Document:

Exhibit 10.1

Exhibit
10.1

Execution Version

TERM LOAN AGREEMENT

dated as of

June 3, 2011

among

NATIONWIDE HEALTH PROPERTIES, INC.,

as Borrower,

The LENDERS Party Hereto

and

JPMORGAN CHASE, N.A.,

as Administrative Agent,

CRÉDIT AGRICOLE CORPORATE & INVESTMENT BANK, KEY BANK NATIONAL

ASSOCIATION & WELLS FARGO SECURITIES LLC,

as Joint Bookrunners and Joint Lead Arrangers

and

J.P. MORGAN SECURITIES LLC,

as Lead Left Joint Bookrunner and Joint Lead Arranger

$800,000,000

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	 	 	 	 
	ARTICLE I. DEFINITIONS
	 	 	1	 
	SECTION 1.01. Defined Terms
	 	 	1	 
	SECTION 1.02. Terms Generally
	 	 	24	 
	SECTION 1.03. Accounting Terms; GAAP
	 	 	24	 
	ARTICLE II. THE CREDITS
	 	 	25	 
	SECTION 2.01. The Commitments
	 	 	25	 
	SECTION 2.02. Loans and Borrowings
	 	 	25	 
	SECTION 2.03. Requests for Borrowings
	 	 	26	 
	SECTION 2.04. [Intentionally Deleted.]
	 	 	26	 
	SECTION 2.05. [Intentionally Deleted.]
	 	 	26	 
	SECTION 2.06. [Intentionally Deleted.]
	 	 	26	 
	SECTION 2.07. Funding of Borrowings
	 	 	27	 
	SECTION 2.08. Interest Elections
	 	 	27	 
	SECTION 2.09. Termination and Reduction of the Commitments
	 	 	28	 
	SECTION 2.10. Repayment of Loans; Evidence of Debt
	 	 	29	 
	SECTION 2.11. Prepayment of Loans
	 	 	30	 
	SECTION 2.12. Fees
	 	 	31	 
	SECTION 2.13. Interest
	 	 	31	 
	SECTION 2.14. Alternate Rate of Interest
	 	 	32	 
	SECTION 2.15. Increased Costs
	 	 	33	 
	SECTION 2.16. Break Funding Payments
	 	 	34	 
	SECTION 2.17. Taxes
	 	 	35	 
	SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Setoffs
	 	 	38	 
	SECTION 2.19. Mitigation Obligations; Replacement of Lenders
	 	 	40	 
	SECTION 2.20. Defaulting Lenders
	 	 	41	 
	ARTICLE III. REPRESENTATIONS AND WARRANTIES
	 	 	41	 
	SECTION 3.01. Organization; Powers
	 	 	41	 
	SECTION 3.02. Authorization; Enforceability
	 	 	41	 
	SECTION 3.03. Governmental Approvals; No Conflicts
	 	 	42	 
	SECTION 3.04. Financial Condition; No Material Adverse Change
	 	 	42	 

 

-i-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page	 
	 	 	 	 
	SECTION 3.05. Properties
	 	 	42	 
	SECTION 3.06. Litigation and Environmental Matters
	 	 	42	 
	SECTION 3.07. Compliance with Laws and Agreements
	 	 	43	 
	SECTION 3.08. Investment Company Status
	 	 	43	 
	SECTION 3.09. Taxes
	 	 	43	 
	SECTION 3.10. ERISA
	 	 	43	 
	SECTION 3.11. Disclosure
	 	 	44	 
	SECTION 3.12. Use of Credit
	 	 	44	 
	SECTION 3.13. Material Agreements and Liens
	 	 	44	 
	SECTION 3.14. Capitalization
	 	 	45	 
	SECTION 3.15. Subsidiaries and Investments
	 	 	45	 
	SECTION 3.16. Real Property
	 	 	45	 
	SECTION 3.17. Solvency
	 	 	46	 
	SECTION 3.18. No Default
	 	 	46	 
	SECTION 3.19. Insurance
	 	 	46	 
	SECTION 3.20. Organizational Documents
	 	 	46	 
	SECTION 3.21. Executive Offices; Places of Organization
	 	 	46	 
	SECTION 3.22. Securities Act
	 	 	46	 
	SECTION 3.23. REIT Status
	 	 	46	 
	SECTION 3.24. Leases
	 	 	46	 
	SECTION 3.25. Brokers
	 	 	47	 
	SECTION 3.26. Foreign Assets Control Regulations, Etc
	 	 	47	 
	ARTICLE IV. CONDITIONS
	 	 	47	 
	SECTION 4.01. Effective Date
	 	 	47	 
	SECTION 4.02. Each Credit Event
	 	 	49	 
	ARTICLE V. AFFIRMATIVE COVENANTS
	 	 	49	 
	SECTION 5.01. Financial Statements and Other Information
	 	 	49	 
	SECTION 5.02. Notices of Material Events
	 	 	51	 
	SECTION 5.03. Existence; Conduct of Business
	 	 	52	 
	SECTION 5.04. Payment of Obligations
	 	 	52	 

 

-ii-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page	 
	 	 	 	 
	SECTION 5.05. Maintenance of Properties; Insurance
	 	 	52	 
	SECTION 5.06. Books and Records; Inspection Rights
	 	 	52	 
	SECTION 5.07. Compliance with Laws
	 	 	52	 
	SECTION 5.08. Use of Proceeds
	 	 	52	 
	SECTION 5.09. Further Assurances
	 	 	53	 
	SECTION 5.10. REIT Status
	 	 	53	 
	SECTION 5.11. Hazardous Materials
	 	 	53	 
	SECTION 5.12. [Intentionally Deleted]
	 	 	53	 
	ARTICLE VI. NEGATIVE COVENANTS
	 	 	53	 
	SECTION 6.01. Indebtedness
	 	 	53	 
	SECTION 6.02. Liens
	 	 	54	 
	SECTION 6.03. Fundamental Changes
	 	 	54	 
	SECTION 6.04. Investments
	 	 	55	 
	SECTION 6.05. Restricted Payments
	 	 	55	 
	SECTION 6.06. Transactions with Affiliates
	 	 	55	 
	SECTION 6.07. Certain Financial Covenants
	 	 	56	 
	SECTION 6.08. Organizational Documents
	 	 	56	 
	SECTION 6.09. Fiscal Year
	 	 	57	 
	SECTION 6.10. Senior Management
	 	 	57	 
	SECTION 6.11. Dispositions
	 	 	57	 
	ARTICLE VII. EVENTS OF DEFAULT
	 	 	57	 
	ARTICLE VIII. THE ADMINISTRATIVE AGENT
	 	 	60	 
	ARTICLE IX. MISCELLANEOUS
	 	 	62	 
	SECTION 9.01. Notices
	 	 	62	 
	SECTION 9.02. Waivers; Amendments
	 	 	63	 
	SECTION 9.03. Expenses; Indemnity; Damage Waiver
	 	 	64	 
	SECTION 9.04. Successors and Assigns
	 	 	65	 
	SECTION 9.05. Survival
	 	 	68	 
	SECTION 9.06. Counterparts; Integration; Effectiveness
	 	 	68	 
	SECTION 9.07. Severability
	 	 	69	 

 

-iii-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page	 
	 	 	 	 
	SECTION 9.08. Right of Setoff
	 	 	69	 
	SECTION 9.09. Governing Law; Jurisdiction; Etc
	 	 	69	 
	SECTION 9.10. WAIVER OF JURY TRIAL
	 	 	70	 
	SECTION 9.11. Headings
	 	 	70	 
	SECTION 9.12. Confidentiality
	 	 	71	 
	SECTION 9.13. USA PATRIOT Act
	 	 	71	 
	SECTION 9.14. Co-Agents
	 	 	71	 

 

-iv-

 

	 	 	 	 	 
	SCHEDULE 2.01

	 	-
	 	Commitments
	SCHEDULE 3.06

	 	-
	 	Litigation and Environmental Disclosed Matters
	SCHEDULE 3.13

	 	-
	 	Material Agreements and Liens
	SCHEDULE 3.14

	 	-
	 	Stock Options
	SCHEDULE 3.15

	 	-
	 	Subsidiaries and Investments
	SCHEDULE 3.16

	 	-
	 	Real Property
	SCHEDULE 3.24

	 	-
	 	Leases
	SCHEDULE 4.01(e)

	 	-
	 	Organizational Documents
	 
	 	 	 	 
	EXHIBIT A

	 	-
	 	Form of Assignment and Assumption
	EXHIBIT B

	 	-
	 	Form of Note
	EXHIBIT C

	 	-
	 	Form of Borrowing Request
	EXHIBIT D

	 	-
	 	Form of Interest Election Request
	EXHIBIT E

	 	-
	 	Form of Opinion of Counsel to the Borrower
	EXHIBIT F

	 	-
	 	Intentionally Deleted
	EXHIBIT G

	 	-
	 	Form of U.S. Tax Certificates
	EXHIBIT H

	 	-
	 	Form of Compliance Certificate

 

-v-

 

TERM LOAN AGREEMENT (as may be amended, amended and restated, supplemented or otherwise
modified, this “Agreement”) dated as of June 3, 2011, among NATIONWIDE HEALTH PROPERTIES,
INC., the LENDERS party hereto, and JPMORGAN CHASE BANK, N.A., as Administrative Agent.

The Borrower has requested that the Lenders extend credit to the Borrower in an aggregate
principal or face amount not exceeding $800,000,000. The Lenders are prepared to extend such
credit upon the terms and conditions hereof.

Accordingly, the parties hereto agree to enter into a Term Loan Agreement in its entirety to
read as follows:

ARTICLE I.

DEFINITIONS

SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have the
meanings specified below:

“ABR”, when used in reference to any Loan or Borrowing, refers to whether a Loan
comprising a Borrowing, is bearing interest at a rate determined by reference to the Alternate Base
Rate.

“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest
Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to
(a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

“Administrative Agent” means JPMorgan, in its capacity as administrative agent for the
Lenders hereunder, or any successor Administrative Agent appointed pursuant to Article
VIII.

“Administrative Agent’s Account” means an account designated by the Administrative
Agent in a notice to the Borrower and the Lenders.

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

“Affiliate” means, with respect to a specified Person, another Person that directly,
or indirectly through one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified.

“Aggregate Investment Value” means for each permitted Investment identified in
Section 6.04 of this Agreement (and any related Property referred to in such Section), the
greater of (i) the purchase price of such Investment (and related Property); or (ii) that portion
of the Capitalization Value represented by the relevant Investment (and related Property) as
calculated in the most recent Measuring Period.

Term Loan Agreement

 

 

 

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of
(a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such
day plus 1/2 of 1% and (c) the Adjusted LIBO Rate for a one-month Interest Period on such day (or
if such day is not a Business Day, the immediately preceding Business Day) plus 1.0%, provided
that, for the avoidance of doubt, the Adjusted LIBO Rate for any day shall be based on the rate
appearing on the Reuters Screen LIBOR01 Page (or on any successor or substitute page, or on any
other service providing comparable rate quotations) at approximately 11:00 a.m. London time on such
day. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds
Effective Rate or the Adjusted LIBO Rate shall be effective from and including the effective date
of such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate,
respectively.

“Applicable Percentage” means, with respect to any Lender, the percentage of the total
Commitments represented by such Lender’s Commitment. If the Commitments have terminated or
expired, the Applicable Percentages shall be determined based upon the Commitments most recently in
effect, giving effect to any assignments.

“Applicable Rate” means, (a) with respect to any Eurodollar Loan, a rate per annum of
1.50%, and (b) with respect to any ABR Loan, 0.50% per annum.

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

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required by Section
9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other
form approved by the Administrative Agent.

“Availability Period” means the period from and including the Effective Date to but
excluding the earlier of the Maturity Date and the date of termination of the Commitments.

“Board” means the Board of Governors of the Federal Reserve System of the United
States of America.

“Borrower” means Nationwide Health Properties, Inc., a Maryland corporation.

“Borrowing” means Loans of the same Type, made, converted or continued on the same
date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

“Borrowing Request” means a request by the Borrower for a Borrowing in accordance with
Section 2.03.

Term Loan Agreement

 

- 2 -

 

“Bullet Payment” shall mean any payment of the entire unpaid balance of any
Indebtedness at its final maturity other than the final payment with respect to a loan that is
fully amortized over its term.

“Business Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain closed; provided
that, when used in connection with a Borrowing, continuation, a payment or prepayment of principal
of or interest on, or Interest Period for, a Eurodollar Loan, or a notice by a Borrower with
respect to any such Borrowing, continuation, payment, prepayment or Interest Period, the term
“Business Day” shall also exclude any day on which banks are not open for dealings in dollar
deposits in the London interbank market.

“Capitalization Value” means, at any date, solely with respect to the Nationwide
Entities, the sum of (without duplication):

(a) EBITDA for the most recent Measuring Period divided by (b) (i) 9.50% for skilled
nursing facilities and specialty care hospitals, and (ii) 8.00% for assisted/independent
living facilities, continuing care retirement facilities, and medical office buildings
(expressed as a decimal) (excluding newly acquired Properties covered by clause (A) below);
plus

(b) all Cash and Cash Equivalents held by any Nationwide Entity at such time, and, in
the case of Cash and Cash Equivalents not Wholly-Owned, multiplied by a percentage
(expressed as a decimal) equal to the percentage of the total outstanding Equity Interest
held by any Nationwide Entity holding title to such Cash and Cash Equivalents;

provided, however, (i) newly acquired Properties shall be valued at acquisition cost for the first
four fiscal quarters of ownership and (ii) the determination of Capitalization Value for any period
shall not include any Property (or any portion of EBITDA relating to any such Property) that has
been sold or otherwise disposed of at any time prior to or during such period.

“Capitalized Loan Fees” means, with respect to the Nationwide Entities, and with
respect to any period, any upfront, closing or similar fees paid by such Person in connection with
the incurrence or refinancing of Indebtedness during such period that are capitalized on the
balance sheet of such Person.

“Capital Lease Obligations” of any Person means the obligations of such Person to pay
rent or other amounts under any lease of (or other arrangement conveying the right to use) real or
personal property, or a combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of
such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

“Cash and Cash Equivalents” means, with respect to any Person, (a) cash and (b) any
unrestricted Investment that qualifies as a Permitted Investment (other than, in either case,
Restricted Cash).

Term Loan Agreement

 

- 3 -

 

“Cash Flow” means, for any period, Net Income plus Depreciation and Amortization
Expense, increases in deferred taxes and other non-cash charges and expenses which were deducted in
determining Net Income of the Consolidated Entities determined on a consolidated basis, as
determined in accordance with GAAP, and including the Consolidated Entities pro rata share of the
net income (or loss) of any Joint Venture in which such Consolidated Entity owns a direct or
indirect Equity Interest.

“Change in Control” means (a) the acquisition of ownership, directly or indirectly,
beneficially or of record, by any Person or group (within the meaning of the Securities Exchange
Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the
date hereof), of Equity Interest representing more than 20% of the aggregate ordinary voting power
represented by the issued and outstanding Equity Interest of the Borrower; (b) a majority of the
members of the board of directors of the Borrower do not constitute Continuing Directors; or (c)
the acquisition of direct or indirect Control of the Borrower by any Person or group.

“Change in Law” means the occurrence, after the date of this Agreement (or with
respect to any Lender, if later, the date on which such Lender becomes a Lender) of any of the
following: (a) the adoption of any law, rule, regulation or treaty, (b) any change in any law,
rule, regulation or treaty or in the interpretation or application thereof by any Governmental
Authority or (c) compliance by any Lender (or, for purposes of Section 2.15(b), by any
lending office of such Lender or by such Lender’s holding company, if any) with any request,
guideline or directive (whether or not having the force of law) of any Governmental Authority made
or issued after the date of this Agreement; provided, however, notwithstanding anything herein to
the contrary, the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,
rules, guidelines, requirements and directives thereunder or issued in connection therewith or in
implementation thereof, shall be deemed to be a “Change in Law”, regardless of the date enacted,
adopted, issued or implemented.

“Code” means the Internal Revenue Code of 1986, as amended.

“Commencement of Construction” means (a) with respect to any unimproved Real Property,
the commencement of material on-site work (including grading) to initially construct a Healthcare
Property, (b) with respect to any improved Real Property which is not then a Healthcare Property,
the commencement of material on-site work to convert such Real Property to a Healthcare Property or
(c) with respect to any improved Real Property which is already a Healthcare Property, the
commencement of material reconstruction, restoration or renovation with respect to such Healthcare
Property in a manner that results in more than twenty-five percent (25%) of the beds located in
such Healthcare Property being unusable for a period of time in excess of thirty (30) days.

“Commitment” means, with respect to each Lender, the commitment, if any, of such
Lender to make Loans hereunder during the Availability Period, expressed as an amount representing
the maximum aggregate principal amount of the Loans to be made by such Lender hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.09 or 2.11(b)
or (b) reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04. The initial amount of each Lender’s Commitment is
set forth on Schedule 2.01, or in the Assignment and Assumption pursuant to which such
Lender shall have assumed its Commitment, as applicable. The aggregate amount of the Lenders’
Commitments is $800,000,000.

Term Loan Agreement

 

- 4 -

 

“Compliance Certificate” shall mean a certificate in the form of that attached as
Exhibit H, with such changes thereto as the Administrative Agent may from time to time
reasonably request.

“Consolidated Entities” means, collectively, (a) the Borrower, (b) the Borrower’s
Subsidiaries; and (c) any other Person the accounts of which are consolidated with those of the
Borrower in the consolidated financial statements of the Borrower in accordance with GAAP.

“Contingent Obligation” as to any Person means, without duplication, (i) any
contingent obligation of such Person required to be shown on such Person’s balance sheet in
accordance with GAAP, and (ii) any obligation required to be disclosed in the footnotes to such
Person’s financial statements in accordance with GAAP, guaranteeing partially or in whole any
Non-Recourse Indebtedness, lease, dividend or other obligation, exclusive of contractual
indemnities (including, without limitation, any indemnity or price-adjustment provision relating to
the purchase or sale of securities or other assets), of such Person or of any other Person. The
amount of any Contingent Obligation described in clause (ii) shall be deemed to be (a) with respect
to a guaranty of interest or interest and principal, or operating income guaranty, the sum of all
payments required to be made thereunder (which in the case of an operating income guaranty shall be
deemed to be equal to the debt service for the note secured thereby), calculated at the interest
rate applicable to such Indebtedness, through (1) in the case of an interest or interest and
principal guaranty, the stated date of maturity of the obligation (and commencing on the date
interest could first be payable thereunder), or (2) in the case of an operating income guaranty,
the date through which such guaranty will remain in effect, and (b) with respect to all guarantees
not covered by the preceding clause (a) an amount equal to the stated or determinable amount of the
primary obligation in respect of which such guaranty is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof (assuming such Person is required to
perform thereunder) as recorded on the balance sheet and on the footnotes to the most recent
financial statements of the applicable Person required to be delivered pursuant hereto.
Notwithstanding anything contained herein to the contrary, guarantees of completion and
non-recourse carve outs in secured loans shall not be deemed to be Contingent Obligations unless
and until a claim for payment has been made thereunder, at which time any such guaranty of
completion shall be deemed to be Indebtedness in an amount equal to any such claim. Subject to the
preceding sentence, (i) in the case of a joint and several guaranty given by such Person and
another Person (but only to the extent such guaranty is recourse, directly or indirectly to the
applicable Borrower Party or their respective Subsidiaries), the amount of the guaranty shall be
deemed to be 100% thereof unless and only to the extent that (X) such other Person has delivered
cash or Cash Equivalents to secure all or any part of such Person’s guaranteed obligations or (Y)
such other Person holds an investment grade credit rating from either Moody’s or S&P, and (ii) in
the case of a guaranty (whether or not joint and several) of an obligation otherwise constituting
Indebtedness of such Person, the amount of such guaranty shall be deemed to be only that amount in
excess of the amount of the obligation constituting Indebtedness of such
Person. Notwithstanding anything contained herein to the contrary, “Contingent Obligations”
shall not be deemed to include guarantees of loan commitments or of construction loans to the
extent the same have not been drawn.

Term Loan Agreement

 

- 5 -

 

“Continuing Director” means (a) any member of the board of directors of the Borrower
who was a director (or comparable manager) of the Borrower on the Effective Date, and (b) any
individual who becomes a member of the board of directors of the Borrower after the Effective Date
if such individual was appointed or nominated for election to the board of directors of the
Borrower by a majority of the Continuing Directors, but excluding any such individual originally
proposed for election in opposition to the board of directors in office at the Effective Date in an
actual or threatened election contest relating to the election of the directors (or comparable
managers) of the Borrower and whose initial assumption of office resulted from such contest or the
settlement thereof.

“Control” means the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether through the ability to
exercise voting power, by contract or otherwise. “Controlling” and “Controlled”
have meanings correlative thereto.

“Default” means any event or condition which constitutes an Event of Default or which
upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

“Defaulting Lender” means any Lender, as determined by the Administrative Agent, that
has (a) failed to fund any portion of its funding obligations within three (3) days of the required
date, (b) given notice that it does not intend to comply with any of its funding obligations, (c)
failed, within three (3) days after request by the Administrative Agent, to confirm that it will
comply with its funding obligations, (d) failed to make any other required payments to the
Administrative Agent or any other Lender within three (3) days of the due date or (e)(i) become or
is insolvent or has a parent company that has become or is insolvent or (ii) become the subject of
a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator,
assignee for the benefit of creditors or similar Person charged with reorganization or liquidation
of its business or custodian, appointed for it, or has taken any action in furtherance of, or
indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has
a parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a
receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar
Person charged with reorganization or liquidation of its business or custodian appointed for it, or
has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence
in any such proceeding or appointment.

“Depreciation and Amortization Expense” means (without duplication), for any period,
the sum for such period of (i) total depreciation and amortization expense, whether paid or
accrued, of the Consolidated Entities, plus (ii) any Consolidated Entity’s pro rata share of
depreciation and amortization expenses of Joint Ventures in which a Consolidated Entity owns a
direct or indirect Equity Interest. For purposes of this definition, the Consolidated Entities’ pro
rata share of depreciation and amortization expense of any Joint Venture in which a
Consolidated Entity owns a direct or indirect Equity Interest shall be deemed equal to the
product of (i) the depreciation and amortization expense of such Joint Venture, multiplied by (ii)
the percentage of the total outstanding Equity Interest of such Person held directly or indirectly
by any Consolidated Entity, expressed as a decimal.

Term Loan Agreement

 

- 6 -

 

“Disclosed Matters” means (a) the actions, suits and proceedings and (b) the
environmental matters disclosed in Schedule 3.06.

“Disposition” means the sale, conveyance, pledge, hypothecation, ground lease,
encumbrance, creation of a security interest with respect to, or other transfer, whether voluntary
or involuntary, direct or indirect, of any legal or beneficial interest in a Property, including
any sale, conveyance, pledge, hypothecation, ground lease, encumbrance, creation of a security
interest with respect to, or other transfer, at any tier, of any ownership interest in any
Nationwide Entity; provided, however, that Disposition shall not include any Permitted
Encumbrances.

“Disqualified Capital Stock” shall mean with respect to any Person any Equity Interest
of such Person that by its terms (or by the terms of any security into which it is convertible or
for which it is exchangeable), or otherwise (including upon the occurrence of any event), is
required to be redeemed or is redeemable for cash at the option of the holder thereof, in whole or
in part (including by operation of a sinking fund), or is exchangeable for Indebtedness (other than
at the option of such Person), in whole or in part, at any time.

“dollars” or “$” refers to lawful money of the United States of America.

“EBITDA” means, for a Measuring Period, solely with respect to the Nationwide
Entities, (i) Net Income, plus (without duplication) (A) Interest Expense, (B) Tax Expense, and (C)
Depreciation and Amortization Expense, in each case for such period.

“Effective Date” means the date on which the conditions specified in Section
4.01 are satisfied (or waived in accordance with Section 9.02).

“Eligible Assignee” means any of (i) a Lender or a Lender Affiliate, (ii) a commercial
bank organized under the Laws of the United States, or any State thereof, and having (x) total
assets in excess of $1,000,000,000 and (y) a combined capital and surplus of at least $250,000,000;
(iii) a commercial bank organized under the laws of any other country which is a member of the
Organization of Economic Cooperation and Development (“OECD”), or a political subdivision
of any such country, and having (x) total assets in excess of $1,000,000,000 and (y) a combined
capital and surplus of at least $250,000,000, provided that such bank is acting through a
branch or agency located in the country in which it is organized or another country which is also a
member of OECD; (iv) a life insurance company organized under the Laws of any State of the United
States, or organized under the Laws of any country and licensed as a life insurer by any State
within the United States and having admitted assets of at least $1,000,000,000; (v) a nationally or
internationally recognized investment banking company or other financial institution in the
business of making, investing in or purchasing loans, or an Affiliate thereof (other than any
Person which is directly or indirectly a Nationwide Core Entity or directly or indirectly an
Affiliate of a Nationwide Core Entity) organized under the Laws of any State of the United States
or any other country which is a member of OECD, and licensed or
qualified to conduct such business under the Laws of any such State and having (1) total
assets of at least $1,000,000,000 and (2) a net worth of at least $250,000,000; or (vi) an Approved
Fund.

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“Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into
by any Governmental Authority, relating in any way to the environment, the preservation or
reclamation of natural resources or the management, release or threatened release of any Hazardous
Material.

“Environmental Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or indemnities, and
including any Lien filed against any Real Property in favor of any governmental entity), of the
Borrower or any Subsidiary Entity directly or indirectly resulting from or based upon (a) violation
of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or
threatened release of any Hazardous Materials into the environment or (e) any contract, agreement
or other consensual arrangement pursuant to which liability is assumed or imposed with respect to
any of the foregoing.

