Document:

Amended & Restated Limited Liability Company Agreement

  
 EXHIBIT 10.28

  

  
 AMENDED AND RESTATED 
 LIMITED
LIABILITY COMPANY AGREEMENT 
  
 OF 
  
 HCPI/TENNESSEE, LLC 
  
 a Delaware limited liability company 
  
 Dated as of October 2, 2003 
  

  
 EXHIBIT 10.28

  
 TABLE OF CONTENTS 
  

	 	 	 	 	 	  	Page

		
	 Article 1. DEFINED TERMS
	  	1
		
	 Article 2. ORGANIZATIONAL MATTERS
	  	18
	 	 	Section 2.1	 	Formation	  	18
	 	 	Section 2.2	 	Name	  	18
	 	 	Section 2.3	 	Registered Office and Agent; Principal Place of Business; Other Places of Business	  	19
	 	 	Section 2.4	 	Power of Attorney	  	19
	 	 	Section 2.5	 	Term	  	20
		
	 Article 3. PURPOSE
	  	20
	 	 	Section 3.1	 	Purpose and Business	  	20
	 	 	Section 3.2	 	Powers	  	20
	 	 	Section 3.3	 	Specified Purposes	  	21
	 	 	Section 3.4	 	Representations and Warranties by the Members; Disclaimer of Certain Representations	  	21
		
	 Article 4. CAPITAL CONTRIBUTIONS
	  	23
	 	 	Section 4.1	 	Capital Contributions of the Initial Members	  	23
	 	 	Section 4.2	 	Additional Members	  	23
	 	 	Section 4.3	 	Loans	  	23
	 	 	Section 4.4	 	Additional Funding and Capital Contributions	  	23
	 	 	Section 4.5	 	No Interest; No Return	  	24
		
	 Article 5. DISTRIBUTIONS
	  	24
	 	 	Section 5.1	 	Requirement and Characterization of Distributions	  	24
	 	 	Section 5.2	 	Distributions in Kind	  	25
	 	 	Section 5.3	 	Amounts Withheld	  	25
	 	 	Section 5.4	 	Distributions Upon Liquidation	  	26
	 	 	Section 5.5	 	Restricted Distributions	  	26
	 	 	Section 5.6	 	Distributions of Proceeds from Sale of Real Properties and the Incurrence of Debt	  	26
		
	 Article 6. ALLOCATIONS
	  	27
	 	 	Section 6.1	 	Timing and Amount of Allocations of Net Income and Net Loss	  	27
	 	 	Section 6.2	 	General Allocations	  	27
	 	 	Section 6.3	 	Additional Allocation Provisions	  	29
	 	 	Section 6.4	 	Tax Allocations	  	31
	 	 	Section 6.5	 	Other Provisions	  	31
		
	 Article 7. MANAGEMENT AND OPERATION OF BUSINESS
	  	32
	 	 	Section 7.1	 	Management	  	32
	 	 	Section 7.2	 	Certificate of Formation	  	35

  

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	 	 	Section 7.3	 	Restrictions on Managing Member’s Authority	  	35
	 	 	Section 7.4	 	Compensation of the Managing Member	  	41
	 	 	Section 7.5	 	Other Business of Managing Member	  	42
	 	 	Section 7.6	 	Contracts with Affiliates	  	42
	 	 	Section 7.7	 	Indemnification	  	43
	 	 	Section 7.8	 	Liability of the Managing Member	  	44
	 	 	Section 7.9	 	Other Matters Concerning the Managing Member	  	45
	 	 	Section 7.10	 	Title to Company Assets	  	46
	 	 	Section 7.11	 	Reliance by Third Parties	  	46
	 	 	Section 7.12	 	Exculpation	  	47
		
	 Article 8. RIGHTS AND OBLIGATIONS OF MEMBERS
	  	47
	 	 	Section 8.1	 	Limitation of Liability	  	47
	 	 	Section 8.2	 	Managing of Business	  	47
	 	 	Section 8.3	 	Outside Activities of Members	  	47
	 	 	Section 8.4	 	Return of Capital	  	48
	 	 	Section 8.5	 	Rights of Non-Managing Members Relating to the Company	  	48
	 	 	Section 8.6	 	Redemption Rights	  	49
	 	 	Section 8.7	 	Confidentiality	  	52
		
