in any case shall entitle such Subsidiary Guarantor to any other or further notice or demand in the same, similar or other circumstances.
SECTION 5.06.    Release of Subsidiary Guarantor.  A Subsidiary Guarantor will be automatically released from its obligations under this Article V:
(1) upon the sale or other disposition (including by way of consolidation or merger) of such Subsidiary Guarantor, including the sale or disposition of Capital Stock of such Subsidiary Guarantor, following which such Subsidiary Guarantor is no longer a Subsidiary of the Company; or
(2) upon the sale or disposition of all or substantially all of the assets of such Subsidiary Guarantor;
in each case other than to the Company or an Affiliate of the Company and as permitted by the Indenture and if in connection therewith the Company provides an Officers’ Certificate to the Trustee to the effect that the Company shall comply with its obligations under Section 6.06 in respect of such disposition.  Upon any sale or disposition described in clause (1) or (2) above, the obligor on the related Subsidiary Guarantee will be released from its obligations thereunder.  
The Subsidiary Guarantor also will be automatically released from its obligations under this Article V:
(1) upon the designation of such Subsidiary Guarantor as an Unrestricted Subsidiary in accordance with the terms of the Indenture;
(2) at such time as any Guarantee by such Subsidiary Guarantor of the obligations under the Credit Agreement and under all Capital Markets Indebtedness has been released and discharged, except a discharge or release by or as a result of payment under such Guarantee; or
(3) if the Company exercises its legal defeasance option or its covenant defeasance option as described in Article XII of  the Indenture or if the Company’s obligations under the Indenture are discharged in accordance with the terms of the Indenture.
For avoidance of doubt, clause (2) above shall include a situation whereby the Guarantee of Capital Markets Indebtedness by a Subsidiary Guarantor, including the Securities, would be released and discharged ("released") immediately upon such release under the Credit Agreement but for the existence of one or more guarantees of other Capital Markets Indebtedness the terms of which also provide that such guarantees would be released immediately upon such release under the Credit Agreement, provided that, in each case, all conditions precedent to such release have been satisfied.
At the request of the Company, the Trustee shall execute and deliver an appropriate instrument evidencing such release.
SECTION 5.07.    Contribution.  Each Subsidiary Guarantor that makes a payment under its Subsidiary Guarantee shall be entitled upon payment in full of all Guaranteed Obligations under the Indenture to a contribution from each other Subsidiary Guarantor in an amount equal to such other Subsidiary Guarantor’s pro rata portion of such 

45

payment based on the respective net assets of all the Subsidiary Guarantors at the time of such payment determined in accordance with GAAP.
ARTICLE VI
MISCELLANEOUS
SECTION 6.01.    Integral Part.  This Supplemental Indenture constitutes an integral part of the Indenture.
SECTION 6.02.    Adoption, Ratification and Confirmation.  The Base Indenture, as supplemented and amended by this Supplemental Indenture, is in all respects hereby adopted, ratified and confirmed.
SECTION 6.03.    Counterparts.  This Supplemental Indenture may be executed in any number of counterparts, each of which when so executed shall be deemed an original; and all such counterparts shall together constitute but one and the same instrument. Signatures of the parties hereto transmitted by facsimile or PDF may be used in lieu of the originals and shall be deemed to be their original signatures for all purposes.
SECTION 6.04.    Severability.  Should any provision of this Supplemental Indenture for any reason be declared invalid or unenforceable, such decision shall not affect the validity or enforceability of any of the other provisions of this Supplemental Indenture, which other provisions shall remain in full force and effect and the application of such invalid or unenforceable provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall be valid and be enforced to the fullest extent permitted by law.
SECTION 6.05.    Governing Law.  THIS SUPPLEMENTAL INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 6.06.    Trustee Makes No Representation.  The Trustee makes no representation and shall not be responsible or accountable as to the validity, execution by the other parties hereto or thereto or sufficiency of this Supplemental Indenture or of the Securities or Subsidiary Guarantees.  The recitals and statements herein are deemed to be those of the Company  and Subsidiary Guarantors and not of the Trustee and the Trustee shall not be held responsible in any manner whatsoever for their correctness.  The Trustee shall not be accountable for the use or application by the Company of the Securities or the proceeds thereof.
SECTION 6.07.    Damages Limitation.  In no event shall the Trustee be responsible or liable for any special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit), irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.
SECTION 6.08.    U.S.A. PATRIOT Act.   The Company and the Subsidiary Guarantors acknowledge that in accordance with Section 326 of the U.S.A. PATRIOT Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The parties to this Supplemental Indenture agree that they shall provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. PATRIOT Act.

