Document:

EX10.1-DirRSU 6.28.14

EXHIBIT 10.1

NOTICE OF GRANT OF RESTRICTED STOCK UNIT AWARD
(NON-EMPLOYEE DIRECTORS)

DARLING INTERNATIONAL INC. 
2012 OMNIBUS INCENTIVE PLAN

SECTION 1.     GRANT OF AWARD.
On the terms and conditions set forth in the attached Terms and Conditions of Restricted Stock Unit Award (the “Terms and Conditions”) and this Notice of Grant of Restricted Stock Unit Award (the “Notice”), the Company hereby grants to the undersigned Non-Employee Director (the “Grantee”) a number of Restricted Stock Units (the “Restricted Stock Units”) as specified below, each of which represents a contingent right to receive a share of common stock of the Company, $0.01 par value per share (a “Share”), at a future date after such Restricted Stock Unit has become vested.  Together, this Notice and the Terms and all Conditions constitute the “Agreement.”

This award is granted under and subject to the terms of the Darling International Inc. 2012 Omnibus Incentive Plan (the “Plan”), which is incorporated herein by this reference.  Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Plan.

Grantee:    [__________]

Grant Date:    [__________]

# of Restricted Stock Units:    [________]

SECTION 2.  VESTING.  
The Grantee shall vest in his or her Restricted Stock Units on the earliest to occur of: (i) the first anniversary of the Grant Date, (ii) the date of the Annual Shareholders Meeting next following the Grant Date, (iii) the Grantee’s Separation from Service as a result of death or Disability, or (iv) a Change of Control (the “Vesting Date”).  In addition, if the Grantee has a Separation from Service for any reason other than death or Disability before the Vesting Date, the Grantee shall become vested in a prorated portion of the Restricted Stock Units as of the date of such Separation from Service based on the number of days from the Grant Date to the date of Separation from Service divided by 365, and any Restricted Stock Units not so vested shall be forfeited.
SECTION 3.  PAYMENT ELECTIONS.  
		
	(a)
	Except as provided by Section 3(b), vested Restricted Stock Units shall be payable to the Grantee in a single lump sum payment as soon as administratively practicable following the Grantee’s Separation from Service.    

		
	(b)
	Notwithstanding the provisions of Section 3(a) to the contrary, if the Grantee has met the stock ownership guidelines established in the Stock Ownership and Retention Policy on or before the Grant Date, the Grantee may elect to have vested Restricted Stock Units payable as soon as administratively practicable after either (i) the Grantee’s Separation from Service or (ii) the earlier of (x) a specified 

date that is no earlier than the Vesting Date or (y) Separation from Service.  In case of an election under clause (ii) in the preceding sentence, the Grantee may also elect to receive payment in either a lump sum or annual installments of up to ten years, with the first installment payment to be made as soon as administratively practicable following the specified payment date elected by the Grantee; provided, however, that no installment payments shall be permitted following Separation from Service and, in that regard, all remaining unpaid installments payments shall be paid in a lump sum as soon as administratively practicable after Separation from Service.
		
	(c)
	Each date upon which vested Restricted Stock Units are payable is referred to herein as a “Settlement Date.”  Any payment election hereunder must be completed no later than the Grant Date by completing an election form which has been approved by the Committee.  If a payment election is not duly made, payment of vested Restricted Stock Units shall be made as a lump sum payment as soon as administratively practicable following Separation from Service.  In case of installment payments, the number of Restricted Stock Units payable as of a given Settlement Date shall be the total number of vested Restricted Stock Units that are subject to the installment payment divided by the number of installment payments remaining (including the payment then being made), rounded to the nearest whole Restricted Stock Unit.  The payment election applicable to the Restricted Stock Units shall also apply to any Dividend Restricted Stock Units credited in accordance with Section 1(c) of the Terms and Conditions.

SECTION 4. DEFINITIONS.
		
	(a)
	“Disability” shall mean that the Grantee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment as determined by the Board of Directors in its sole discretion; provided, however, that the Grantee shall recuse himself or herself from the determination as to his or her own Disability.

		
	(b)
	“Separation from Service” shall mean the Grantee’s “separation from service” with the Company within the meaning of Section 409A and any related administrative policies of the Company.

This Award is conditioned upon the Grantee’s acceptance of the provisions set forth in this Notice and the Terms and Conditions within 90 days after the Notice and such Terms and Conditions are presented to the Grantee for review.  If the Grantee fails to accept the award of Restricted Stock Units within such 90-day period, such award shall be null and void, and the Grantee’s rights in the Restricted Stock Units shall immediately terminate without any payment of consideration by the Company.

By signing below, the Grantee agrees that this award of Restricted Stock Units is granted under and governed by the terms and conditions of the Plan and the attached Terms and Conditions.

Grantee                        Darling Ingredients Inc.
(formerly Darling International Inc.)

___________________________        By:                     
Title:                     
Date: ______________________        Date:                     

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TERMS AND CONDITIONS OF RESTRICTED STOCK UNIT AWARD

These Terms and Conditions of Restricted Stock Unit Award (the “Terms and Conditions”) relate to the Notice of Grant of Restricted Stock Unit Award (the “Notice”) attached hereto, by and between Darling International Inc. (the “Company”), and the person identified in the Notice (the “Grantee”).

