Document:

Exhibit 10.1

Exhibit 10.1

LOAN AGREEMENT

LOAN AGREEMENT, dated as of May 17, 2011 (this “Agreement”), between NATIONWIDE HEALTH
PROPERTIES, INC., a Maryland corporation (with its successors, the “Borrower”), and VENTAS REALTY,
LIMITED PARTNERSHIP, a Delaware limited partnership (with its successors, the “Lender”).

1. Certain Definitions. As used herein, the following terms have the following meanings:

“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.

“Capital Lease” means at any time any lease of Property which, in accordance with
generally accepted accounting principles in the United States of America, would at such time
be required to be capitalized on a balance sheet of the lessee.

“Capital Lease Obligation” means at any time the amount of the liability in respect of
a Capital Lease which, in accordance with generally accepted accounting principles in the
United States of America, would at such time be required to be capitalized on a balance
sheet of the lessee.

“Change of Control” means (a) the acquisition of ownership, directly or indirectly,
beneficially or of record, by any Person or group (within the meaning of the Exchange Act
and the rules of the Commission thereunder as in effect on the date hereof) other than a
Permitted Acquiror, of Equity Interests representing more than 40% of the aggregate ordinary
voting power represented by the issued and outstanding Equity Interests of the Borrower; (b)
a majority of the members of the board of directors of the Borrower do not constitute
Continuing Directors; (c) the acquisition of direct or indirect Control of the Borrower by
any Person or group other than a Permitted Acquiror; or (d) the Borrower completes a share
exchange, consolidation, merger, sale of all or substantially all of its assets or similar
transaction, in each case, other than a share exchange, consolidation or merger in which the
Permitted Acquiror or the holders of the Borrower’s Equity Interests entitled to vote in the
election of the board of directors of the Borrower generally immediately prior to the share
exchange, consolidation or merger have, directly or indirectly, at least 60% of the total
voting power in the aggregate of all classes of Equity Interests of the Borrower or, if such
entity is not the Borrower, the continuing or surviving entity entitled to vote in the
election of the board of directors of such Person generally immediately after the share
exchange, consolidation or merger.

“Commission” means the Securities and Exchange Commission, as from time to time
constituted, created under the Exchange Act.

 

 

 

“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 date hereof, and (b) any
individual who becomes a member of the board of directors of the Borrower after the date
hereof 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
date hereof 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 a condition that, after notice or lapse of time or both, would
constitute an Event of Default.

“Discount Amount” means, with respect to any prepayment of the Loan, an amount equal to
the difference between (a) the amount of interest actually accrued on the portion of the
Loan being repaid from the date of this Agreement through the date of such prepayment
(exclusive of any interest due by virtue of Section 4(b)) and (b) the amount of interest
that would have accrued on such portion of the Loan during such period of time if the
interest rate referred to in Section 4(a) had been 2.50%.

“EBITDA” means, for any period, with respect to the Borrower and its Subsidiaries on a
consolidated basis, determined in accordance with generally accepted accounting principles
in the United States of America, the sum of net income (or net loss) for such period plus,
the sum of all amounts treated as expenses for: (a) interest, (b) depreciation, (c)
amortization, (d) all accrued taxes on or measured by income to the extent included in the
determination of such net income (or net loss) and (e) any noncash charge resulting from a
change in accounting principles; provided, however, that net income (or net loss) shall be
computed without giving effect to extraordinary losses or gains and without taking into
account any provision for gains, losses or impairments on properties.

“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.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

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“Funded Indebtedness”, when used with respect to any Person, means as of any date of
determination thereof, (i) its Indebtedness, determined in accordance with generally
accepted accounting principles in the United States of America, which by its terms matures
more than one year after the date of calculation, and any such Indebtedness maturing within
one year from such date which is renewable or extendable at the option of the obligor to a
date more than one year from such date, and (ii) the current portion of all such
Indebtedness.

“Governmental Authority” means any federal, state, municipal, national or other
government, governmental department, commission, board, bureau, court, agency or
instrumentality or political subdivision thereof or any entity, officer or examiner
exercising executive, legislative, judicial, regulatory or administrative functions of or
pertaining to any government or any court, in each case whether associated with a state of
the United States, the United States, or a foreign entity or government.

“Indebtedness”, when used with respect to any Person means its (i) indebtedness,
secured or unsecured, for borrowed money; (ii) liabilities secured by any Lien existing on
Property owned by such Person; (iii) Capital Lease Obligations, and the present value of all
payments due under any arrangement for retention of title (discounted at a rate per annum
equal to 5.00% and compounded semi-annually) if such arrangement is in substance an
installment purchase or an arrangement for the retention of title for security purposes; and
(iv) guarantees of obligations of the character specified in the foregoing clauses (i), (ii)
and (iii) to the full extent of the liability of the guarantor (discounted to the present
value, as provided in the foregoing clause (iii), in the case of guarantees of title
retention arrangements).

“Interest Coverage Ratio” as of any date means the ratio of (a) EBITDA to (b) Interest
Expense; all of the foregoing calculated by reference to the immediately preceding four
fiscal quarters of the Borrower most recently ended prior to such date of determination.

“Interest Expense” means, for any period, with respect to the Borrower and its
Subsidiaries on a consolidated basis, the sum of all interest in respect of Indebtedness of
the Borrower accrued during such period.

 

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“Lien” means any interest in Property securing an obligation owed to, or a claim by, a
Person other than the owner of the Property, whether such interest is based on the common
law, statute or contract, and including but not limited to the security interest lien
arising from a mortgage, encumbrance, pledge, conditional sale or trust receipt or a lease,
consignment or bailment for security purposes. The term “Lien” shall include reservations,
exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions,
leases and all other title exceptions and encumbrances affecting Property, but will not
apply to (1) any liens securing the performance of any contract or
undertaking of the Borrower not directly or indirectly in connection with the borrowing
of money, obtaining of advances or credit or the securing of debts, if made and continuing
in the ordinary course of business, (2) any lien in favor of the United States or any state
thereof or the District of Columbia, or any agency, department or other instrumentality
thereof, to secure progress, advance, or other payments pursuant to any contract or
provision of any statute, (3) mechanics’, materialmen’s, carriers’, or other like liens
arising in the ordinary course of business (including construction of facilities) in respect
of obligations which are not due or which are being contested in good faith, (4) any lien
arising by reason of deposits with, or the giving of any form of security to, any
governmental agency or any body created or approved by law or governmental regulation, which
is required by law or governmental regulation as a condition to the transaction of any
business, or the exercise of any privilege, franchise or license, (5) any liens for taxes,
assessments or governmental charges or levies not yet delinquent, or liens for taxes,
assessments or governmental charges or levies already delinquent but the validity of which
is being contested in good faith, (6) liens (including judgment liens) arising in connection
with legal proceedings so long as such proceedings are being contested in good faith and in
the case of judgment liens, execution thereof is stayed, and (7) any extension, renewal or
replacement (or successive extensions, renewals or replacements), as a whole or in part, of
any lien referred to in the foregoing clauses (1) to (6) inclusive; provided, however, that
the amount of any and all obligations and indebtedness secured thereby shall not exceed the
amount thereof so secured immediately prior to the time of such extension, renewal or
replacement and that such extension, renewal or replacement shall be limited to all or a
part of the Property which secured the charge or lien so extended, renewed or replaced (plus
improvements on such Property). For all purposes of this Agreement, the Borrower shall be
deemed to be the owner of any Property which it has acquired or holds subject to a
conditional sale agreement, Capital Lease or other arrangement pursuant to which title to
the Property has been retained by or vested in some other Person for security purposes.