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IN WITNESS WHEREOF, the parties hereto have executed this Supplemental Indenture on the date first set forth above.
HEALTHSOUTH CORPORATION, as Issuer

By:          /s/ John P. Whittington
Name:  John P. Whittington
Title:    Executive Vice President, General Counsel and Secretary

[Signatures Continued on Next Page]

[Signature Page to Supplemental Indenture for 5.125% Senior Notes due 2023]

GUARANTORS
CMS Jonesboro Rehabilitation, Inc.
CMS Topeka Rehabilitation, Inc.
Continental Medical of Arizona, Inc.
Continental Medical Systems, Inc.
Continental Rehabilitation Hospital of Arizona, Inc.
HEALTHSOUTH LTAC of Sarasota, Inc.
HEALTHSOUTH of Dothan, Inc.
HEALTHSOUTH of Montgomery, Inc.
HEALTHSOUTH of Nittany Valley, Inc.
HEALTHSOUTH of South Carolina, Inc.
HEALTHSOUTH of Spring Hill, Inc.
HEALTHSOUTH of Treasure Coast, Inc.
HEALTHSOUTH of Yuma, Inc.
HEALTHSOUTH Rehabilitation Center, Inc.
 HEALTHSOUTH Rehabilitation Center of New Hampshire, Inc.
HealthSouth Rehabilitation Hospital of Austin, Inc.
HEALTHSOUTH Rehabilitation Hospital of Manati, Inc.
HealthSouth Rehabilitation Hospital of San Juan, Inc.
HealthSouth Rehabilitation Hospital of Texarkana, Inc.
HealthSouth Rehabilitation Hospital The Woodlands, Inc.
HealthSouth Rehabilitation Institute of San Antonio, (RIOSA), Inc.
Lakeshore System Services of Florida, Inc.
Rehab Concepts Corp.
Rehabilitation Hospital of Colorado Springs, Inc.
Rehabilitation Hospital of Nevada-Las Vegas, Inc.
Sherwood Rehabilitation Hospital, Inc.
Tarrant County Rehabilitation Hospital, Inc.
Tyler Rehabilitation Hospital, Inc.
 Western Neuro Care, Inc.

By:  /s/ Edmund M. Fay
Name:  Edmund M. Fay 
Title:  Authorized Signatory

[Signatures Continued on Next Page]

[Signature Page to Supplemental Indenture for 5.125% Senior Notes due 2023]

Lakeview Rehabilitation Group Partners
By:  Continental Medical of Kentucky, Inc.
Its:  General Partner
 
Southern Arizona Regional Rehabilitation Hospital, L.P.
By:  Continental Rehabilitation Hospital of Arizona, Inc.
Its:  General Partner
 
Western Medical Rehab Associates, L.P.
By:  Western Neuro Care, Inc.
Its:  General Partner