The Committee has approved an award to the Grantee of a number of Restricted Stock Units (the “Restricted Stock Units”) under the Darling International Inc. 2012 Omnibus Incentive Plan (the “Plan”), conditioned upon the Grantee’s acceptance of the provisions set forth in the Notice and these Terms and Conditions within 90 days after the Notice and these Terms and Conditions are presented to the Grantee for review.  Together, the Notice and these Terms and all Conditions constitute the “Agreement.”  For purposes of the Notice and these Terms and Conditions, any reference to the Company shall include a reference to any Affiliate.

1.    Grant of Restricted Stock Units.

(a)    As of the grant date set forth in the Notice (the “Grant Date”), the Company grants to the Grantee the number of Restricted Stock Units set forth in the Notice, each of which represents a contingent right to receive a share of common stock of the Company, $0.01 par value per share (a “Share”) at a future date after such Restricted Stock Unit has become vested.  The Restricted Stock Units are subject to the restrictions set forth in Section 2 of these Terms and Conditions, the provisions of the Plan and the provisions contained in the Notice.

(b)    The Restricted Stock Units granted to the Grantee shall be reflected in a bookkeeping account maintained by the Company until the date on which the Restricted Stock Units are to be settled.  If and when the restrictions set forth in Section 2 expire in accordance with the terms of these Terms and Conditions, and upon the satisfaction of all other applicable conditions as to the Restricted Stock Units, such Restricted Stock Units not forfeited pursuant to Section 4 hereof shall be settled in Shares as provided in Section 1(e) of these Terms and Conditions and otherwise in accordance with the Plan.

 (c)     With respect to each Restricted Stock Unit, whether or not vested, that has not been forfeited (but only to the extent such award of Restricted Stock Units has not been settled for Shares), the Company shall, with respect to any cash dividends paid on the Shares, accrue and credit to the Grantee’s bookkeeping account a number of Restricted Stock Units having a Fair Market Value as of the date such dividend is paid equal to the cash dividends that would have been paid with respect to such Restricted Stock Unit if it were an outstanding Share (the “Dividend Restricted Stock Units”).  These Dividend Restricted Stock Units thereafter shall (i) be treated as Restricted Stock Units for purposes of future dividend accruals pursuant to this Section 1(c); (ii) vest in such amounts  at the same time as the Restricted Stock Units with respect to which such Dividend Restricted Stock Units were received; and (iii) be paid on the Settlement Date(s) applicable to the Restricted Stock Units under Section 3 of the Notice (rounded to the nearest whole Restricted Stock Unit on such Settlement Date(s)).  Any dividends or distributions on Common Stock paid other than in cash shall accrue in the Grantee’s bookkeeping account and shall vest at the same time as the Restricted Stock Units in respect of which they are made (in each case in the same form, based on the same record date and at the same time, as such dividend or other distribution is paid on such Common Stock).

(d)    The Company’s obligations under these Terms and Conditions (with respect to both the Restricted Stock Units and the Dividend Restricted Stock Units, if any) shall be unfunded and 

unsecured, and no special or separate fund shall be established and no other segregation of assets shall be made.  The rights of Grantee under these Terms and Conditions shall be no greater than those of a general unsecured creditor of the Company.  In addition, the Restricted Stock Units shall be subject to such restrictions as the Company may deem advisable under the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which Share are then listed, any Company policy and any applicable federal or state securities law.

(e)    Except as otherwise provided in these Terms and Conditions, settlement of any vested Restricted Stock Units in accordance with the provisions of the Notice and this Section 1(e) shall be delivered as soon as administratively practicable (generally not more than 30 days) after the applicable Settlement Date, and upon the satisfaction of all other applicable conditions as to the Restricted Stock Units (including the payment by the Grantee of all applicable withholding taxes).  The Restricted Stock Units shall be settled solely in whole Shares.

2.    Restrictions.

(a)    The Grantee shall have no rights as a stockholder of the Company by virtue of any Restricted Stock Unit unless and until such Restricted Stock Unit vests and resulting Shares are issued to the Grantee.

(b)      None of the Restricted Stock Units may be sold, transferred, assigned, pledged or otherwise encumbered or disposed of prior to the date such Restricted Stock Units are settled under Section 1(e) above, except as may be permitted by the Plan or as otherwise permitted by the Committee in its sole discretion or pursuant to rules adopted by the Committee in accordance with the Plan.

(c)    Any attempt to dispose of the Restricted Stock Units or any interest in the Restricted Stock Units in a manner contrary to the restrictions set forth in these Terms and Conditions shall be void and of no effect.

3.    Restricted Period and Vesting.  Subject to the provisions contained in Sections 4, 5 and 6 hereof and Section 2 of the Notice, the Restricted Stock Units shall be deemed vested and no longer subject to forfeiture under Section 4 upon the Vesting Date and the satisfaction of all other applicable conditions as to the Restricted Stock Units (including the payment by the Grantee of all applicable withholding taxes).  