“Loan” means a loan with a principal amount of $600,000,000.00 made pursuant to Section
2.

“Mandatory Prepayment Date” means October 31, 2012.

“Maturity Date” means the tenth anniversary hereof, or, if such day is not a Business
Day, the next succeeding Business Day.

“Merger Agreement” means the Agreement and Plan of Merger, dated as of February 27,
2011, by and among Ventas, Needles Acquisition LLC, a Delaware limited liability company,
and the Borrower.

“Permitted Acquiror” means Ventas or any wholly owned Subsidiary of Ventas.

 

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“Person” means any individual, corporation, partnership, limited liability company,
joint venture, association, joint-stock company, trust, unincorporated organization or
government or agency or political subdivision thereof.

“Property” means any interest in any kind of property or asset, whether real, personal
or mixed, or tangible or intangible.

“Solvent” means that, with respect to any Person, (a) the sum of such Person’s debt
(including contingent liabilities) does not exceed the present fair saleable value of such
Person’s present assets; (b) such Person’s capital is not unreasonably small in relation to
its business as conducted on the date hereof or proposed to be conducted after the date
hereof; and (c) such Person has not incurred and does not intend to incur, debts beyond its
ability to pay such debts as they become due (whether at maturity or otherwise).

“Subsidiary” or “Subsidiaries” means a corporation, partnership, limited liability
company or trust more than 50% of the outstanding Voting Stock of which is owned, directly
or indirectly, by the Borrower or by one or more other Subsidiaries, or by the Borrower and
one or more other Subsidiaries.

“Total Assets” means, on any date, the sum of (i) Undepreciated Real Estate Assets and
(ii) all other assets of the Borrower and its Subsidiaries determined in accordance with
generally accepted accounting principles in the United States of America (but excluding
intangibles).

“Total Unencumbered Assets” means, on any date, the sum of (i) the value of those
Undepreciated Real Estate Assets that are not subject to any Lien which secures Indebtedness
for borrowed money of any of the Borrower and its Subsidiaries and (ii) the value of all
other assets of the Borrower and its Subsidiaries not subject to any Lien securing
Indebtedness for borrowed money of any of the Borrower and its Subsidiaries determined in
accordance with generally accepted accounting principles in the United States of America
(but excluding intangibles) after eliminating intercompany accounts and transactions.

“Undepreciated Real Estate Assets” means, on any date, the cost (original cost plus
capital improvements) of any real estate assets of the Borrower and its Subsidiaries, before
depreciation and amortization, determined on a consolidated basis in accordance with
generally accepted accounting principles in the United States of America.

“Unsecured Debt” means Funded Indebtedness less Indebtedness secured by Liens on the
Property or assets of the Borrower and its Subsidiaries.

“Ventas” means Ventas, Inc., a Delaware corporation.

 

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“Voting Stock” means stock or other interests evidencing ownership in a corporation,
partnership, limited liability company or trust which ordinarily has voting power for the
election of directors, or other persons performing equivalent functions, whether at all
times or only so long as no senior class of stock has such voting power by reason of any
contingency.

2. Loan. The Lender hereby agrees to make the Loan to the Borrower on the first Business Day
immediately following the date hereof.

3. Repayment of Loan. The Borrower shall pay to the Lender the outstanding principal amount of
the Loan on the Maturity Date, together with all accrued and unpaid interest on the Loan.

4. Interest Rate. (a) The outstanding principal amounts of the Loan shall bear interest at
the rate of 5.00% per annum from the date of this Agreement, or from the immediately preceding
Interest Payment Date to which interest has been paid. The Borrower shall pay interest on the Loan
to the Lender semi-annually, in arrears, on the date that is two Business Days prior to June 1 of
each year and the date that is two Business Days prior to December 1 of each year (each, an
“Interest Payment Date”) commencing the date that is two Business Days prior to December 1, 2011.
Accrued interest will also be payable on the date of maturity or any earlier date of repayment of
the Loan. Interest on the Loan will be computed on the basis of a 360-day year of twelve 30-day
months.

(b) Notwithstanding the foregoing, to the extent permitted by applicable law, in the
case of any overdue amounts of principal or interest, the Borrower shall pay interest on
such overdue amounts, on demand by the Lender, at the rate of 7.00% per annum.

5. Use of Proceeds. The proceeds of the Loan will be used by the Borrower to repay
outstanding amounts under its existing revolving credit facility, to acquire properties and for
other corporate purposes.

6. Voluntary Prepayments. The Borrower will have the right at any time to prepay the Loan in
whole or in part without premium or penalty at any time and from time to time, provided that any
such prepayment shall be accompanied by all accrued but unpaid interest on the principal amount
being prepaid. Upon any prepayment under this Section 6, unless an Event of Default has occurred
and is continuing, the Borrower shall receive a credit equal to the Discount Amount with respect to
such prepayment, and such credit shall be applied to such prepayment; provided that the Borrower
shall only receive such credit if such prepayment occurs after the Outside Date (as defined in the
Merger Agreement).

 

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7. Mandatory Prepayments. The Borrower shall prepay the Loan in whole, including accrued and
unpaid interest, on the earlier of (a) the occurrence of a Change of Control or (b) the
Mandatory Prepayment Date if the Closing Date (as defined in the Merger Agreement) has not
occurred on or before the Outside Date (as defined in the Merger Agreement). Upon any prepayment
under clause (a) or (b) of the immediately preceding sentence, unless an Event of Default has
occurred and is continuing, the Borrower shall receive a credit equal to the Discount Amount with
respect to such prepayment, and such credit shall be applied to such prepayment.