“Equity Interests “ means shares of capital stock, partnership interests, membership
interests in a limited liability company, beneficial interests in a trust or other equity ownership
interests in a Person, and any warrants, options or other rights entitling the holder thereof to
purchase or acquire any such equity interest.

“Equity Rights” means, with respect to any Person, any subscriptions, options,
warrants, commitments, preemptive rights or agreements of any kind (including any shareholders’ or
voting trust agreements) for the issuance, sale, registration or voting of, or securities
convertible into, any additional shares of capital stock of any class, or partnership or other
ownership interests of any type in, such Person.

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

“ERISA Affiliate” means any trade or business (whether or not incorporated) that,
together with any Consolidated Entity, is, or within the last six years was, treated as a single
employer under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302 of ERISA
and Section 412 of the Code, is, or within the last six years was, treated as a single employer
under Section 414 of the Code.

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“ERISA Event” means, (i) a reportable event as defined in Section 4043 of ERISA with
respect to a Plan, excluding, however, such events as to which the PBGC by regulation has waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days of the occurrence of
such event; (ii) a withdrawal by any Consolidated Entity or any of their ERISA Affiliates
(collectively referred to hereunder as the “ERISA Group”) from a Plan, or the termination
of any Plan, in either case resulting in liability under Sections 4063 or 4064 of ERISA; (iii) the
withdrawal of any member of the ERISA Group in a complete or partial
withdrawal (within the meaning of Section 4203 and 4205 of ERISA) from any Multiemployer Plan
if there is any potential liability therefore, or the receipt by any member of the ERISA Group of
notice from any Multiemployer Plan that it is in reorganization or insolvency pursuant to Section
4241 or 4245 of ERISA; (iv) the filing of a notice of intent to terminate, the treatment of a plan
amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings
by the PBGC to terminate a Plan or Multiemployer Plan; (v) the imposition of liability on any
member of the ERISA Group pursuant to Sections 4062(e) or 4069 of ERISA or by reason of the
application of Section 4212(c) of ERISA; (vi) the failure by any member of the ERISA Group to make
any required contribution to a Plan, or the failure to meet the minimum funding standard of Section
412 of the Code with respect to any Plan (whether or not waived in accordance with Section 412(c)
of the Code) or the failure to make by its due date a required installment under Section 430 of the
Code with respect to any Plan or the failure to make any required contribution to a Multiemployer
Plan; (vii) the determination that any Plan is considered an at-risk plan or a plan in endangered
to critical status within the meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304
and 305 of ERISA; (viii) an event or condition which might reasonably be expected to constitute
grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan or Multiemployer Plan; (ix) the imposition of any material liability under
Title I or Title IV of ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon any member of the ERISA Group; (x) the imposition of any lien (or the fulfillment of
the conditions for the imposition of any lien) on any of the rights, properties or assets of any
member of the ERISA Group pursuant to Title I or Title IV, including, without limitation, Sections
302(f) or 303(k) of ERISA or to Section 401(a)(29) or 430(k) of the Code; (xi) any member of the
ERISA Group has not met all applicable requirements under the ERISA Funding Rules with respect to
any Plan, or a waiver of the minimum funding standards under the ERISA Funding Rules has been
applied for or obtained, (xii) as of the most recent valuation date for any Plan, the funding
target attainment percentage (as defined in Section 430(d)(2) of the Code) is less than 60%, or any
member of the ERISA Group knows of any facts or circumstances that could reasonably be expected to
cause the funding target attainment percentage to fall below 60% as of the most recent valuation
date, (xiii) the execution or delivery of this Agreement and the consummation of the transactions
contemplated hereunder will involve any transaction that is subject to the prohibitions of Section
406 of ERISA or in connection with which taxes could be imposed pursuant to Section
4975(c)(1)(A)-(D) of the Code.

“ERISA Funding Rules” means the rules regarding minimum required contributions
(including any installment payment thereof) to Plans, as set forth Section 412 of the Code and
Section 302 of ERISA, with respect to Plan Years ending prior to the effective date of the Pension
Protection Act of 2006, and thereafter, as set forth in Sections 412, 430, 431, 432 and 436 of the
Code and Sections 302, 303, 304 and 305 of ERISA.

“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by
reference to the Adjusted LIBO Rate.

“Event of Default” has the meaning assigned to such term in Article VII.

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“Event of Loss” means with respect to any Property of any Nationwide Entity (a) any
loss, destruction or damage of such Property, (b) any pending or threatened institution of any
proceedings for the condemnation or seizure of such Property or of any right of eminent domain or
(c) any actual condemnation, seizure or taking, by exercise of the power of eminent domain or
otherwise, of such Property, or confiscation of such Property or requisition of the use of such
Property.

“Excluded Taxes” means, with respect to any payment made by the Borrower under this
Agreement, any of the following Taxes imposed on or with respect to a Recipient: (a) income or
franchise Taxes imposed on (or measured by) net income by the United States of America, or by the
jurisdiction under the laws of which such Recipient is organized or in which its principal office
is located or, in the case of any Lender, in which its applicable lending office is located, (b)
any branch profits Taxes imposed by the United States of America or any similar Taxes imposed by
any other jurisdiction in which the Borrower is located and (c) in the case of a Non-U.S. Lender
(other than an assignee pursuant to a request by the Borrower under Section 2.19(b)), any
U.S. Federal withholding Taxes resulting from any law in effect (including FATCA) on the date such
Non-U.S. Lender becomes a party to this Agreement (or designates a new lending office) or is
attributable to such Non-U.S. Lender’s failure to comply with Section 2.17(f), except to
the extent that such Non-U.S. Lender (or its assignor, if any) was entitled, at the time of
designation of a new lending office (or assignment), to receive additional amounts from the
Borrower with respect to such withholding Taxes pursuant to Section 2.17(a).

“Existing Revolving Credit Facility” means that certain $700,000,000 revolving credit
facility evidenced by that certain Amended and Restated Agreement dated as of October 20, 2005 (as
may have been Modified from time to time) by and among the Borrower, as borrower, JPMorgan, as
administrative agent, and the lenders party thereto.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement
and any regulations or official interpretations thereof.

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal funds brokers, as
published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received
by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.

“Financial Officer” means the chief financial officer, principal accounting officer,
treasurer or controller of the Borrower.

“Fiscal Quarter” or “fiscal quarter” means any three-month period ending on
March 31, June 30, September 30 or December 31 of any Fiscal Year.

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“Fiscal Year” or “fiscal year” means the 12-month period ending on December 31
in each year or such other period as the Borrower may designate and the Administrative Agent may
approve in writing.

“Fitch” means Fitch Investors Service, Inc.

“Fixed Charges Ratio” means, as at any date, the ratio of (a) EBITDA for the Measuring
Period ending on or most recently ended prior to such date to (b) Fixed Charges for such period.

“Fixed Charges” means, for any period, solely with respect to Nationwide Entities, the
sum of the amounts for such period of (i) scheduled payments of principal of Indebtedness of the
Consolidated Entities (other than any Bullet Payment), (ii) the Consolidated Entities’ pro rata
share of scheduled payments of principal of Indebtedness of Joint Ventures in which a Consolidated
Entity owns a direct or indirect Equity Interest (other than any Bullet Payment) that does not
otherwise constitute Indebtedness of and is not otherwise recourse to any of the Consolidated
Entities or their assets, (iii) Interest Expense, (iv) payments of dividends in respect of
Disqualified Capital Stock; and (v) to the extent not otherwise included in Interest Expense,
dividends and other distributions paid during such period by the Borrower with respect to preferred
stock or preferred operating units. For purposes of clauses (ii) and (v), the
Consolidated Entities’ pro rata share of payments by any Joint Venture in which a Consolidated
Entity owns a direct or indirect Equity Interest shall be deemed equal to the product of (a) the
payments made by such Joint Venture, multiplied by (b) the percentage of the total outstanding
Equity Interest of such Person held directly or indirectly by any Consolidated Entity, expressed as
a decimal.

“GAAP” means generally accepted accounting principles in the United States of America.

“Governmental Authority” means the government of the United States of America, any
other nation or any political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.

“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or
otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any
Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to
purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation or to purchase (or to advance or supply funds for the purchase of) any security
for the payment thereof, (b) to purchase or lease property, securities or services for the purpose
of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to
maintain working capital, equity capital or any other financial statement condition or liquidity of
the primary obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation or (d) as an account party in respect of any letter of credit or
letter of guaranty issued to support such Indebtedness or obligation; provided, that the term
Guarantee shall not include endorsements for collection or deposit in the ordinary course of
business.

Term Loan Agreement

 

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“Hazardous Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to
any Environmental Law.

“Healthcare Lease” means a lease of a Healthcare Property by the Borrower or one of
its Subsidiary Entities, as lessor, to an Operator, as lessee.

“Healthcare Property” means a property operating as a nursing home, an acute care
hospital, a rehabilitation hospital, an assisted living facility, an adult congregate living
facility, a personal care facility, a medical office building, or any combination of the foregoing;
provided that any of the foregoing may also include independent living units as part of such
property.

“Healthcare Property Under Construction” means Real Property for which Commencement of
Construction has occurred but either: (i) construction of such Real Property is not substantially
complete; or (ii) such Real Property is not subject to a Healthcare Lease.

“Indebtedness” of any Person means, without duplication, (a) all obligations of such
Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations
of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of
such Person upon which interest charges are customarily paid, (d) all obligations of such Person
under conditional sale or other title retention agreements relating to property acquired by such
Person, (e) all obligations of such Person in respect of the deferred purchase price of property or
services (excluding current accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such
Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by
such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all
obligations, contingent or otherwise, of such Person as an account party in respect of letters of
credit, letters of guaranty and similar instruments, (j) all obligations, contingent or otherwise,
of such Person in respect of bankers’ acceptances, (k) all synthetic leases and (l) all Net Swap
Obligations under or in respect of Swap Agreements. The Indebtedness of any Person shall include
the Indebtedness of any other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with
respect to any payment made by the Borrower under this Agreement and (b) Other Taxes.

“Indemnitee” has the meaning assigned to such term in Section 9.03(b).

Term Loan Agreement

 

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“Index Debt” means senior, unsecured, long-term indebtedness for borrowed money of the
Borrower that is not guaranteed by any other Person or subject to any other credit enhancement.

“Information” has the meaning assigned to such term in Section 9.12.

“Interest Election Request” means a request by the Borrower to convert or continue a
Borrowing in accordance with Section 2.08.

“Interest Expense” means, for any period, the sum, for the Nationwide Entities
(determined on a consolidated basis without duplication in accordance with GAAP), of the following:
(a) all interest in respect of Indebtedness (including the interest component of any payments in
respect of Capital Lease Obligations) of the Consolidated Entities accrued or capitalized during
such period (whether or not actually paid during such period), (b) the net amount payable (or minus
the net amount receivable) under Swap Agreements relating to interest during such period (whether
or not actually paid or received during such period), (c) for purposes of determining Interest
Expense as used in the Fixed Charge Coverage Ratio (both numerator and denominator) only,
amortization of Capitalized Loan Fees, (d) interest incurred on any liability or obligation that
constitutes a Contingent Obligation of any Consolidated Entity and (e) to the extent not included
in clauses (a), (b), (c) and (d), any Consolidated Entities’ pro
rata share of interest expense and other amounts of the type referred to in such clauses of the
Joint Ventures in which such Consolidated Entity owns a direct or indirect Equity Interest. For
purposes of clause (e), any Consolidated Entities’ pro rata share of interest expense or
other amount of any Joint Venture in which such Consolidated Entity owns a direct or indirect
Equity Interest shall be deemed equal to the product of (a) the interest expense or other relevant
amount of such Joint Venture, multiplied by (b) the percentage of the total outstanding Equity
Interest of such Person held directly or indirectly by any Consolidated Entity, expressed as a
decimal.

“Interest Payment Date” means (a) with respect to any ABR Loan, each Monthly Date, and
(b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part.

“Interest Period” means with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically corresponding day in the
calendar month that is one, two or three months thereafter, as the Borrower may elect;
provided, that (i) if any Interest Period would end on a day other than a Business Day,
such Interest Period shall be extended to the next succeeding Business Day unless, in the case of a
Eurodollar Borrowing only, such next succeeding Business Day would fall in the next calendar month,
in which case such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period pertaining to a Eurodollar Borrowing that commences on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of the last calendar
month of such Interest Period. For purposes hereof, the date of a Eurodollar Borrowing shall
initially be the date on which such Eurodollar Borrowing is made.

Term Loan Agreement

 

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“Investment” means, for any Person: (a) any purchase or other acquisition by that
Person of Securities, or of a beneficial interest in Securities, issued by any other Person, (b)
any purchase by that Person of a Property or the assets of a business conducted by another Person,
(c) any loan (other than loans to employees), advance (other than deposits with financial
institutions available for withdrawal on demand, prepaid expenses, accounts receivable, advances to
employees and similar items made or incurred in the ordinary course of business) or capital
contribution by that Person to any other Person, including, without limitation, all Indebtedness to
such Person arising from a sale of property by such Person other than in the ordinary course of its
business and (d) the entering into of any Guarantee of, or other contingent obligation with respect
to, Indebtedness or other liability of any other Person and (without duplication) any amount
committed to be advanced, lent or extended to such Person. The amount of any Investment shall be
the original cost of such Investment, plus the cost of all additions thereto less the amount of any
return of capital or principal to the extent such return is in cash with respect to such Investment
without any adjustments for increases or decreases in value or write-ups, write-downs or write-offs
with respect to such Investment.

“IRS” means the United States Internal Revenue Service.

“Joint Venture” means, as to any Person: (i) any corporation fifty percent (50%) or
less of the outstanding securities having ordinary voting power of which shall at the time be owned
or controlled, directly or indirectly, by such Person or by one or more of its Subsidiaries or by
such Person and one or more of its Subsidiaries, or (ii) any partnership, limited liability
company, association, joint venture or similar business organization fifty percent (50%) or less of
the ownership interests having ordinary voting power of which shall at the time be so owned or
controlled. Notwithstanding the foregoing, a Joint Venture of the Borrower shall include each
Person, other than a Subsidiary, in which the Borrower owns a direct or indirect Equity Interest.
Unless otherwise expressly provided, all references in the Loan Documents to a “Joint Venture”
shall mean a Joint Venture of the Borrower.

“JPMorgan” means JPMorgan Chase Bank, N.A.

“JPMS” means J.P. Morgan Securities LLC.

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that
shall have become a party hereto pursuant to an Assignment and Assumption, other than any such
Person that ceases to be a party hereto pursuant to an Assignment and Assumption.

“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period,
the rate appearing on the Reuters Screen LIBOR01 Page (or 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
Administrative Agent from time to time for purposes of providing quotations of interest rates
applicable to Dollar deposits in the London interbank market) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, as the rate for Dollar
deposits with a maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the LIBO Rate with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which Dollar deposits of
$5,000,000 and for a maturity comparable to such Interest Period are offered by the principal
London office of the Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of
such Interest Period.

Term Loan Agreement

 

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“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, or any
other type of preferential arrangement that has the practical effect of creating a security
interest, in, on or of such asset (excepting Permitted Encumbrances), (b) the interest of a vendor
or a lessor under any conditional sale agreement, capital lease or title retention agreement (or
any financing lease having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities, any purchase option, call or similar right of a
third party with respect to such securities.

“Loan Documents” means, collectively, this Agreement, the Notes, and each other
instrument, certificate or agreement executed by the Borrower in connection herewith, as any of the
same may be Modified from time to time.

“Loans” means the loans made by the Lenders to the Borrower pursuant to Section
2.01.

“Margin Stock” means “margin stock” within the meaning of Regulations T, U and X of
the Board.

“Material Adverse Effect” means a material adverse effect on (a) the business, assets,
operations, prospects or condition, financial or otherwise, of the Borrower and its Subsidiaries
taken as a whole, (b) the ability of the Borrower to perform any of its material obligations under
this Agreement or any of the other Loan Documents to which it is a party or (c) the rights of or
benefits available to the Lenders under this Agreement or any of the other Loan Documents.

“Material Agreement” has the meaning assigned to such term in Section 3.13(a).

“Material Indebtedness” means Indebtedness (other than the Loans), or obligations in
respect of one or more Swap Agreements, that is recourse to any one or more of the Borrower and the
Nationwide Core Entities in an aggregate principal amount exceeding $35,000,000. For purposes of
determining Material Indebtedness, the “principal amount” of the obligations of the Borrower and
any Nationwide Core Entity in respect of any Swap Agreement at any time shall be the maximum
aggregate amount (giving effect to any netting agreements) that the Borrower or such Nationwide
Core Entity would be required to pay if such Swap Agreement were terminated at such time.

“Maturity Date” means June 1, 2012.

“Measuring Period” means the period of four consecutive fiscal quarters ended on the
last day of the Fiscal Quarter most recently ended.

Term Loan Agreement

 

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“Modifications” means any amendments, supplements, modifications, renewals,
replacements, consolidations, severances, substitutions and extensions of any document or
instrument from time to time; “Modify”, “Modified”, or related words shall have meanings
correlative thereto.

“Monthly Date” means the last Business Day of each calendar month in each calendar
year, the first of which shall be the first such day after the date hereof.

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

“Mortgage Loan” means any loan owned or held by any of the Nationwide Entities secured
by a mortgage or deed of trust on Healthcare Properties.

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

“Nationwide Core Entities” means collectively, (a) the Consolidated Entities, and (b)
all Unconsolidated Joint Ventures of which any Consolidated Entity is a general partner, managing
member or of which any Consolidated Entity owns more than 50% of the Equity Interest.

“Nationwide Entities” means the Borrower and all Subsidiary Entities of the Borrower.

“Net Asset Value” means (a) Capitalization Value minus (b) Total Adjusted Outstanding
Indebtedness.

“Net Income” means, for any period, the net income (or loss), after provision for
taxes, of the Consolidated Entities determined on a consolidated basis for such period taken as a
single accounting period as determined in accordance with GAAP, and including the Consolidated
Entities’ pro rata share of the net income (or loss) of any Joint Venture in which such
Consolidated Entity owns a direct or indirect Equity Interest for such period, but excluding (i)
any recorded losses and gains arising from the sale of any Real Property and/or Mortgage Loans and
other extraordinary items for such period; (ii) other non-cash charges and expenses (including
non-cash charges resulting from accounting changes) and (iii) any gains or losses arising outside
of the ordinary course of business. For purposes hereof the Consolidated Entities’ pro rata share
of the net income (or loss) of any Joint Venture in which such Consolidated Entity owns a direct or
indirect Equity Interest shall be deemed equal to the product of (i) the income (or loss) of such
Joint Venture, multiplied by (ii) the percentage of the total outstanding Equity Interest of such
Person held directly or indirectly by any Consolidated Entity, expressed as a decimal.

Term Loan Agreement

 

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“Net Swap Obligations” means, as of any date of determination, the excess (if any) of
all “unrealized losses” over all “unrealized profits” of such Person arising from Swap
Agreement as substantiated in writing by the Borrower and approved by the Administrative
Agent. “Unrealized losses” means the fair market value of the cost to such Person of replacing
such Swap Agreement as of the date of determination (assuming the Swap Agreement were to be
terminated as of that date), and “unrealized profits” means the fair market value of the gain to
such Person of replacing such Swap Agreement as of the date of determination (assuming such Swap
Agreement were to be terminated as of that date).

“Non-Recourse Indebtedness” means any Indebtedness: (a) under the terms of which the
payee’s remedies upon the occurrence of any event of default are limited to specific, identified
assets of the payor which secure such Indebtedness and (b) for the repayment of which the payor has
no personal liability beyond the loss of such specified assets, except for liability for fraud,
material misrepresentation or misuse or misapplication of insurance proceeds, condemnation awards
or rents, existence of Hazardous Materials and other then customary exceptions to non-recourse
provisions.

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

“Note” means the promissory note provided for in Section 2.10(f)(i) and any
promissory note delivered in substitution or exchange therefor, in each case as the same shall be
Modified and in effect from time to time

“Obligations” means all obligations, liabilities and indebtedness of every nature of
the Borrower, from time to time owing to the Administrative Agent or any Lender under or in
connection with this Agreement or any other Loan Document to which it is a party, including,
without limitation, principal, interest, fees (including fees of counsel), and expenses whether now
or hereafter existing under the Loan Documents.

“Operator” means any Person who leases Real Property from the Borrower or any of its
Subsidiary Entities pursuant to a Healthcare Lease for the purpose of operating such Real Property
as a Healthcare Property.

“Organizational Documents” means: (a) for any corporation, the certificate or
articles of incorporation, the bylaws, any certificate of determination or instrument relating to
the rights of preferred shareholders of such corporation, and all applicable resolutions of the
board of directors (or any committee thereof) of such corporation, (b) for any partnership, the
partnership agreement, any certificate of formation, and any other instrument or agreement relating
to the rights between the partners or pursuant to which such partnership is formed, (c) for any
limited liability company, the operating agreement, any articles of organization or formation, and
any other instrument or agreement relating to the rights between the members, pertaining to the
manager, or pursuant to which such limited liability company is formed, and (d) for any trust, the
trust agreement and any other instrument or agreement relating to the rights between the trustors,
trustees and beneficiaries, or pursuant to which such trust is formed.

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

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“Other Taxes” means any present or future stamp, court, documentary, intangible,
recording, filing or similar excise or property Taxes that arise from any payment made under, from
the execution, delivery, performance, enforcement or registration of, or from the registration,
receipt or perfection of a security interest under, or otherwise with respect to any Loan Document,
except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other
than an assignment under Section 2.19(b))

“Participant” has the meaning assigned to such term in Section 9.04.

“Participant Register” has the meaning assigned to such term in Section
9.04(c).

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA
and any successor entity performing similar functions.

“Permitted Encumbrances” means:

(a) Liens imposed by law for Taxes, fees, assessments or other governmental charges or
levies that are not yet delinquent or are being contested in compliance with Section
5.04;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like
Liens imposed by law, arising in the ordinary course of business and securing obligations
that are not overdue by more than 30 days or are being contested in compliance with
Section 5.04;

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

(d) deposits to secure the performance of bids, trade contracts, leases, statutory
obligations, surety and appeal bonds, performance bonds and other obligations of a like
nature, in each case in the ordinary course of business;

(e) judgment liens in respect of judgments that do not constitute an Event of Default
under clause (l) of Article VII;

(f) easements, zoning restrictions, rights-of-way and similar encumbrances on real
property imposed by law or arising in the ordinary course of business that do not (i) secure
any monetary obligations, (ii) materially detract from the value of the affected property as
it is then being used, (iii) materially interfere with the ordinary conduct of business of
any Nationwide Entities or (iv) violate any terms or conditions of this Agreement; and

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(g) statutory landlord’s Liens under leases to which the Borrower or any of its
Subsidiary Entities is a party.

provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.

“Permitted Investments” means:

(a) direct obligations of, or obligations the principal of and interest on which are
unconditionally guaranteed by, the United States of America (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the United States of
America), in each case maturing within one year from the date of acquisition thereof;

(b) investments in commercial paper maturing within 270 days from the date of
acquisition thereof and having, at such date of acquisition, the highest credit rating
obtainable from S&P or from Moody’s;

(c) investments in certificates of deposit, banker’s acceptances and time deposits
maturing within 180 days from the date of acquisition thereof issued or guaranteed by or
placed with, and money market deposit accounts issued or offered by, any domestic office of
any commercial bank organized under the laws of the United States of America or any State
thereof which has a combined capital and surplus and undivided profits of not less than
$500,000,000;

(d) fully collateralized repurchase agreements with a term of not more than 30 days for
securities described in clause (a) of this definition and entered into with a
financial institution satisfying the criteria described in clause (c) of this
definition; and

(e) money market funds that (i) comply with the criteria set forth in Securities and
Exchange Commission Rule 2a-7 under the Investment Company Act of 1940, (ii) are rated AAA
by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least $5,000,000,000.

“Person” means any natural person, corporation, limited liability company, trust,
joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA,
and in respect of which any Consolidated Entity or any of their ERISA Affiliates is, or within the
last six years was, (or, if such plan were terminated, would under Section 4069 of ERISA be deemed
to be) an “employer” as defined in Section 3(5) of ERISA.

“Prime Rate” means the rate of interest per annum publicly announced from time to time
by JPMorgan as its prime rate in effect at its principal office in New York City; each change in
the Prime Rate shall be effective from and including the date such change is publicly announced as
being effective.

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“Process Agent” has the meaning assigned to such term in Section 9.09(d).

“Property” means, collectively and severally, any and all Real Property and all
personal property owned or occupied by the subject Person. “Property” shall include all Equity
Interests owned by the subject Person in a Subsidiary Entity.

“Qualified Unencumbered Assets” means Real Properties and/or Mortgage Loans that (a)
are not encumbered by a Lien (other than a Permitted Encumbrance), (b) Wholly-Owned by the Borrower
or a Subsidiary Wholly-Owned by the Borrower, (c) are located, or encumber real properties that are
located, in the United States and (d) are operated, or encumber real properties that are operated,
as a Healthcare Property.

“Real Property” means each of those parcels (or portions thereof) of real property,
improvements and fixtures thereon and appurtenances thereto now or hereafter owned or leased by the
Nationwide Entities.

“Recipient” means, as applicable, (a) the Administrative Agent and (b) any Lender.

“Register” has the meaning assigned to such term in Section 9.04.

“REIT” means a domestic trust or corporation that qualifies as a real estate
investment trust under the provisions of Sections 856, et seq. of the Code.

“Related Parties” means, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, employees, agents and advisors of such Person
and such Person’s Affiliates.

“Required Lenders” means, at any time, Lenders who are not Defaulting Lenders having
outstanding Loans and unused Commitments representing at least 51% of the sum of the total
outstanding Loans and unused Commitments at such time.