4.    Forfeiture.  Subject to Section 6 hereof and Section 2 of the Notice, if prior to the Vesting Date (i) the Grantee has a Separation from Service, (ii) there occurs a material breach of the Notice or these Terms and Conditions by the Grantee, or (iii) the Grantee fails to meet the tax withholding obligations described in Section 5(b) hereof, all rights of the Grantee to the Restricted Stock Units that have not vested in accordance with Section 3 as of the date of such termination shall terminate immediately and be forfeited in their entirety.

5.    Withholding.

(a)    Regardless of any action the Company takes with respect to any or all income tax, payroll tax or other tax-related withholding (“Tax-Related Items”), the Grantee acknowledges that the ultimate liability for all Tax-Related Items owed by the Grantee is and remains the Grantee’s responsibility and that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the award made under this Agreement, including the grant or vesting of the Restricted Stock Units, or the subsequent sale of Shares; and (ii) does 

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not commit to structure the terms of the grant or any aspect of this award to reduce or eliminate the Grantee’s liability for Tax-Related Items.

(b)    Prior to vesting of the Restricted Stock Units, the Grantee shall pay or make adequate arrangements satisfactory to the Company to satisfy all withholding obligations of the Company.  In this regard, the Grantee authorizes the Company to withhold all applicable Tax-Related Items legally payable by the Grantee from the Grantee’s wages or other cash compensation paid to the Grantee by the Company or from proceeds of the sale of the Shares.  Alternatively, or in addition, to the extent permissible under applicable law, the Company may (i) sell or arrange for the sale of Shares that the Grantee acquires to meet the withholding obligation for Tax-Related Items, and/or (ii) withhold in Shares to be issued to the Grantee under this award, provided that the Company only withholds the amount of Shares necessary to satisfy the minimum withholding amount.  Finally, the Grantee shall pay to the Company any amount of Tax-Related Items that the Company may be required to withhold as a result of the Grantee’s participation in the Plan that cannot be satisfied by the means previously described.  The Company may refuse to issue and deliver Shares in payment of any earned and vested Restricted Stock Units if the Grantee fails to comply with the Grantee’s obligations in connection with the Tax-Related Items as described in this Section 5(b).

6.    Committee’s Discretion.  Notwithstanding any provision of these Terms and Conditions to the contrary, the Committee shall have discretion to waive, in accordance with the provisions of Section 3.2 of the Plan, any forfeiture of the Restricted Stock Units as set forth in Section 4 hereof, the vesting requirements and any other conditions set forth in this Terms and Conditions.

7.    Defined Terms.  Capitalized terms used but not defined in the Notice and these Terms and Conditions shall have the meanings set forth in the Plan, unless such term is defined in any employment or similar agreement between the Grantee and the Company or an Affiliate.  Any terms used in the Notice and Terms and Conditions, but defined in the Grantee’s employment agreement are incorporated herein by reference and shall be effective for purposes of the Notice and these Terms and Conditions without regard to the continued effectiveness of such employment agreement.  

8.    Grantee Representations.  The Grantee hereby represents to the Company that the Grantee has read and fully understands the provisions of the Notice, these Terms and Conditions and the Plan and the Grantee’s decision to participate in the Plan is completely voluntary.  Further, the Grantee acknowledges that the Grantee is relying solely on his or her own advisors with respect to the tax consequences of this restricted stock award.

9.    Regulatory Restrictions on the Restricted Stock Units.  Notwithstanding any other provision of the Plan, the obligation of the Company to issue Shares in connection with the grant of Restricted Stock Units under the Plan shall be subject to all applicable laws, rules and regulations and such approval by any regulatory body as may be required.  The Company reserves the right to restrict, in whole or in part, the delivery of Shares pursuant to these Terms and Conditions prior to the satisfaction of all legal requirements relating to the issuance of such Shares, to their registration, qualification or listing or to an exemption from registration, qualification or listing.

10.    Miscellaneous.

(a)    Data Privacy and Other Acknowledgments.   By accepting the award provided for in this Agreement, the Grantee acknowledges and agrees that such award is subject to the provisions regarding data privacy set forth in Appendix A.  The Grantee shall review the provisions of Appendix A 

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carefully, as this award shall be null and void absent the Grantee’s acceptance of such provisions.  The Company reserves the right to impose other requirements on the award to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the award and to require the Grantee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

(b)    No Rights as a Shareholder.  The Restricted Stock Units constitute an unfunded and unsecured obligation of the Company.  The Grantee shall not have any rights of a stockholder of the Company with respect to the Shares underlying the Restricted Stock Units unless and until the Restricted Stock Units become earned and vested and are settled by the issuance of Shares.  Upon issuance of Shares in connection with the settlement of vested Restricted Stock Units, the Grantee shall be the record owner of the Shares unless and until such Shares are sold or otherwise disposed of, and as record owner shall be entitled to all rights of a stockholder of the Company (including voting rights).