8. General Provisions Regarding Payments. The Borrower will pay all amounts due hereunder
free and clear of and without reduction for any taxes, levies, imposts, deductions, withholding or
charges and without set-off or counterclaim, in U.S. dollars available the same day in Chicago,
Illinois. Payments received that are insufficient to pay amounts then due shall be applied
first to indemnification obligations to the Lender, second to interest then due and
payable and third to principal repayment amounts then due.

9. Representation and Warranties. In order to induce the Lender to make the Loan, the
Borrower represents and warrants to the Lender that:

(a) The Borrower is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization and has all requisite power and authority to
carry on its business as now conducted.

(b) The execution, delivery and performance by the Borrower of this Agreement are
within the Borrower’s corporate powers and have been duly authorized by all necessary
corporate action.

(c) The execution, delivery and performance by the Borrower of this Agreement do not
and will not (i) violate (x) any material law or governmental rule or regulation applicable
to the Borrower, (y) the certificate of incorporation or by-laws of the Borrower, or (z) any
order, judgment or decree of any court or other agency of government binding on the
Borrower; (ii) conflict with, result in a breach of or constitute (with due notice or lapse
of time or both) a default under any material contractual obligation of the Borrower; (iii)
result in or require the creation or imposition of any Lien upon any of the properties or
assets of the Borrower; or (iv) require any approval of stockholders, members or partners or
any approval or consent of any Person under any contractual obligation of the Borrower, or
any registration with, consent or approval of, or notice to, or other action to, with or by,
any Governmental Authority except for such approvals or consents which have been obtained on
or before the date hereof.

(d) This Agreement has been duly executed and delivered by the Borrower and constitutes
a legal, valid and binding obligation of the Borrower, enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and other
laws affecting creditors’ rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.

 

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(e) On the date hereof the Borrower is Solvent.

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

10. Covenants. So long as any amount is outstanding under this Agreement, unless compliance
shall have been waived in writing, in advance, by the Lender, the Borrower agrees that:

(a) Merger, Consolidation, etc. Only on Certain Terms. The Borrower shall not
consolidate with or merge into any other Person or convey, transfer or lease its properties
and assets substantially as an entirety to any Person, and the Borrower shall not permit any
Person to consolidate with or merge into the Borrower or convey, transfer or lease its
properties and assets substantially as an entirety to the Borrower, unless: (1) in case the
Borrower shall consolidate with or merge into another Person or convey, transfer or lease
its properties and assets substantially as an entirety to any Person, the Person formed by
such consolidation or into which the Borrower is merged or the Person which acquires by
conveyance or transfer, or which leases, the properties and assets of the Borrower
substantially as an entirety shall be a corporation, limited liability company, partnership
or trust, shall be organized and validly existing under the laws of the United States of
America, any State thereof or the District of Columbia and shall expressly assume, in
writing, executed and delivered to the Lender, in form satisfactory to the Lender, the due
and punctual payment of the principal of (and premium, if any) and interest on the Loan and
the performance of every covenant and other obligation under this Agreement on the part of
the Borrower to be performed or observed, and (2) immediately after giving effect to such
transaction no Event of Default, and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have occurred and be continuing. Upon any
consolidation by the Borrower with or merger by the Borrower into any other Person or any
conveyance, transfer or lease of the properties and assets of the Borrower substantially as
an entirety in accordance with this Section 10(a), the successor Person formed by such
consolidation or into which the Borrower is merged or to which such conveyance, transfer or
lease is made shall succeed to, and be substituted for, and may exercise every right and
power of, the Borrower under this Agreement with the same effect as if such successor Person
had been named as the Borrower herein, and thereafter, except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under this Agreement.

(b) Corporate Existence. Subject to Section 10(a), the Borrower will do or
cause to be done all things necessary to preserve and keep in full force and effect its
corporate existence and the rights (charter and statutory) and franchises of the Borrower
and its Subsidiaries; provided, however, that the Borrower shall not be required to preserve
any such right or franchise if it shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Borrower and/or any Subsidiary and that the
loss thereof is not disadvantageous in any material respects to the Lender.

 

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(c) Payment of Taxes and Other Claims. The Borrower will pay or discharge or
cause to be paid or discharged, before the same shall become delinquent, (1) all taxes,
assessments and governmental charges levied or imposed upon the Borrower or any Subsidiary
or upon the income, profits or property of the Borrower or any Subsidiary, and (2) all
lawful claims for labor, materials and supplies which, if unpaid, might by law become a lien
upon the property of the Borrower or any Subsidiary; provided, however, that the Borrower
shall not be required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings.

(d) Statement by Officers as to Default.

(i) The Borrower shall deliver to the Lender, within 120 days after the end of
each fiscal year, a written statement (which need not be contained in or
accompanied by an officers’ certificate) signed by the principal executive officer,
the principal financial officer or the principal accounting officer of the
Borrower, stating that (x) a review of the activities of the Borrower during such
year and of performance under this Agreement has been made under his or her
supervision, and (y) to the best of his or her knowledge, based on such review, (a)
the Borrower has complied with all the conditions and covenants imposed on it under
this Agreement throughout such year, or, if there has been a default in the
fulfillment of any such condition or covenant, specifying each such default known
to him or her and the nature and status thereof, and (b) no event has occurred and
is continuing which is, or after notice or lapse of time or both would become, an
Event of Default, or, if such an event has occurred and is continuing, specifying
each such event known to him or her and the nature and status thereof.

(ii) The Borrower shall deliver to the Lender, within five business days after
the occurrence thereof, written notice of any event which after notice or lapse of
time or both would become an Event of Default.

(e) Limitation on Liens. The Borrower will not pledge or otherwise subject to
any Lien, any of its Property or assets; provided, however, that such covenant will not
apply to Liens securing obligations which do not in the aggregate at any one time
outstanding exceed 40% of the sum of (i) the Total Assets of the Borrower and its
consolidated Subsidiaries as of the end of the calendar year or quarter covered in the
Borrower’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be,
most recently filed with the Commission (or, if such filing is not permitted under the
Exchange Act, with the Lender) prior to the incurrence of such additional Liens and (ii) the
purchase price of any real estate assets or mortgages receivable acquired, and the amount of
any securities offering proceeds received (to the extent that such proceeds were not used to
acquire real estate assets or mortgages receivable or used to reduce
Indebtedness), by the Borrower or any Subsidiary since the end of such calendar
quarter, including those proceeds obtained in connection with the incurrence of such
additional Liens.