“Restricted Cash” means any Cash or Cash Equivalents held by any Person with respect
to which such Person does not have unrestricted access and unrestricted right to expend such cash
or expend or liquidate such Permitted Investments.

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in the Borrower or any of its
Subsidiaries, or any payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such Equity Interests in the Borrower or any option, warrant or
other right to acquire any such Equity Interests in the Borrower or any of its Subsidiaries.

“S&P” means Standard & Poor’s Ratings Service, a division of The McGraw-Hill
Companies, Inc.

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“Secured Indebtedness” means that portion of the Total Adjusted Outstanding
Indebtedness that is, without duplication, secured by a Lien.

“Secured Indebtedness Ratio” means, at any time, the ratio (expressed as a percentage)
of (i) Secured Indebtedness, to (ii) Capitalization Value for such period.

“Securities” means any stock, shares, partnership interests, membership interests,
voting trust certificates, certificates of interest or participation in any profit sharing
agreement or arrangement, bonds, debentures, options, warrants, notes, or other evidences of
indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any
instruments commonly known as “securities” or any certificates of interest, shares or
participations in temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing (other than any Security
convertible into, exchangeable for or exercisable into the Equity Interests of the Borrower).

“Solvent” means, when used with respect to any Person, that at the time of
determination: (i) the fair saleable value of its assets is in excess of the total amount of its
liabilities (including, without limitation, contingent liabilities); (ii) the present fair saleable
value of its assets is greater than its probable liability on its existing debts as such debts
become absolute and matured; (iii) it is then able and expects to be able to pay its debts
(including, without limitation, contingent debts and other commitments) as they mature; and (iv)
it has capital sufficient to carry on its business as conducted and as proposed to be conducted.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of
which is the number one and the denominator of which is the number one minus the aggregate of the
maximum reserve percentages (including any marginal, special, emergency or supplemental reserves)
expressed as a decimal established by the Board to which the Administrative Agent is subject with
respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency
Liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute eurocurrency funding
and to be subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender under such Regulation D
or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.

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“Subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity the accounts of
which would be consolidated with those of the parent in the parent’s consolidated financial
statements if such financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than 50% of the equity or
more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as
of such date, otherwise Controlled, by the parent or one or more subsidiaries of the
parent or by the parent and one or more subsidiaries of the parent. Unless otherwise
specified, “Subsidiary” means a Subsidiary of the Borrower.

“Subsidiary Entities” means a Subsidiary or Joint Venture of a Person. Unless
otherwise expressly provided, all references in the Loan Documents to a “Subsidiary Entity” shall
mean a Subsidiary Entity of the Borrower.

“Swap Agreement” means any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by reference to, one or
more rates, currencies, commodities, equity or debt instruments or securities, or economic,
financial or pricing indices or measures of economic, financial or pricing risk or value or any
similar transaction or any combination of these transactions; provided that no phantom
stock or similar plan providing for payments only on account of services provided by current or
former directors, officers, employees or consultants of the Borrower or its Subsidiaries shall be a
Swap Agreement.

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

“Tax Expense” means (without duplication), for any period, total tax expense (if any)
attributable to income and franchise taxes based on or measured by income, whether paid or accrued,
of the Consolidated Entities, including the Consolidated Entities’ pro rata share of tax expenses
in any Joint Venture in which a Consolidated Entity owns a direct or indirect Equity Interest. For
purposes of this definition, any Consolidated Entity’s pro rata share of any such tax expense of
any Joint Venture in which a Consolidated Entity owns a direct or indirect Equity Interest shall be
deemed equal to the product of (i) such tax expense of such Joint Venture, multiplied by (ii) the
percentage of the total outstanding Equity Interest of such Person held directly or indirectly by
such Consolidated Entity, expressed as a decimal.

“Total Adjusted Outstanding Indebtedness” means, as at any date, without duplication,
the aggregate amount of (i) all Indebtedness and other liabilities of the Consolidated Entities
reflected in the financial statements of the Borrower or disclosed in the notes thereto (to the
extent the same would constitute a Contingent Obligation), plus (ii) all Indebtedness and other
liabilities of all Joint Ventures in which a Consolidated Entity owns a direct or indirect Equity
Interest reflected in the financial statements of such Joint Ventures or disclosed in the notes
thereto (to the extent the same would constitute a Contingent Obligation) which are otherwise
recourse to any Consolidated Entity or any of its assets or that otherwise constitutes Indebtedness
of any Consolidated Entity (including any recourse obligations arising as a result of a
Consolidated Entity serving as a general partner, directly or indirectly, in such Joint Ventures),
plus (iii) all liabilities of the Consolidated Entities with respect to purchase and repurchase
obligations, provided that any obligations to acquire fully-constructed Real Property shall not be
included in Total Adjusted Outstanding Indebtedness prior to the transfer of title of such Real
Property, plus (iv) to the extent not included in clauses (i), (ii) and
(iii), any Consolidated Entity’s pro rata share of all Indebtedness, other amounts of the
types referred to in such clauses and other liabilities reflected in the financial

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statements of
any Joint Venture in which such
Consolidated Entity owns a direct or indirect Equity Interest or disclosed in the notes
thereto (to the extent the same would constitute a Contingent Obligation) not otherwise
constituting Indebtedness of or recourse to any Consolidated Entity or any of its assets. For
purposes of clause (iv), the Consolidated Entities’ pro rata share of all Indebtedness and
other liabilities of any Joint Venture in which a Consolidated Entity owns a direct or indirect
Equity Interest shall be deemed equal to the product of (a) such Indebtedness or other liabilities,
multiplied by (b) the percentage of the total outstanding Equity Interest of such Person held
directly or indirectly by any Consolidated Entity, expressed as a decimal. Notwithstanding
anything to the contrary in this definition, accounts payable and accrued expenses arising in the
ordinary course of business shall not be included in the computation of Indebtedness and other
liabilities of the Consolidated Entities or any Joint Venture in which a Consolidated Entity owns a
direct or indirect Equity Interest.

“Transactions” means the execution, delivery and performance by the Borrower of this
Agreement and the other Loan Documents, the borrowing of Loans and the use of the proceeds thereof.

“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of
interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the
Adjusted LIBO Rate or the Alternate Base Rate.

“Unconsolidated Joint Venture” means (i) any Joint Venture of the Borrower or any
Subsidiary Entity in which the Borrower or such Subsidiary Entity holds any Equity Interest but
which would not be combined with the Borrower in the consolidated financial statements of the
Borrower in accordance with GAAP, and (ii) any Investment of the Borrower or any Subsidiary Entity
in any Person that is not a Joint Venture.

“Unencumbered Asset Value” means, at any date, solely with respect to the Borrower and
its Wholly-Owned Subsidiaries, (a) EBITDA from Qualified Unencumbered Assets for the most recent
Measuring Period divided by (b) (i) 9.50% for skilled nursing facilities and specialty care
hospitals and (ii) 8.00% for assisted/independent living facilities, continuing care retirement
facilities and medical buildings; provided, however, (A) newly acquired Qualified Unencumbered
Assets shall be valued at acquisition cost until there have been four fiscal quarters of ownership;
and (B) the determination of Unencumbered Asset Value for any period shall not include any
Qualified Unencumbered Property (or any portion of EBITDA relating to any such Qualified
Unencumbered Property) that has been sold or otherwise disposed of at any time prior to or during
such period.

“Unencumbered Asset Value Ratio” means, at any date, the ratio (expressed as a
percentage) of (a) Total Adjusted Outstanding Indebtedness (exclusive of Total Adjusted Outstanding
Indebtedness of a Joint Venture provided that such Total Adjusted Outstanding Indebtedness are not
Contingent Obligations of Borrower or any of its Wholly-Owned Subsidiaries) which are unsecured by
a Lien to (b) Unencumbered Asset Value.

“Uniform Commercial Code” means the Uniform Commercial Code as in effect from time to
time in the State of New York.

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“Unsecured Interest Coverage Ratio” means, as at any date of determination thereof,
the ratio of (a) EBITDA arising from Qualified Unencumbered Assets for the Measuring Period ending
on or most recently ended prior to such date to (b) Interest Expense (exclusive of Interest Expense
of a Joint Venture provided that such Interest Expense is not a Contingent Obligation of Borrower
or any of its Wholly-Owned Subsidiaries) not secured by a Lien for such period.

“U.S. Person” means a “United States person” within the meaning of Section 7701(a)(30)
of the Code.

“U.S. Tax Certificate” has the meaning assigned to such term in Section
2.17(f)(ii)(D)(2).

“Wholly-Owned” means, with respect to any Real Property, Equity Interest, or other
Property owned or leased, that title to such Property is held directly by, or such Property is
leased by, the Borrower or a Subsidiary of the Borrower.

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of
Subtitle E of Title IV of ERISA.

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

SECTION 1.02. Terms Generally. The definitions of terms herein shall apply equally to
the singular and plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The
word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the
context requires otherwise (a) any definition of or reference to any agreement, instrument or other
document herein shall be construed as referring to such agreement, instrument or other document as
from time to time amended, supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference herein to any Person
shall be construed to include such Person’s successors and assigns, (c) the words “herein”,
“hereof” and “hereunder”, and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all references herein to
Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be
construed to have the same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, securities, accounts and contract rights.

SECTION 1.03. Accounting Terms; GAAP. Except as otherwise expressly provided herein,
all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in
effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the
Borrower requests an amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent notifies the Borrower that the
Required Lenders request an amendment to any provision hereof for such purpose), regardless of
whether any such notice is given before or after such change in GAAP or in the application thereof,
then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been withdrawn or such
provision amended in accordance herewith.

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ARTICLE II.

THE CREDITS

SECTION 2.01. The Commitments. Subject to the terms and conditions set forth herein,
each Lender agrees to make Loans on a non-revolving basis to the Borrower in Dollars from time to
time during the term of the Loan in an aggregate principal amount that will not exceed such
Lender’s Commitment. Any portion of a Loan that is prepaid may not be reborrowed.

SECTION 2.02. Loans and Borrowings.

(a) Obligations of Lenders. Each Loan shall be made as part of a Borrowing consisting
of Loans made by the Lenders ratably in accordance with their respective Applicable Percentages.
On the date hereof, the Lenders shall fund their respective Loan in accordance with their
Applicable Percentages. The failure of any Lender to make any Loan required to be made by it shall
not relieve any other Lender of its obligations hereunder; provided that the Commitments of the
Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans
as required.

(b) Type of Loans. Subject to Section 2.14, each Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in accordance herewith. Each
Lender at its option may make any Eurodollar Loan by causing any domestic or foreign branch or
Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not
affect the obligation of the Borrower to repay such Loan in accordance with the terms of this
Agreement.

(c) Minimum Amounts; Limitation on Number of Borrowings. At the commencement of each
Interest Period for any Eurodollar Borrowing, such Borrowing shall be in an aggregate amount that
is an integral multiple of $5,000,000 and not less than $100,000,000. At the time that each ABR
Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of
$5,000,000 and not less than $100,000,000. Notwithstanding the foregoing, if the unused
Commitments are less than $100,000,000, a single Borrowing shall be permitted in an amount equal to
the unused Commitments. Borrowings of more than one Type may be outstanding at the same time;
provided that there shall not at any time be more than a total of eight (8) Eurodollar Borrowings
outstanding.

(d) Limitations on Lengths of Interest Periods. Notwithstanding any other provision
of this Agreement, the Borrower shall not be entitled to request, or to elect to convert
or continue any Eurodollar Borrowing if the Interest Period requested therefor would end after
the Maturity Date.

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SECTION 2.03. Requests for Borrowings.

(a) To request a Borrowing, the Borrower shall notify the Administrative Agent of such request
by telephone (a) in the case of a Eurodollar Borrowing, not later than 1:00 p.m., New York City
time, three Business Days before the date of the proposed Borrowing or (b) in the case of a ABR
Borrowing, not later than 1:00 p.m., New York City time, one Business Day before the date of the
proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable and shall be
confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Borrowing
Request in the form set forth in Exhibit C (or such other form approved by the
Administrative Agent) and signed by the Borrower. Each such telephonic and written Borrowing
Request shall specify the following information in compliance with Section 2.02:

(i) the aggregate amount of the requested Borrowing;

(ii) the date of such Borrowing, which shall be a Business Day;

(iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;

(iv) in the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of the term
“Interest Period”; and

(v) the location and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.07.

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an
ABR Borrowing. If no Interest Period is specified with respect to any requested Eurodollar
Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s
duration. Promptly following receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the amount of such
Lender’s Loan to be made as part of the requested Borrowing.

SECTION 2.04. [Intentionally Deleted.]

SECTION 2.05. [Intentionally Deleted.]

SECTION 2.06. [Intentionally Deleted.]

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SECTION 2.07. Funding of Borrowings.

(a) Funding by Lenders. Each Lender shall make each Loan to be made by it hereunder
on the proposed date thereof by wire transfer of immediately available funds by 12:00
noon, New York City time, to the account of the Administrative Agent most recently designated
by it for such purpose by notice to the Lenders. The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amounts so received, in like funds, to an
account of the Borrower maintained with the Administrative Agent in New York City and designated by
the Borrower in the applicable Borrowing Request.

(b) Presumption by the Administrative Agent. Unless the Administrative Agent shall
have received notice from a Lender prior to the proposed date of any Borrowing that such Lender
will not make available to the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance upon such assumption,
make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on
demand such corresponding amount with interest thereon, for each day from and including the date
such amount is made available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective
Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on
interbank compensation or (ii) in the case of the Borrower, the interest rate applicable to ABR
Loans. If such Lender pays such amount to the Administrative Agent, then such amount shall
constitute such Lender’s Loan included in such Borrowing.

SECTION 2.08. Interest Elections.

(a) Elections by the Borrower for Borrowings. Each Borrowing initially shall be of
the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing,
shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the
Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing as a
Borrowing of the same Type and, in the case of a Eurodollar Borrowing, may elect Interest Periods
therefor, all as provided in this Section. The Borrower may elect different options with respect
to different portions of the affected Borrowing, in which case each such portion shall be allocated
ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising
each such portion shall be considered a separate Borrowing.

(b) Notice of Elections. To make an election pursuant to this Section, the Borrower
shall notify the Administrative Agent of such election by telephone by the time that a Borrowing
Request would be required under Section 2.03 if the Borrower were requesting a Borrowing
of the Type resulting from such election to be made on the effective date of such election. Each
such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly by
hand delivery or telecopy to the Administrative Agent of a written Interest Election Request in the
form set forth in Exhibit D (or such other form approved by the Administrative Agent) and
signed by the Borrower.

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(c) Information in Interest Election Requests. Each telephonic and written Interest
Election Request shall specify the following information in compliance with Section 2.02:

(i) the Borrowing to which such Interest Election Request applies and, if different
options are being elected with respect to different portions thereof, the portions thereof
to be allocated to each resulting Borrowing (in which case the information to be specified
pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and

(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be
applicable thereto after giving effect to such election, which shall be a period
contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an
Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one
month’s duration.

(d) Notice by the Administrative Agent to Lenders. Promptly following receipt of an
Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof
and of such Lender’s portion of each resulting Borrowing.

(e) Failure to Elect; Events of Default. If the Borrower fails to deliver a timely
Interest Election Request with respect to a Eurodollar Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of
such Interest Period such Borrowing shall be converted to an ABR Borrowing. Notwithstanding any
contrary provision hereof, if an Event of Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so
long as an Event of Default is continuing (i) no outstanding Borrowing may be converted to or
continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be
converted to a ABR Borrowing at the end of the Interest Period applicable thereto.

SECTION 2.09. Termination and Reduction of the Commitments.

(a) Scheduled Termination. Unless previously terminated, the Commitments shall
terminate on the Maturity Date.

(b) Voluntary Termination or Reduction. The Borrower may at any time terminate, or
from time to time reduce, the unused Commitments; provided that (i) each reduction of the
Commitments shall be in an amount that is an integral multiple of $1,000,000
and not less than $10,000,000 and (ii) terminations and/or reductions may not be made more
than one (1) time in any given calendar quarter.

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SECTION 2.10. Repayment of Loans; Evidence of Debt.

(a) Repayment. The Borrower hereby unconditionally promises to pay the Loans to the
Administrative Agent, for the account of the Lenders, the outstanding principal amount of the Loans
on the Maturity Date.

(b) Manner of Payment. Prior to any repayment or prepayment of any Borrowings
hereunder, the Borrower shall select the Borrowing or Borrowings to be paid and shall notify the
Administrative Agent by telephone (confirmed by telecopy) of such selection not later than 2:00
p.m., New York City time, three Business Days before the scheduled date of such repayment in the
case of a Eurodollar Borrowing and one Business Day before the scheduled date of such repayment in
the case of an ABR Borrowing; provided that each repayment of Borrowings shall be applied to repay
any outstanding ABR Borrowings before any other Borrowings. If the Borrower fails to make a timely
selection of the Borrowing or Borrowings to be repaid or prepaid, such payment shall be applied,
first, to pay any outstanding ABR Borrowings and, second, to other Borrowings in the order of the
remaining duration of their respective Interest Periods (the Borrowing with the shortest remaining
Interest Period to be repaid first),. Each payment of a Borrowing shall be applied ratably to the
Loans included in such Borrowing.

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

(d) Maintenance of Loan Accounts by the Administrative Agent. The Administrative
Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder,
the Type thereof and each Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of
the Lenders and each Lender’s share thereof.

(e) Effect of Entries. The entries made in the accounts maintained pursuant to
paragraph (c) or (d) of this Section shall be prima facie evidence of the existence
and amounts of the obligations recorded therein; provided that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall not in any manner affect
the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.

(f) Promissory Notes. (i) The Loans of such Lender shall be evidenced by a single
promissory note of the Borrower substantially in the form of Exhibit B, dated the date
hereof, payable to such Lender in a principal amount equal to the amount of its Commitment as
originally in effect and otherwise duly completed.

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(ii) Substitution, Exchange and Subdivision of Notes. No Lender shall be
entitled to have its Note substituted or exchanged for any reason, or subdivided for
promissory notes of lesser denominations, except in connection with a permitted assignment
of all or any portion of such Lender’s relevant Commitment, Loans and Note pursuant to
Section 9.04 (and, if requested by any Lender in connection with such permitted
assignment, the Borrower agrees to so exchange any Note).

(iii) Loss, Theft, Destruction or Mutilation of Notes. In the event of the
loss, theft or destruction of any Note, upon the Borrower’s receipt of a reasonably
satisfactory indemnification agreement executed in favor of the Borrower by the holder of
such Note, or in the event of the mutilation of any Note, upon the surrender of such
mutilated Note by the holder thereof to the Borrower, the Borrower shall execute and deliver
to such holder a new replacement Note in lieu of the lost, stolen, destroyed or mutilated
Note.

SECTION 2.11. Prepayment of Loans.

(a) Optional Prepayments. The Borrower shall have the right at any time and from time
to time to prepay any Borrowing in whole, or in part, subject to three Business Days prior notice.
Any portion of the Loans that is prepaid may not be reborrowed.

(b) Mandatory Prepayments and Commitment Reductions. The Borrower will prepay the
Loans and/or the Commitments shall be subject to automatic reduction, as follows:

(i) Non-Compliance with Maximum Unencumbered Asset Value Ratio. If, at any
time, the Borrower fails to comply with the Unencumbered Asset Value covenant set forth in
Section 6.07(a)(vi), then the Borrower shall, within five Business Days after such
occurrence, at the Borrower’s election, (A) prepay the Loans and/or the Commitments shall be
subject to automatic reduction, and/or (B) prepay the “Loans” (as defined in the Existing
Revolving Credit Facility) and/or provide cover for “LC Exposure” (as defined in the
Existing Revolving Credit Facility) as specified in Section 2.06(k) of the Existing
Revolving Credit Facility, in either case, in an aggregate amount to the extent necessary to
achieve compliance with the maximum Unencumbered Asset Value covenant set forth in
Section 6.07(a)(vi), such prepayment and/or reduction under clause (A) above
to be effected in each case in the manner and to the extent specified in clause
(iii) of this paragraph.

(ii) If any net cash proceeds (i.e., net of any and all customary costs, expenses and
fees, any Indebtedness that is being repaid or any other item that is customary in a
particular type of transaction) are actually received by Borrower from any debt or equity
issuance made after the date of this Agreement, then the Borrower shall, within five
Business Days after receipt of such net proceeds, prepay the Loans in the amount of such net
proceeds; provided, however, that such obligation shall expressly exclude
(A) any debt or equity issuance rights or obligations existing as of the date of this
Agreement such as new borrowings under the Existing Revolving Credit Facility (or any
replacement of the Existing Revolving Credit Facility) or under any existing construction
loan, any exercise by any Person of existing stock options or any similar event; (B)
any debt issuances hereafter made to finance the acquisition, construction or improvement of
assets; and (C) any loans hereafter made by Ventas, Inc. and/or Ventas Realty, Limited
Partnership to the Borrower.

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(iii) Application. Any prepayments of Loans and/or reductions of Commitments
available hereunder made under this Agreement shall reduce the aggregate amount of the
Commitments.

(c) Notices, Etc. The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of prepayment of a Borrowing,
not later than 2:00 p.m., New York City time, three (3) Business Days before the date of
prepayment. Each such notice shall be irrevocable and shall specify the prepayment date, the
principal amount of each Borrowing or portion thereof to be prepaid and, in the case of a mandatory
prepayment, a reasonably detailed calculation of the amount of such prepayment. Each partial
prepayment of any Borrowing shall be in an amount that would be permitted in the case of an advance
of a Borrowing of the same Type as provided in Section 2.02, except as necessary to apply
fully the required amount of a mandatory prepayment. Each prepayment of a Borrowing shall be
applied ratably to the Loans included in the prepaid Borrowing. Prepayments shall be accompanied
by (A) accrued interest to the extent required by Section 2.13 and (B) any payments due
pursuant to Section 2.16 and shall be made in the manner specified in Section
2.10(b).

SECTION 2.12. Fees.

(a) Unused Commitment Fee. The Borrower agrees to pay to the Administrative Agent for
the account of each Lender an unused commitment fee, which shall accrue at a rate per annum equal
to the product of (i) the average daily unused amount of the Commitment of such Lender during the
period from and including the Effective Date to but excluding the date on which such unused
Commitment terminates and (ii) the rate per annum equal to 0.10%. Accrued unused commitment fees
shall be payable on each Quarterly Date and on the date the Commitment terminates, commencing on
the first such date to occur after the date hereof. All commitment fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day).

(b) Payment of Fees. All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent for distribution to the Persons entitled
thereto. Fees paid shall not be refundable under any circumstances.

SECTION 2.13. Interest.

(a) ABR Loans. The Loans comprising each ABR Borrowing shall bear interest at the
Alternate Base Rate plus the Applicable Rate.

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(b) Eurodollar Loans. The Loans comprising each Eurodollar Borrowing shall bear
interest in the case of a Eurodollar Loan, at the Adjusted LIBO Rate for the Interest Period in
effect for such Borrowing plus the Applicable Rate.

(c) Default Interest. Notwithstanding the foregoing, if any principal of or interest
on any Loan or any fee or other amount payable by the Borrower hereunder is not paid within 5 days
of when due (except default interest shall accrue immediately with respect to (x) principal payment
from the date when such payment is due and (y) any payments that are not made on the Maturity Date,
as applicable), whether upon acceleration or otherwise, such overdue amount shall bear interest,
after as well as before judgment, at a rate per annum equal to 2% plus the rate applicable to ABR
Loans as provided in paragraph (a) of this Section.

(d) Payment of Interest. Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date; provided that (i) interest accrued pursuant to paragraph (c) of
this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any
Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of
such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Borrowing
prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be
payable on the effective date of such conversion.

(e) Computation. All interest hereunder shall be computed on the basis of a year of
360 days, except that interest computed by reference to the Alternate Base Rate at times when the
Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days
(or 366 days in a leap year), and in each case shall be payable for the actual number of days
elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate,
Adjusted LIBO Rate or LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.

SECTION 2.14. Alternate Rate of Interest. If prior to the commencement of the
Interest Period for a Eurodollar Borrowing:

(a) the Administrative Agent determines (which determination shall be conclusive absent
manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO
Rate or the LIBO Rate, as applicable, for such Interest Period;

(b) the Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate or
the LIBO Rate, as applicable, for such Interest Period will not adequately and fairly reflect the
cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in
such Borrowing for such Interest Period; or

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(c) the Administrative Agent is advised by a Lender that it has become unlawful for such
Lender to honor its obligation to make or maintain Eurodollar Loans hereunder;

then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telecopy
as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and
the Lenders that the circumstances giving rise to such notice no longer exist, (i)
any Interest Election Request that requests the conversion of any Borrowing to, or continuation of
any Borrowing as a Eurodollar Borrowing shall be ineffective (in the case of clause (c)
above, only as to the affected Lender), (ii) if any Borrowing Request requests a Eurodollar
Borrowing, such Borrowing shall be made as an ABR Borrowing (in the case of clause (c)
above, only as to the affected Lender), and (iii) if in accordance with clause (c) above
any Lender determines that it is no longer lawful for such Lender or its applicable lending office
(subject to Section 2.19(a)) to maintain any existing Eurodollar Loans, or to continue to
charge interest rates based upon the LIBO Rate, then, on notice thereof by such Lender to the
Borrower through the Administrative Agent, any obligation of such Lender to continue Eurodollar
Loans shall be suspended until such Lender notifies the Administrative Agent and the Borrower that
the circumstances giving rise to such determination no longer exist and, in such event, all
Eurodollar Loans of such Lender shall be converted to ABR Loans, either on the last day of the
Interest Period thereof, if such Lender may lawfully continue to maintain such Eurodollar Loans to
such day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar
Loans.