(c)    Notices.  Any notification required by the terms of this Agreement shall be given in writing and shall be deemed effective (i) upon personal delivery; (ii) upon deposit with the United States Postal Service, by registered or certified mail, with postage and fees prepaid; or (iii) upon the Company’s sending of an email to the Grantee.  A notice shall be addressed to the Company at its principal executive office and to the Grantee at the postal address that he or she most recently provided to the Company or at his or her Service email address, if any.

(d)    Waiver.  The waiver by any party hereto of a breach of any provision of the Notice or these Terms and Conditions shall not operate or be construed as a waiver of any other or subsequent breach.

(e)    Entire Agreement.  These Terms and Conditions, the Notice and the Plan constitute the entire agreement between the parties with respect to the subject matter hereof.  They supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) relating to the subject matter hereof.  In the event of a conflict between any provision of the Plan and the Notice or these Terms and Conditions, the Plan shall control.

(f)    Binding Effect; Successors.  These Terms and Conditions shall inure to the benefit of and be binding upon the parties hereto and to the extent not prohibited herein, their respective heirs, successors, assigns and representatives.  Nothing in these Terms and Conditions, express or implied, is intended to confer on any person other than the parties hereto and as provided above, their respective heirs, successors, assigns and representatives any rights, remedies, obligations or liabilities.

(g)    Governing Law.  The Notice and these Terms and Conditions shall be governed by and construed in accordance with the laws of the State of Texas.

(h)    Headings.  The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the meaning or interpretation of any of the terms or provisions of these Terms and Conditions.

(i)    Conflicts; Amendment.  The provisions of the Plan are incorporated in these Terms and Conditions in their entirety.  In the event of any conflict between the provisions of these Terms and Conditions and the Plan, the provisions of the Plan shall control.  The Terms and Conditions may be amended at any time by written agreement of the parties hereto.

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(j)    No Right to Continued Service.  Nothing in the Notice or these Terms and Conditions or the Plan shall confer upon the Grantee any right to continue in service with the Company for any period of specific duration.

(k)    Further Assurances.  The Grantee agrees, upon demand of the Company or the Committee, to do all acts and execute, deliver and perform all additional documents, instruments and agreements which may be reasonably required by the Company or the Committee, as the case may be, to implement the provisions and purposes of the Notice and these Terms and Conditions and the Plan.

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Appendix A

DATA PRIVACY

By accepting the this award, you hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by and among, as applicable, the Company and its Subsidiaries for the exclusive purpose of implementing, administering and managing the Restricted Stock Units which have been awarded to you under this Agreement (collectively, the “Stock Awards”).

You understand that the Company holds certain personal information about you, including, but not limited to, your name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of any entitlement to shares of stock or equivalent benefits awarded, canceled, vested, unvested or outstanding in your favor (“Data”), for the purpose of implementing, administering and managing the Stock Awards.  You understand that Data may be transferred to any third parties assisting in the implementation, administration and management of the Stock Awards, that these recipients may be located in your country or elsewhere, and that the recipient’s country may have different data privacy laws and protections from your country.  You understand that you may request a list with the names and addresses of any potential recipients of the Data by contacting your local human resources representative.  You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Stock Awards.  You understand that Data will be held only as long as is necessary to implement, administer and manage the Stock Awards.  You understand that you may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local human resources representative.  Further, you understand that you are providing the consents herein on a purely voluntary basis.  If you do not consent, or if you later seek to revoke your consent, your service and career with the Company will not be adversely affected; the only adverse consequence of refusing or withdrawing your consent is that the Company would not be able to grant you Stock Awards or other awards or administer or maintain such awards.  Therefore, you understand that refusing or withdrawing your consent may affect your ability to benefit from the Stock Awards.  For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact the Company.

- 6 -EX10.1 - Third Amendment to Amended and Restated Term Loan

THIRD AMENDMENT TO 
AMENDED AND RESTATED TERM LOAN AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO AMENDED AND RESTATED TERM LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into as of July 1, 2014, by and among THE PRIVATEBANK AND TRUST COMPANY, an Illinois banking corporation (“Administrative Agent”) in its capacity as administrative agent for the Lenders (as defined below), the Lenders and DIVERSICARE AFTON OAKS, LLC, DIVERSICARE BRIARCLIFF, LLC, DIVERSICARE CHISOLM, LLC, DIVERSICARE HARTFORD, LLC, DIVERSICARE OF CHANUTE, LLC, DIVERSICARE OF COUNCIL GROVE, LLC, DIVERSICARE OF HAYSVILLE, LLC, DIVERSICARE OF SEDGWICK, LLC, DIVERSICARE OF LARNED, LLC, DIVERSICARE WINDSOR HOUSE, LLC, DIVERSICARE HILLCREST, LLC, DIVERSICARE LAMPASAS, LLC, DIVERSICARE HOLDING COMPANY, LLC, DIVERSICARE KANSAS, LLC, and DIVERSICARE YORKTOWN, LLC, each a Delaware limited liability company (individually and collectively, (“Borrower”).
WHEREAS, Borrower, Administrative Agent, and the financial institutions thereto (the “Lenders”) are parties to that certain Amended and Restated Term Loan and Security Agreement dated as of April 30, 2013, as amended by that certain First Amendment to Amended and Restated Term Loan and Security Agreement dated as of November 1, 2013 and that certain Second Amendment to Amended and Restated Term Loan and Security Agreement dated as of March 31, 2014 (as the same may be further amended or modified from time to time, the “Loan Agreement”); and
WHEREAS, Borrower, Administrative Agent and Lenders desire to amend the Loan Agreement as provided in and subject to the terms and conditions of this Amendment.
NOW, THEREFORE, in consideration of the premises and mutual agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto (intending to be legally bound) hereby agree as follows:
1.Defined Terms.  Unless otherwise defined herein, capitalized terms used herein shall have the meanings assigned to such terms in the Loan Agreement.
2.    Amendments.  Subject to the terms and conditions contained herein, Borrower, Administrative Agent and Lenders hereby amend the Loan Agreement as follows:
(a)    The definition of “Affiliated Revolving Borrowers” in Section 1.1 of the Loan Agreement is hereby amended and restated in its entirety as follows:

“Affiliated Revolving Borrowers” means each of the entities identified on Schedule 1 attached hereto.
3.    Continuing Effect; No Waiver.  Except as expressly set forth in Section 2 of this Amendment, nothing in this Amendment shall constitute a modification or alteration of the terms, conditions or covenants of the Loan Agreement or any other Financing Agreement, or a waiver of any other terms or provisions thereof, and the Loan Agreement and the other Financing Agreements shall remain unchanged and shall continue in full force and effect, in each case as modified hereby.  Administrative Agent’s and Lender’s failure, at any time or times hereafter, to require strict performance by Borrower of any provision or term of the Loan Agreement, this Amendment or the Financing Agreements shall not waive, affect or diminish any right of Administrative Agent or any Lender hereafter to demand strict compliance and performance herewith or therewith.  Any suspension or waiver by Administrative Agent and a Lender of a breach of this Amendment or any Event of Default under the Loan Agreement shall not, except as expressly set forth herein, suspend, waive or affect any other breach of this Amendment or any Event of Default under the Loan Agreement, whether the same is prior or subsequent thereto and whether of the same or of a different kind or character.  None of the undertakings, agreements, warranties, covenants and representations of Borrower contained in this Amendment, shall be deemed to have been suspended or waived by Administrative Agent and Lenders unless such suspension or waiver is (i) in writing and signed by Administrative Agent and Lenders and (ii) delivered to Borrower.  In no event shall Administrative Agent’s and Lenders’ execution and delivery of this Amendment establish a course of dealing among Administrative Agent, Lenders, Borrower or any other obligor, or in any other way obligate Administrative Agent and Lenders to hereafter provide any amendments or waivers with respect to the Loan Agreement.  The terms and provisions of this Amendment shall be limited precisely as written and shall not be deemed (i) to be a consent to an amendment or a modification of any other term or condition of the Loan Agreement or of any of the Financing Agreements (except as expressly provided herein); or (ii) to prejudice any right or remedy which Administrative Agent and Lenders may now have under or in connection with the Loan Agreement or any of the Financing Agreements.  In the event any ambiguity or question of intent or interpretation arises, this Amendment shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Amendment.
4.    Reaffirmation and Confirmation.  Borrower hereby ratifies, affirms, acknowledges and agrees that the Loan Agreement and the other Financing Agreements represent the valid, enforceable and collectible obligations of Borrower, and further acknowledges that there are no existing claims, defenses, personal or otherwise, or rights of setoff whatsoever with respect to the Loan Agreement or any other Financing Agreement.  Borrower hereby agrees that this Amendment in no way acts as a release or relinquishment of the Liens and rights securing payments of the Liabilities.  The Liens and rights securing payment of the Liabilities are hereby ratified and confirmed 

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by Borrower in all respects.  Upon the effectiveness of this Amendment, each reference in the Loan Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or words of like import shall mean and be a reference to the Loan Agreement, as amended by this Amendment.
5.    Representations and Warranties.  In order to induce Administrative Agent and Lenders to enter into this Amendment, Borrower hereby represents and warrants to Administrative Agent and Lenders (which representations and warranties shall survive the execution and delivery hereof), both before and after giving effect to this Amendment that:
(a)    This Amendment has been duly authorized, validly executed and delivered by one or more Duly Authorized Officers of Borrower, and each of this Amendment, the Loan Agreement as amended hereby, and each of the other Financing Agreements to which Borrower is a party, constitutes the legal, valid and binding obligations of Borrower, enforceable against Borrower in accordance with their respective terms, subject to bankruptcy, insolvency or other similar laws affecting the enforcement of creditor’s rights and remedies generally;
(b)    The execution and delivery of this Amendment and performance by Borrower under this Amendment, the Loan Agreement and each of the other Financing Agreements to which Borrower is a party do not and will not require the consent or approval of any regulatory authority or governmental authority or agency having jurisdiction over Borrower that has not already been obtained, nor be in contravention of or in conflict with the organizational documents of Borrower or any provision of any statute, judgment, order, indenture, instrument, agreement, or undertaking, to which Borrower is party or by which Borrower’s respective assets or properties are bound;
(c)    Each of the representations and warranties of each Borrower contained in the Loan Agreement and the other Financing Agreements to which Borrower is a party are true and correct in all material respects (without duplication of any materiality carve out already provided therein) on and as of the date hereof, in each case as if made on and as of such date, other than representations and warranties that expressly relate solely to an earlier date (in which case such representations and warranties were true and correct on and as of such earlier date); and
(d)    No Default or Event of Default will result after giving effect to this Amendment, and no event has occurred that has had or could reasonably be expected to have a Material Adverse Effect after giving effect to this Amendment.
6.    Conditions to Effectiveness of Consent.  This Amendment shall become effective as of the date first written above upon the satisfaction of the following conditions precedent:
(a)    Each party hereto shall have executed and delivered this Amendment to Administrative Agent;