 

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(f) Limitation on Total Unencumbered Assets. The Borrower will at all times
maintain Total Unencumbered Assets of not less than 150% of the aggregate outstanding
principal amount of the Unsecured Debt of the Borrower and its Subsidiaries on a
consolidated basis.

(g) Limitation on Indebtedness. The Borrower will not create, assume, incur or
otherwise become liable in respect of, any Indebtedness if the aggregate outstanding
principal amount of Indebtedness of the Borrower and its consolidated Subsidiaries is, at
the time of such creation, assumption or incurrence and after giving effect thereto and to
any concurrent transactions, greater than 60% of the sum of (i) the Total Assets of the
Borrower and its consolidated subsidiaries as of the end of the calendar year or quarter
covered in the Borrower’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as
the case may be, most recently filed with the Commission (or, if such filing is not
permitted under the Exchange Act, with the Lender) prior to the incurrence of such
additional Indebtedness and (ii) the purchase price of any real estate assets or mortgages
receivable acquired, and the amount of any securities offering proceeds received (to the
extent that such proceeds were not used to acquire real estate assets or mortgages
receivable or used to reduce Indebtedness), by the Borrower or any Subsidiary since the end
of such calendar year or quarter, including those proceeds obtained in connection with the
incurrence of such additional Indebtedness.

(h) Interest Coverage Ratio. The Borrower will not incur any Indebtedness if,
on a consolidated basis, the Interest Coverage Ratio on the date on which such additional
Indebtedness is to be incurred, on a pro forma basis, after giving effect to the incurrence
of such Indebtedness and to the application of the proceeds thereof, would have been less
than 1.50 to 1.00.

11. Events of Default. If any of the following events (each, an “Event of Default”) shall
occur and be continuing:

(a) default in the payment of any interest on the Loan when such interest becomes due
and payable, and continuance of such default for a period of 30 days; or

(b) default in the payment of principal of the Loan when and as the same shall become
due and payable; or

(c) default in the performance, or breach, of any covenant or warranty of the Borrower
under this Agreement (other than a covenant or warranty a default in whose performance or
whose breach is elsewhere in this Section specifically dealt with), and
continuance of such default or breach for a period of 60 days after there has been
given, by registered or certified mail, to the Borrower by the Lender a written notice
specifying such default or breach and requiring it to be remedied and stating that such
notice is a “NOTICE OF DEFAULT” hereunder; or

 

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(d) the entry by a court having jurisdiction in the premises of (a) a decree or order
for relief in respect of the Borrower in an involuntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or
(b) a decree or order adjudging the Borrower as bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or composition of
or in respect of the Borrower under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official
of the Borrower or of any substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or order for relief or
any such other decree or order unstayed and in effect for a period of 90 consecutive days;
or

(e) the commencement by the Borrower of a voluntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or
of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by
it to the entry of a decree or order for relief in respect of the Borrower in an involuntary
case or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any bankruptcy or insolvency
case or proceeding against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State law, or the consent
by it to the filing of such petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of the
Borrower or of any substantial part of its property, or the making by it of an assignment
for the benefit of creditors, or the admission by it in writing of its inability to pay its
debts generally as they become due, or the taking of corporate action by the Borrower in
furtherance of any such action; or

(f) a Change of Control shall occur;

then, in the case of any Event of Default specified above, the Lender may, by written notice to the
Borrower, declare the Loan to be forthwith due and payable, together with accrued interest,
whereupon the same shall become forthwith due and payable, without demand, protest, presentment,
notice of dishonor or any other notice or demand whatsoever, all of which are hereby waived by the
Borrower. Notwithstanding anything to the contrary contained herein, if any Event of Default
described under Section 11(f) above occurs prior to the Mandatory Prepayment Date, the Borrower
shall immediately pay to the Lender an amount equal to any and all Discount Amounts credited to the
Borrower under this Agreement, which provisions shall survive any prior payment of the Loan or
amounts outstanding hereunder.

 

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12. Notices. Any notice to be given under this Agreement shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or registered mail or sent by
telecopier to the address or telecopier number specified on the signature page hereto. Notices
sent by hand or overnight courier service or mailed by certified or registered mail shall be deemed
to have been duly given when received by the recipient. Notices sent by telecopier shall be deemed
to have been given when sent (except that, if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the next Business Day
for the recipient).

13. No Waiver. No delay on the part of the Lender in exercising any of its powers or rights,
and no partial or single exercise, shall constitute a waiver thereof.

14. Amendments and Waivers. Any provision of this Agreement may be amended or waived, but
only if such amendment or waiver is in writing and is signed by the Lender and the Borrower.

15. Successors and Assigns. This Agreement shall be binding upon the Borrower and its
successors and assigns, for the benefit of the Lender and its successors and assigns, except that
the Borrower may not assign or otherwise transfer its rights or obligations under this Agreement
without the prior written consent of the Lender. The Lender may transfer all or a portion of the
Loan to any wholly owned Subsidiary of the Lender.

16. Indemnity. (a) The Borrower agrees to indemnify, defend and hold harmless the Lender,
and any of its participants, parent corporations, subsidiary corporations, affiliated corporations,
successor corporations, and all present and future officers, directors, employees and agents of the
foregoing (the “Indemnitees”), from and against (i) any and all transfer taxes, documentary taxes,
assessments or charges made by any governmental authority by reason of the execution and delivery
of this Agreement or the making of the Loan, and (ii) any and all liabilities, losses, damages,
penalties, judgments, suits, claims, costs and expenses of any kind or nature whatsoever
(including, without limitation, the reasonable fees and disbursements of counsel) in connection
with any investigative, administrative or judicial proceedings, whether or not such Indemnitee
shall be designated a party thereto, which may be imposed on, incurred by or asserted against such
Indemnitee, in any manner relating to or arising out of or in connection with the making of the
Loan and this Agreement or the use or intended use of the proceeds of the Loan (the “Indemnified
Liabilities”); provided, however, that the Borrower shall not have any indemnification obligations
with respect to any liabilities, losses, damages, penalties, judgments, suits, claims, costs or
expenses of the Lender which arise out of the gross negligence or willful misconduct of the Lender.
If any investigative, judicial or administrative proceeding arising from any of the foregoing is
brought against any Indemnitee, upon request of such Indemnitee, the Borrower, or counsel
designated by the Borrower and reasonably satisfactory to the Indemnitee, will resist and defend
such action, suit or proceeding to the extent and in the manner directed by the Indemnitee, at the
Borrower’s sole cost and expense. Each Indemnitee will use its reasonable best efforts to
cooperate in the defense of any such action, suit or proceeding. If
the foregoing undertaking to indemnify, defend and hold harmless may be held to be
unenforceable because it violates any law or public policy, the Borrower shall nevertheless make
the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities
which is permissible under applicable law. The obligations of the Borrower under this Section 16
shall survive the termination of this Agreement and the discharge of the Borrower’s other
obligations under this Agreement.