SECTION 2.15. Increased Costs.

(a) Increased Costs Generally. If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit or similar
requirement against assets of, deposits with or for the account of, or credit extended by,
any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate);

(ii) impose on any Lender or the London interbank market any other condition affecting
this Agreement or Eurodollar Loans made by such Lender; or

(iii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B)
Excluded Taxes and (C) Other Connection Taxes on gross or net income, profits or revenue
(including value-added or similar Taxes)) on its loans, loan principal, letters of credit,
commitments, or other obligations, or its deposits, reserves, other liabilities or capital
attributable thereto;

and the result of any of the foregoing shall be to increase the cost to such Lenders or such other
Recipient of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make
any such Loan), then, in accordance with and subject to Section 2.15(c), the Borrower will
promptly on demand pay to such Lender or such other Recipient, as the case may be, such additional
amount or amounts as will compensate such Lender or such other Recipient, as the case may be, for
such additional costs incurred or reduction suffered.

(b) Capital Requirements. If any Lender determines that any Change in Law regarding
capital requirements has or would have the effect of reducing the rate of return on such Lender’s
capital or on the capital of such Lender’s holding company, if any, as a consequence of this
Agreement or the Loans made by such Lender, to a level below that which such Lender or such
Lender’s holding company could have achieved but for such Change in Law (taking into consideration
such Lender’s policies and the policies of such Lender’s holding company with respect to capital
adequacy), then, in accordance with and subject to Section 2.15(c), from time
to time the Borrower will promptly on demand pay to such Lender such additional amount or
amounts as will compensate such Lender or such Lender’s holding company for any such reduction
suffered.

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(c) Certificates from Lenders. A certificate of a Lender setting forth, in
reasonable detail, the amount or amounts necessary to compensate such Lender or its holding
company, as the case may be, as specified in paragraph (a) or (b) of this Section
shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt
thereof. No Lender shall have the right to collect payments from the Borrower pursuant to
paragraph (a) or (b) of this Section unless it is the policy of such Lender, at the
time of collection, to collect similar payments from borrowers in connection with credit facilities
similar to those made available pursuant to this Agreement.

(d) Delay in Requests. Failure or delay on the part of any Lender to demand
compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to
demand such compensation; provided that the Borrower shall not be required to compensate a Lender
pursuant to this Section for any increased costs or reductions incurred more than 180 days prior to
the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased
costs or reductions and of such Lender’s intention to claim compensation therefor; provided further
that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then
the 180-day period referred to above shall be extended to include the period of retroactive effect
thereof.

SECTION 2.16. Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest Period applicable
thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan
other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under Section 2.11(c) and
is revoked in accordance herewith), or (d) the assignment of any Eurodollar Loan other than on the
last day of the Interest Period applicable thereto as a result of a request by the Borrower
pursuant to Section 2.19, then, in any such event, the Borrower shall compensate each
Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar
Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by
such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that would
have been applicable to such Loan, for the period from the date of such event to the last day of
the then current Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such Loan), over (ii) the
amount of interest which would accrue on such principal amount for such period at the interest rate
which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits
of a comparable amount and period from other banks in the eurodollar market. A certificate of any
Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive absent manifest error.
The Borrower shall pay such Lender the amount shown as due on any such certificate within 10
days after receipt thereof.

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SECTION 2.17. Taxes.

(a) Withholding of Taxes; Gross-Up. Each payment by the Borrower under any Loan
Document shall be made without withholding for any Taxes, unless such withholding is required by
any law. If any Withholding Agent determines, in its sole discretion exercised in good faith, that
it is so required to withhold Taxes, then such Withholding Agent may so withhold and shall timely
pay the full amount of withheld Taxes to the relevant Governmental Authority in accordance with
applicable law. If such Taxes are Indemnified Taxes, then the amount payable by the Borrower shall
be increased as necessary so that, net of such withholding (including such withholding applicable
to additional amounts payable under this Section), the applicable Recipient receives the amount it
would have received had no such withholding been made.

(b) Payment of Other Taxes by the Borrower. The Borrower shall timely pay any Other
Taxes to the relevant Governmental Authority in accordance with applicable law.

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

(d) Indemnification by the Borrower. The Borrower shall indemnify each Recipient for
any Indemnified Taxes that are paid or payable by such Recipient in connection with any Loan
Document (including amounts paid or payable under this Section 2.17(d)) and any reasonable
expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority. The indemnity
under this Section 2.17(d) shall be paid within 10 days after the Recipient delivers to the
Borrower a certificate stating the amount of any Indemnified Taxes so paid or payable by such
Recipient and describing the basis for the indemnification claim. Such certificate shall be
conclusive of the amount so paid or payable absent manifest error. Such Recipient shall deliver a
copy of such certificate to the Administrative Agent.

(e) Indemnification by the Lenders. Each Lender shall severally indemnify the
Administrative Agent for any Taxes (but, in the case of any Indemnified Taxes, only to the extent
that the Borrower has not already indemnified the Administrative Agent for such Indemnified Taxes
and without limiting the obligation of the Borrower to do so) attributable to such Lender that are
paid or payable by the Administrative Agent in connection with any Loan Document and any reasonable
expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. The indemnity under this
Section 2.17(e) shall be paid within 10 days after the Administrative Agent delivers to the
applicable Lender a certificate stating the amount of Taxes
so paid or payable by the Administrative Agent. Such certificate shall be conclusive of the
amount so paid or payable absent manifest error.

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(f) Status of Lenders. (i) Any Lender that is entitled to an exemption from, or
reduction of, any applicable withholding Tax with respect to any payments under any Loan Document
shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably
requested by the Borrower or the Administrative Agent, such properly completed and executed
documentation reasonably requested by the Borrower or the Administrative Agent as will permit such
payments to be made without, or at a reduced rate of, withholding. In addition, any Lender, if
requested by the Borrower or the Administrative Agent, shall deliver such other documentation
prescribed by law or reasonably requested by the Borrower or the Administrative Agent as will
enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject
to any withholding (including backup withholding) or information reporting requirements.
Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution
and submission of such documentation (other than such documentation set forth in Section
2.17(f)(ii)(A) through (E) below) shall not be required if in the Lender’s judgment
such completion, execution or submission would subject such Lender to any material unreimbursed
cost or expense or would materially prejudice the legal or commercial position of such Lender.
Upon the reasonable request of such Borrower or the Administrative Agent, any Lender shall update
any form or certification previously delivered pursuant to this Section 2.17(f). If any
form or certification previously delivered pursuant to this Section expires or becomes obsolete or
inaccurate in any respect with respect to a Lender, such Lender shall promptly (and in any event
within 10 days after such expiration, obsolescence or inaccuracy) notify such Borrower and the
Administrative Agent in writing of such expiration, obsolescence or inaccuracy and update the form
or certification if it is legally eligible to do so.

(ii) Without limiting the generality of the foregoing, if the Borrower is a U.S.
Person, any Lender with respect to such Borrower shall, if it is legally eligible to do so,
deliver to such Borrower and the Administrative Agent (in such number of copies reasonably
requested by such Borrower and the Administrative Agent) on or prior to the date on which
such Lender becomes a party hereto, duly completed and executed copies of whichever of the
following is applicable:

(A) in the case of a Lender that is a U.S. Person, IRS Form W-9 certifying that
such Lender is exempt from U.S. Federal backup withholding tax;

(B) in the case of a Non-U.S. Lender claiming the benefits of an income tax
treaty to which the United States is a party (1) with respect to payments of
interest under any any Loan Document, IRS Form W-8BEN establishing an exemption
from, or reduction of, U.S. Federal withholding Tax pursuant to the “interest”
article of such tax treaty and (2) with respect to any other applicable payments
under this Agreement, IRS Form W-8BEN establishing an exemption from, or reduction
of, U.S. Federal withholding Tax pursuant to the “business profits” or “other
income” article of such tax treaty;

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(C) in the case of a Non-U.S. Lender for whom payments under this Agreement
constitute income that is effectively connected with such Lender’s conduct of a
trade or business in the United States, IRS Form W-8ECI;

(D) in the case of a Non-U.S. Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code both (1) IRS Form W-8BEN and (2)
a certificate substantially in the form of Exhibit G (a “U.S. Tax
Certificate”) to the effect that such Lender is not (a) a “bank” within the
meaning of Section 881(c)(3)(A) of the Code, (b) a “10 percent shareholder” of the
Borrower within the meaning of Section 881(c)(3)(B) of the Code (c) a “controlled
foreign corporation” described in Section 881(c)(3)(C) of the Code and (d)
conducting a trade or business in the United States with which the relevant interest
payments are effectively connected;

(E) in the case of a Non-U.S. Lender that is not the beneficial owner of
payments made under this Agreement (including a partnership or a participating
Lender) (1) an IRS Form W-8IMY on behalf of itself and (2) the relevant forms
prescribed in clauses (A), (B), (C), (D) and
(F) of this paragraph (f)(ii) that would be required of each such
beneficial owner or partner of such partnership if such beneficial owner or partner
were a Lender; provided, however, that if the Lender is a
partnership and one or more of its partners are claiming the exemption for portfolio
interest under Section 881(c) of the Code, such Lender may provide a U.S. Tax
Certificate on behalf of such partners; or

(F) any other form prescribed by law as a basis for claiming exemption from, or
a reduction of, U.S. Federal withholding Tax together with such supplementary
documentation necessary to enable the Borrower or the Administrative Agent to
determine the amount of Tax (if any) required by law to be withheld.

(iii) If a payment made to a Lender under any Loan Document would be subject to U.S.
Federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the
applicable reporting requirements of FATCA (including those contained in Section 1471(b) or
1472(b) of the Code, as applicable), such Lender shall deliver to the Withholding Agent, at
the time or times prescribed by law and at such time or times reasonably requested by the
Withholding Agent, such documentation prescribed by applicable law (including as prescribed
by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably
requested by the Withholding Agent as may be necessary for the Withholding Agent to comply
with its obligations under FATCA, to determine that such Lender has or has not complied with
such Lender’s obligations under FATCA and, as necessary, to determine the amount to deduct
and withhold from such payment. Solely for purposes of this Section 2.17(f)(iii), “FATCA”
shall include any amendments made to FATCA after the date of this Agreement.

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(g) Treatment of Certain Refunds. If any party determines, in its sole discretion
exercised in good faith, that it has received a refund of any Taxes as to which it has
been indemnified pursuant to this Section 2.17 (including additional amounts paid
pursuant to this Section 2.17), it shall pay to the indemnifying party an amount equal to
such refund (but only to the extent of indemnity payments made under this Section with respect to
the Taxes giving rise to such refund), net of all out-of-pocket expenses (including any Taxes) of
such indemnified party and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund). Such indemnifying party, upon the request of
such indemnified party, shall repay to such indemnified party the amount paid to such indemnified
party pursuant to the previous sentence (plus any penalties, interest or other charges imposed by
the relevant Governmental Authority) in the event such indemnified party is required to repay such
refund to such Governmental Authority. Notwithstanding anything to the contrary in this
Section 2.17(g), in no event will any indemnified party be required to pay any amount to
any indemnifying party pursuant to this Section 2.17(g) if such payment would place such
indemnified party in a less favorable position (on a net after-Tax basis) than such indemnified
party would have been in if the indemnification payments or additional amounts giving rise to such
refund had never been paid. This Section 2.17(g) shall not be construed to require any
indemnified party to make available its Tax returns (or any other information relating to its Taxes
which it deems confidential) to the indemnifying party or any other Person.

SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Setoffs.

(a) Payments by the Borrower. The Borrower shall make each payment required to be
made by it hereunder (whether of principal, interest, fees or of amounts payable under Section
2.15, 2.16 or 2.17, or otherwise) or under any other Loan Document (except to
the extent otherwise provided therein) prior to 3:00 p.m., New York City time, on the date when
due, in immediately available funds, without set-off or counterclaim. Any amounts received after
such time on any date may, in the discretion of the Administrative Agent, be deemed to have been
received on the next succeeding Business Day for purposes of calculating interest thereon. All
such payments shall be made to the Administrative Agent at its offices at the Administrative
Agent’s Account, except as otherwise expressly provided in the relevant Loan Document, and except
that payments pursuant to Sections 2.15, 2.16, 2.17 and 9.03 shall
be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any
such payments received by it for the account of any other Person to the appropriate recipient
promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding Business Day and, in
the case of any payment accruing interest, interest thereon shall be payable for the period of such
extension. All payments hereunder or under any other Loan Document (except to the extent otherwise
provided therein) shall be made in dollars.

(b) Application of Insufficient Payments. If at any time insufficient funds are
received by and available to the Administrative Agent to pay fully all amounts of principal,
interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of
interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with
the amounts of interest and fees then due to such parties, and (ii) second, towards payment of
principal then due hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal then due to such parties.

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(c) Pro Rata Treatment. Except to the extent otherwise provided herein: (i) each
Borrowing shall be made from the Lenders, each payment of commitment fee under Section 2.12
shall be made for the account of the Lenders, and each termination or reduction of the amount of
the Commitments under Section 2.09 shall be applied to the respective Commitments of the
relevant Lenders, pro rata according to the amounts of their respective Commitments; (ii) each
Borrowing shall be allocated pro rata among the Lenders according to the amounts of their
respective Commitments (in the case of the making of Loans) or their respective Loans (in the case
of conversions and continuations of Loans); (iii) each payment or prepayment of principal of Loans
by the Borrower shall be made for account of the Lenders pro rata in accordance with the respective
unpaid principal amounts of the Loans held by them; and (iv) each payment of interest on the Loans
by the Borrower shall be made for account of the Lenders pro rata in accordance with the amounts of
interest on such Loans then due and payable to the respective Lenders.

(d) Sharing of Payments by Lenders. If any Lender shall, by exercising any right of
set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on
any of its Loans resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Loans and accrued interest thereon then due than the proportion received by
any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at
face value) participations in the Loans of other Lenders to the extent necessary so that the
benefit of all such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective Loans; provided that (i)
if any such participations are purchased and all or any portion of the payment giving rise thereto
is recovered, such participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph shall not be
construed to apply to any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans to any assignee or participant, other
than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with
respect to such participation as fully as if such Lender were a direct creditor of the Borrower in
the amount of such participation.

(e) Presumptions of Payment. Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the Administrative Agent
for the account of the Lenders hereunder that the Borrower will not make such payment, the
Administrative Agent may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In
such event, if the Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such
Lender with interest thereon, for each day from and including the date such amount is distributed
to it to but excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Effective Rate and a rate determined
by the Administrative Agent in accordance with banking industry rules on interbank
compensation.

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(f) Certain Deductions by the Administrative Agent. If any Lender shall fail to make
any payment required to be made by it pursuant to Section 2.05(c), 2.06(e) or
(f), 2.07(b) or 2.18(e), then the Administrative Agent may, in its
discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received
by the Administrative Agent for account of such Lender to satisfy such Lender’s obligations under
such Sections until all such unsatisfied obligations are fully paid.

SECTION 2.19. Mitigation Obligations; Replacement of Lenders.

(a) Designation of a Different Lending Office. If any Lender requests compensation
under Section 2.15, or if the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to Section
2.17, then such Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another
of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.15 or
2.17, as the case may be, in the future and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

(b) Replacement of Lenders. If (i) any Lender is unable to make or maintain
Eurodollar Loans pursuant to Section 2.14(c), (ii)any Lender requests compensation under
Section 2.15, (iii) the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section 2.17, or (iv)
any Lender becomes a Defaulting Lender, then the Borrower may, at its sole expense and effort, upon
notice to such Lender and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained in Section
9.04), all its interests, rights and obligations under this Agreement to an assignee that shall
assume such obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (A) the Borrower shall have received the prior written consent of the
Administrative Agent, which consent shall not unreasonably be withheld, (B) such Lender shall have
received payment of an amount equal to the outstanding principal of its Loans, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the
extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of
all other amounts) and (C) in the case of any such assignment resulting from a claim for
compensation under Section 2.15 or payments required to be made pursuant to Section
2.17, such assignment will result in a reduction in such compensation or payments. A Lender
shall not be required to make any such assignment and delegation if, prior thereto, as a result of
a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.

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SECTION 2.20. Defaulting Lenders. Notwithstanding any provision of this Agreement to
the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply
for so long as such Lender is a Defaulting Lender:

(a) fees shall cease to accrue on the unfunded portion of the Commitment of such Defaulting
Lender pursuant to Section 2.12(a);

(b) the Commitment of such Defaulting Lender shall not be included in determining whether all
Lenders or the Required Lenders have taken or may take any action hereunder (including any consent
to any amendment or waiver pursuant to Section 9.02), provided that any waiver, amendment
or modification requiring the consent of all Lenders or each affected Lender which affects such
Defaulting Lender differently than other affected Lenders shall require the consent of such
Defaulting Lender;

(c) in the event that the Administrative Agent and the Borrower each agree that a Defaulting
Lender has adequately remedied all matters that caused such Lender to be a Defaulting Lender, then
on such date such Lender shall purchase at par such of the Loans of the other Lenders as the
Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans
in accordance with its Applicable Percentage, if necessary.

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Lenders that:

SECTION 3.01. Organization; Powers. Each of the Borrower and its Nationwide Core
Entities is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, has all requisite power and authority to carry on its business as
now conducted and, except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and
is in good standing in, every jurisdiction where such qualification is required.

SECTION 3.02. Authorization; Enforceability. The Transactions are within the
Borrower’s organizational powers and have been duly authorized by all necessary organizational and,
if required, stockholder action under their respective Organizational Documents. This Agreement
has been duly executed and delivered by the Borrower and constitutes, and each of the other Loan
Documents to which it is a party when executed and delivered will constitute, a legal, valid and
binding obligation of the Borrower, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws of affecting creditors’ rights
generally and subject to general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

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SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other action by, any
Governmental Authority, except for such as have been obtained or made and are in full force and
effect, (b) will not violate any applicable law or regulation or the Organizational Documents
of the Borrower or any of the Nationwide Core Entities or any order of any Governmental Authority,
(c) will not violate or result in a default under any indenture, material agreement or other
material instrument binding upon the Borrower or any of the Nationwide Core Entities or their
assets, or give rise to a right thereunder to require any payment to be made by the Borrower or any
of the Nationwide Core Entities, and (d) will not result in the creation or imposition of any Lien
on any asset of the Borrower or any of the Nationwide Core Entities.

SECTION 3.04. Financial Condition; No Material Adverse Change.

(a) Financial Condition. The Borrower has heretofore furnished to the Lenders its
consolidated balance sheet and statements of income, stockholders equity and cash flows as of and
for the period ending December 31, 2010. Such financial statements present fairly, in all material
respects, the financial position and results of operations and cash flows of the Consolidated
Entities as of such dates and for such periods in accordance with GAAP. Neither the Borrower nor
any of its Subsidiaries has any Contingent Obligation, contingent liability or liability for any
taxes, long-term leases or commitments, not reflected in its audited financial statements delivered
to the Administrative Agent on or prior to the Effective Date or otherwise disclosed to the
Administrative Agent in writing, which will have or is reasonably likely to have a Material Adverse
Effect.

(b) No Material Adverse Change. Since December 31, 2010, there has been no material
adverse change in the business, assets, operations, prospects or condition, financial or otherwise,
of the Borrower and the other Consolidated Entities, taken as a whole.

SECTION 3.05. Properties.

(a) Property Generally. Each of the Nationwide Entities has good title to, or valid
leasehold interests in, all its real and personal property material to its business, except for
minor defects in title that do not materially interfere with its ability to conduct its business as
currently conducted or to utilize such properties for their intended purposes.

(b) Intellectual Property. Each of the Nationwide Entities owns, or is licensed to
use, all trademarks, tradenames, copyrights, patents and other intellectual property material to
its business, and the use thereof by the Nationwide Entities does not infringe upon the rights of
any other Person, except for any such infringements that, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.06. Litigation and Environmental Matters.

(a) Actions, Suits and Proceedings. There are no actions, suits or proceedings by or
before any arbitrator or Governmental Authority now pending against or, to the knowledge of the
Borrower, threatened against or affecting the Borrower or any of the Nationwide Core Entities (i)
as to which there is a reasonable possibility of an adverse determination and that, if adversely
determined, could reasonably be expected, individually or in the aggregate, to result in a Material
Adverse Effect (other than the Disclosed Matters) or (ii) that involve this Agreement or the
Transactions.

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(b) Environmental Matters. Except for the Disclosed Matters and except with respect
to any other matters that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect, neither the Borrower nor any of the Nationwide Core Entities
(i) has failed to comply in all material respects with any Environmental Law or to obtain, maintain
or comply in all material respects with any permit, license or other approval required under any
Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received
notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any
Environmental Liability.

(c) Disclosed Matters. Except as otherwise disclosed to the Lenders and approved by a
majority of Required Lenders, since the date of this Agreement, there has been no change in the
status of the Disclosed Matters that, individually or in the aggregate, has resulted in, or
materially increased the likelihood of, a Material Adverse Effect.

SECTION 3.07. Compliance with Laws and Agreements. Each of the Borrower and the
Nationwide Core Entities is in compliance with all laws, regulations and orders of any Governmental
Authority applicable to it or its property and all indentures, agreements and other instruments
binding upon it or its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse Effect. No Default has
occurred and is continuing.

SECTION 3.08. Investment Company Status. Neither the Borrower nor any of the
Nationwide Core Entities is an “investment company” as defined in, or subject to regulation under,
the Investment Company Act of 1940.

SECTION 3.09. Taxes. Each of the Borrower and the Nationwide Core Entities has timely
filed or timely caused to be filed all material Tax returns and reports required to have been filed
and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that
are being contested in good faith by appropriate proceedings and for which the Borrower or
Nationwide Core Entity, as applicable, has set aside on its books adequate reserves in accordance
with GAAP or (b) to the extent that the failure to do so could not reasonably be expected to result
in a Material Adverse Effect.

SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably expected to occur
that, when taken together with all other such ERISA Events for which liability is reasonably
expected to occur, could reasonably be expected to result in a material liability. The fair market
value of the assets of each Plan equal or exceed sixty percent (60%) of the present value of all
accumulated benefit obligations of all such underfunded Plans (based on the assumptions used for
purposes of Statement of Financial Accounting Standards No. 87), as of the date of the most recent
financial statements reflecting such amounts The Borrower (i) does not hold any “plan assets”
within the meaning of the Plan Asset Regulation that are subject to ERISA or (ii) complies with an
exception set forth in the Plan Asset Regulation such that the assets of such Borrower would not be
subject to Title I of ERISA and/or Section 4975 of the Code. Neither the execution, delivery or
performance of this Agreement or the other Loan Documents, or the borrowing or repayment of amounts
hereunder, do or will constitute a “prohibited transaction” (as such term is defined in Section
4975 of the Code or Section 406 of
ERISA) that could subject the Administrative Agent or the Lenders to any tax or penalty or
prohibited transactions imposed under Section 4975 of the Internal Revenue Code or Section 502(i)
of ERISA.

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SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders all agreements,
instruments and corporate or other restrictions to which it or any of its Subsidiaries is subject,
and all other matters known to it, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. None of the reports, financial statements,
certificates or other information furnished by or on behalf of the Borrower to the Administrative
Agent or any Lender in connection with the negotiation of this Agreement and the other Loan
Documents or delivered hereunder or thereunder (as modified or supplemented by other information so
furnished) contains any material misstatement of fact or omits to state any material fact necessary
to make the statements therein, in the light of the circumstances under which they were made, not
misleading in any material respect; provided that, with respect to projected financial information,
the Borrower represents only that such information was prepared in good faith based upon
assumptions believed to be reasonable at the time.

SECTION 3.12. Use of Credit. Neither the Borrower nor any of the Nationwide Core
Entities is engaged principally, or as one of its important activities, in the business of
extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying
Margin Stock, and no part of the proceeds of any extension of credit hereunder will be used to buy
or carry any Margin Stock.

SECTION 3.13. Material Agreements and Liens.

(a) Material Agreements. Part A of Schedule 3.13 is a complete and
correct list of each credit agreement, loan agreement, indenture, purchase agreement, guarantee,
letter of credit or other arrangement providing for or otherwise relating to any Indebtedness or
any extension of credit (or commitment for any extension of credit) to, or guarantee by, the
Borrower or any of the Nationwide Core Entities outstanding on the date hereof that is not
disclosed on the most recent financial statement delivered to the Administrative Agent pursuant to
Section 3.04 or 5.01, as applicable, the aggregate principal or face amount of
which equals or exceeds (or may equal or exceed) $5,000,000 (each, a “Material Agreement”),
and the aggregate principal or face amount outstanding or that may become outstanding under each
such arrangement is correctly described in Part A of Schedule 3.13. The Borrower
is not in default in any material respect beyond any applicable grace period under or with respect
to any Material Agreement to which it is a party or by which it or any of its property is bound in
any respect, the existence of which default is likely to result in a Material Adverse Effect.

(b) Liens. Part B of Schedule 3.13 is a complete and correct list of
each Lien securing Indebtedness of any Person outstanding on the date hereof that is not disclosed
on the most recent financial statement delivered to the Administrative Agent pursuant to
Section 3.04 or 5.01, as applicable, the aggregate principal or face amount of
which equals or exceeds (or may equal or exceed) $5,000,000 and covering any property of the
Borrower or any of the Nationwide Core Entities, and the aggregate Indebtedness secured (or that
may be secured) by
each such Lien and the property covered by each such Lien is correctly described in Part
B of Schedule 3.13.