By:  /s/ Edmund M. Fay
Name:  Edmund M. Fay 
Title:  Authorized Signatory 

Advantage Health, LLC
HealthSouth Arizona Real Estate, LLC
HealthSouth Aviation, LLC
HealthSouth Bakersfield Rehabilitation Hospital, LLC
HealthSouth California Real Estate, LLC
HealthSouth Colorado Real Estate, LLC
HealthSouth Deaconess Holdings, LLC
HealthSouth East Valley Rehabilitation Hospital, LLC
HealthSouth Harmarville Rehabilitation Hospital, LLC
HealthSouth Johnson City Holdings, LLC
HealthSouth Joint Ventures Holdings, LLC
HealthSouth Kansas Real Estate, LLC
HealthSouth Kentucky Real Estate, LLC
HealthSouth Littleton Rehabilitation, LLC
HealthSouth Martin County Holdings, LLC
HealthSouth Middletown Rehabilitation Hospital, LLC
HealthSouth Nevada Real Estate, LLC
HealthSouth New Mexico Real Estate, LLC
HealthSouth Northern Kentucky Rehabilitation Hospital, LLC
HealthSouth Ohio Real Estate, LLC
HealthSouth Owned Hospitals Holdings, LLC
HealthSouth Pennsylvania Real Estate, LLC
HealthSouth Plano Rehabilitation Hospital, LLC
HealthSouth Properties, LLC
HealthSouth Reading Rehabilitation Hospital, LLC
HealthSouth Real Estate, LLC
HealthSouth Real Property Holding, LLC
HealthSouth Rehabilitation Hospital at Drake, LLC
HealthSouth Rehabilitation Hospital of Arlington, LLC
HealthSouth Rehabilitation Hospital of Beaumont, LLC
HealthSouth Rehabilitation Hospital of Charleston, LLC
HealthSouth Rehabilitation Hospital of Cypress, LLC
HealthSouth Rehabilitation Hospital of Desert Canyon, LLC
HealthSouth Rehabilitation Hospital of Fort Worth, LLC
HealthSouth Rehabilitation Hospital of Fredericksburg, LLC
HealthSouth Rehabilitation Hospital of Gadsden, LLC
HealthSouth Rehabilitation Hospital of Henderson, LLC
HealthSouth Rehabilitation Hospital of Humble, LLC

[Signature Page to Supplemental Indenture for 5.125% Senior Notes due 2023]

HealthSouth Rehabilitation Hospital of Largo, LLC
HealthSouth Rehabilitation Hospital of Las Vegas, LLC
HealthSouth Rehabilitation Hospital of Marion County, LLC
HealthSouth Rehabilitation Hospital of Mechanicsburg, LLC
HealthSouth Rehabilitation Hospital of Miami, LLC 
HealthSouth Rehabilitation Hospital of Midland/Odessa, LLC 
HealthSouth Rehabilitation Hospital of Modesto, LLC 
HealthSouth Rehabilitation Hospital of New Mexico, LLC
HealthSouth Rehabilitation Hospital of Newnan, LLC
HealthSouth Rehabilitation Hospital of Northern Virginia, LLC
HealthSouth Rehabilitation Hospital of Petersburg, LLC
HealthSouth Rehabilitation Hospital of Sarasota, LLC
HealthSouth Rehabilitation Hospital of Seminole County, LLC
HealthSouth Rehabilitation Hospital of Sewickley, LLC
HealthSouth Rehabilitation Hospital of South Jersey, LLC
HealthSouth Rehabilitation Hospital of Sugar Land, LLC
HealthSouth Rehabilitation Hospital of Tallahassee, LLC
HealthSouth Rehabilitation Hospital of Utah, LLC
HealthSouth Rehabilitation Institute of Tucson, LLC
HealthSouth Savannah Holdings, LLC
HealthSouth Scottsdale Rehabilitation Hospital, LLC
HealthSouth Sea Pines Holdings, LLC
HealthSouth South Carolina Real Estate, LLC
HealthSouth Specialty Hospital of North Louisiana, LLC
HealthSouth Sub-Acute Center of Mechanicsburg, LLC
HealthSouth Sunrise Rehabilitation Hospital, LLC
HealthSouth Support Companies, LLC
HealthSouth Texas Real Estate, LLC
HealthSouth Tucson Holdings, LLC
HealthSouth Utah Real Estate, LLC
HealthSouth Valley of the Sun Rehabilitation Hospital, LLC
HealthSouth Virginia Real Estate, LLC
HealthSouth Walton Rehabilitation Hospital, LLC
HealthSouth West Virginia Real Estate, LLC
HealthSouth of East Tennessee, LLC
HealthSouth of Erie, LLC
HealthSouth of Fort Smith, LLC
HealthSouth of Pittsburgh, LLC
HealthSouth of Toms River, LLC
HealthSouth of York, LLC
New England Rehabilitation Management Co., LLC
Print Promotions Group, LLC
Rebound, LLC
Rehabilitation Hospital Corporation of America, LLC
Rehabilitation Hospital of Plano, LLC
Rehabilitation Institute of Western Massachusetts, LLC