 

12

 

(b) To the extent permitted by applicable law, the Borrower shall not assert, and
hereby waives, any claim against the Lender and its affiliates, directors, employees,
attorneys, agents or sub-agents, on any theory of liability, including, without limitation,
for special, indirect, consequential or punitive damages (as opposed to direct or actual
damages) arising out of, in connection with, as a result of or related to, this Agreement or
any agreement or instrument contemplated hereby or referred to herein, the transactions
contemplated hereby, the Loan or the use of the proceeds thereof.

17. Governing Law. This Agreement shall be governed by and construed in accordance with the
law of the State of New York, without regard to conflicts of law principles thereof.

18. Submission to Jurisdiction; Consent to Service of Process. The Borrower and, by its
acceptance of this Agreement, the Lender, each agree as follows:

(a) each such party 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 relevant appellate court, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment, and each such
party hereby irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in New York State court or, to the extent
permitted by law, in such Federal court; provided that nothing in this Agreement shall
affect any right that the Lender or the Borrower may otherwise have to bring any action or
proceeding relating to this Agreement against the other party or its properties in the
courts of any jurisdiction;

(b) each such party hereby irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that 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 Section 18(a), and each such party also irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of any such suit, action or proceeding in any such court; and

 

13

 

(c) each such party irrevocably consents to service of process in the manner provided
for notices in Section 12. Nothing in this Agreement will affect the right of any party to
serve process in any other manner permitted by law.

19. WAIVER OF JURY TRIAL. THE BORROWER HEREBY WAIVES AND, BY ITS ACCEPTANCE OF THIS
AGREEMENT, THE LENDER HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT.

20. Severability. If any provision of this Agreement is held to be invalid, illegal or
unenforceable, the other provisions of the Agreement shall remain in full force and effect.

[Signature Page Follows]

 

14

 

IN WITNESS WHEREOF, the undersigned has executed this Agreement as of the date first above
written.

	 	 	 	 	 	 	 	 	 
	 	 	NATIONWIDE HEALTH PROPERTIES, INC., as Borrower	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Abdo H. Khoury	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Abdo H. Khoury	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and 

Chief
Financial & Portfolio Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Address for notices:

Nationwide Health Properties, Inc.

610 Newport Center Drive, Suite 1150

Newport Beach, California 92660

Attention: Douglas M. Pasquale

VENTAS REALTY, LIMITED PARTNERSHIP, as Lender	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	VENTAS, INC., its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Richard A. Schweinhart	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Richard A. Schweinhart	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and 
Chief
Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Address for notices: 

Ventas Realty, Limited Partnership

10350 Ormsby Park Place, Suite 300

Louisville, Kentucky 40223

Attention: T. Richard Riney, Esqexv10w1

Exhibit 10.1

CLAIRE’S INC.

AMENDED AND RESTATED

STOCK INCENTIVE PLAN

(including amendments through May 20, 2011)

Section 1. Purpose

     The Plan authorizes the Committee to provide employees and directors of the Company or its
Affiliates, and consultants of the Company or its Affiliates who previously served as employees of
the Company or its Affiliates, who are in a position to contribute to the long-term success of the
Company or its Affiliates, with Shares or Options to acquire Shares in the Company. The Company
believes that this incentive program will cause those individuals to increase their interest in the
welfare of the Company and its Affiliates, and aid in attracting, retaining and motivating
individuals of outstanding ability.

Section 2. Definitions

     Capitalized terms used herein shall have the meanings set forth in this Section.

	 	(a)	 	“Affiliate” of any specified Person shall mean any other Person, whether now or
hereafter existing, directly or indirectly controlling or controlled by, or under
direct or indirect common control with, such specified Person. For purposes hereof,
“control” or any other form thereof, when used with respect to any Person, means the
power to direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise; and the
terms “controlling” and “controlled” shall have meanings correlative to the foregoing.
	 
	 	(b)	 	“Claire’s Investor” shall mean any of Apollo Investment Fund VI, L.P., Apollo
Investors Claire’s A LLC, and Apollo Investors Claire’s B LLC, and each of their
successors or assigns.
	 
	 	(c)	 	“Board” shall mean the Board of Directors of the Company.
	 
	 	(d)	 	“Cause” shall have the meaning ascribed thereto in any effective employment
agreement between the Company or Affiliates and the Grantee, or if no employment
agreement is in effect that contains a definition of cause, then Cause shall mean a
finding by the Committee that the Grantee has (i) committed a felony or a crime
involving moral turpitude, (ii) committed any act of gross negligence or fraud, (iii)
failed, refused or neglected to substantially perform his duties (other than by reason
of a physical or mental impairment) or to implement the reasonable directives of the
Company (which, if curable, is not cured within 30 days after notice thereof to the
Grantee by the Committee), (iv) materially violated any policy of the Company (which,
if curable, is not cured within 30 days after notice thereof to the Grantee by the
Committee), or (v) engaged in conduct
that is materially injurious to the Company, monetarily or otherwise.

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	 	(e)	 	“Committee” shall mean the committee appointed by the Board to administer the
Plan, or if no such committee is appointed, the Board.
	 
	 	(f)	 	“Company” shall mean Claire’s Inc., a corporation organized under the laws of
the State of Delaware.
	 
	 	(g)	 	“Disability” shall have the meaning ascribed thereto in any effective
employment agreement between the Company or its Affiliates and the Grantee, or if no
employment agreement is in effect that contains a definition of disability, then
Disability shall mean any physical or mental incapacitation which results in a
Grantee’s inability to perform his duties and responsibilities hereunder, as determined
by the Committee in its good faith judgment, for a period of 180 consecutive days.
	 
	 	(h)	 	“Employee” shall mean any individual that is providing services to the Company
or any of its Affiliates as an employee or director.
	 
	 	(i)	 	“Grant Letter” shall mean a letter, certificate or other agreement accepted by
the Grantee, evidencing the grant of an Option hereunder and containing such terms and
conditions, not inconsistent with the express provisions of the Plan, as the Committee
shall approve.
	 
	 	(j)	 	“Grantee” shall mean an Employee granted an Option under the Plan.
	 
	 	(k)	 	“ISO” shall mean any Option or portion thereof that meets the requirements of
an incentive stock option under Section 422 of the Internal Revenue Code of 1986, and
that is designated by the Committee to be an ISO.
	 