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SECTION 3.14. Capitalization. The Borrower has heretofore delivered to the Lenders a
true and complete copy of the Organizational Documents referred to in Section 4.01(d). As
of the date hereof, (x) except for stock options listed on Schedule 3.14 and future stock
options (so long as such future options do not otherwise have a Material Adverse Effect) granted
pursuant to Borrower’s 2005 Performance Incentive Plan, there are no outstanding Equity Rights with
respect to the Borrower and (y) there are no outstanding obligations of the Borrower or any of the
Nationwide Core Entities to repurchase, redeem, or otherwise acquire any Equity Interests in the
Borrower nor are there any outstanding obligations of the Borrower or any of its Subsidiaries to
make payments to any Person, such as “phantom stock” payments, where the amount thereof is
calculated with reference to the fair market value or equity value of the Borrower or any of its
Subsidiaries.

SECTION 3.15. Subsidiaries and Investments.

(a) Subsidiaries. Set forth in Part A of Schedule 3.15 (such schedule
being subject to update from time to time as of the dates when this representation is remade, or
deemed to be remade) is a complete and correct chart and list of all of the organizational
structure of the Borrower and its Subsidiary Entities, together with, for each such Person, (i) the
jurisdiction of organization of such Person, (ii) in the case of each such Subsidiary, each Person
holding Equity Interests in such Person and (iii) in the case of each such Subsidiary, the nature
of the ownership interests held by each such Person and the percentage of ownership of the Borrower
and Subsidiary Entity represented by such ownership interests. Except as disclosed in Part
A of Schedule 3.15, (x) each of the Borrower and its Subsidiary Entities owns, free and
clear of Liens, and has the unencumbered right to vote, all outstanding ownership interests in each
Person shown to be held by it in Part A of Schedule 3.15, (y) all of the issued and
outstanding capital stock of each such Person organized as a corporation is validly issued, fully
paid and nonassessable and (z) there are no outstanding Equity Rights with respect to such Person.

(b) Investments. Set forth in Part B of Schedule 3.15 is a complete
and correct list of all Investments (other than Investments disclosed in Part A of
Schedule 3.15 and other than Permitted Investments and operating deposit accounts with
banks) held by the Borrower or any of its Subsidiary Entities in any Person on the date hereof that
are not disclosed on the most recent financial statement delivered to the Administrative Agent
pursuant to Section 3.04 or 5.01 and, for each such Investment, (x) the identity of
the Person or Persons holding such Investment and (y) the nature of such Investment. Except as
disclosed in Part B of Schedule 3.15, each of the Borrower and its Subsidiary
Entities owns, free and clear of all Liens, all such Investments.

SECTION 3.16. Real Property. Set forth on Schedule 3.16 is a list, as of the
date hereof, of all of the real property interests held by the Borrower and its Subsidiary
Entities, indicating in each case whether the respective property is owned or leased, the identity
of the owner or lessee and the location of the respective property.

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SECTION 3.17. Solvency. On the Effective Date and after and giving effect to the
Loans occurring on the Effective Date or such other date as Loans requested hereunder are made, and
the disbursement of the proceeds of such Loans pursuant to the Borrower’s instructions, the
Borrower is and will be Solvent.

SECTION 3.18. No Default. No Default or Event of Default has occurred and is
continuing.

SECTION 3.19. Insurance. The Borrower and the Nationwide Core Entities currently
maintain all insurance which is required to be maintained pursuant to Section 5.05.

SECTION 3.20. Organizational Documents. The Organizational Documents heretofore
delivered to the Administrative Agent pursuant to Section 4.01(e) constitute, as of the
date hereof, all of the Organizational Documents (together with all amendments and modifications
thereof) of the Borrower. The Borrower represents that it has delivered to the Administrative
Agent true, correct and complete copies of each of the documents set forth in this Section.

SECTION 3.21. Executive Offices; Places of Organization. The principal offices, chief
executive offices and principal places of business of the Borrower are located at 610 Newport
Center Drive, Suite 1150, Newport Beach, California 92660. The Borrower was organized in the State
of Maryland.

SECTION 3.22. Securities Act. Neither the Borrower nor any of its Subsidiary Entities
have issued any unregistered securities in violation of the registration requirements of Section 5
of the Securities Act of 1933, (as amended from time to time) or any other law, nor are they in
violation of any rule, regulation or requirement under such act, or the Securities Exchange Act of
1934, (as amended from time to time) other than violations which could not reasonably be expected
to have a Material Adverse Effect. Neither the Borrower nor any of its Subsidiary Entities is
required to qualify an indenture under the Trust Indenture Act of 1939, (as amended from time to
time) in connection with its execution and delivery of this Agreement or the incurrence of
Indebtedness hereunder.

SECTION 3.23. REIT Status. The Borrower: (i) is a REIT, (ii) has not revoked its
election to be a REIT and (iii) for its current “tax year” as defined in the Code is and for all
prior tax years subsequent to its election to be a REIT has been entitled to a dividends paid
deduction which meets the requirements of Section 857 of the Code.

SECTION 3.24. Leases. All of the leases of real property in which the Borrower or any
of its Subsidiary Entities is the lessor, including Healthcare Leases, are listed on Schedule
3.24. To the best of the Borrower’s knowledge, with respect to each such lease, the lease has
been duly authorized, executed and delivered by the lessee, is in full force and effect and the
obligations of the lessee are valid, binding and enforceable, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws and equitable
principles relating to or limiting creditors’ rights generally. To the best of the Borrower’s
knowledge except as otherwise disclosed to the Lenders and approved by the Required Lenders, there
exists no material breach, default, or event or condition which, with
notice or lapse of time or both, would constitute such a material breach or default by the
lessee, and there are no existing claims, defenses or offsets against rental due or to become due,
under the terms of any such lease, other than such breaches, defaults, claims, defenses or offsets
that could not reasonably be expected to result in a Material Adverse Effect.

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SECTION 3.25. Brokers. The Borrower has not dealt with any broker or finder with
respect to the Transactions or otherwise in connection with this Agreement.

SECTION 3.26. Foreign Assets Control Regulations, Etc. Neither the execution and
delivery of the Notes and the other Loan Documents by the Borrower nor the use of the proceeds of
the Loans, will violate the Trading with the Enemy Act, as amended, or any of the foreign assets
control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as
amended) or the Anti-Terrorism Order or any enabling legislation or executive order relating to any
of the same. Without limiting the generality of the foregoing, no Nationwide Entity (a) is or will
become a blocked person described in Section 1 of the Anti-Terrorism Order or (b) engages or will
engage in any dealings or transactions or be otherwise associated with any such blocked person.

ARTICLE IV.

CONDITIONS

SECTION 4.01. Effective Date. The obligations of the Lenders to make Loans shall not
become effective until the date on which (i) the Administrative Agent shall have received each of
the documents referred to below and (ii) each of the other conditions listed below is satisfied,
the satisfaction of each of such conditions to be satisfactory to the Administrative Agent (and to
the extent specified below, to each Lender) in form and substance (or any such condition shall have
been waived in accordance with Section 9.02):

(a) Agreement. From each party hereto either (i) a counterpart of this Agreement
signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent
(which may include telecopy transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement.

(b) Notes. The Notes duly completed and executed by the Borrower for each respective
Lender.

(c) Opinion of Counsel to the Borrower. A favorable written opinion (addressed to the
Administrative Agent and the Lenders and dated the Effective Date) of Sherry, Meyerhoff, Hanson &
Crance LLP, counsel for the Borrower, substantially in the form of Exhibit E, and covering
such other matters relating to the Borrower, this Agreement or the Transactions as the Required
Lenders shall reasonably request. The Borrower hereby requests such counsel to deliver such opinion
to the Lenders and the Administrative Agent.

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(d) Opinion of Special New York Counsel to the Borrower. A favorable written opinion
(addressed to the Administrative Agent and the Lenders and dated the Effective
Date) of Skadden, Arps, Slate, Meagher & Flom LLP, special New York counsel for the Borrower,
covering such matters relating to the laws of the State of New York and to the Borrower, this
Agreement or the Transaction s as the Required Lenders shall reasonably request. The Borrower
hereby requests such counsel to deliver such opinion to the Lenders and the Administrative Agent.

(e) Organizational Documents. Copies of (i) the Certificate of Incorporation,
Certificate of Formation, Certificate of Limited Partnership or similar formation document of the
Borrower, certified by the Secretary of State of the state of formation of such Person as of a
recent date, (ii) the Organizational Documents of the Borrower (unless delivered pursuant to
clause (i) above) and the Persons identified in Schedule 4.01(e) and (iii) the
applicable resolutions authorizing the delivery of the Loan Documents, certified by the Secretary
or an Assistant Secretary of such Person (or if such Person is a limited partnership or limited
liability company, an authorized representative of its general partner or manager) as of the date
of this Agreement as being accurate and complete, in each case relating to the organization,
existence and good standing of such Person, the authorization of the Transactions and any other
legal matters relating to such Person, this Agreement or the Transactions, all in form and
substance satisfactory to the Administrative Agent and its counsel.

(f) Compliance Certificate. A certificate, dated the Effective Date and signed by a
Financial Officer.

(g) Material Adverse Effect. There shall not have occurred any change, event or
development that could, in the opinion of the Lenders, have a Material Adverse Effect.

(h) [Intentionally Deleted].

(i) Third Party Approvals. All acts and conditions (including, without limitation,
the obtaining of any third party consents and necessary regulatory approvals and the making of any
required filings, recordings or registrations) required to be done and performed and to have
happened precedent to the execution, delivery and performance of the Loan Documents by the
Borrower.

(j) [Intentionally Deleted].

(k) Other Documents. Such other documents as the Lender or special New York counsel
to JPMorgan may reasonably request.

The obligation of any Lender to make its initial extension of credit hereunder is also subject
to the payment or delivery by the Borrower of such fees, expenses and other consideration as the
Borrower shall have agreed to pay or deliver to any Lender, the Arrangers or the Administrative
Agent in connection herewith, including the reasonable fees and expenses of Morrison & Foerster
LLP, special New York counsel to JPMorgan, in connection with the negotiation, preparation,
execution and delivery of this Agreement and the other Loan Documents and the extensions of credit
hereunder (to the extent that statements for such fees and expenses have been delivered to the
Borrower).

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The Administrative Agent shall notify the Borrower of the Effective Date, and such notice
shall be conclusive and binding.

SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on the
occasion of any Borrowing is subject to the satisfaction of the following conditions:

(a) receipt by the Administrative Agent of a Borrowing Request pursuant to Section
2.03);

(b) unless otherwise disclosed to and approved by the Required Lenders, the representations
and warranties of the Borrower set forth in this Agreement and in the other Loan Documents shall be
true and correct in all material respects on and as of the date of such Borrowing (except, if any
such representation or warranty is expressly stated to have been made as of a specific date, as of
such specific date); and

(c) at the time of and immediately after giving effect to such Borrowing, no Default shall
have occurred and be continuing.

Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower on the
date thereof as to the matters specified in paragraphs (b) and (c) of the preceding
sentence.

ARTICLE V.

AFFIRMATIVE COVENANTS

Until the Commitments have expired or been terminated and the principal of and interest on
each Loan and all fees payable hereunder shall have been paid in full, the Borrower covenants and
agrees with the Lenders that:

SECTION 5.01. Financial Statements and Other Information. The Borrower will furnish
to the Administrative Agent and each Lender:

(a) as soon as available but in no event beyond five (5) days after such financials are
required to be filed with the Securities and Exchange Commission, its audited consolidated balance
sheet and related statements of operations, stockholders’ equity and cash flows as of the end of
and for such year, setting forth in each case in comparative form the figures for the previous
fiscal year, all reported on by Ernst & Young US, LLP or other independent public accountants of
recognized national standing (without a “going concern” or like qualification or exception and
without any qualification or exception as to the scope of such audit) to the effect that such
consolidated financial statements present fairly in all material respects the financial condition
and results of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis
in accordance with GAAP consistently applied;

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(b) as soon as available after the end of each of the first three fiscal quarters of each
fiscal year of the Borrower (but in no event beyond five (5) days after such financials are
required to be filed with the Securities and Exchange Commission), its consolidated balance
sheet and related statements of operations, stockholders’ equity and cash flows as of the end
of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in
each case in comparative form the figures for the corresponding period or periods of (or, in the
case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its
Financial Officers as presenting fairly in all material respects the financial condition and
results of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;

(c) concurrently with any delivery of financial statements under clause (a) or
(b) above, a Compliance Certificate of a Financial Officer of the Borrower representing and
certifying (i) that the Financial Officer signatory thereto has reviewed the terms of the Loan
Documents, and has made, or caused to be made under his/her supervision, a review in reasonable
detail of the transactions and consolidated financial condition of the Borrower and its
Subsidiaries, during the fiscal quarter covered by such reports, that such review has not disclosed
the existence during or at the end of such fiscal quarter, and that such officer does not have
knowledge of the existence as at the date of such Compliance Certificate, of any condition or event
which constitutes an Event of Default or Default or mandatory prepayment event, or, if any such
condition or event existed or exists, specifying the nature and period of existence thereof and
what action the Borrower or its Subsidiaries has taken, is taking and proposes to take with respect
thereto, (ii) the calculations (with such specificity as the Administrative Agent may reasonably
request) for the period then ended which demonstrate compliance with the covenants and financial
ratios set forth in Sections 6.01, 6.04 and 6.07, (iii) stating whether
any change in GAAP or in the application thereof has occurred since the date of the audited
financial statements referred to in Section 3.04 and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying such certificate,
(iv) a schedule of Total Adjusted Outstanding Indebtedness in respect of borrowed money in the
level of detail disclosed in the Borrower’s Form 10-Q filings with the Securities and Exchange
Commission, as well as such other information regarding such Indebtedness as may be reasonably
requested by the Administrative Agent, and (v) a schedule of EBITDA.

(d) concurrently with any delivery of financial statements under clause (a) above, a
certificate of the accounting firm that reported on such financial statements stating whether they
obtained knowledge during the course of their examination of such financial statements of any
Default (which certificate may be limited to the extent required by accounting rules or
guidelines);

(e) promptly after the same become publicly available, copies of all periodic and other
reports, proxy statements and other materials filed by the Borrower or any its Subsidiaries with
the Securities and Exchange Commission, or any Governmental Authority succeeding to any or all of
the functions of said Commission, or with any national securities exchange, or distributed by the
Borrower to its shareholders generally;

(f) to the extent not otherwise delivered pursuant to this Section 5.01, copies of all
financial statements and financial information delivered by the Borrower (or, upon
Administrative Agent’s request, any of its Subsidiary Entities) from time to time to the
holders of any unsecured Indebtedness for borrowed money of such Persons;

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(g) promptly after Moody’s, Fitch or S&P shall have announced a change in the rating
established or deemed to have been established for the Index Debt, written notice of such rating
change; and

(h) promptly following any request therefor, such other information regarding the operations,
business affairs and financial condition of the Borrower, any Subsidiary Entity, any of the
Properties of the Borrower or any Subsidiary Entity, or compliance with the terms of this Agreement
and the other Loan Documents, as the Administrative Agent or any Lender may reasonably request,
such other information to include, without limitation, any information that the Administrative
Agent or any Lender deems necessary from time to time in order to ensure compliance with all
applicable laws concerning money laundering and similar activities.

SECTION 5.02. Notices of Material Events. The Borrower will furnish to the
Administrative Agent and each Lender prompt written notice of the following:

(a) the occurrence of any Default;

(b) the filing or commencement of any action, suit or proceeding by or before any arbitrator
or Governmental Authority against or affecting the Borrower or any of the Nationwide Core Entities
that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect;

(c) the assertion of a claim of any Environmental Liability by any Person against, or with
respect to any activities of the Borrower or any Nationwide Core Entity, and any alleged violation
of or non-compliance by or on behalf of the Borrower or any Nationwide Core Entity with any
Environmental Laws or any permits, licenses or authorizations, other than any claim of
Environmental Liability or alleged violation that, if adversely determined, would not (either
individually or in the aggregate) have a Material Adverse Effect;

(d) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that
have occurred, could reasonably be expected to result in liability of the Borrower and the
Nationwide Core Entities in an aggregate amount exceeding $1,000,000;

(e) the occurrence of any Event of Loss aggregating $5,000,000 or more;

(f) the purchase or Disposition of any Healthcare Properties aggregating $10,000,000 or more,
together with (i) a description of such transaction(s) in reasonable detail and (ii) if requested
by the Administrative Agent, copies of all materials presented to the Borrower’s board of directors
in connection with the approval of such transaction(s); and

(g) any other development that results in, or could reasonably be expected to result in, a
Material Adverse Effect.

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Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer
or other executive officer of the Borrower setting forth the details of the event or development
requiring such notice and any action taken or proposed to be taken with respect thereto.

SECTION 5.03. Existence; Conduct of Business. The Borrower will, and will cause each
of the Nationwide Core Entities to, do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its legal existence and the rights, licenses, permits, privileges
and franchises material to the conduct of its business; provided that the foregoing shall not
prohibit any merger, consolidation, liquidation or dissolution permitted under Section
6.03.

SECTION 5.04. Payment of Obligations. The Borrower will, and will cause each of the
Nationwide Core Entities to, pay its obligations, including Tax liabilities, that, if not paid,
could result in a Material Adverse Effect before the same shall become delinquent or in default,
except where (a) the validity or amount thereof is being contested in good faith by appropriate
proceedings, (b) the Borrower or such Nationwide Core Entity has set aside on its books adequate
reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending
such contest could not reasonably be expected to result in a Material Adverse Effect.

SECTION 5.05. Maintenance of Properties; Insurance. The Borrower will or will cause,
and will cause each of the Nationwide Core Entities to, (a) keep and maintain all property material
to the conduct of its business in good working order and condition, ordinary wear and tear excepted
and (b) maintain, with financially sound and reputable insurance companies, insurance in such
amounts and against such risks as are customarily maintained by companies engaged in the same or
similar businesses operating in the same or similar locations.

SECTION 5.06. Books and Records; Inspection Rights. The Borrower will, and will cause
each of the Nationwide Core Entities to, keep proper books of record and account in which full,
true and correct entries are made of all dealings and transactions in relation to its business and
activities. The Borrower will, and will cause each of the Nationwide Core Entities to, permit any
representatives designated by the Administrative Agent or any Lender, upon reasonable prior notice,
to visit and inspect its properties, to examine and make extracts from its books and records, and
to discuss its affairs, finances and condition with its officers and independent accountants, all
at such reasonable times and as often as reasonably requested.

SECTION 5.07. Compliance with Laws. The Borrower will, and will cause each of the
Nationwide Core Entities to, comply in all material respects with all laws, rules, regulations and
orders of any Governmental Authority applicable to it or its property, except where the failure to
do so, individually or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.

SECTION 5.08. Use of Proceeds. The proceeds of the Loans will be used only for
general corporate purposes. No part of the proceeds of any Loan will be used, whether directly or
indirectly, for any purpose that entails a violation of any of the Regulations of the Board,
including Regulations T, U and X.

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SECTION 5.09. Further Assurances. The Borrower will, and will cause each of the
Nationwide Core Entities to, promptly upon request by the Administrative Agent or the Required
Lenders, execute any and all further documents, agreements and instruments, and take all such
further actions which may be required under any applicable law, or which either Agent or the
Required Lenders may reasonably request, to effectuate the Transactions, all at the expense of the
Borrower.

SECTION 5.10. REIT Status. The Borrower shall maintain its status as a REIT and (a) all of the
representations and warranties set forth in clauses (i), (ii) and (iii) of
Section 3.23 shall remain true and correct at all times. The Borrower will do or cause to
be done all things necessary to maintain the listing of its Equity Interest on the New York Stock
Exchange, the American Stock Exchange or the Nasdaq National Market System (or any successor
thereof).

SECTION 5.11. Hazardous Materials. The Borrower will, and will cause each of the
Nationwide Core Entities to, do the following:

(a) Keep and maintain all Real Properties in material compliance with any Environmental Laws
unless the failure to so comply would not be reasonably expected to result in a Material Adverse
Effect; and

(b) Promptly cause the removal of any Hazardous Materials discharged, disposed of, or
otherwise released in, on or under any Real Properties that are in violation of any Environmental
Laws and which would be reasonably expected to result in a Material Adverse Effect, and cause any
remediation required by any Environmental Laws or Governmental Authority to be performed, though no
such action shall be required if any action is subject to a good faith contest. In the course of
carrying out such actions, the Borrower shall provide the Administrative Agent with such periodic
information and notices regarding the status of investigation, removal, and remediation, as the
Administrative Agent may reasonably require.

SECTION 5.12. [Intentionally Deleted]

ARTICLE VI.

NEGATIVE COVENANTS

Until the Commitments have expired or terminated and the principal of and interest on each
Loan and all fees payable hereunder have been paid in full, the Borrower covenants and agrees with
the Lenders that:

SECTION 6.01. Indebtedness. The Borrower will not, and will not permit any Nationwide
Core Entity to, create, incur, assume or permit to exist any Indebtedness, except Indebtedness to
the extent the Borrower and the Nationwide Core Entities maintain compliance with the covenants set
forth in Sections 6.04 and 6.07. 

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SECTION 6.02. Liens. The Borrower will not, and will not permit any Nationwide Core
Entity to, create, incur, assume or permit to exist any Lien on any property or asset now owned or
hereafter acquired by it, or assign or sell any income or revenues (including accounts receivable)
or rights in respect of any thereof, except:

(a) Liens that secure Secured Indebtedness to the extent that the Borrower and the Nationwide
Core Entities maintain compliance with the covenants set forth in Sections 6.04 and
6.07;

(b) Permitted Encumbrances; and

(c) without limiting the provisions of clause (a) of this Section, any Lien on any
property or asset of the Borrower or any of the Nationwide Core Entities existing on the date
hereof and set forth in Part B of Schedule 3.13, or, to the extent not meeting the
minimum thresholds for required listing on Schedule 3.13 pursuant to Section 3.13,
in an aggregate amount not exceeding $10,000,000 (excluding, however, following the making of the
initial Loans hereunder, Liens securing Indebtedness to be repaid with the proceeds of such Loans,
as indicated on Schedule 3.13); provided that, except with respect to Secured Indebtedness
permitted under clause (a) of this Section, (i) such Lien shall not apply to any other
property or asset of the Borrower or any Nationwide Core Entity, (ii) any such Lien shall secure
only those obligations which it secures on the date hereof, provided that in any case, the Borrower
and the Nationwide Core Entities shall maintain compliance with the covenants set forth in
Sections 6.04 and 6.07.

SECTION 6.03. Fundamental Changes.

(a) Mergers, Consolidations, Disposal of Assets, Etc. The Borrower will not, and will
not permit any Nationwide Core Entity to, merge into or consolidate with any other Person, or
permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise
dispose of (in one transaction or in a series of transactions) all or substantially all of its
Properties and assets whether now owned or hereafter acquired, or all or substantially all of the
Equity Interest of any of the Nationwide Core Entities (in each case, whether now owned or
hereafter acquired), or liquidate or dissolve, except that, if at the time thereof and immediately
after giving effect thereto no Default shall have occurred and be continuing (i) any Nationwide
Core Entity (other than the Borrower) may merge into the Borrower in a transaction in which the
Borrower is the surviving corporation, (ii) any Nationwide Core Entity (other than the Borrower)
may merge into a Nationwide Core Entity in a transaction in which the surviving entity is a
Nationwide Core Entity, (iii) subject to compliance with the provisions of Section 6.04,
any Person (other than a Nationwide Core Entity) may merge into any Nationwide Core Entity (other
than the Borrower in a transaction in which such Nationwide Core Entity is the surviving entity),
and (iv) to the extent not otherwise permitted by clause (i), (ii) or (iii)
above, the Borrower or any other Nationwide Core Entity may merge or consolidate with and into any
Person, in each case with the prior written approval of the Required Lenders and (vi) any
Nationwide Core Entity may sell, transfer, lease or otherwise dispose of its assets to the Borrower
or to another Nationwide Core Entity; provided that any such merger involving a Person that is not
a Wholly-Owned Subsidiary of (x) the Borrower or (y) any Wholly-Owned Subsidiary of a Subsidiary of
the Borrower immediately prior to such merger shall not be permitted unless also permitted by
Section 6.04.

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(b) Lines of Business. The Borrower will not, and will not permit any Nationwide Core
Entity to, engage to any material extent in any business other than businesses of the type
conducted by the Borrower and the Nationwide Core Entities on the date of execution of this
Agreement and businesses reasonably related thereto.

SECTION 6.04. Investments. The Borrower will not, and will not permit any Nationwide
Core Entity to, make or permit to remain outstanding any Investments except:

(a) subject to the limitations set forth in paragraph (c) below, Investments
outstanding on the date hereof and identified in Part B of Schedule 3.15;

(b) subject to the limitations set forth in paragraph (c) below, Investments by the
Borrower and the Nationwide Core Entities in the Borrower and the Nationwide Core Entities; and

(c) subject to the limitations set forth below, Investments in Healthcare Properties:

	 	 	 
	Asset Type	 	Limitations
	Joint Ventures/ Healthcare Property Under
Construction/ Mortgage Loans acquired by
the Borrower or any Wholly-Owned Subsidiary
which have first lien priority on Healthcare
Properties

	 	The Aggregate Investment
Value of all such Joint
Ventures, Healthcare
Property Under Construction
and Mortgage Loans shall
not exceed 40% of the
Capitalization Value
	 
	 	 
	Portfolio of Healthcare Properties

	 	Unlimited
	 
	 	 
	Individual Healthcare Properties

	 	Unlimited
	 
	 	 
	Permitted Investments

	 	Unlimited
	 
	 	 
	Operating Deposit Accounts with Banks

	 	Unlimited”

SECTION 6.05. Restricted Payments. During the continuance of a monetary Event of
Default, the Borrower will not, and will not permit any Nationwide Core Entity to, declare or make,
or agree to pay or make, directly or indirectly, Restricted Payments, unless after taking into
account all available funds of the Borrower from all other sources, such Restricted Payments are
required in order to enable the Borrower to continue to qualify as a REIT and to eliminate any
entity level taxable income.