By:  /s/ Edmund M. Fay
Name:  Edmund M. Fay 
Title:  Authorized Signatory 

[Signatures Continued on Next Page]

[Signature Page to Supplemental Indenture for 5.125% Senior Notes due 2023]

WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

By:  /s/ Patrick Giordano____
Name:  Patrick Giordano
Title:    Vice President

[Signature Page to Supplemental Indenture for 5.125% Senior Notes due 2023]

EXHIBIT A
[FORM OF FACE OF SECURITY]
[Global Securities Legend]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK OR A NOMINEE OF DTC, WHICH MAY BE TREATED BY THE COMPANY, THE TRUSTEE AND ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS SECURITY FOR ALL PURPOSES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Definitive Securities Legend]
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

A-1

5.125% Senior Note Due 2023
NO.___
CUSIP No. [                  ]
ISIN No.  [                   ]
HEALTHSOUTH CORPORATION, a Delaware corporation, promises to pay to Cede & Co., or registered assigns, the principal sum of $                     Dollars on March 15, 2023.
Interest Payment Dates:  March 15 and September 15.
Record Dates:  March 1 and September 1.
Additional provisions of this Security are set forth on the other side of this Security.
Dated:  
HEALTHSOUTH CORPORATION
By ________________________________
Name:   
Title:  

By ________________________________
Name:   
Title:  

TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.
Date of authentication:  
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee
By ________________________________
     Authorized Signatory

A-2

[FORM OF REVERSE SIDE OF SECURITY]
5.125% Senior Note Due 2023
1.     Interest
HealthSouth Corporation, a Delaware corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest on the principal amount of this Security at the rate per annum shown above.  The Company shall pay interest semiannually on March 15 and September 15 of each year, commencing                  .  Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from               .  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  The Company shall pay interest on overdue principal at the rate borne by this Security plus 1.0% per annum, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.
2.     Method of Payment
The Company shall pay interest on the Securities (except defaulted interest) to the Persons who are registered holders of Securities at the close of business on the March 1 or September 1 next preceding the interest payment date even if Securities are canceled after the record date and on or before the interest payment date.  Holders must surrender Securities to a Paying Agent to collect principal payments.  The Company shall pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.  Payments in respect of the Securities represented by a Global Security (including principal, premium and interest) will be made by wire transfer of immediately available funds to the accounts specified by the Depository.  The Company shall make all payments in respect of a certificated Security (including principal, premium and interest) by mailing a check to the registered address of each Holder thereof; provided, however, that payments on a certificated Security will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 30 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
3.     Paying Agent and Registrar
Initially, Wells Fargo Bank, National Association, a national banking association (the “Trustee”), will act as Paying Agent and Registrar.  The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice.  The Company or any of its domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent, Registrar or co-registrar.
4.     Indenture
The Company issued the Securities under the fifth supplemental indenture (the “Supplemental Indenture”), dated as of March 12, 2015, to the indenture dated as of December 1, 2009 (together with the Supplemental Indenture, the “Indenture”), among the Company, the Subsidiary Guarantors and the Trustee.  The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) (the “Act”).  Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture.  The Securities are subject to all such terms, and Securityholders are referred to the Indenture and the Act for a statement of those terms.
The Securities are general unsecured obligations of the Company.  The Company shall be entitled, subject to its compliance with Section 6.03 of the Indenture, to issue Additional Securities pursuant to Section 3.14 of the Indenture.  The Securities issued on the Issue Date, and any Additional Securities, will be treated as a single class for all purposes under the Indenture.  The Indenture contains covenants that limit the ability of the Company and its subsidiaries to incur additional indebtedness; pay dividends or distributions on, or redeem or repurchase capital stock; make investments; issue or sell capital stock of subsidiaries; engage in transactions with affiliates; create liens on assets; 