	 Article 9. BOOKS, RECORDS, ACCOUNTING AND REPORTS
	  	52
	 	 	Section 9.1	 	Records and Accounting	  	52
	 	 	Section 9.2	 	Fiscal Year	  	53
	 	 	Section 9.3	 	Reports	  	53
		
	 Article 10. TAX MATTERS
	  	53
	 	 	Section 10.1	 	Preparation of Tax Returns	  	53
	 	 	Section 10.2	 	Tax Elections	  	53
	 	 	Section 10.3	 	Tax Matters Partner	  	53
	 	 	Section 10.4	 	Organizational Expenses	  	54
		
	 Article 11. TRANSFERS AND WITHDRAWALS
	  	54
	 	 	Section 11.1	 	Transfer	  	54
	 	 	Section 11.2	 	Transfer of Managing Member’s Membership Interest	  	54
	 	 	Section 11.3	 	Non-Managing Members’ Rights to Transfer	  	55
	 	 	Section 11.4	 	Substituted Members	  	56
	 	 	Section 11.5	 	Assignees	  	57
	 	 	Section 11.6	 	General Provisions	  	57
		
	 Article 12. ADMISSION OF MEMBERS
	  	59
	 	 	Section 12.1	 	Admission of Successor Managing Member	  	59
	 	 	Section 12.2	 	Admission of Additional Members	  	59
	 	 	Section 12.3	 	Amendment of Agreement and Certificate	  	60
	 	 	Section 12.4	 	Limitation on Admission of Members	  	60

  

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	 Article 13. DISSOLUTION, LIQUIDATION AND TERMINATION
	  	61
	 	 	Section 13.1	 	Dissolution	  	61
	 	 	Section 13.2	 	Exchange of Non-Managing Member Units	  	61
	 	 	Section 13.3	 	Winding Up	  	62
	 	 	Section 13.4	 	Deemed Distribution and Recontribution	  	63
	 	 	Section 13.5	 	Rights of Members	  	63
	 	 	Section 13.6	 	Cancellation of Certificate	  	63
	 	 	Section 13.7	 	Reasonable Time for Winding-Up	  	64
	 	 	Section 13.8	 	Liability of Liquidator	  	64
		
	 Article 14. PROCEDURES FOR ACTIONS AND CONSENTS OF MEMBERS; AMENDMENTS; MEETINGS
	  	64
	 	 	Section 14.1	 	Procedures for Actions and Consents of Members	  	64
	 	 	Section 14.2	 	Amendments	  	64
	 	 	Section 14.3	 	Meetings of the Members	  	65
		
	 Article 15. GENERAL PROVISIONS
	  	65
	 	 	Section 15.1	 	Registration	  	65
	 	 	Section 15.2	 	Addresses and Notice	  	66
	 	 	Section 15.3	 	Titles and Captions	  	66
	 	 	Section 15.4	 	Pronouns and Plurals	  	66
	 	 	Section 15.5	 	Further Action	  	66
	 	 	Section 15.6	 	Binding Effect	  	67
	 	 	Section 15.7	 	Creditors	  	67
	 	 	Section 15.8	 	Waiver	  	67
	 	 	Section 15.9	 	Counterparts	  	67
	 	 	Section 15.10	 	Applicable Law	  	67
	 	 	Section 15.11	 	Entire Agreement	  	67
	 	 	Section 15.12	 	Invalidity of Provisions	  	67
	 	 	Section 15.13	 	Limitation to Preserve REIT Status	  	68
	 	 	Section 15.14	 	No Partition	  	68
	 	 	Section 15.15	 	Non-Managing Member Representative	  	69
	 	 	Section 15.16	 	Venue	  	69
			
	Exhibit A	 	Member Information	  	A-1
	Exhibit B	 	Notice of Redemption	  	B-1
	Exhibit C	 	Initial Values	  	C-1

  

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 AMENDED AND RESTATED

 LIMITED LIABILITY COMPANY AGREEMENT 
 OF 
 HCPI/TENNESSEE, LLC 
  
 This AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT is made and entered into as of October 2, 2003, by and
among Health Care Property Investors, Inc., a Maryland corporation, and the Persons whose names are set forth on Exhibit A as attached hereto, for the purpose of setting forth and confirming certain terms, conditions and provisions regarding
the management and business of HCPI/Tennessee, LLC, a Delaware limited liability company, the regulation and governance of its affairs, and the rights and privileges of its Members. 
  