SECTION 6.06. Transactions with Affiliates. The Borrower will not, and will not
permit any Nationwide Core Entity to, directly or indirectly, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or assets from, or
otherwise engage in any other transactions with, any of their Affiliates, except (a) in the
ordinary course of business at prices and on terms and conditions not less favorable to the
Borrower or such Nationwide Core Entity than could be obtained on an arm’s-length basis from
unrelated third parties and (b) any Restricted Payment permitted by Section 6.05.

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SECTION 6.07. Certain Financial Covenants. The Borrower will not permit the
non-compliance with any of the following covenants and ratios at any time, such covenants and
ratios to be tested (x) on the last day of each Fiscal Quarter and (y) at any time acquisitions and
Dispositions by the Borrower and its Subsidiary Entities (provided, in the case of a Joint Venture,
such calculation shall be made based upon the Consolidated Entities’ direct or indirect pro rata
share of such acquisition or Disposition) exceed $100,000,000 in any Fiscal Quarter, and in the
case of clause (y), the following covenants and ratios shall be adjusted to reflect any such
acquisitions and Dispositions:

(i) Minimum Net Asset Value. The Borrower will not permit Net Asset Value to
be less than an amount equal to eighty five percent (85%) of the Net Asset Value as of the
Effective Date.

(ii) Maximum Total Adjusted Outstanding Indebtedness to Capitalization Value.
The Borrower will not permit the ratio of Total Adjusted Outstanding Indebtedness to
Capitalization Value (expressed as a percentage) to be more than 60%; provided,
however, such ratio may exceed 60% for up to two (2) consecutive fiscal quarters,
but in no event shall Total Adjusted Outstanding Indebtedness exceed 65% of Capitalization
Value.

(iii) Minimum Fixed Charges Ratio. The Borrower will not permit the Fixed
Charges Ratio to be less than 1.75 to 1.00.

(iv) Maximum Secured Indebtedness Ratio. The Borrower will not permit the
Secured Indebtedness Ratio to exceed 30%.

(v) [Intentionally Deleted].

(vi) Maximum Unencumbered Asset Value Ratio. The Borrower will not permit the
Unencumbered Asset Value Ratio to exceed 60%; provided, however, such ratio
may exceed 60% for up to two (2) consecutive fiscal quarters, but in no event shall the
Unencumbered Asset Value Ratio exceed 65%; and provided further, the
Borrower shall not be in default under this Section if the Borrower timely complies with the
provisions of Section 2.11(b).

SECTION 6.08. Organizational Documents. Without the prior written consent of
Administrative Agent and the Required Lenders, the Borrower will not, and will not permit any other
Person to, Modify any of the terms or provisions in the Organizational Documents delivered in
connection with Section 4.01(e), except: (a) any Modifications necessary for the Borrower
to issue more Equity Interests (provided such issuance does not otherwise violate the terms of this
Agreement); (b) Modifications necessary to clarify existing provisions of such
Organizational Documents; or (c) Modifications which would have no material adverse,
substantive effect on the rights or interests of the Lenders in conjunction with the Loans or under
the Loan Documents.

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SECTION 6.09. Fiscal Year. The Borrower will not change its Fiscal Year for
accounting or tax purposes from a period consisting of the 12-month period ending on December 31 of
each calendar year.

SECTION 6.10. Senior Management. The Borrower will cause Douglas M. Pasquale to be
the chief executive officer of the Borrower until the indefeasible payment in full of the
Obligations; provided, however, no Default or Event of Default shall be deemed to have occurred if
Douglas M. Pasquale ceases to be the chief executive officer of the Borrower so long as the
Borrower promptly takes all action necessary to replace Douglas M. Pasquale, with another similarly
qualified and experienced individual reasonably acceptable to the Required Lenders in their sole
determination.

SECTION 6.11. Dispositions. The Borrower will not permit any Disposition by the
Borrower or its Subsidiary Entities of any of its respective Properties if such Disposition would
cause the Borrower to be in violation of any of (a) the covenants set forth in Section 6.07
or (b) the limitations on Investments set forth in Section 6.04.

ARTICLE VII.

EVENTS OF DEFAULT

If any of the following events (“Events of Default”) shall occur:

(a) the Borrower shall fail to pay any principal on any Loan when and as the same shall become
due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or
otherwise;

(b) the Borrower shall fail to pay interest on any Loan or any fee or any other amount (other
than an amount referred to in clause (a) of this Article) payable under this Agreement or
under any other Loan Document, when and as the same shall become due and payable, and such failure
shall continue unremedied for a period of five days;

(c) any representation or warranty made or deemed made by or on behalf of the Borrower or any
of its Subsidiary Entities in or in connection with this Agreement or any other Loan Document or
any amendment or modification hereof or thereof or any waiver hereunder or thereunder, or in any
report, certificate, financial statement or other document furnished pursuant to or in connection
with this Agreement or any other Loan Document or any amendment or modification hereof or thereof
or any waiver hereunder or thereunder, shall prove to have been incorrect in any material respect
when made or deemed made;

(d) the Borrower shall fail to observe or perform any covenant, condition or agreement
contained in Section 5.02, 5.03 (with respect to its existence), 5.08,
5.10 or in Article VI;

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(e) any Event of Default shall occur under any of the other Loan Documents or an “Event of
Default” shall occur under and as defined in the Existing Revolving Credit Facility;

(f) the Borrower shall fail to observe or perform any covenant, condition or agreement
contained in this Agreement (other than those specified in this Article, including clause
(a), (b), (d) or (e) of this Article) or any other Loan Document and
such failure shall continue unremedied for a period of 30 or more days after notice thereof from
the Administrative Agent to the Borrower (which notice shall be given at the request of any
Lender); provided that in the case of any such Default which is susceptible to cure but
cannot be cured within 30 days through the exercise of reasonable diligence, if (i) the Required
Lenders shall not have determined that such default is not susceptible of being cured within a
maximum of 90 days from the Administrative Agent’s original notice of Default, and (ii) such
Borrower commences such cure within the initial 30 days period and diligently prosecutes same to
completion, such period of 30 days shall be extended for such additional period of time as may be
reasonably necessary to cure same, but in no event shall such extended period exceed 60 days;

(g) the Borrower or any Nationwide Core Entity shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material Indebtedness, when and
as the same shall become due and payable, other than Non-Recourse Indebtedness of the Borrower and
the Nationwide Core Entities;

(h) any event or condition occurs that results in any Material Indebtedness becoming due prior
to its scheduled maturity or that enables or permits (with or without the giving of notice, the
lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent
on its or their behalf to cause any Material Indebtedness to become due, or to require the
prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided
that this clause (h) shall not apply to (i) Secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets securing such Indebtedness in
accordance with this Agreement or (ii) Non-Recourse Indebtedness of the Borrower and the Nationwide
Core Entities. For purposes of this clause (h), the Indebtedness evidenced by the Existing
Revolving Credit Facility shall be Material Indebtedness;

(i) an involuntary proceeding shall be commenced or an involuntary petition shall be filed
seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any
Nationwide Core Entities or its debts, or of a substantial part of its assets, under any Federal,
state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or
(ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar
official for the Borrower or any Nationwide Core Entities or for a substantial part of its assets,
and, in any such case, such proceeding or petition shall continue undismissed for a period of 90
days or an order or decree approving or ordering any of the foregoing shall be entered;

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(j) the Borrower or any Nationwide Core Entities shall (i) voluntarily commence any proceeding
or file any petition seeking liquidation, reorganization or other relief under any Federal, state
or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii)
consent to the institution of, or fail to contest in a timely and appropriate manner, any
proceeding or petition described in clause (i) of this Article, (iii) apply for or consent
to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official
for the Borrower or any Nationwide Core Entities or for a substantial part of its assets, (iv) file
an answer admitting the material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose
of effecting any of the foregoing;

(k) the Borrower or any Nationwide Core Entities shall become unable, admit in writing its
inability or fail generally to pay its debts as they become due;

(l) one or more judgments for the payment of money in an aggregate amount in excess of
$35,000,000 shall be rendered against the Borrower, any Nationwide Core Entities or any combination
thereof and the same shall remain undischarged for a period of 30 consecutive days during which
execution shall not be effectively stayed, or any action shall be legally taken by a judgment
creditor to attach or levy upon any assets of the Borrower or such Nationwide Core Entity to
enforce any such judgment;

(m) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when
taken together with all other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower, any Nationwide Core Entities or any combination thereof in an
aggregate amount exceeding $10,000,000 for all periods;

(n) If the Borrower has any investors whose assets are considered “plan assets” under the Plan
Asset Regulation and the Borrower shall fail or cease to meet an exception under the Plan Asset
Regulation which would prevent the assets of the Borrower from being subject to Title I of ERISA
and/or Section 4975 of the Internal Revenue Code;

(o) Any event shall occur which gives rise to a nonexempt prohibited transaction (as such term
is defined in Section 4975 of the Code or Section 406 of ERISA) that could subject the
Administrative Agent and/or the Lenders, on account of the Loans or any other transaction
contemplated by the Loan Documents, or the borrowing or repayment of amounts hereunder, to any tax
or penalty on prohibited transactions imposed under Section 4975 of the Internal Revenue Code or
Section 502(i) of ERISA

(p) a Change in Control shall occur;

(q) the Borrower shall be terminated, dissolved or liquidated (as a matter of law or
otherwise) or proceedings shall be commenced by any Person (including the Borrower) seeking the
termination, dissolution or liquidation of the Borrower and such proceeding shall continue
undismissed for a period of 90 days; or

(r) the occurrence of any event which results in a Material Adverse Effect, as reasonably
determined by the Administrative Agent;

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then, and in every such event (other than an event described in clause (i) or (j)
of this Article), and at any time thereafter during the continuance of such event, the
Administrative Agent may, with the consent of the Required Lenders, and at the request of the
Required Lenders shall, by notice to the Borrower, take either or both of the following actions, at
the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall
terminate immediately, (ii) declare the Loans then outstanding to be due and payable in whole (or
in part, in which case any principal not so declared to be due and payable may thereafter be
declared to be due and payable), and thereupon the principal of the Loans so declared to be due and
payable, together with accrued interest thereon and all fees and other Obligations of the Borrower
accrued hereunder, shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower; and in case of any
event described in clause (i) or (j) of this Article, the Commitments shall
automatically terminate and the principal of the Loans then outstanding, together with accrued
interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall
automatically become due and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower and exercise all of its rights and remedies,
whether provided at law or in equity.

ARTICLE VIII.

THE ADMINISTRATIVE AGENT

Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent
hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such
actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by
the terms hereof or thereof, together with such actions and powers as are reasonably incidental
thereto.

The Person serving as the Administrative Agent hereunder shall have the same rights and powers
in its capacity as a Lender as any other Lender and may exercise the same as though it were not the
Administrative Agent, and such Person and its Affiliates may accept deposits from, lend money to
and generally engage in any kind of business with the Borrower or any of its Subsidiary Entities or
other Affiliate thereof as if it were not the Administrative Agent hereunder.

The Administrative Agent shall not have any duties or obligations except those expressly set
forth herein and in the other Loan Documents. Without limiting the generality of the foregoing,
(a) the Administrative Agent shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall
not have any duty to take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that
the Administrative Agent is required to exercise in writing by the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the circumstances as provided in
Section 9.02), and (c) except as expressly set forth herein and in the other Loan
Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable
for the failure to disclose, any information relating to the Borrower or any of its
Subsidiary Entities that is communicated to or obtained by the bank serving as Administrative
Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for
any action taken or not taken by it with the consent or at the request of the Required

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Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02), or in the absence of its own gross negligence or willful
misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless
and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender,
and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire
into (i) any statement, warranty or representation made in or in connection with this Agreement or
any other Loan Document, (ii) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth herein or therein, (iv)
the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document, or (v) the satisfaction of any condition
set forth in Article IV or elsewhere herein or therein, other than to confirm receipt of
items expressly required to be delivered to the Administrative Agent.

The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for
relying upon, any notice, request, certificate, consent, statement, instrument, document or other
writing believed by it to be genuine and to have been signed or sent by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any liability for relying
thereon. The Administrative Agent may consult with legal counsel (who may be counsel for the
Borrower), independent accountants and other independent or third party experts selected by it, and
shall not be liable for any action taken or not taken by it in accordance with the advice of any
such counsel, accountants or experts.

The Administrative Agent may perform any and all its duties and exercise its rights and powers
by or through any one or more subagents appointed by the Administrative Agent. The Administrative
Agent and any such subagent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the preceding paragraphs
shall apply to any such subagent and to the Related Parties of the Administrative Agent and any
such subagent, and shall apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as Administrative Agent.

Subject to the appointment and acceptance of a successor Administrative Agent as provided in
this paragraph, the Administrative Agent may resign at any time by notifying the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right, with the approval
of the Borrower (so long as no Event of Default has occurred and is continuing), to appoint a
successor. If no successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after the retiring Administrative Agent gives notice of
its resignation, then the retiring Administrative Agent may, on behalf of the Lenders with the
approval of the Borrower (so long as no Event of Default has occurred and is continuing), appoint a
successor Administrative Agent which shall be a bank with an office in New York, New York, or an
Affiliate of any such bank. Upon the acceptance
of its appointment as Administrative Agent hereunder by a successor, such successor shall
succeed to and become vested with all the rights, powers, privileges and duties of the retiring
Administrative Agent and the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder. The fees payable by the Borrower to a successor Administrative Agent shall
be the same as those payable to its predecessor unless otherwise agreed between the Borrower and
such successor. After the Administrative Agent’s resignation hereunder, the provisions of this
Article and Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent, its subagents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while it was acting as Administrative Agent.

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

ARTICLE IX.

MISCELLANEOUS

SECTION 9.01. Notices.

(a) Except in the case of notices and other communications expressly permitted to be given by
telephone (and subject to paragraph (b) below), all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as follows:

(i) if to the Borrower, to Nationwide Health Properties, Inc., 610 Newport Center
Drive, Suite 1150, Newport Beach, California 92660, Attention of Abdo Khoury (Telecopy No.
(949) 759-6887; Telephone No. (949) 718-4413);

(ii) if to Administrative Agent, to JPMorgan Chase Bank, N.A., c/o JPMorgan Chase Bank,
N.A., 1111 Fannin Street, 10th Floor, Houston, Texas 77002, Attention of Wanda
Grace (Telecopy No. (713) 750-2223), with a copy to JPMorgan Chase Bank, N.A., 383 Madison
Avenue, 24th Floor, New York, New York 10018, Attention of Nadeige Charles
(Telecopy No. (212) 270-2157); and

(iii) if to any other Lender, to it at its address (or telecopy number) set forth in
its Administrative Questionnaire.

(b) Notices and other communications to a Lender hereunder may be delivered or furnished by
electronic communications pursuant to procedures approved by the Administrative Agent and such
Lender; provided that the foregoing shall not apply to notices
pursuant to Article II unless otherwise agreed by the Administrative Agent and the
applicable Lender. The Administrative Agent or the Borrower may, in its discretion, agree to
accept notices and other communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be limited to particular
notices or communications.

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(c) Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and other
communications given to any party hereto in accordance with the provisions of this Agreement shall
be deemed to have been given on the date of receipt.

SECTION 9.02. Waivers; Amendments.

(a) No Deemed Waivers; Remedies Cumulative. No failure or delay by the Administrative
Agent or any Lender in exercising any right or power hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of the Administrative
Agent and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this Agreement or consent to any
departure by the Borrower therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent or any Lender may have had notice or
knowledge of such Default at the time.

(b) Amendments. Neither this Agreement nor any provision hereof may be waived or
Modified except pursuant to an agreement or agreements in writing entered into by the Borrower and
the Required Lenders or by the Borrower and the Administrative Agent with the consent of the
Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender
without the written consent of such Lender, (ii) reduce the principal amount of any Loan or reduce
the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of
each Lender affected thereby, (iii) postpone the scheduled date of payment of the principal amount
of any Loan or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive
or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without
the written consent of each Lender affected thereby, (iv) change Section 2.18(b),
(c) or (d) in a manner that would alter the pro rata sharing of payments required
thereby, without the written consent of each Lender, (v) subordinate the interests of the Lenders
hereunder, without the prior written consent of all the Lenders, or (vi) change any of the
provisions of this Section or the definition of “Required Lenders” or any other provision hereof
specifying the number or percentage of Lenders required to waive, amend or modify any rights
hereunder or make any determination or grant any consent hereunder, without the written consent of
each Lender; provided further that no such agreement shall amend, modify or otherwise affect the
rights or duties of the Administrative Agent without the prior written consent of the
Administrative Agent. Notwithstanding anything to the contrary
contained herein, any Modification, after the Effective Date of this Agreement, to Article
III, Article V, Article VI or Article VII of the Existing Revolving Credit Facility (the
“Included Provisions”) shall automatically be incorporated to the same provisions herein
(if such provisions herein are identical) without further action or consent on the part of any
party hereto; provided, however, that (i) the Included Provisions, or any part thereof, may be
excluded from this Agreement with the prior written consent of the Administrative Agent, Borrower
and the Required Lenders and (ii) the borrower and the Administrative Agent shall promptly, after
any such Modification, enter into an amendment hereto to evidence such Modification.

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SECTION 9.03. Expenses; Indemnity; Damage Waiver.

(a) Costs and Expenses. The Borrower shall pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates, including the reasonable fees,
charges and disbursements of counsel for the Administrative Agent in connection with the
syndication of the credit facilities provided for herein, the preparation and administration of
this Agreement and the other Loan Documents or any amendments, modifications or waivers of the
provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall
be consummated), (ii) all out-of-pocket expenses incurred by the Administrative Agent or any
Lender, including the reasonable fees, charges and disbursements of any counsel for the Administrative
Agent or any Lender, in connection with the enforcement or protection of its rights in connection
with this Agreement and the other Loan Documents, including its rights under this Section, or in
connection with the Loans made, and (iii) and all costs, expenses, taxes, assessments and other
charges incurred in connection with any filing, registration, recording or perfection of any
security interest contemplated by any document referred to therein.

(b) Indemnification by the Borrower. The Borrower shall indemnify the Lender, and
each Related Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”) against, and to hold each Indemnitee harmless from, any and all losses,
claims, damages, liabilities, penalties and related expenses, including the fees, charges and
disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee
arising out of, in connection with, or as a result of (i) the execution or delivery of this
Agreement or any agreement or instrument contemplated hereby, the performance by the parties hereto
of their respective obligations hereunder or the consummation of the Transactions or any other
transactions contemplated hereby, (ii) any Loan or the use of the proceeds therefrom, (iii) any
actual or alleged presence or release of Hazardous Materials on or from any property owned or
operated by the Borrower or any of its Subsidiary Entities, or any Environmental Liability related
in any way to the Borrower or any of the its Subsidiary Entities, or (iv) any actual or prospective
claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities, penalties or related expenses resulted from the gross
negligence or willful misconduct of such Indemnitee. This Section 9.03(b) shall not apply
with respect to Taxes other than any Taxes that represent losses or damages arising from any
non-Tax claim.

(c) Reimbursement by Lenders. To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent under paragraph (a) or (b) of
this Section, each Lender severally agrees to pay to the Administrative Agent, the Applicable
Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment
is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent in its capacity as such.

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(d) Waiver of Consequential Damages, Etc. To the extent permitted by applicable law,
the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory
of liability, for special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions, any Loan or the use of the proceeds
thereof.

(e) Payments. All amounts due under this Section shall be payable not later than 10
days after written demand therefor.

SECTION 9.04. Successors and Assigns.

(a) Assignments Generally. The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and assigns permitted
hereby, except that (i) the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and void) and (ii) the
Lender may not assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section. Nothing in this Agreement, expressed or implied, shall be construed
to confer upon any Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants (to the extent provided in paragraph (c) of this Section)
and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative
Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this
Agreement.

(b) Assignments by Lenders.

(i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender
may assign to one or more Eligible Assignees all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans at the time
owing to it) with the prior written consent (such consent to be granted or withheld in the
Borrower’s sole discretion) of the Borrower and the Administrative Agent, provided
that no consent of the Borrower shall be required for an assignment to a Lender, an
Affiliate of a Lender, as a result of a merger of a Lender to another financial institution
or, if an Event of Default has occurred and is continuing, any other assignee; and

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

(A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender’s Commitment
or Loans, the amount of the Commitment or Loans of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and Assumption with
respect to such assignment is delivered to the Administrative Agent) shall not be
less than $5,000,000 unless each of the Borrower and the Administrative Agent
otherwise consent, provided that no such consent of the Borrower shall be
required if an Event of Default has occurred and is continuing;

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(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement,
provided that this clause shall not be construed to prohibit the assignment
of a proportionate part of all the assigning Lender’s rights and obligations in
respect of one Class of Commitments or Loans 

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing and
recordation fee of $3,500; and

(D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment and
Assumption the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Assumption, have the rights and obligations of a
Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its obligations under
this Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of Sections
2.15, 2.16, 2.17 and 9.03). Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with this
Section 9.04 shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with paragraph
(c) of this Section.

(iv) The Administrative Agent, acting for this purpose as an agent of the Borrower,
shall maintain at one of its offices a copy of each Assignment and Assumption delivered to
it and a register for the recordation of the names and addresses of the Lenders, and the
Commitment of, and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent and the Lenders shall treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding
notice to the contrary. The Register shall be available for inspection by the Borrower
and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

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(v) Upon its receipt of a duly completed Assignment and Assumption executed by an
assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire
(unless the assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section and any written consent to such
assignment required by paragraph (b) of this Section, the Administrative Agent shall
accept such Assignment and Assumption and record the information contained therein in the
Register. No assignment shall be effective for purposes of this Agreement unless it has
been recorded in the Register as provided in this paragraph.

(c) Participations.

(i) Any Lender may sell participations to one or more banks or other entities (a
“Participant”) in all or a portion of such Lender’s rights and/or obligations under
this Agreement and the other Loan Documents (including all or a portion of its Commitment
and the Loans owing to it) with the prior written consent (such consent to be granted or
withheld in the Borrower’s sole discretion) of the Borrower, provided that no consent shall
be required for a participation to a Lender, an Affiliate of a Lender or if an Event of
Default has occurred and is continuing; and provided further that (i) such Lender’s
obligations under this Agreement and the other Loan Documents shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other parties hereto for the performance
of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement and the other Loan Documents. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and the other Loan Documents
and to approve any amendment, modification or waiver of any provision of this Agreement or
any other Loan Document; provided that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 9.02(b) that
affects such Participant. The Borrower agrees that each Participant shall be entitled to
the benefits of Sections 2.15, 2.16 and 2.17 (subject to the
requirements and limitations therein, including the requirements under Section
2.17(f) (it being understood that the documentation required under Section
2.17(f) shall be delivered to the participating Lender)) to the same extent as if it
were a Lender and had acquired its interest by assignment pursuant to paragraph (b)
of this Section; provided that such Participant (A) agrees to be subject to the provisions
of Sections 2.18 and 2.19 as if it were an assignee under paragraph
(b) of this Section; and (B) shall not be entitled to receive any greater payment under
Sections 2.15 or 2.17, with respect to any participation, than its
participating Lender would have been entitled to receive, except to the extent such
entitlement to receive a greater payment results from a Change in Law that occurs after the
Participant acquired the applicable participation. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 9.08 as
though it were a Lender, provided such Participant agrees to be subject to Section
2.18(c) as though it were a Lender. Each Lender that sells a participation shall,
acting solely for this purpose as an agent of the

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Borrower, maintain a register on which it
enters the name
and address of each Participant and the principal amounts (and stated
interest) of each Participant’s interest in the Loans or other obligations under this
Agreement (the “Participant Register”); provided that no Lender shall have any
obligation to disclose all or any portion of the Participant Register to any Person
(including the identity of any Participant or any information relating to a Participant’s
interest in any Commitments, Loans or its other obligations under any Loan Document) except
to the extent that such disclosure is necessary to establish that such Commitment, Loan or
other obligation is in registered form under Section 5f.103-1(c) of the United States
Treasury Regulations. The entries in the Participant Register shall be conclusive absent
manifest error, and such Lender shall treat each person whose name is recorded in the
Participant Register as the owner of such participation for all purposes of this Agreement
notwithstanding any notice to the contrary.

(d) Certain Pledges. Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this
Section shall not apply to any such pledge or assignment of a security interest; provided that no
such pledge or assignment of a security interest shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

(e) No Assignments to the Borrower or Affiliates. Anything in this Section to the
contrary notwithstanding, no Lender may assign or participate any interest in any Loan held by it
hereunder to the Borrower, any Nationwide Core Entity or any of their Affiliates without the prior
consent of each Lender.

SECTION 9.05. Survival. All covenants, agreements, representations and warranties
made by the Borrower herein and in the certificates or other instruments delivered in connection
with or pursuant to this Agreement shall be considered to have been relied upon by the other
parties hereto and shall survive the execution and delivery of this Agreement and the making of any
Loans, regardless of any investigation made by any such other party or on its behalf and
notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any accrued interest on any
Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so
long as the Commitments have not expired or terminated. The provisions of Sections 2.15,
2.16, 2.17 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans and the Commitments or the termination of this Agreement or any provision
hereof.

SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different counterparts), each of which
shall constitute an original, but all of which when taken together shall constitute a single
contract. This Agreement and any separate letter agreements with respect to fees payable to
the Administrative Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings, oral or written,
relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement
shall become effective when it shall have been executed by the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns. Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall be effective as
delivery of a manually executed counterpart of this Agreement.