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transfer or sell assets; guarantee indebtedness; restrict dividends or other payments of subsidiaries; consolidate, merge or transfer all or substantially all of its assets; and engage in sale/leaseback transactions.  These covenants are subject to important exceptions and qualifications.
5.     Optional Redemption
Except as set forth below, the Company shall not be entitled to redeem the Securities.
On and after March 15, 2018, the Company shall be entitled at its option to redeem all or a portion of the Securities upon not less than 30 nor more than 60 days’ notice, at the redemption prices (expressed in percentages of principal amount on the redemption date), plus accrued interest to the redemption date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the 12-month period commencing on March 15 of the years set forth below:
	
		
	Period
	Redemption Price

	March 15, 2018
	103.844%

	March 15, 2019
	102.563%

	March 15, 2020
	101.281%

	March 15, 2021 and thereafter
	100.000%

In addition, prior to March 15, 2018, the Company shall be entitled at its option on one or more occasions to redeem Securities (which includes Additional Securities, if any) in an aggregate principal amount not to exceed 35% of the aggregate principal amount of the Securities (which includes Additional Securities, if any) originally issued at a redemption price (expressed as a percentage of principal amount) of 105.125%, plus accrued and unpaid interest to the redemption date, with the net cash proceeds from one or more Equity Offerings; provided, however, that (1) at least 65% of such aggregate principal amount of Securities (which includes Additional Securities, if any) remains outstanding immediately after the occurrence of each such redemption (other than Securities held, directly or indirectly, by the Company or its Affiliates); and (2) each such redemption occurs within 90 days after the date of the related Equity Offering.
Prior to March 15, 2018, the Company shall be entitled at its option to redeem all or a portion of the Securities at a redemption price equal to 100% of the principal amount of the Securities plus the Applicable Premium as of, and accrued and unpaid interest to, the redemption date (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date).  
6.     Notice of Redemption
Notice of redemption will be mailed (or with respect to Global Securities, to the extent permitted or required by applicable DTC procedures or regulations, send electronically) at least 30 days but not more than 60 days before the redemption date to each Holder of Securities to be redeemed at his registered address.  Securities in denominations larger than $2,000 principal amount may be redeemed in part but only in whole multiples of $1,000.  If money sufficient to pay the redemption price of and accrued interest on all Securities (or portions thereof) to be redeemed on the redemption date is deposited with the Paying Agent on or before the redemption date and certain other conditions are satisfied, on and after such date interest ceases to accrue on such Securities (or such portions thereof) called for redemption.
7.     Put Provisions
Upon a Change of Control, any Holder of Securities will have the right to cause the Company to repurchase all or any part of the Securities of such Holder at a repurchase price equal to 101% of the principal amount of the Securities to be repurchased plus accrued interest to the date of repurchase (subject to the right of holders of record on 