 WHEREAS, pursuant to that certain Contribution Agreement, MedCap Properties, LLC, a Delaware limited liability company
(hereinafter the “Initial Member”) transferred the Transferred Properties, directly or indirectly through the transfer or limited liability company interests in limited liability companies owning one or more
Transferred Properties, to the Company in exchange for all of the Company’s Non-Managing Member Units; 
  
 WHEREAS, subsequent to such contribution, the Initial Member transferred all of the Non-Managing Member Units to the Persons other than the Managing
Member whose names are set forth on Exhibit A as attached hereto; and 
  
 WHEREAS, pursuant to the Contribution Agreement, the Managing Member contributed the Cash Contribution and the HCPI Property to the Company in exchange for all of the Company’s Managing Member Units; 

 
 NOW THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements contained herein and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto hereby agree as follows: 
  
 ARTICLE 1. 
 DEFINED TERMS 
  
 The following definitions shall
be for all purposes, unless otherwise clearly indicated to the contrary, applied to the terms used in this Agreement. 
  
 “Accounting Firm” has the meaning set forth in Section 7.3.H hereof. 
  
 “Act” means the Delaware Limited Liability Company Act, as it may be amended from time to time, and
any successor to such statute. 
  
 “Actions” has the meaning set forth in Section 7.7.A hereof. 
  
 “Additional Funds” has the meaning set forth in Section 4.4.A hereof. 
  

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 “Additional Member” means a Person admitted to the Company as a Member pursuant
to Section 4.2 hereof. 
  
 “Adjusted Capital Account
Deficit” means, with respect to any Member, the deficit balance, if any, in such Member’s Capital Account as of the end of the relevant Fiscal Year, after giving effect to the following adjustments: 
  
 (i) decrease such deficit by any amounts that such Member is
obligated to restore pursuant to this Agreement or by operation of law upon liquidation of such Member’s Membership Interest or is deemed to be obligated to restore pursuant to Regulation Section 1.704-1(b) (2)(ii)(c) or the penultimate
sentence of each of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and 
  
 (ii) increase such deficit by the items described in Regulations Section 1.704-1(b) (2)(ii)(d)(4), (5) and (6). 
  
 The foregoing definition of “Adjusted Capital Account Deficit” is intended to comply with the provisions of Regulations Section
1.704-1(b) (2)(ii)(d) and shall be interpreted consistently therewith. 
  
 “Adjustment Factor” means 1.0; provided, however, that in the event that: the Managing Member (i) declares or pays a dividend on its outstanding REIT Shares in REIT Shares or makes a distribution to all
Members of its outstanding REIT Shares in REIT Shares, (ii) splits or subdivides its outstanding REIT Shares or (iii) effects a reverse stock split or otherwise combines its outstanding REIT Shares into a smaller number of REIT Shares, the
Adjustment Factor shall be adjusted by multiplying the Adjustment Factor in effect immediately prior to such adjustment by a fraction, (1) the numerator of which shall be the number of REIT Shares issued and outstanding on the record date for such
dividend, distribution, split, subdivision, reverse split or combination (assuming for such purposes that such dividend, distribution, split, subdivision, reverse split or combination has occurred as of such time) and (2) the denominator of which
shall be the actual number of REIT Shares issued and outstanding on the record date for such dividend, distribution, split, subdivision, reverse split or combination (assuming for such purposes that such dividend, distribution, split, subdivision,
reverse split or combination has not occurred as of such time). Any adjustments to the Adjustment Factor shall become effective immediately after the effective date of such event, retroactive to the record date, if any, for such event. 

 
 “Affiliate” means any Person which, directly or
indirectly (including through one or more intermediaries), controls or is controlled by or is under common control with any other Person, including any Subsidiary of a Person. For purposes of this definition, the term “control” (including
the correlative meanings of the terms “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly (including through one or more intermediaries), of the
power to direct or cause the direction of the management and policies of such Person, through the ownership or control of voting securities, partnership interests or other equity interests, by contract or otherwise. Without limiting the generality
of the foregoing, with respect to any legal or business entity, the term “Affiliate” shall also include (a) any Person which owns, directly or indirectly (including through 

  

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one or more intermediaries), fifty percent (50%) or more of any class of voting securities entitled to vote in the election of directors of such Person, (b)
any Subsidiary of such legal or business entity and (c) any Subsidiary of a Person described in clause (a). A Person will not be an affiliate of any other Person solely as a result of being a director, governor, officer or similar fiduciary of such
other Person. 
  