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SECTION 9.07. Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such invalidity, illegality or unenforceability without affecting the validity, legality
and enforceability of the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time
to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and other obligations at any
time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against
any of and all the obligations of the Borrower now or hereafter existing under this Agreement held
by such Lender, irrespective of whether or not such Lender shall have made any demand under this
Agreement and although such obligations may be unmatured. The rights of each Lender under this
Section are in addition to other rights and remedies (including other rights of setoff) which such
Lender may have.

SECTION 9.09. Governing Law; Jurisdiction; Etc.

(a) Governing Law. This Agreement shall be construed in accordance with and governed
by the law of the State of New York.

(b) Submission to Jurisdiction. The Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the Supreme Court of the
State of New York sitting in New York County and of the United States District Court of the
Southern District of New York, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or any other Loan Document, or for
recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such Federal court. Each
of the parties hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement shall affect any right that the Administrative
Agent or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement against the Borrower or its properties in the courts of
any jurisdiction.

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(c) Waiver of Venue. The Borrower hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating
to this Agreement in any court referred to in paragraph (b) of this Section. Each of the
parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such court.

(d) Service of Process. The Borrower hereby irrevocably appoints CT Corporation
System (the “Process Agent”) with an office on the date hereof at 111 8th Avenue, New York,
New York 10011 as its agent to receive on behalf of it and its property service of copies of the
summons and complaint and any other process which may be served in any such suit, action or
proceeding. Such service may be made by mailing or delivering a copy of such process to the
Borrower, in care of the Process Agent at the Process Agent’s above address and the Borrower hereby
irrevocably authorizes and directs the Process Agent to accept such service on its behalf. The
Administrative Agent and each Lender agree to mail to the Borrower at its address provided in
Section 9.01 a copy of any summons, complaint, or other process mailed or delivered by it
to the Borrower in care of the Process Agent. As an alternate method of service, the Borrower also
irrevocably consents to the service of any and all process in any such suit, action or proceeding
in the manner provided for notices in Section 9.01. The Borrower agrees that a final
judgment in any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law. All mailings under
this Section 9.09 shall be by certified mail, return receipt requested. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process in any other manner
permitted by law.

SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

SECTION 9.11. Headings. Article and Section headings and the Table of Contents used
herein are for convenience of reference only, are not part of this Agreement and shall not affect
the construction of, or be taken into consideration in interpreting, this Agreement.

Term Loan Agreement

 

- 70 -

 

SECTION 9.12. Confidentiality. Each of the Administrative Agent and the Lenders
agrees to maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and
agents, including accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the extent requested by
any regulatory authority, (c) to the extent required by applicable laws or regulations or by any
subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with
the exercise of any remedies hereunder or under any other Loan Document or any suit, action or
proceeding relating to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same
as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of
or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction relating to the
Borrower and its obligations, (g) with the consent of the Borrower or (h) to the extent such
Information (i) becomes publicly available other than as a result of a breach of this Section or
(ii) becomes available to the Administrative Agent or any Lender on a nonconfidential basis from a
source other than the Borrower. For the purposes of this Section, “Information” means all
information received from or on behalf of the Borrower relating to the Borrower, its Subsidiaries
or Affiliates or their respective businesses, other than any such information that is available to
the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by the
Borrower; provided that, in the case of information received from the Borrower after the date
hereof, such information is clearly identified at the time of delivery as confidential. Any Person
required to maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

SECTION 9.13. USA PATRIOT Act. Each Lender and the Administrative Agent (for itself
and not on behalf of any Lender) 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 Lender or the Administrative Agent, as applicable, to identify the Borrower in accordance with
the Act.

SECTION 9.14. Co-Agents. Anything herein to the contrary notwithstanding, none of the
Lead Left Joint Bookrunner, Joint Bookrunners, or Joint Lead Arrangers listed on the cover page
hereof shall have any powers, duties or responsibilities under this Agreement or any of the other
Loan Documents, except in its capacity, as applicable, as a Lender.

[Signature Pages Follow]

Term Loan Agreement

 

- 71 -

 

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

	 	 	 	 	 
	 	BORROWER:

NATIONWIDE HEALTH PROPERTIES, INC.,

a Maryland corporation

 	 
	 	By:  	/s/ Danion Fielding
 	 
	 	 	Name:  	Danion Fielding 	 
	 	 	Title:  	Vice President, Finance 	 

	 	 	 	 	 
	 

	 	Address:
	 	610 Newport Center Drive
	 

	 	 	 	Suite 1150
	 

	 	 	 	Newport Beach, CA 92660
	 
	 	 	 	 
	 	 	Taxpayer ID # 95-3997619

Term Loan Agreement

 

 

 

	 	 	 	 	 
	 	ADMINISTRATIVE AGENT:

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 	 
	 	By:  	/s/ Marc Costantino
 	 
	 	 	Name:  	Marc Costantino 	 
	 	 	Title:  	Executive Director 	 

Term Loan Agreement

 

 

 

	 	 	 	 	 
	 	LENDERS:

JPMORGAN CHASE BANK, N.A.,

as a Lender

 	 
	 	By:  	/s/ Marc Costantino
 	 
	 	 	Name:  	Marc Costantino 	 
	 	 	Title:  	Executive Director 	 

Term Loan Agreement

 

 

 

	 	 	 	 	 
	 	CRÉDIT AGRICOLE CORPORATE & INVESTMENT BANK,

as a Lender

 	 
	 	By:  	/s/ Tanya Crossley
 	 
	 	 	Name:  	Tanya Crossley 	 
	 	 	Title:  	Managing Director 	 
	 	 	 
	 	By:  	               /s/ David Christiansen
 	 
	 	 	Name:  	David Christiansen 	 
	 	 	Title:  	Director 	 

Term Loan Agreement

 

 

 

	 	 	 	 	 
	 	KEY BANK NATIONAL ASSOCIATION,

as a Lender

 	 
	 	By:  	/s/ Bellini Lacey
 	 
	 	 	Name:  	Bellini Lacey 	 
	 	 	Title:  	Vice President 	 

Term Loan Agreement

 

 

 

	 	 	 	 	 
	 	WELLS FARGO BANK, N.A.,

as a Lender

 	 
	 	By:  	/s/ Matthew J. Taylor
 	 
	 	 	Name:  	Matthew J. Taylor 	 
	 	 	Title:  	Vice President 	 

Term Loan Agreementex10_1.htm

Exhibit 10.1

XOMA LTD.

2010 LONG TERM INCENTIVE AND SHARE AWARD PLAN

(as amended through May 26, 2011)

1.           Purposes.

 

The purposes of the XOMA Ltd. 2010 Long Term Incentive and Share Award Plan are to advance the interests of XOMA Ltd. and its shareholders by providing a means to attract, retain, and motivate employees, consultants and directors of the Company, its Subsidiaries and Affiliates, to provide for competitive compensation opportunities, to encourage long term service, to recognize individual contributions and reward achievement of performance goals, and to promote the creation of long term value for shareholders by aligning the interests of such persons with those of shareholders.

 

2.           Definitions.

 

For purposes of this Plan, the following terms shall be defined as set forth below:

 

(a) “Affiliate” means any entity other than the Company and its Subsidiaries that is designated by the Board or the Committee as a participating employer under this Plan; provided, however, that the Company directly or indirectly owns at least 20% of the combined voting power of all classes of stock of such entity or at least 20% of the ownership interests in such entity.

 

(b) “Award” means any Option, SAR, Restricted Share, Restricted Share Unit, Performance Share, Performance Unit, Dividend Equivalent, or Other Share-Based Award granted to an Eligible Person under this Plan.

 

(c) “Award Agreement” means any written agreement, contract, or other instrument or document evidencing an Award.

 

(d) “Beneficiary” means the person, persons, trust or trusts which have been designated by an Eligible Person in his or her most recent written beneficiary designation filed with the Company to receive the benefits specified under this Plan upon the death of the Eligible Person, or, if there is no designated Beneficiary or surviving designated Beneficiary, then the person, persons, trust or trusts entitled by will or the laws of descent and distribution to receive such benefits.

 

(e) “Board” means the Board of Directors of the Company.

 

(f) “Change in Control” means the occurrence of any of the following events:

 

(i) a merger, amalgamation or acquisition in which the Company is not the surviving or continuing entity, except for a transaction the principal purpose of which is to change the jurisdiction of the Company’s organization;

 

(ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company;

 

(iii) any other reorganization or business combination in which fifty percent (50%) or more of the Company’s outstanding voting securities are transferred to different holders in a single transaction or series of related transactions;

 

  

  

  

(iv) any approval by the shareholders of the Company of a plan of complete liquidation of the Company;

 

(v) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becoming the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing more than fifty percent (50%) of the total voting power represented by the Company’s then outstanding voting securities; or

 

(vi) a change in the composition of the Board, as a result of which fewer than a majority of the directors are Incumbent Directors.

 

(g) “Code” means the Internal Revenue Code of 1986, as amended from time to time.  References to any provision of the Code shall be deemed to include successor provisions thereto and regulations thereunder.

 

(h) “Committee” means the Compensation Committee of the Board, or such other Board committee or committees (which may include the entire Board) as may be designated by the Board to administer all or any portion of this Plan; provided, however, that, unless otherwise determined by the Board, a Committee shall consist of two or more directors of the Company, each of whom is a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, to the extent applicable, and each of whom is an “outside director” within the meaning of Section 162(m) of the Code, to the extent applicable; provided, further, that the mere fact that a Committee shall fail to qualify under either of the foregoing requirements shall not invalidate any Award made by such Committee which Award is otherwise validly made under this Plan.  Different Committees may administer this Plan with respect to different groups of Eligible Persons.  As used herein, the singular “Committee” shall include the plural “Committees” if applicable, except where the context requires otherwise.

 

(i) “Company” means XOMA Ltd., a company organized under the laws of Bermuda, or any successor company.

 

(j) “Director” means a member of the Board who is not an employee of the Company, a Subsidiary or an Affiliate.

 

(k) “Dividend Equivalent” means a right, granted under Section 5(g), to receive cash, Shares, or other property equal in value to dividends paid with respect to a specified number of Shares.  Dividend Equivalents may be awarded on a free-standing basis or in connection with another Award, and may be paid currently or on a deferred basis.

 

(l) “Effective Date” means July 21, 2010, contingent on shareholder approval of this Plan on such date.

 

(m) “Eligible Person” means (i) an employee or consultant of the Company, a Subsidiary or an Affiliate, including any director who is an employee, or (ii) a Director.  Notwithstanding any provisions of this Plan to the contrary, an Award may be granted to an employee or consultant in connection with his or her hiring or retention prior to the date the employee or consultant first performs services for the Company, a Subsidiary or an Affiliate; provided, however, that any such Award shall not become vested or exercisable prior to the date the employee or consultant first performs such services.

 

(n) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.  References to any provision of the Exchange Act shall be deemed to include successor provisions thereto and regulations thereunder.

 

(o) “Fair Market Value” means:

 

  

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    (i) if the Shares are not at the time listed or admitted to trading on any stock exchange but are traded in the over-the-counter market, the fair market value shall be the closing selling price per Share on the date in question, as such price is reported by the National Association of Securities Dealers through its Nasdaq National Market or any successor system; provided that if there is no reported closing selling price for Shares on the date in question, then the closing selling price on the last preceding date for which such quotation exists shall be determinative of fair market value;

 

    (ii) if the Shares are at the time listed or admitted to trading on any stock exchange, then the fair market value shall be the closing selling price per Share on the date in question on the stock exchange determined by the Committee to be the primary market for the Shares, as such price is officially quoted on such exchange; provided that if there is no reported sale of Shares on such exchange on the date in question, then the fair market value shall be the closing selling price on the exchange on the last preceding date for which such quotation exists; or

 

    (iii) if the Shares are at the time neither listed nor admitted to trading on any stock exchange nor traded in the over-the-counter market (or if the Committee determines that the value as determined pursuant to subsection (i) or (ii) above does not reflect fair market value), then the Committee shall determine fair market value after taking into account such factors as it deems appropriate, including one or more independent professional appraisals.

 

(p) “Incumbent Directors” means directors who (i) are directors of the Company as of the date hereof, (ii) are elected, or nominated for election, to the Board with the affirmative votes of the directors of the Company as of the date hereof, or (iii) are elected, or nominated for election, to the Board with the affirmative votes of at least a majority of those directors whose election or nomination was not in connection with any transaction described in subsections (i) through (v) of the definition of Change in Control or in connection with an actual or threatened proxy contest relating to the election of directors of the Company.

 

(q) “ISO” means any Option intended to be and designated as an incentive stock option within the meaning of Section 422 of the Code.

 

(r) “NQSO” means any Option that is not an ISO.

 

(s) “Option” means a right, granted under Section 5(b), to purchase Shares.

 

(t) “Other Share-Based Award” means a right, granted under Section 5(h), that relates to or is valued by reference to Shares.

 

(u) “Participant” means an Eligible Person who has been granted an Award under this Plan.

 

(v) “Performance Award” shall have the meaning set forth in Section 7(a).

 

(w) “Performance Period” shall have the meaning set forth in Section 5(f)(i).

 

(x) “Performance Share” means a performance share granted under Section 5(f).

 

(y) “Performance Unit” means a performance unit granted under Section 5(f).

 

(z) “Plan” means this XOMA Ltd. 2010 Long Term Incentive and Share Award Plan.

 

(aa) “Restricted Shares” means an Award of Shares under Section 5(d) that may be subject to certain restrictions and to a risk of forfeiture.

 

  

-3-

  

(bb) “Restricted Share Unit” means a right, granted under Section 5(e), to receive Shares or cash at the end of a specified deferral period.

 

(cc) “Rule 16b-3” means Rule 16b-3, as from time to time in effect and applicable to this Plan and Participants, promulgated by the Securities and Exchange Commission under Section 16 of the Exchange Act.

 

(dd) “SAR” or “Share Appreciation Right” means the right, granted under Section 5(c), to be paid an amount measured by the difference between the exercise price of the right and the Fair Market Value of Shares on the date of exercise of the right, with payment to be made in cash, Shares, or property as specified in the Award or determined by the Committee.

 

(ee) “Shares” means common shares of the Company, and such other securities as may be substituted for Shares pursuant to Section 4(c) hereof.

 

(ff) “Subsidiary” means any company (other than the Company) in an unbroken chain of companies beginning with the Company if each of the companies (other than the last company in the unbroken chain) owns shares possessing 50% or more of the total combined voting power of all classes of stock in one of the other companies in the chain.

 

(gg) “Termination of Service” means the termination of the Participant’s employment, consulting services or directorship with the Company, its Subsidiaries and its Affiliates, as the case may be.  A Participant employed by a Subsidiary of the Company or one of its Affiliates shall also be deemed to incur a Termination of Service if the Subsidiary of the Company or Affiliate ceases to be such a Subsidiary or an Affiliate, as the case may be, and the Participant does not immediately thereafter become an employee or director of, or a consultant to, the Company, another Subsidiary of the Company or an Affiliate.  In the event that a Participant who is an employee of the Company, a Subsidiary or an Affiliate becomes a Director or a consultant to the Company, a Subsidiary or an Affiliate upon the Participant’s termination of employment, unless otherwise determined by the Committee in its sole discretion, no Termination of Service shall be deemed to occur until such time as such Participant is no longer an employee of, or consultant to, the Company, a Subsidiary or an Affiliate or a Director, as the case may be.  If a Participant who is a Director becomes an employee of, or a consultant to, the Company, a Subsidiary or an Affiliate upon such Participant ceasing to be a Director, unless otherwise determined by the Committee in its sole discretion, such termination of the Participant’s directorship shall not be treated as a Termination of Service unless and until the Participant’s employment or consultancy, as the case may be, terminates.  Temporary absences from employment because of illness, vacation or leave of absence and transfers among the Company and its Subsidiaries and Affiliates shall not be considered a Termination of Service.

 

3.           Administration.

 

(a) Authority of the Committee.  This Plan shall be administered by the Committee, and the Committee shall have full and final authority to take the following actions, in each case subject to and consistent with the provisions of this Plan:

 

(i) to select Eligible Persons to whom Awards may be granted;

 

(ii) to designate Affiliates;

 

(iii) to determine the type or types of Awards to be granted to each Eligible Person;

 

(iv) to determine the type and number of Awards to be granted, the number of Shares to which an Award may relate, the terms and conditions of any Award granted under this Plan

 

  

-4-

  

 (including, but not limited to, any exercise price, grant price, or purchase price, any restriction or condition, any schedule for lapse of restrictions or conditions relating to transferability or forfeiture, exercisability, or settlement of an Award, and waiver or accelerations thereof, and waivers of performance conditions relating to an Award, based in each case on such considerations as the Committee shall determine), and all other matters to be determined in connection with an Award;

 

(v) to determine whether, to what extent, and under what circumstances an Award may be settled, or the exercise price of an Award may be paid, in cash, Shares, other Awards, or other property, or an Award may be canceled, forfeited (including by repurchase at a nominal price, where required by Bermuda law), exchanged, or surrendered;

 

(vi) to determine whether, to what extent, and under what circumstances cash, Shares, other Awards, or other property payable with respect to an Award will be deferred either automatically, at the election of the Committee, or at the election of the Eligible Person, provided that such deferral shall be intended to be in compliance with Section 409A of the Code;

 

(vii) to prescribe the form of each Award Agreement, which need not be identical for each Eligible Person;

 

(viii) to adopt, amend, suspend, waive, and rescind such rules and regulations and appoint such agents as the Committee may deem necessary or advisable to administer this Plan;

 

(ix) to correct any defect or supply any omission or reconcile any inconsistency in this Plan and to construe and interpret this Plan and any Award, rules and regulations, Award Agreement, or other instrument hereunder;

 

(x) to accelerate the exercisability or vesting of all or any portion of any Award or to extend the period during which an Award is exercisable;

 

(xi) to determine whether uncertificated Shares may be used in satisfying Awards and otherwise in connection with this Plan; and

 

(xii) to make all other decisions and determinations as may be required under the terms of this Plan or as the Committee may deem necessary or advisable for the administration of this Plan.

 

(b) Manner of Exercise of Committee Authority.  The Committee shall have sole discretion in exercising its authority under this Plan.  Any action of the Committee with respect to this Plan shall be final, conclusive, and binding on all persons, including the Company, Subsidiaries, Affiliates, Eligible Persons, any person claiming any rights under this Plan from or through any Eligible Person, and shareholders.  The express grant of any specific power to the Committee, and the taking of any action by the Committee, shall not be construed as limiting any power or authority of the Committee.   The Committee may delegate to other members of the Board or officers or managers of the Company or any Subsidiary or Affiliate the authority, subject to such terms as the Committee shall determine, to perform administrative functions and, with respect to Awards granted to persons not subject to Section 16 of the Exchange Act, to perform such other functions as the Committee may determine, to the extent permitted under Rule 16b-3 (if applicable) and applicable law.

 

(c) Limitation of Liability.  Each member of the Committee shall be entitled to, in good faith, rely or act upon any report or other information furnished to him or her by any officer or other employee of the Company or any Subsidiary or Affiliate, the Company’s independent certified public accountants, or other professional retained by the Company to assist in the administration of this Plan.  No member of the Committee, and no officer or employee of the Company acting on behalf of the Committee, shall be personally liable for any action, determination, or interpretation taken or made in good faith with respect to this Plan, and all members of

 

  

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the Committee and any officer or employee of the Company acting on their behalf shall, to the extent permitted by law, be fully indemnified and protected by the Company with respect to any such action, determination, or interpretation.

 

(d) Limitation on Committee’s Discretion.  Anything in this Plan to the contrary notwithstanding, in the case of any Award which is intended to qualify as “performance-based compensation” within the meaning of Section 162(m)(4)(C) of the Code, the Committee shall have no discretion to increase the amount of compensation payable under the Award to the extent such an increase would cause the Award to lose its qualification as such performance-based compensation.

 

(e) No Option or SAR Repricing Without Shareholder Approval.  Except as provided in the first sentence of Section 4(c) hereof relating to certain anti-dilution adjustments, unless the approval of shareholders of the Company is obtained, (i) Options and SARs shall not be amended to lower their exercise price, (ii) Options and SARs  will not be exchanged for other Options or SARs with lower exercise prices, (iii) Options and SARs with an exercise price in excess of the Fair Market Value of the underlying Shares will not be exchanged for cash or other property and (iii) no other action shall be taken with respect to Options or SARs that would be treated as a repricing under the rules of the principal stock exchange on which the Shares are listed.

 

(f) Limitation on Committee’s Authority under 409A.  Anything in this Plan to the contrary notwithstanding, the Committee’s authority to modify outstanding Awards shall be limited to the extent necessary so that the existence of such authority does not (i) cause an Award that is not otherwise deferred compensation subject to Section 409A of the Code to become deferred compensation subject to Section 409A of the Code or (ii) cause an Award that is otherwise deferred compensation subject to Section 409A of the Code to fail to meet the requirements prescribed by Section 409A of the Code.

 

4.           Shares Subject to this Plan.

 

(a) Subject to adjustment as provided in Section 4(c) hereof, the total number of Shares reserved for issuance in connection with Awards under this Plan shall be (i) 6,150,718 plus (ii) the number of Shares subject to awards granted prior to the Effective Date of this Plan under the Company’s 1981 Share Option Plan, its Restricted Share Plan or its 1992 Directors Share Option Plan which awards are, after the Effective Date, forfeited, canceled, surrendered or otherwise terminated without a distribution of Shares to the holder of the award; provided, however, that, subject to adjustment as provided in Section 4(c) hereof, no more than 2,000,000 Shares may be issued as ISOs under this Plan; and, provided, further, that, in the case of Awards granted out of the 5,500,000 Share allotment added to such total number of available Shares with the approval of the Company’s shareholders effective May 26, 2011, for each SAR, Restricted Share, Restricted Share Unit, Performance Share, Performance Unit, Dividend Equivalent or Other Share-Based Award issued, such total number of available Shares shall be reduced by 1.3 Shares.  No Award may be granted if the number of Shares to which such Award relates, when added to the number of Shares previously issued under this Plan, exceeds the number of Shares reserved under the applicable provisions of the preceding sentence.  If any Awards are forfeited (including by repurchase at a nominal price, where required by Bermuda law), canceled, terminated, exchanged or surrendered or such Award is settled in cash or otherwise terminates without a distribution of Shares to the Participant, any Shares counted against the number of Shares reserved and available under this Plan with respect to such Award shall, to the extent of any such forfeiture, repurchase, settlement, termination, cancellation, exchange or surrender, again be available for Awards under this Plan.  Upon the exercise of any Award granted in tandem with any other Awards, such related Awards shall be canceled to the extent of the number of Shares as to which the Award is exercised.

 

(b) Subject to adjustment as provided in Section 4(c) hereof, the maximum number of Shares (i) with respect to which Options or SARs may be granted during a calendar year to any Eligible Person under this Plan shall be 466,666 Shares, and (ii) with respect to which Performance Shares, Performance Units, Restricted Shares or Restricted Share Units intended to qualify as performance-based compensation within the

 

  

-6-

  

meaning of Section 162(m)(4)(C) of the Code may be granted during a calendar year to any Eligible Person under this Plan shall be 466,666 Shares.

 

(c) In the event that the Committee shall determine that any dividend in Shares, recapitalization, Share split, reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, share exchange, extraordinary distribution or other similar corporate transaction or event, affects the Shares such that an adjustment is appropriate in order to prevent dilution or enlargement of the rights of Eligible Persons under this Plan, then the Committee shall make such equitable changes or adjustments as it deems appropriate and, in such manner as it may deem equitable, (i) adjust any or all of (x) the number and kind of shares which may thereafter be issued under this Plan, (y) the number and kind of shares, other securities or other consideration issued or issuable in respect of outstanding Awards, and (z) the exercise price, grant price, or purchase price relating to any Award, or (ii) provide for a distribution of cash or property in respect of any Award; provided, however, in each case that, with respect to ISOs, such adjustment shall be made in accordance with Section 424(a) of the Code, unless the Committee determines otherwise; provided, further, that no adjustment shall be made pursuant to this Section 4(c) that causes any Award that is not otherwise deferred compensation subject to Section 409A of the Code to be treated as deferred compensation pursuant to Section 409A of the Code.  In addition, the Committee is authorized to make adjustments in the terms and conditions of, and the criteria and performance objectives, if any, included in, Awards in recognition of unusual or non-recurring events (including, without limitation, events described in the preceding sentence) affecting the Company or any Subsidiary or Affiliate or the financial statements of the Company or any Subsidiary or Affiliate, or in response to changes in applicable laws, regulations, or accounting principles; provided, however, that the Committee shall not have discretion to increase the amount of compensation payable under any Award intended to qualify as performance-based compensation for purposes of Section 162(m)(4)(C) of the Code to the extent such an increase would cause the Award to lose its qualification as performance-based compensation for purposes of Section 162(m)(4)(C) of the Code and the regulations thereunder.

 

(d) Any Shares distributed pursuant to an Award may consist, in whole or in part, of authorized and unissued Shares or treasury Shares including Shares acquired by purchase in the open market or in private transactions.

 

5.           Specific Terms of Awards.

 

(a) General.  Awards may be granted on the terms and conditions set forth in this Section 5.  In addition, the Committee may impose on any Award or the exercise thereof, at the date of grant or thereafter (subject to Section 9(d)), such additional terms and conditions, not inconsistent with the provisions of this Plan, as the Committee shall determine, including terms regarding forfeiture (including by repurchase at a nominal price, where required by Bermuda law) of Awards or continued exercisability of Awards in the event of Termination of Service by the Eligible Person.

 

(b) Options.  The Committee is authorized to grant Options, which may be NQSOs or ISOs, to Eligible Persons on the following terms and conditions:

 

(i) Exercise Price.  The exercise price per Share purchasable under an Option shall be determined by the Committee; provided, however, that the exercise price per Share of an Option shall not be less than the Fair Market Value of a Share on the date of grant of the Option.  The Committee may, without limitation, set an exercise price that is based upon achievement of performance criteria if deemed appropriate by the Committee.