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the relevant record date to receive interest due on the related interest payment date) as provided in, and subject to the terms of, the Indenture.
8.     Guarantee
The payment by the Company of the principal of, and premium and interest on, the Securities is fully and unconditionally guaranteed on a joint and several senior unsecured basis by each of the Subsidiary Guarantors to the extent set forth in the Indenture.
9.    Denominations; Transfer; Exchange
The Securities are in registered form without coupons in denominations of $2,000 principal amount and any greater integral multiple of $1,000.  A Holder may transfer or exchange Securities in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.  The Registrar need not register the transfer of or exchange any Securities selected for redemption (except, in the case of a Security to be redeemed in part, the portion of the Security not to be redeemed) or any Securities for a period of 15 days before a selection of Securities to be redeemed or 15 days before an interest payment date.
10.     Persons Deemed Owners
Except as provided in paragraph 2 hereof, the registered Holder of this Security may be treated as the owner of it for all purposes.
11.     Unclaimed Money
If money for the payment of principal or interest on any Securities remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its request at the end of the two years after such principal or interest has become due or payable, unless an abandoned property law designates another Person.  After any such payment, Holders entitled to the money must look only to the Company as general creditors and not to the Trustee for payment.
12.     Discharge and Defeasance
Subject to certain conditions, the Company at any time shall be entitled to terminate some or all of its obligations under the Securities and the Indenture if the Company irrevocably deposits with the Trustee money or U.S. Government Obligations for the payment of principal and interest on the Securities to redemption or maturity, as the case may be.
13.     Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (a) the Indenture and the Securities may be amended with the written consent of the Holders of at least a majority in principal amount outstanding of the Securities and (b) any default or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount outstanding of the Securities.  Subject to certain exceptions set forth in the Indenture, without the consent of any Securityholder, the Company, the Subsidiary Guarantors and the Trustee shall be entitled to amend the Indenture or the Securities to cure any ambiguity, omission, defect or inconsistency, or to comply with Article V of the Indenture, or to provide for uncertificated Securities in addition to or in place of certificated Securities, or to add guarantees with respect to the Securities, including Subsidiary Guarantees, or to add additional covenants or surrender rights and powers conferred on the Company or the Subsidiary Guarantors, or to conform the text of the Indenture or the Securities to any provision of the “Description of Notes” section of the Prospectus Supplement under certain circumstances, or to comply with any requirement of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the rights of any Securityholder, or to make amendments to provisions of the Indenture relating to the form, authentication, transfer and legending of the Securities.

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14.     Defaults and Remedies
Under the Indenture, Events of Default include (a) default for 30 days in payment of interest on the Securities; (b) default in payment of principal on the Securities at maturity, upon redemption pursuant to paragraph 5 of the Securities, upon acceleration or otherwise, or failure by the Company to redeem or purchase Securities when required; (c) failure by the Company or any Subsidiary Guarantor to comply with other agreements in the Indenture or the Securities, in certain cases subject to notice and lapse of time; (d) certain accelerations (including failure to pay within any grace period after final maturity) of other Indebtedness of the Company, any Subsidiary Guarantor or any Significant Subsidiary if the amount accelerated (or so unpaid) exceeds $50 million; (e) certain events of bankruptcy or insolvency with respect to the Company, a Subsidiary Guarantor or any Significant Subsidiary; (f) certain judgments or decrees for the payment of money in excess of $50 million against the Company, a Subsidiary Guarantor or any Significant Subsidiary; and (g) certain defaults with respect to Subsidiary Guarantees.  If an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the Securities may declare all the Securities to be due and payable immediately.  Certain events of bankruptcy or insolvency are Events of Default which will result in the Securities being due and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture.  The Trustee may refuse to enforce the Indenture or the Securities unless it receives indemnity or security satisfactory to it.  Subject to certain limitations, Holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Securityholders notice of any continuing Default (except a Default in payment of principal or interest) if it determines that withholding notice is in the interest of the Holders.
15.     Trustee Dealings with the Company
Subject to certain limitations imposed by the Act, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.  Any Paying Agent, Registrar, Co-Registrar or Co-Paying Agent may do the same with like rights.
16.     No Recourse Against Others
A director, officer, employee or stockholder, as such, of the Company, a Subsidiary Guarantor or the Trustee shall not have any liability for any obligations of the Company or any Subsidiary Guarantor under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Security, each Securityholder waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Securities.
17.     Authentication
This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Security.
18.     Abbreviations
Customary abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act).
19.     CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Securities and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Securityholders.  No representation is made as to the accuracy 

A-6

of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
20.     Governing Law
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
The Company will furnish to any Securityholder upon written request and without charge to the Security holder a copy of the Indenture which has in it the text of this Security in larger type.  Requests may be made to:
3660 Grandview Parkway, Suite 200
Birmingham, Alabama 35243
Attention: General Counsel

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ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to

_____________________________________________________________________________________________
(Print or type assignee’s name, address and zip code)

_____________________________________________________________________________________________
(Insert assignee’s soc. sec. or tax I.D. No.)    

and irrevocably appoint ____________________ agent to transfer this Security on the books of the Company.  The agent may substitute another to act for him.
_________________________________________________
	
		
	DATE:
	YOUR SIGNATURE:

_______________________________________________________
Sign exactly as your name appears on the other side of this Security.