	 	(l)	 	“Nonqualified Option” shall mean any Option or portion thereof that is not an
ISO.
	 
	 	(m)	 	“Options” shall refer to options issued under and subject to the Plan.
	 
	 	(n)	 	“Person” shall mean any individual, corporation, partnership, limited liability
company, joint venture, association, business trust, joint-stock company, estate,
trust, unincorporated organization, government or other agency or political subdivision
thereof or any other legal or commercial entity.
	 
	 	(o)	 	“Plan” shall mean this Stock Incentive Plan as set forth herein and as amended
from time to time.
	 
	 	(p)	 	“Qualified IPO” shall mean a sale by the Company of Shares for cash in an
initial underwritten (firm commitment) public offering registered under the Securities
Act of 1933 resulting in the listing of the Shares on a nationally recognized stock
exchange, including without limitation the Nasdaq Stock Market.

2

 

	 	(q)	 	“Share” shall mean a share of common stock of the Company, or of any class of
security, if any, into which such common stock may be converted or for which such
common stock may be exchanged.
	 
	 	(r)	 	“Specified Conduct” shall mean a Grantee’s (i) unauthorized disclosure of
confidential information relating to the Company or its Affiliates, (ii) engaging,
directly or indirectly, as an employee, partner, consultant, director, stockholder,
owner, or agent in any retail business that derives 20% or more of its business from
sales of jewelry, accessories and/or cosmetics targeted to girls and women (a
“Competing Business”), (iii) inducing or attempting to induce any customer, vendor,
supplier, licensor or other Person in a business relationship with the Company or any
Affiliate, for or with which the Grantee or employees working under the Grantee’s
supervision had any direct or indirect responsibility or contact during the Grantee’s
employment with the Company or its Affiliates, (A) to do business with a Competing
Business or (B) to cease, restrict, terminate or otherwise reduce business with the
Company or its Affiliates for the benefit of a Competing Business, regardless of
whether the Grantee initiates contact, or (iv) hiring, directly or indirectly, any
individual who was an employee of the Company or its Affiliates within the six month
period prior to termination of Grantee’s employment, or soliciting or inducing,
directly or indirectly, any such individual to terminate his or her employment with the
Company or its Affiliates.
	 
	 	(s)	 	“Target IPO Price” shall mean $10.00, accumulated at an effective annual rate
of 17.5% from May 29, 2007 to the date of consummation of a Qualified IPO, provided
that the Committee shall make such adjustment to the Target IPO Price as it determines
is equitable and appropriate to reflect changes to the outstanding Shares or capital
structure of the Company, including contributions and distributions of capital.

Section 3. Shares Available under the Plan

     Subject to the provisions of Section 7, the total number of Shares that may be issued under
the Plan shall not exceed 8,200,000. If, prior to exercise, any awards are forfeited, lapse or
terminate for any reason without issuance of Shares, the Shares covered thereby may again be
available for Option grants under the Plan.

Section 4. Administration of the Plan

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

     (i) to select the Employees to whom Options or Shares may be granted;

3

 

     (ii) to determine the number of Shares awarded or subject to an Option;

     (iii) to determine the terms and conditions of any Shares or Option granted under the
Plan, including the purchase or exercise price, conditions relating to exercise, and
termination of the right to exercise;

     (iv) to determine whether any Option shall be an ISO or a Nonqualified
Option;

     (v) to determine the restrictions or conditions related to the delivery, holding and
disposition of Shares;

     (vi) to prescribe the form of each Grant Letter;

     (vii) 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 the Plan;

     (viii) to correct any defect or supply any omission or reconcile any inconsistency in
the Plan and to construe and interpret the Plan and any Option or award of Shares, or Grant
Letter or other instrument hereunder; and

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

     (b) Manner of Exercise of Committee Authority. Any action of the Committee with
respect to the Plan shall be final, conclusive and binding on all Persons, including the Company,
its Affiliates, Grantees, or any Person claiming any rights under the Plan from or through any
Grantee, except to the extent the Committee may subsequently modify, or take further action not
consistent with, its prior action. If not specified in the Plan, the time at which the Committee
must or may make any determination shall be determined by the Committee, and any such determination
may thereafter be modified by the Committee. 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 officers or managers of the
Company or any Affiliate of the Company the authority, subject to such terms as the Committee shall
determine, to perform such functions as the Committee may determine, to the extent permitted under
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 by any officer or
other employee of the Company or any of its Affiliates, the Company’s independent certified public
accountants or any executive compensation consultant, legal counsel or other professional retained
by the Company to assist in the administration of the Plan. To the fullest extent permitted by
applicable law, no member of the Committee, nor any 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 the Plan, and all
members of the Committee and any officer or employee of the Company acting on its 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.

4

 

     Section 5. Option Termination.

     Unless otherwise determined by the Committee and set forth in a Grant Letter, Options shall
terminate on the earliest of:

     (a) the 91st day following the date the Grantee ceases to be an Employee for any reason
(except if such cessation is on account of death or Disability, the 181st day
following such cessation); provided, however, that (i) in all cases the
portion of any Option that did not vest prior to or upon the date of termination of
employment or engagement with the Company or its Affiliates for any reason shall terminate
immediately upon such termination, and (ii) if such termination is for Cause, the vested
portion shall terminate as well;

     (b) the seventh anniversary of the date of grant as set forth in the Grant Letter; and

     (c) cancellation, termination or expiration of the Options pursuant to action taken by
the Committee in accordance with Section 7.

Section 6. Exercise of Options

     (a) Only the vested portion of any Option may be exercised. A Grantee shall exercise an
Option by delivery of written notice to the Company setting forth the number of Shares with respect
to which the Option is to be exercised, together with cash, a certified check or bank draft payable
to the order of the Company, in amount equal to the sum of the exercise price for such Shares and
any withholding tax obligation arising in connection with such exercise. The Committee may, in its
sole discretion, permit other forms of payment, including notes or other contractual obligations of
a Grantee to make payment on a deferred basis.

     (b) Before the Company issues any Shares to a Grantee pursuant to the exercise of an Option,
the Company shall have the right to require that the Grantee make such provision, or furnish the
Company such authorization, necessary or desirable so that the Company may satisfy its obligation
under applicable tax laws to withhold for income or other taxes due upon or incident to such
exercise. The Committee, may, in its discretion, permit such withholding obligation to be
satisfied through the withholding of Shares that would otherwise be delivered upon exercise of the
Option.