 

(ii) Option Term.  The term of each Option shall be determined by the Committee; provided, however, that such term shall not be longer than ten years from the date of grant of the Option.

 

  

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(iii) Time and Method of Exercise.  The Committee shall determine at the date of grant or thereafter the time or times at which an Option may be exercised in whole or in part (including, without limitation, upon achievement of performance criteria if deemed appropriate by the Committee), the methods by which such exercise price may be paid or deemed to be paid (including, without limitation, broker-assisted exercise arrangements), the form of such payment (including, without limitation, cash, Shares or other property), and the methods by which Shares will be delivered or deemed to be delivered to Eligible Persons.

 

(iv) ISOs.  The terms of any ISO granted under this Plan shall comply in all respects with the provisions of Section 422 of the Code, including but not limited to the requirement that the ISO shall be granted within ten years from the earlier of the date of adoption or shareholder approval of this Plan.  ISOs may only be granted to employees of the Company or a Subsidiary.

 

(c) SARs.  The Committee is authorized to grant SARs (Share Appreciation Rights) to Eligible Persons on the following terms and conditions:

 

(i) Right to Payment.  A SAR shall confer on the Eligible Person to whom it is granted a right to receive with respect to each Share subject thereto, upon exercise thereof, the excess of (1) the Fair Market Value of one Share on the date of exercise over (2) the exercise price per Share of the SAR, as determined by the Committee as of the date of grant of the SAR (which shall not be less than the Fair Market Value per Share on the date of grant of the SAR and, in the case of a SAR granted in tandem with an Option, shall be equal to the exercise price of the underlying Option).

 

(ii) Other Terms.  The Committee shall determine, at the time of grant or thereafter, the time or times at which a SAR may be exercised in whole or in part (which shall not be more than ten years after the date of grant of the SAR), the method of exercise, method of settlement, form of consideration payable in settlement, method by which Shares will be delivered or deemed to be delivered to Eligible Persons, whether or not a SAR shall be in tandem with any other Award, and any other terms and conditions of any SAR.  Unless the Committee determines otherwise, a SAR (1) granted in tandem with an NQSO may be granted at the time of grant of the related NQSO or at any time thereafter and (2) granted in tandem with an ISO may only be granted at the time of grant of the related ISO.

 

(d) Restricted Shares.  The Committee is authorized to grant Restricted Shares to Eligible Persons on the following terms and conditions:

 

(i) Issuance and Restrictions.  Restricted Shares shall be subject to such restrictions on transferability and other restrictions, if any, as the Committee may impose at the date of grant or thereafter, which restrictions may lapse separately or in combination at such times, under such circumstances (including, without limitation, upon achievement of performance criteria if deemed appropriate by the Committee), in such installments, or otherwise, as the Committee may determine.  Except to the extent restricted under the Award Agreement relating to the Restricted Shares, an Eligible Person granted Restricted Shares shall have all of the rights of a shareholder including, without limitation, the right to vote Restricted Shares and the right to receive dividends thereon.

 

(ii) Forfeiture.  Except as otherwise determined by the Committee, at the date of grant or thereafter, upon Termination of Service during the applicable restriction period, Restricted Shares shall be repurchased by the Company for a nominal amount equal to their par value and any accrued but unpaid dividends or Dividend Equivalents that are at that time subject to restrictions shall be forfeited; provided, however, that the Committee may provide, by rule or regulation or in any Award Agreement, or may determine in any individual case, that restrictions or forfeiture conditions relating to Restricted Shares will be waived in whole or in part in the event of Termination of Service resulting from specified causes, and the Committee may in other cases waive in whole or in part the forfeiture of Restricted Shares.

 

  

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(iii) Certificates for Shares.  Restricted Shares granted under this Plan may be evidenced in such manner as the Committee shall determine.  If certificates representing Restricted Shares are registered in the name of the Eligible Person, such certificates shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Shares, and, unless otherwise determined by the Committee, the Company shall retain physical possession of the certificate and the Participant shall deliver a stock power to the Company, endorsed in blank, relating to the Restricted Shares.

 

(iv) Dividends.  Dividends paid on Restricted Shares shall be either paid at the dividend payment date, or deferred for payment to such date, and subject to such conditions, as determined by the Committee, in cash or in restricted or unrestricted Shares having a Fair Market Value equal to the amount of such dividends. Unless otherwise determined by the Committee, Shares distributed in connection with a Share split or dividend in Shares, and other property distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Shares with respect to which such Shares or other property has been distributed.

 

(e) Restricted Share Units.  The Committee is authorized to grant Restricted Share Units to Eligible Persons, subject to the following terms and conditions:

 

(i) Award and Restrictions.  Delivery of Shares or cash, as the case may be, will occur upon expiration of the deferral period specified for Restricted Share Units by the Committee (or, if permitted by the Committee, as elected by the Eligible Person).  In addition, Restricted Share Units shall be subject to such restrictions as the Committee may impose, if any (including, without limitation, the achievement of performance criteria if deemed appropriate by the Committee), at the date of grant or thereafter, which restrictions may lapse at the expiration of the deferral period or at earlier or later specified times, separately or in combination, in installments or otherwise, as the Committee may determine.

 

(ii) Forfeiture.  Except as otherwise determined by the Committee at the date of grant or thereafter, upon Termination of Service during the applicable deferral period or portion thereof to which forfeiture conditions apply (as provided in the Award Agreement evidencing the Restricted Share Units), or upon failure to satisfy any other conditions precedent to the delivery of Shares or cash to which such Restricted Share Units relate, all Restricted Share Units that are at that time subject to deferral or restriction shall be forfeited; provided, however, that the Committee may provide, by rule or regulation or in any Award Agreement, or may determine in any individual case, that restrictions or forfeiture conditions relating to Restricted Share Units will be waived in whole or in part in the event of Termination of Service resulting from specified causes, and the Committee may in other cases waive in whole or in part the forfeiture of Restricted Share Units.

 

(iii) Dividend Equivalents.  Unless otherwise determined by the Committee at the date of grant, Dividend Equivalents on the specified number of Shares covered by a Restricted Share Unit shall be either (A) paid with respect to such Restricted Share Unit at the dividend payment date in cash or in restricted or unrestricted Shares having a Fair Market Value equal to the amount of such dividends, or (B) deferred with respect to such Restricted Share Unit and the amount or value thereof automatically deemed reinvested in additional Restricted Share Units or other Awards, as the Committee shall determine.

 

(f) Performance Shares and Performance Units.  The Committee is authorized to grant Performance Shares or Performance Units or both to Eligible Persons on the following terms and conditions:

 

(i) Performance Period.  The Committee shall determine a performance period (the “Performance Period”) of one or more years or other periods and shall determine the performance objectives for grants of Performance Shares and Performance Units.  Performance objectives may vary

 

  

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from Eligible Person to Eligible Person and shall be based upon the performance criteria as the Committee may deem appropriate.  The performance objectives may be determined by reference to the performance of the Company, or of a Subsidiary or Affiliate, or of a division or unit of any of the foregoing.  Performance Periods may overlap and Eligible Persons may participate simultaneously with respect to Performance Shares and Performance Units for which different Performance Periods are prescribed.

 

(ii) Award Value.  At the beginning of a Performance Period, the Committee shall determine for each Eligible Person or group of Eligible Persons with respect to that Performance Period the range of number of Shares, if any, in the case of Performance Shares, and the range of dollar values, if any, in the case of Performance Units, which may be fixed or may vary in accordance with such performance or other criteria specified by the Committee, which shall be paid to an Eligible Person as an Award if the relevant measure of Company performance for the Performance Period is met.

 

(iii) Significant Events.  If during the course of a Performance Period there shall occur significant events as determined by the Committee which the Committee expects to have a substantial effect on a performance objective during such period, the Committee may revise such objective; provided, however, that, in the case of any Award intended to qualify as performance-based compensation for purposes of Section 162(m)(4)(C) of the Code, the Committee shall not have any discretion to increase the amount of compensation payable under the Award to the extent such an increase would cause the Award to lose its qualification as performance-based compensation for purposes of Section 162(m)(4)(C) of the Code and the regulations thereunder.

 

(iv) Forfeiture.  Except as otherwise determined by the Committee at the date of grant or thereafter, upon Termination of Service during the applicable Performance Period, Performance Shares and Performance Units for which the Performance Period was prescribed shall be forfeited; provided, however, that the Committee may provide, by rule or regulation or in any Award Agreement, or may determine in an individual case, that restrictions or forfeiture conditions relating to Performance Shares and Performance Units will be waived in whole or in part in the event of Terminations of Service resulting from specified causes, and the Committee may in other cases waive in whole or in part the forfeiture of Performance Shares and Performance Units.

 

(v) Payment.  Each Performance Share or Performance Unit may be paid in whole Shares, or cash, or a combination of Shares and cash either as a lump sum payment or in installments, all as the Committee shall determine, at the time of grant of the Performance Share or Performance Unit or otherwise, commencing at the time determined by the Committee.

 

(vi) Restriction on Dividends.  No dividends or Dividend Equivalents shall be paid on any Performance Share or Performance Unit until such time (if ever) as the performance criteria associated therewith have been met.

 

(g) Dividend Equivalents.  The Committee is authorized to grant Dividend Equivalents to Eligible Persons.  The Committee may provide, at the date of grant or thereafter, that Dividend Equivalents shall be paid or distributed when accrued or shall be deemed to have been reinvested in additional Shares, or other investment vehicles as the Committee may specify; provided, however, that, unless otherwise determined by the Committee, Dividend Equivalents (other than freestanding Dividend Equivalents) shall be subject to all conditions and restrictions of any underlying Awards to which they relate.

 

(h) Other Share-Based Awards.  The Committee is authorized, subject to limitations under applicable law, to grant to Eligible Persons such other Awards that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Shares, as deemed by the Committee to be consistent with the purposes of this Plan, including, without limitation, unrestricted shares awarded purely as a “bonus” and not subject to any restrictions or conditions, other rights convertible or exchangeable into Shares,

 

  

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purchase rights for Shares, Awards with value and payment contingent upon performance of the Company or any other factors designated by the Committee, and Awards valued by reference to the performance of specified Subsidiaries or Affiliates.  The Committee shall determine the terms and conditions of such Awards at date of grant or thereafter.  Shares delivered pursuant to an Award in the nature of a purchase right granted under this Section 5(h) shall be purchased for such consideration, paid for at such times, by such methods, and in such forms, including, without limitation, cash, Shares, notes or other property, as the Committee shall determine.  Cash awards, as an element of or supplement to any other Award under this Plan, shall also be authorized pursuant to this Section 5(h).

 

6.           Certain Provisions Applicable to Awards.

 

(a) Stand-Alone, Additional, Tandem and Substitute Awards.  Awards granted under this Plan may, in the discretion of the Committee, be granted to Eligible Persons either alone or in addition to, in tandem with, or in exchange or substitution for, any other Award granted under this Plan or any award granted under any other plan or agreement of the Company, any Subsidiary or Affiliate, or any business entity to be acquired by the Company or a Subsidiary or Affiliate, or any other right of an Eligible Person to receive payment from the Company or any Subsidiary or Affiliate.  Awards may be granted in addition to or in tandem with such other Awards or awards, and may be granted either as of the same time as, or a different time from, the grant of such other Awards or awards.  Subject to the provisions of Section 3(e) hereof prohibiting Option and SAR repricing without shareholder approval, the per Share exercise price of any Option, or grant price of any SAR, which is granted in connection with the substitution of awards granted under any other plan or agreement of the Company or any Subsidiary or Affiliate, or any business entity to be acquired by the Company or any Subsidiary or Affiliate, shall be determined by the Committee, in its discretion.

 

(b) Term of Awards.  The term of each Award granted to an Eligible Person shall be for such period as may be determined by the Committee; provided, however, that in no event shall the term of any Option or SAR exceed a period of ten years from the date of its grant (or, in the case of ISOs, such shorter period as may be applicable under Section 422 of the Code).

 

(c) Form of Payment Under Awards.  Subject to the terms of this Plan and any applicable Award Agreement, payments to be made by the Company or a Subsidiary or Affiliate upon the grant, maturation, or exercise of an Award may be made in such forms as the Committee shall determine at the date of grant or thereafter, including, without limitation, cash, Shares, notes or other property, and may be made in a single payment or transfer, in installments, or on a deferred basis, provided that any such deferral shall be intended to be in compliance with Section 409A of the Code.  The Committee may make rules relating to installment or deferred payments with respect to Awards, including the rate of interest to be credited with respect to such payments, and the Committee may require deferral of payment under an Award if, in the sole judgment of the Committee, it may be necessary in order to avoid nondeductibility of the payment under Section 162(m) of the Code.

 

(d) Nontransferability.  Awards shall not be transferable by an Eligible Person except by will or the laws of descent and distribution (except pursuant to a Beneficiary designation) and shall be exercisable during the lifetime of an Eligible Person only by such Eligible Person or his or her guardian or legal representative, provided that Awards that are NQSOs may be transferred or assigned by the optionee to the optionee’s spouse or descendent (any such spouse or descendent, an “Immediate Family Member”) or a corporation, partnership, limited liability company or trust so long as all of the shareholders, partners, members or beneficiaries thereof, as the case may be, are either the optionee or the optionee’s Immediate Family Member, provided, further, that (i) there may be no consideration for any such transfer and (ii) subsequent transfers of the transferred NQSO will be prohibited other than by will or the laws of descent and distribution.  An Eligible Person’s rights under this Plan may not be pledged, mortgaged, hypothecated, or otherwise encumbered, and shall not be subject to claims of the Eligible Person’s creditors.

 

  

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(e) Noncompetition.  The Committee may, by way of the Award Agreements or otherwise, establish such other terms, conditions, restrictions and/or limitations, if any, of any Award, provided they are not inconsistent with this Plan, including, without limitation, the requirement that the Participant not engage in competition with, solicit customers or employees of, or disclose or use confidential information of the Company or its Affiliates.

 

7.           Performance Awards.

 

(a) Performance Awards Granted to Covered Employees.  If the Committee determines that an Award (other than an Option or SAR) to be granted to an Eligible Person should qualify as “performance-based compensation” for purposes of Section 162(m) of the Code, the grant, vesting, exercise and/or settlement of such Award (each, a “Performance Award”) shall be contingent upon achievement of preestablished performance goals and other terms set forth in this Section 7(a).

 

(i) Performance Goals Generally.  The performance goals for such Performance Awards shall consist of one or more business criteria and a targeted level or levels of performance with respect to each of such criteria, as specified by the Committee consistent with this Section 7(a).  The performance goals shall be objective and shall otherwise meet the requirements of Section 162(m) of the Code and regulations thereunder (including Treasury Regulation 1.162-27 and successor regulations thereto), including the requirement that the level or levels of performance targeted by the Committee result in the achievement of performance goals being “substantially uncertain.”  The Committee may determine that such Performance Awards shall be granted, vested, exercised and/or settled upon achievement of any one performance goal or that two or more of the performance goals must be achieved as a condition to grant, vesting, exercise and/or settlement of such Performance Awards.  Performance goals may differ for Performance Awards granted to any one Participant or to different Participants.

 

(ii) Business Criteria.  One or more of the following business criteria for the Company, on a consolidated basis, and/or for specified Subsidiaries or Affiliates or other business units or lines of business of the Company shall be used by the Committee in establishing performance goals for such Performance Awards: (1) earnings per share (basic or fully diluted); (2) revenues; (3) earnings, before or after taxes, from operations (generally or specified operations), or before or after interest expense, depreciation, amortization, incentives, or extraordinary or special items; (4) cash flow, free cash flow, cash flow return on investment (discounted or otherwise), net cash provided by operations, or cash flow in excess of cost of capital; (5) return on net assets, return on assets, return on investment, return on capital, return on equity; (6) economic value added; (7) operating margin or operating expense; (8) net income; (9) Share price or total stockholder return; (10) book value; (11) expense ratio; (12) operating income; and (13) strategic business criteria, consisting of one or more objectives based on meeting specified market penetration, geographic business expansion goals, cost targets, customer satisfaction, supervision of litigation and information technology, and goals relating to acquisitions or divestitures of Subsidiaries, Affiliates or joint ventures.  The targeted level or levels of performance with respect to such business criteria may be established at such levels and in such terms as the Committee may determine, in its discretion, including in absolute terms, as a goal relative to performance in prior periods, or as a goal compared to the performance of one or more comparable companies or an index covering multiple companies.

 

(iii) Performance Period; Timing for Establishing Performance Goals; Per-Person Limit.  Achievement of performance goals in respect of such Performance Awards shall be measured over a performance period, as specified by the Committee.  A performance goal shall be established not later than the earlier of (A) 90 days after the beginning of any performance period applicable to such Performance Award or (B) the time 25% of such performance period has elapsed.   In all cases, the maximum Performance Award of any Participant shall be subject to the limitation set forth in Section 4(b) or 7(a)(v), as applicable.

 

  

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(iv) Settlement of Performance Awards; Other Terms.  Settlement of such Performance Awards shall be in cash, Shares, other Awards or other property, in the discretion of the Committee.  The Committee may, in its discretion, reduce the amount of a settlement otherwise to be made in connection with such Performance Awards, but may not exercise discretion to increase any such amount payable to the Participant in respect of a Performance Award subject to this Section 7(a).  Any settlement which changes the form of payment from that originally specified shall be implemented in a manner such that the Performance Award and other related Awards do not, solely for that reason, fail to qualify as “performance-based compensation” for purposes of Section 162(m) of the Code.  The Committee shall specify the circum­stances in which such Performance Awards shall be paid or forfeited (including by repurchase for a nominal amount, where required by Bermuda law) in the event of Termination of Service of the Participant or other event (including a Change in Control) prior to the end of a performance period or settlement of such Performance Awards.

 

(v) Maximum Annual Cash Award.  The maximum amount payable upon settlement of a cash-settled Performance Unit (or other cash-settled Award) granted under this Plan that is intended to satisfy the requirements for “performance-based compensation” under Section 162(m) of the Code for any calendar year to any Eligible Person shall not exceed $3,000,000.

 

(b) Written Determinations.  Determinations by the Committee as to the establishment of performance goals, the amount potentially payable in respect of Performance Awards, the level of actual achievement of the specified performance goals relating to Performance Awards and the amount of any final Performance Award shall be recorded in writing in the case of Performance Awards intended to qualify under Section 162(m) of the Code.  Specifi­cally, the Committee shall certify in writing, in a manner conforming to applicable regulations under Section 162(m), prior to settlement of each such Award, that the performance objective relating to the Performance Award and other material terms of the Award upon which settlement of the Award was conditioned have been satisfied.

 

8.           Change in Control Provisions.  Unless otherwise provided by the Committee at the time of the Award grant, in the event of a Change in Control, (i) all outstanding Awards pursuant to which the Participant may have rights the exercise of which is restricted or limited, shall become fully exercisable at the time of the Change in Control, and (ii) unless the right to lapse of restrictions or limitations is waived or deferred by a Participant prior to such lapse, all restrictions or limitations (including risks of forfeiture and deferrals) on outstanding Awards subject to restrictions or limitations under this Plan shall lapse, and all performance criteria and other conditions to payment of Awards under which payments of cash, Shares or other property are subject to conditions shall be deemed to be achieved or fulfilled at target (if applicable) and shall be waived by the Company at the time of the Change in Control.  However, if so determined by the Board, notwithstanding the foregoing, an outstanding Award shall not be subject to the treatment provided in 8(a)(i) and 8(a)(ii) above if and to the extent such Award is, in connection with the Change in Control, either to be assumed by the successor company or parent thereof or to be replaced with comparable awards with respect to capital stock of the successor company or parent thereof, such comparability to be determined by the Committee.

 

9.           General Provisions.

 

(a) Compliance with Legal and Trading Requirements.  This Plan, the granting and exercising of Awards thereunder, and the other obligations of the Company under this Plan and any Award Agreement, shall be subject to all applicable federal, state and foreign laws, rules and regulations, and to such approvals by any stock exchange, regulatory or governmental agency as may be required.  The Company, in its discretion, may postpone the issuance or delivery of Shares under any Award until completion of such stock exchange or market system listing or registration or qualification of such Shares or any required action under any state, federal or foreign law, rule or regulation as the Company may consider appropriate, and may require any Participant to make such representations and furnish such information as it may consider appropriate in connection with the issuance or delivery of Shares in compliance with applicable laws, rules and regulations.  No provisions of this Plan shall be interpreted or construed to obligate the Company to register any Shares under federal, state or

 

  

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foreign law.  The Shares issued under this Plan may be subject to such other restrictions on transfer as determined by the Committee.

 

(b) No Right to Continued Employment or Service.  Neither this Plan nor any action taken thereunder shall be construed as giving any employee, consultant or director the right to be retained in the employ or service of the Company or any of its Subsidiaries or Affiliates, nor shall it interfere in any way with the right of the Company or any of its Subsidiaries or Affiliates to terminate any employee’s, consultant’s or director’s employment or service at any time.

 

(c) Taxes.  The Company or any Subsidiary or Affiliate is authorized to withhold from any Award granted, any payment relating to an Award under this Plan, including from a distribution of Shares, or any payroll or other payment to an Eligible Person, amounts of withholding and other taxes due in connection with any transaction involving an Award, and to take such other action as the Committee may deem advisable to enable the Company and Eligible Persons to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any Award.  This authority shall include authority to withhold or receive Shares or other property and to make cash payments in respect thereof in satisfaction of an Eligible Person’s tax obligations; provided, however, that the amount of tax withholding to be satisfied by withholding Shares shall be limited to the minimum amount of taxes, including employment taxes, required to be withheld under applicable Federal, state and local law.

 

(d) Changes to this Plan and Awards.  The Board may amend, alter, suspend, discontinue, or terminate this Plan or the Committee’s authority to grant Awards under this Plan without the consent of shareholders of the Company or Participants, except that any such amendment or alteration shall be subject to the approval of the Company’s shareholders (i) to the extent such shareholder approval is required under the rules of any stock exchange or automated quotation system on which the Shares may then be listed or quoted, or (ii) as it applies to ISOs, to the extent such shareholder approval is required under Section 422 of the Code; provided, however, that, without the consent of an affected Participant, no amendment, alteration, suspension, discontinuation, or termination of this Plan may materially and adversely affect the rights of such Participant under any Award theretofore granted to him or her.  The Committee may waive any conditions or rights under, amend any terms of, or amend, alter, suspend, discontinue or terminate, any Award theretofore granted, prospectively or retrospectively; provided, however, that, without the consent of a Participant, no amendment, alteration, suspension, discontinuation or termination of any Award may materially and adversely affect the rights of such Participant under any Award theretofore granted to him or her.

 

(e) No Rights to Awards; No Shareholder Rights.  No Eligible Person or employee shall have any claim to be granted any Award under this Plan, and there is no obligation for uniformity of treatment of Eligible Persons and employees.  No Award shall confer on any Eligible Person any of the rights of a shareholder of the Company unless and until Shares are duly issued or transferred to the Eligible Person in accordance with the terms of the Award.

 

(f) Unfunded Status of Awards.  This Plan is intended to constitute an “unfunded” plan for incentive compensation.  With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in this Plan or any Award shall give any such Participant any rights that are greater than those of a general creditor of the Company; provided, however, that the Committee may authorize the creation of trusts or make other arrangements to meet the Company’s obligations under this Plan to deliver cash, Shares, other Awards, or other property pursuant to any Award, which trusts or other arrangements shall be consistent with the “unfunded” status of this Plan unless the Committee otherwise determines with the consent of each affected Participant.

 

(g) Nonexclusivity of this Plan.  Neither the adoption of this Plan by the Board nor its submission to the shareholders of the Company for approval shall be construed as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including, without limitation,

 

  

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the granting of options and other awards otherwise than under this Plan, and such arrangements may be either applicable generally or only in specific cases.

 

(h) Not Compensation for Benefit Plans.  No Award payable under this Plan shall be deemed salary or compensation for the purpose of computing benefits under any benefit plan or other arrangement of the Company for the benefit of its employees, consultants or directors unless the Company shall determine otherwise.

 

(i) No Fractional Shares.  No fractional Shares shall be issued or delivered pursuant to this Plan or any Award.  The Committee shall determine whether cash, other Awards, or other property shall be issued or paid in lieu of such fractional Shares or whether such fractional Shares or any rights thereto shall be forfeited (including by repurchase at a nominal price, where required by Bermuda law) or otherwise eliminated.

 

(j) Governing Law.  The validity, construction, and effect of this Plan, any rules and regulations relating to this Plan, and any Award Agreement shall be determined in accordance with the laws of Bermuda without giving effect to principles of conflict of laws thereof.

 

(k) Effective Date; Plan Termination.  This Plan became effective as of the Effective Date.  This Plan shall terminate as to future awards on May 25, 2020 unless earlier terminated or extended by amendment.

 

(l) Section 409A .   Awards under this Plan are intended to comply with, or be exempt from, the applicable requirements of Section 409A of the Code and shall be limited, construed and interpreted in accordance with such intent.  Although the Company does not guarantee any particular tax treatment, to the extent that any Award is subject to Section 409A of the Code, it shall be paid in a manner that is intended to comply with Section 409A of the Code, including regulations and any other guidance issued by the Secretary of the Treasury and the Internal Revenue Service with respect thereto.  In no event whatsoever shall the Company be liable for any additional tax, interest or penalties that may be imposed on a Participant by Section 409A of the Code or any damages for failing to comply with Section 409A of the Code.

 

(m) Titles and Headings.  The titles and headings of the sections in this Plan are for convenience of reference only.  In the event of any conflict, the text of this Plan, rather than such titles or headings, shall control.

 

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