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(b)    Borrower shall have delivered (or caused its Affiliates to deliver) to Administrative Agent the fully executed First Amendment and Consent to Amended and Restated Revolving Loan and Security Agreement contemplated to be delivered in connection with this Amendment; and
(c)    Borrower shall have delivered to Administrative Agent resolutions of the Borrower’s governing body authorizing the execution and delivery of this Amendment.
7.    Release.
(a)    In consideration of, among other things, the consent and amendments provided for herein, and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, Borrower (on behalf of themselves and their respective subsidiaries, Affiliates, successors and assigns), and, to the extent permitted by applicable law, and the same is claimed by right of, through or under the above, for their past, present and future employees, directors, members, managers, partners, agents, representatives, officers, directors, and equity holders (all collectively, with Borrower, the “Releasing Parties”), do hereby unconditionally, irrevocably, fully, and forever remise, satisfy, acquit, release and discharge Administrative Agent and Lenders and each of Administrative Agent’s and Lender’s past, present and future officers, directors, agents, employees, attorneys, parent, shareholders, successors, assigns, subsidiaries and Affiliates and all other persons and entities to whom Administrative Agent or Lenders would be liable if such persons or entities were found in any way to be liable to any of the Releasing Parties (collectively, the “Lender Parties”), of and from any and all manner of action and actions, cause and causes of action, claims, cross-claims, charges, demands, counterclaims, suits, proceedings, disputes, debts, dues, sums of money, accounts, bonds, covenants, contracts, controversies, damages, judgments, liabilities, damages, costs, expenses, executions, liens, claims of liens, claims of costs, penalties, attorneys’ fees, or any other compensation, recovery or relief on account of any liability, obligation, demand, proceedings or cause of action of whatever nature, whether in law, equity or otherwise (including, without limitation, those arising under 11 U.S.C. §§ 541-550 and interest or other carrying costs, penalties, legal, accounting and other professional fees and expenses, and incidental, consequential and punitive damages payable to third parties), whether known or unknown, fixed or contingent, joint and/or several, secured or unsecured, due or not due, primary or secondary, liquidated or unliquidated, contractual or tortious, direct, indirect, or derivative, asserted or unasserted, foreseen or unforeseen, suspected or unsuspected, now existing, heretofore existing or which may have heretofore accrued against any or all of Lender Parties, whether held in a personal or representative capacity, that the Releasing Parties (or any of them) have or may have against the Lender Parties or any of them (whether directly or indirectly) and which are based on any act, fact, event, action or omission or any other matter, condition, cause or thing occurring at or from any time prior to and including the date hereof in any way, directly or indirectly arising out of, connected with or relating to this Amendment, the Loan Agreement or any other Financing 

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Agreement and the transactions contemplated hereby and thereby, the Collateral or the Liabilities, and all other agreements, certificates, instruments and other documents and statements (whether written or oral) related to any of the foregoing, other than any applicable good faith claim as to which a final determination is made in a judicial proceeding (in which Administrative Agent and any of the Released Parties have had an opportunity to be heard) which determination includes a specific finding that Administrative Agent acted in a grossly negligent manner or with actual willful misconduct or illegal activity.  Borrower acknowledges that Administrative Agent and Lenders are specifically relying upon the representations, warranties and agreements contained herein and that such representations, warranties and agreements constitute a material inducement to Administrative Agent and Lenders in entering into this Amendment.
(b)    Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.
(c)    To the furthest extent permitted by law, Borrower hereby knowingly, voluntarily, intentionally and expressly waives and relinquishes any and all rights and benefits that it respectively may have as against Lender Parties under any law, rule or regulation of any jurisdiction that would or could have the effect of limiting the extent to which a general release extends to claims which a Lender Party or Releasing Party does not know or suspect to exist as of the date hereof.  Borrower hereby acknowledges that the waiver set forth in the prior sentence was separately bargained for and that such waiver is an essential term and condition of this Amendment.
8.    Miscellaneous.
(a)    Costs and Expenses.  Borrower, jointly and severally, agrees to pay on demand all costs and expenses of Administrative Agent (including, without limitation, the reasonable fees and expenses of outside counsel for Administrative Agent) in connection with the preparation, negotiation, execution, delivery and administration of this Amendment and all other instruments or documents provided for herein or delivered or to be delivered hereunder or in connection herewith.  All obligations provided herein shall survive any termination of this Amendment and the Loan Agreement as amended hereby.
(b)    Financing Agreement.  This Amendment shall constitute a Financing Agreement.
(c)    Titles.  Titles and section headings herein shall be without substantive meaning and are provided solely for the convenience of the parties.