     (c) Unless otherwise determined by the Committee and set forth in a Grant Letter, upon
exercise of an Option by a Grantee that occurs both (i) while the Grantee remains an Employee, and
(ii) within the 90 day period prior to the outside expiration date of the Option, the Grantee may
satisfy the exercise price and withholding tax obligation described in Section 6(c) by any
combination of cash and/or Shares (including both previously owned Shares and Shares otherwise to
be delivered upon exercise of the Option) having an aggregate fair market value (as
determined by the Board in good faith) that, when added to any such cash, equals the exercise
price and withholding tax obligation, provided, however, that the use of Shares shall not be
permitted to the extent (i) it would result in a default or breach on the part of the Company or
any subsidiary under any loan or other agreement, or (ii) the Grantee is able to effect a
broker-assisted “cashless” exercise arrangement that may then be available to the Grantee.

5

 

     (d) As a condition to the grant of an Option or delivery of any Shares upon exercise of an
Option, the Company shall have the right to require that the Grantee become party to any
stockholders agreement then in effect.

Section 7. Adjustment Upon Changes in Capitalization

     In the event any recapitalization, forward or reverse split, reorganization, merger,
consolidation, spin-off, combination, repurchase, exchange or issuance of Shares or other
securities, any stock dividend or other special and nonrecurring dividend or distribution (whether
in the form of cash, securities or other property), liquidation, dissolution, or other similar
transactions or events, affects the Shares, then the Committee shall make such equitable adjustment
as it determines in its discretion is appropriate in order to prevent dilution or enlargement of
the rights of Grantees under the Plan, including adjustment in (i) the number and kind of Shares
deemed to be available thereafter for grants of Options or Shares under Section 3, (ii) the number
and kind of Shares that may be delivered or deliverable in respect of outstanding Options, and
(iii) the exercise price. In addition, the Committee is authorized to make such adjustments as it
shall in its sole discretion determine are appropriate in the terms and conditions of, and the
criteria included in, Options and Shares (including, without limitation, cancellation of Options in
exchange for the in-the-money value, if any, of the vested portion thereof, cancellation of
unvested and/or out-of-the-money Options for no consideration, substitution of Options using
securities of a successor or other entity, acceleration of the time that Options expire, or
adjustment of performance targets or the manner in which they are calculated) in recognition of
unusual or nonrecurring events (including, without limitation, an event described in the preceding
sentence) affecting the Company, the Claire’s Investors or any other Affiliate of the Company or
the financial statements of the Company, the Claire’s Investors or any Affiliate of the Company, or
in response to changes in applicable laws, regulations or accounting principles.

     Section 8. Restrictions/Rights on Shares.

     (a) Restrictions on Issuing Shares. No Shares shall be issued or transferred to an
Employee under the Plan unless and until all applicable legal requirements have been complied with
to the satisfaction of the Committee. The Committee shall have the right to condition the
acquisition of Shares on the Grantee’s undertaking in writing to comply with such restrictions on
any subsequent disposition of the Shares issued or transferred thereunder as the Committee shall
deem necessary or advisable as a result of any applicable law, regulation, official interpretation
thereof, or any underwriting agreement.

     (b) ISO Notice. A Grantee shall notify the Company of any disposition of Shares
acquired upon exercise of an ISO if such disposition occurs within one year of the date of such
exercise or within two years of the date of grant of such ISO. The Company may impose such
procedures as it determines may be necessary to ensure that such notification is made.

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     (c) Transfer Restrictions. Except for transfers made pursuant to Sections 8(d), (e)
or (f) below, Shares issued to a Grantee pursuant to the Plan may not be sold, pledged, encumbered
or otherwise transferred, other than by the laws of decent and distribution (but such Shares shall
in any event remain subject to the terms of the Plan and Grant Certificate).

     (d) Repurchase Right. Unless otherwise determined in a Grant Letter, the Company
shall have the right (but not the obligation) to repurchase any or all of the Shares acquired upon
exercise of the Options upon a Grantee’s ceasing to be an Employee for any reason. Such right
shall be exercisable by the Company during the one year period following the later of the date of
such cessation or the date the Option is exercised. The price per Share to be paid by the Company
should it choose to exercise its repurchase right shall equal the fair market value per share, as
determined by the Board in good faith; provided, however, if the Shares are to be
repurchased following a termination for Cause, or if, prior to such repurchase the Grantee engages
in Specified Conduct, then the price per Share to be paid by the Company shall not exceed the price
per Share paid by the Grantee, less any distributions paid in respect of such Share. The price per
Share to be paid by the Company should it choose to exercise its repurchase right shall be paid in
cash or by plain check against delivery of certificates representing the repurchased Shares;
provided that, if such payment would result in a default or breach on the part of the Company or
any subsidiary under any loan or other agreement, then payment shall be deferred until the first
business day that it may occur without any such default or breach existing or resulting (and such
deferral shall be credited with a market rate of interest as determined by the Committee),
provided, further that if such payment cannot be made within two years of the date of such
repurchase, the Grantee may elect to cancel such repurchase and receive a return of the repurchased
Shares. The Company may offset against the payment of the repurchase price any amounts owed by the
Grantee to the Company or any Affiliate of the Company. Should the Company choose not to exercise
its repurchase right, or is otherwise prohibited by law or contract from doing so, any Claire’s
Investor or its controlling Affiliates may exercise such right as if it were the Company.

     (e) Drag-Along Right. If one or more Claire’s Investors notifies a holder of Shares
issued under the Plan that it or they desires to sell Shares representing at least a majority of
the outstanding Shares of the Company and specifies the terms and conditions of such proposed
transfer, then such holder shall take all necessary and desirable actions reasonably requested by
such Claire’s Investors in connection with the consummation of such sale, and within ten (10)
business days of the receipt of such notice (or such longer period of time as such Claire’s
Investors shall designate in such notice) such holder shall cause a pro rata number of his Shares
to be sold to the designated purchaser on the same terms and conditions for the same per share
consideration and at the same time as the Shares being sold by such Claire’s Investors. In
furtherance, and not in limitation, of the foregoing, in connection with such a sale, such holder
will, (i) consent to and raise no objections against the sale or the process pursuant to which it
was arranged, (ii) waive any dissenter’s rights and other similar rights and (iii) execute all
documents containing such terms and conditions as those executed by such Claire’s Investors as
directed by such Claire’s Investors.