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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have been made:
	
					
	Date of Exchange
	Amount of decrease in Principal  amount of this Global Security
	Amount of increase in Principal amount of this Global Security
	Principal amount of this Global Security following such decrease or increase
	Signature of authorized officer of Trustee or Securities Custodian

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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company pursuant to Section 6.06 or 6.08 of the Indenture, check the box:   ̈
If you want to elect to have only part of this Security purchased by the Company pursuant to Section 6.06 or 6.08 of the Indenture, state the amount in principal amount:  $
	
			
	Dated:
_______________________________________
	Your  
Signature:  _________________________________

	 
	(Sign exactly as your name appears on the other side of this Security.)

	Signature Guarantee:
	________________________________________

	 
	(Signature must be guaranteed)

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

A-10

EXHIBIT B
[FORM OF GUARANTY AGREEMENT]
GUARANTY AGREEMENT (this “Guaranty Agreement”) dated as of ____________________ among [GUARANTOR] (the “New Guarantor”), a subsidiary of HEALTHSOUTH CORPORATION (or its successor), a Delaware corporation (the “Company”), the subsidiary guarantors party to the Indenture (defined below) (the “Subsidiary Guarantors”), in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION, as trustee under the Indenture (the “Trustee”).
W I T N E S S E T H :
WHEREAS the Company and the Subsidiary Guarantors (the “Existing Guarantors”) have heretofore executed and delivered to the Trustee a fifth supplemental indenture (the “Fifth Supplemental Indenture”) dated as of March 12, 2015, to the indenture (together with the Fifth Supplemental Indenture, the “Indenture”) dated as of December 1, 2009, providing for the issuance of the Company’s 5.125% Senior Notes due 2023 (the “Securities”);
WHEREAS Section 6.11 of the Indenture provides that under certain circumstances the Company is required to cause the New Guarantor to execute and deliver to the Trustee an agreement pursuant to which the New Guarantor shall unconditionally guarantee all the Company’s obligations under the Securities pursuant to a Subsidiary Guarantee on the terms and conditions set forth herein; and
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantor and the Company mutually covenant and agree for the equal and ratable benefit of the holders of the Securities as follows:
1.  Agreement to Guarantee.  The New Guarantor hereby agrees, jointly and severally with all Existing Guarantors, to unconditionally guarantee the Company’s obligations under the Securities on the terms and subject to the conditions set forth in Article V of the Fifth Supplemental Indenture and to be bound by all other applicable provisions of the Indenture and the Securities.
2.  Ratification of Indenture; Supplemental Indentures and Guaranty Agreements Part of Indenture.  Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect.  This Guaranty Agreement shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.
3.  Governing Law.  THIS GUARANTY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
4.  Trustee Makes No Representation.  The Trustee makes no representation and shall not be responsible or accountable as to the validity, execution by the parties hereto or thereto or sufficiency of this Guaranty Agreement or the Securities.
5.  Counterparts.  The parties may sign any number of copies of this Guaranty Agreement.  Each signed copy shall be an original, but all of them together represent the same agreement.  Signatures of the parties hereto transmitted by facsimile or PDF may be used in lieu of the originals and shall be deemed to be their original signatures for all purposes.
6.  Effect of Headings.  The Section headings herein are for convenience only and shall not affect the construction thereof.

B-1

IN WITNESS WHEREOF, the parties hereto have caused this Guaranty Agreement to be duly executed as of the date first above written.
[NEW GUARANTOR], 
by
Name:
Title:
HEALTHSOUTH CORPORATION, 
by
____________________________________
Name:

Title:

B-2

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