5

(d)    Severability; Etc.  Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Amendment shall be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Amendment.  The parties hereto have participated jointly in the negotiation and drafting of this Amendment.  In the event an ambiguity or question of intent or interpretation arises, this Amendment shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Amendment.
(e)    Successors and Assigns.  This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns; provided, however, no Borrower may assign any of its respective rights or obligations under this Amendment without the prior written consent of Administrative Agent.
9.    Further Assurances.  Borrower shall, at its own cost and expense, cause to be promptly and duly taken, executed, acknowledged and delivered all such further acts, certificates, instruments, reaffirmations, amendments, documents and assurances as may from time to time be necessary or as Administrative Agent may from time to time reasonably request in order to more fully carry out the intent and purposes of this Amendment and the other documents entered into in connection herewith.
10.    Governing Law.  This Amendment shall be a contract made under and governed by, and construed and enforced in accordance with, the internal laws of the State of Illinois without regard to conflicts of law principles.
11.    Counterparts; Fax Signatures.  This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Consent.  A signature hereto sent or delivered by facsimile or other electronic transmission shall be as legally valid, effective and enforceable as a signed original for all purposes.
[Signature pages follow]

6

IN WITNESS WHEREOF, the parties hereto have duly executed this Third Amendment to Amended and Restated Term Loan and Security Agreement as of the day and year first above written.
	
			
	BORROWER:

	DIVERSICARE AFTON OAKS, LLC

	DIVERSICARE BRIARCLIFF, LLC

	DIVERSICARE CHISOLM, LLC

	DIVERSICARE HARTFORD, LLC

	BY:
	DIVERSICARE LEASING CORP., its sole member

	 
	By:
	/s/James R. McKnight, Jr.

	 
	Name:   James R. McKnight, Jr.

	 
	Its:   Executive Vice President &  
Chief Financial Officer

	DIVERSICARE OF CHANUTE, LLC

	DIVERSICARE OF COUNCIL GROVE, LLC

	DIVERSICARE OF HAYSVILLE, LLC

	DIVERSICARE OF SEDGWICK, LLC

	DIVERSICARE OF LARNED, LLC

	BY:
	

Diversicare Kansas, LLC,
its sole member

	 
	By:
	/s/James R. McKnight, Jr.

	 
	Name:   James R. McKnight, Jr.

	 
	Its:   Executive Vice President &  
Chief Financial Officer

	DIVERSICARE WINDSOR HOUSE, LLC

	DIVERSICARE HILLCREST, LLC

	DIVERSICARE LAMPASAS, LLC

	DIVERSICARE YORKTOWN, LLC

Signature Page to Third Amendment to 
Amended and Restated Term Loan and Security Agreement

	
			
	BY:
	DIVERSICARE LEASING CORP., its sole member

	 
	By:
	/s/James R. McKnight, Jr.

	 
	Name:   James R. McKnight, Jr.

	 
	Its:   Executive Vice President &  
Chief Financial Officer

DIVERSICARE HOLDING COMPANY, LLC

By:/s/James R. McKnight, Jr.        
   Name: James R. McKnight, Jr.
   Its:       Executive Vice President &
               Chief Financial Officer

DIVERSICARE KANSAS, LLC

By:/s/James R. McKnight, Jr.        
Name: James R. McKnight, Jr.
Its:       Executive Vice President &
             Chief Financial Officer
                
                
                
                

Signature Page to Third Amendment to 
Amended and Restated Term Loan and Security Agreement

ADMINISTRATIVE AGENT:

THE PRIVATEBANK AND TRUST COMPANY, in its capacity as administrative agent

By:/s/Adam D. Panos                
      Name: Adam D. Panos
      Its:  Managing Director

Signature Page to Third Amendment to 
Amended and Restated Term Loan and Security Agreement

LENDER:

THE PRIVATEBANK AND TRUST COMPANY

By:/s/Adam D. Panos                
      Name:  Adam D. Panos
      Its:  Managing Director

Signature Page to Third Amendment to 
Amended and Restated Term Loan and Security Agreement

LENDER:

BANKERS TRUST COMPANY

By:/s/Jon M. Doll                
      Name:  Jon M. Doll
      Its:  Vice President

Signature Page to Third Amendment to 
Amended and Restated Term Loan and Security Agreement

LENDER:

BOKF, NA D/B/A BANK OF OKLAHOMA

By:/s/Ryan Kirk                
      Name:  Ryan Kirk
      Its:  Vice President

Signature Page to Third Amendment to 
Amended and Restated Term Loan and Security Agreement

LENDER:

CIT FINANCE LLC

By:/s/Barbara Perich                
      Name:  Barbara Perich
      Its:  Director