 “Agreement” means this
Amended and Restated Limited Liability Company Agreement of HCPI/Tennessee, LLC, as it may be amended, supplemented or restated from time to time. 
  
 “Appraisal” means, with respect to any assets, the written opinion of an independent third party experienced in the valuation of
similar assets in the general location of the property being appraised, selected by the Managing Member with the Consent of the Non-Managing Members. Such opinion may be in the form of an opinion by such independent third party that the value for
such property or asset as set by the Managing Member is fair, from a financial point of view, to the Company. 
  
 “Assignee” means a Person to whom one or more LLC Units have been Transferred in a manner permitted under this Agreement, but who
has not become a Substituted Member, and who has the rights set forth in Section 11.5 hereof. 
  
 “Available Cash” means, as of any Distribution Date: 
  
 (a) the sum, without duplication, of: 
  
 (i) the Company’s net income or net loss (as the case may be) for the period beginning on the date hereof and ending on such LLC
Distribution Date, as determined in accordance with GAAP, 
  
 (ii) depreciation and all other noncash charges to the extent deducted in determining net income or net loss for such period pursuant to the foregoing clause (a)(i), and 
  
 (iii) all other cash received (including, but not limited to
Capital Contributions and amounts previously accrued as net income and amounts of deferred income) that was not included in determining net income or net loss for such period pursuant to the foregoing clause (a)(i); 
  
 provided, however, that such amount calculated pursuant to this clause (a)
shall exclude all Disposition Proceeds; 
  
 (b) less the
sum, without duplication, of: 
  
 (i) all
regularly scheduled principal debt payments made during such period by the Company, 
  
 (ii) capital expenditures made by the Company during such period, 
  

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 (iii) all other expenditures and payments not deducted in determining net income or net
loss for such period pursuant to the foregoing clause (a)(i) (including amounts paid in respect of expenses previously accrued), 
  
 (iv) all amounts (other than Disposition Proceeds) expended by the Company in connection with the Properties and the purchase, lease or
other acquisition of assets and properties; 
  
 (v) any amount included in determining net income or net loss for such period pursuant to the foregoing clause (a)(i) that was not received by the Company during such period, 
  
 (vi) the amount of any reserves (including, without limitation, working capital reserves) established as of
the end of such period; 
  
 (vii) the amount of
all cash distributions made to the Members pursuant to the terms of this Agreement; and 
  
 (viii) the amount of all cash Redemptions made by the Company. 
  
 provided, however, that such amount calculated pursuant to this clause (b) shall exclude all distributions or other payments
of Disposition Proceeds. 
  
 “Bankruptcy
Law” means Title 11, U.S. Code or any similar federal or state law for the relief of debtors. 
  
 “Beneficial Ownership” means ownership of REIT Shares by a Person who is or would be treated as an owner of such REIT Shares
either actually or constructively through the application of Section 544 of the Code, as modified by Section 856(h)(1)(B) of the Code. The terms “Beneficially Own,” “Beneficially Owned,” “Beneficially Owns” and
“Beneficial Owner” shall have the correlative meanings. 
  
 “Built-in Gain” means the excess of the gross fair market value of one or more of the Real Properties or Successor Properties over the adjusted tax basis of such property or properties (as the
case may be) for federal income tax purposes, as determined as of the Effective Date, as reduced from time to time in accordance with applicable provisions of the Code and Regulations. 
  
 “Business Day” means any day except a Saturday, Sunday or other day on which commercial banks in Los
Angeles, California or Nashville, Tennessee are authorized or required by law to close. 
  
 “Call Notice” means a written notice to the Non-Managing Members informing them of the Managing Member’s election to call their Non-Managing Member Units pursuant to Section 13.2 hereof.

  

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 “Capital Account” means, with respect to any Member, the Capital Account
maintained for such Member on the Company’s books and records in accordance with the following provisions: 
  
 (a) To each Member’s Capital Account, there shall be added such Member’s Capital Contributions, such Member’s allocable
share of Net Income and any items of income or gain specially allocated pursuant to Section 6.3 hereof, and the amount of any Company liabilities assumed by such Member or that are secured by any property distributed to such Member. 
  