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     (f) Tag-Along Right. If one or more Claire’s Investors desires to sell Shares
representing at least a majority of the outstanding Shares of the Company (disregarding any sale to
Affiliates of such Claire’s Investor), the Company shall notify a holder of Shares in writing.
After such notice, a holder of Shares issued under the Plan may, but is not obligated to, by
written notice, request that such Claire’s Investor cause such designated purchaser to purchase on
the same terms and conditions as are applicable to such Claire’s Investor’s Shares, the number of
such holder’s Shares to be sold, which as a percentage of such Holder’s Shares shall not exceed the
percentage of such Claire’s Investor’s Shares to be sold. The Company shall cause such Claire’s
Investor to agree, within ten (10) business days of the receipt of such notice (or such longer
period of time as such Claire’s Investor shall designate in such notice) to cause such holder’s
Shares to be purchased by the designated purchaser on the same terms and conditions for the same
per share consideration and at the same time as the sale of the Claire’s Investor’s Shares. In
furtherance, and not in limitation, of the foregoing, in connection with such a sale, such holder
will, (i) consent to and raise no objections against the sale or the process pursuant to which it
was arranged, (ii) waive any dissenter’s rights and other similar rights and (iii) execute all
documents containing such terms and conditions as those executed by such Claire’s Investor as
directed by such Claire’s Investor.

     (g) Voting. Each holder of Shares issued under the Plan shall be deemed to have
irrevocably appointed Apollo Management VI, L.P. on behalf of certain affiliated co-investment
partnerships (with full power of substitution), as such holder’s proxy and attorney-in-fact (in
such capacity, the “Proxy Holder”) to vote and give or withhold consent, with respect to all Shares
held by such stockholder at any time, for all matters subject to the vote of such holder from time
to time in such manner as the Proxy Holder shall determine in its sole and absolute discretion,
whether at any meeting (whether annual or special and whether or not an adjourned meeting) of the
Company or by written consent or otherwise, giving and granting to the Proxy Holder all powers such
holder would possess if personally present and hereby ratifying and confirming all that the Proxy
Holder shall lawfully do or cause to be done by virtue hereof. The Proxy Holder shall not have any
liability to any holder of Shares as a result of any action taken or failure to take action
pursuant to the foregoing proxy except for any action or failure to take action not taken or
omitted in good faith or which involves intentional misconduct or a knowing violation of applicable
law. The Company acknowledges the validity of the foregoing irrevocable proxy, and agrees to
recognize the Proxy Holder as the sole attorney and proxy for each such holder of Shares at all
times.

     (h) Qualified IPO. The rights and restrictions contained in subsections (c), (d), (e)
and (f) above shall lapse upon a Qualified IPO; provided, however, that unless
otherwise determined by the Committee, each Grantee shall enter into such standstill agreements and
related agreements as the managing underwriters of such Qualified IPO may request.

     (i) Certificates for Shares. Shares issued under the Plan may be evidenced in such
manner as the Committee shall determine. If certificates representing Shares are registered in the
name of a Grantee, such certificates may bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Shares, and the Company may retain physical
possession of the certificates, in which case the Grantee shall be required to have delivered
a power of transfer to the Company, endorsed in blank, relating to the Shares.

8

 

     (j) Third Party Beneficiaries Rights. The Claire’s Investors and their Affiliates
shall be third party beneficiaries under subsections (d) and (e), and Apollo Management VI, L.P.
shall be a third party beneficiary under subsection (g), and they each shall be entitled to enforce
their rights thereunder as to any Grantee.

Section 9. General Provisions

     (a) Grant Letter. Each award under the Plan shall be evidenced by a Grant Letter.
The terms and provisions of such Grant Letters may vary among Grantees and among different awards
granted to the same Grantee.

     (b) No Right to Employment. The grant of an award under the Plan in any year shall not
give the Grantee any right to similar grants in future years, any right to continue such Grantee’s
employment relationship with the Company or its Affiliates, or, with respect to an Option, until
the Option is exercised and Shares are issued, any rights as a stockholder of the Company. All
Grantees shall remain subject to discharge to the same extent as if the Plan were not in effect.
For purposes of the Plan, a Grantee shall cease to be an Employee upon a sale of any subsidiary of
the Company that employs or engages such Grantee, unless the Grantee shall otherwise continue to
provide services to the Company or another subsidiary of the Company as an employee or director.

     (c) No Funding. No Grantee, and no beneficiary or other Persons claiming under or
through the Grantee, shall have any right, title or interest by reason of any award under the Plan
to any particular assets of the Company or Affiliates of the Company, or any Shares allocated or
reserved for the purposes of the Plan or subject to any Option except as set forth herein. The
Company shall not be required to establish any fund or make any other segregation of assets to
assure satisfaction of the Company’s obligations under the Plan.

     (d) No Transfers. No Option may be sold, transferred, assigned, pledged or otherwise
encumbered, except by will or the laws of descent and distribution, and an Option shall be
exercisable during the Grantee’s lifetime only by the Grantee. Upon a Grantee’s death, the estate
or other beneficiary of such deceased Grantee shall be subject to all the terms and conditions of
the Plan and Grant Letter, including the provisions relating to the termination of the right to
exercise an Option.

9

 

     (e) Governing Law; Jurisdiction. The Plan shall be governed by and construed in
accordance with the laws of the State of Illinois, without giving effect to any choice of law or
conflict of law provision or rule (whether of the State of Illinois or any other jurisdiction) that
would cause the application of the laws of any jurisdiction other than the State of Illinois,
except to the extent that the Delaware General Corporation Law applies as a result of the Company
being incorporated in the State of Delaware, in which case the Delaware General Corporation Law
shall apply. Each Grantee, and each beneficiary or other Person claiming under or through the
Grantee by accepting the grant of an Option consents to the exclusive jurisdiction of any state
or federal court located within the State of Illinois, agrees that all actions or proceedings
relating to the Plan shall be litigated in such courts, waives any defense of forum
non conveniens, and agrees to be bound by any final and nonappealable judgment
rendered thereby in connection with the Plan. To the extent the Grantee is a party to an
employment agreement with the Company or any of its Affiliates that provides for binding
arbitration of employment disputes, then any disputes between the Company and such Grantee arising
under the Plan shall be arbitrated in accordance with the procedures set forth in such employment
agreement.

     (f) Currency. The Committee, in its discretion, may permit payment of any exercise
price or purchase price for Shares in any currency other than U.S. dollars, based on prevailing
exchange rates, as determined by procedures established by the Committee.

Section 10. Amendment or Termination

     In addition to its authority elsewhere in the Plan, the Committee may, at any time, amend or
terminate the Plan or any Grant Letter; provided, however, that, no such action
shall adversely affect the rights of Grantees with respect to Options or other awards previously
granted hereunder or under such Grant Letter.

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