SCHEDULE 1
(AFFILIATED REVOLVING BORROWERS)
	
			
	Name
	State of Incorporation or Formation
	Principal Place of Business and Chief Executive Office

	Advocat Ancillary Services, Inc.
	Tennessee corporation
	1621 Galleria Blvd., Brentwood, TN  37027

	Advocat Finance, Inc.
	Delaware corporation
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Management Services Co.
	Tennessee corporation
	1621 Galleria Blvd., Brentwood, TN  37027

	Advocat Distribution Services, Inc.
	Tennessee corporation
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Assisted Living Services, Inc.
	Tennessee corporation
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Assisted Living Services NC, LLC
	Tennessee limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Leasing Corp.
	Tennessee corporation
	1621 Galleria Blvd., Brentwood, TN  37027

	Sterling Health Care Management, Inc.
	Kentucky corporation
	1621 Galleria Blvd., Brentwood, TN  37027

	Senior Care Cedar Hills, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Senior Care Golfcrest, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Senior Care Golfview, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Senior Care Florida Leasing, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Senior Care Southern Pines, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Afton Oaks, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Assisted Living Services NC I, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Assisted Living Services NC II, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Briarcliff, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Chisolm, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Hartford, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Hillcrest, LLC,
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Lampasas, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Pinedale, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Windsor House, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Yorktown, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Ballinger, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Doctors, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Estates, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Humble, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Katy, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Normandy Terrace, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Texas I, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Treemont, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Rose Terrace, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Paris, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Therapy Services, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Chanute, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Council Grove, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Haysville, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Sedgwick, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Larned, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Highlands, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Holding Company, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Kansas, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare Leasing Company II, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Seneca Place, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Bradford Place, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Providence, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Siena Woods, LLC
	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of St. Theresa, LLC

	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Big Springs, LLC

	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Nicholasville, LLC

	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Avon, LLC

	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Mansfield, LLC

	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Riverside, LLC

	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of Chateau, LLC

	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

	Diversicare of St. Joseph, LLC

	Delaware limited liability company
	1621 Galleria Blvd., Brentwood, TN  37027

CONSENT AND REAFFIRMATION
The undersigned (“Guarantor”) hereby (i) confirms and agrees with The PrivateBank and Trust Company, an Illinois banking corporation in its capacity as administrative agent (together with its successors and assigns, “Administrative Agent”) that Guarantor’s Amended and Restated Guaranty dated as of April 30, 2013 made in favor of Administrative Agent (as amended or modified, “Guaranty”), remains in full force and effect and is hereby ratified and confirmed in all respects, including with regard to the Amended and Restated Term Loan and Security Agreement dated as of April 30, 2013, as amended by that certain First Amendment to Amended and Restated Term Loan and Security Agreement dated as of November 1, 2013, and that certain Second Amendment to Amended and Restated Term Loan and Security Agreement dated as of March 31, 2014, and as further amended by the foregoing Third Amendment to Amended and Restated Term Loan and Security Agreement (“Amendment”), and each reference to the term “Borrower” in the Guaranty shall also include New Borrower and each reference to the “Loan Agreement” shall refer to the Loan Agreement as amended by the Amendment; (ii) represents and warrants to Administrative Agent, which representations and warranties shall survive the execution and delivery hereof, that Guarantor’s representations and warranties contained in the Guaranty are true and correct as of the date hereof, with the same effect as though made on the date hereof, except to the extent that such representations expressly related solely to an earlier date, in which case such representations were true and correct on and as of such earlier date (and except for the representations in Section 10(b) thereof which were true and correct on and as of the date when made); (iii) agrees and acknowledges that such ratification and confirmation is not a condition to the continued effectiveness of the Amendment or the Guaranty; and (iv) agrees that neither such ratification and confirmation, nor Administrative Agent’s solicitation of such ratification and confirmation, constitutes a course of dealing giving rise to any obligation or condition requiring a similar or any other ratification or confirmation from the undersigned with respect to subsequent amendments or modifications, if any, to the Loan Agreement, as amended by the Amendment or any other Financing Agreement (as defined in the Loan Agreement, as amended by the Amendment).  The execution, delivery and effectiveness of this instrument shall not operate as a waiver of any right, power or remedy of Administrative Agent under or pursuant to the Guaranty.  Guarantor acknowledges and agrees that Guarantor has received and reviewed a fully-executed copy of the Amendment (and any other instrument, document or agreement executed or delivered in connection therewith) and understands the contents thereof.  A signature hereto sent or delivered by facsimile or other electronic transmission shall be as legally binding and enforceable as a signed original for all purposes.  This instrument shall be governed by and construed and enforced in accordance with the internal laws of the State of Illinois, without regard to conflict of law principles.

Dated:  July 1, 2014
DIVERSICARE HEALTHCARE SERVICES, INC. (F/K/A ADVOCAT INC.)

By:/s/Kelly J. Gill            
Name:    Kelly J. Gill
Its:    President and Chief Executive Officer

Signature Page to Third Amendment to 
Amended and Restated Term Loan and Security Agreement

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