 (b) From each Member’s Capital Account, there shall be
subtracted the amount of cash and the Gross Asset Value of any property distributed to such Member pursuant to any provision of this Agreement, such Member’s allocable share of Net Loss and any items of loss or deductions specially allocated
pursuant to Section 6.3 hereof, and the amount of any liabilities of such Member assumed by the Company or that are secured by any property contributed by such Member to the Company. 
  
 (c) In the event any interest in the Company is Transferred in accordance with the terms of this Agreement,
the transferee shall succeed to the Capital Account of the transferor to the extent that it relates to the Transferred interest. 
  
 (d) In determining the principal amount of any liability for purposes of subsections (a) and (b) above there shall be taken into account
Code Section 752(c) and any other applicable provisions of the Code and Regulations. 
  
 (e) The provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulations Sections
1.704-1(b) and 1.704-2, and shall be interpreted and applied in a manner consistent with such Regulations. If the Managing Member shall determine that it is prudent to modify the manner in which the Capital Accounts are maintained in order to comply
with such Regulations, the Managing Member may make such modification provided that such modification will not change the amounts distributable to any Member without such Member’s consent. The Managing Member also shall (i) make any adjustments
that are necessary or appropriate to maintain equality between the Capital Accounts of the Members and the amount of Company capital reflected on the Company’s balance sheet, as computed for book purposes, in accordance with Regulations Section
1.704-1(b) (2)(iv)(q) and (ii) make any appropriate modifications in the event that unanticipated events might otherwise cause this Agreement not to comply with Regulations Section 1.704-1(b) or Section 1.704-2. 
  
 “Capital Contribution” means, with respect to any
Member, the amount of money and the initial Gross Asset Value of any Property that such Member contributes to the Company pursuant to Section 4.1, Section 4.2 or Section 4.4 hereof. 
  
 “Cash Amount” means with respect to any Non-Managing Member, an amount of cash per unit equal to the
sum of (i) the average closing share price of the common stock of Health Care Property Investors, Inc., a Maryland corporation, for the ten (10) trading days ending on the second trading day immediately prior to the day on which such Non-Managing

  

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Member delivers a Notice of Redemption or the Managing Member delivers a Call Notice to such Non-Managing Member, as applicable, (ii) the Preferred Return
Shortfall Per Unit and (iii) the cash dividend per REIT Share declared or accrued by the Managing Member for holders of REIT Shares on any date between the Notice of Redemption or Call Notice, as applicable, and the Redemption Date or the purchase
pursuant to Section 13.2, as applicable, to the extent not taken into account in the computation of Preferred Return Per Unit. 
  
 “Cash Contribution” means $168,973. 
  
 “Certificate” means the Certificate of Formation of the Company filed in the office of the Secretary of State of the State of
Delaware, as amended from time to time in accordance with the terms hereof and the Act. 
  
 “Charter” means the Articles of Incorporation of the Managing Member, as amended, supplemented or restated from time to time. 
  
 “Closing Date” has the meaning set forth in the Contribution Agreement. 
  
 “Closing Price” means the closing price of a REIT
Share on the New York Stock Exchange. 
  
 “Code” means the Internal Revenue Code of 1986, as amended and in effect from time to time or any successor statute thereto, as interpreted by the applicable Regulations thereunder. Any reference herein to a specific
section or sections of the Code shall be deemed to include a reference to any corresponding provision of future law. 
  
 “Company” means the limited liability company formed by filing the Certificate under the Act and pursuant to this Agreement under
the name “HCPI/Tennessee, LLC”, and any successor thereto. 
  
 “Company Minimum Gain” has the meaning set forth in Regulations Section 1.704-2(b) (2) for the phrase “partnership minimum gain,” and the amount of Company Minimum Gain, as well as any net increase or
decrease in Company Minimum Gain, for a Fiscal Year shall be determined in accordance with the rules of Regulations Section 1.704-2(d). 
  
 “Consent” means the consent to, approval of, or vote on a proposed action by a Member given in accordance with Article 14
hereof. 
  
 “Consent of the Non-Managing
Members” means the Consent of a Majority in Interest of the Non-Managing Members, which Consent shall be obtained prior to the taking of any action for which it is required by this Agreement and, except as otherwise provided in this
Agreement, may be given or withheld by a Majority in Interest of the Non-Managing Members, in their reasonable discretion. 
  
 “Constructive Ownership” means ownership of REIT Shares, or any other interest in an entity by a Person who is or would be treated
as an owner thereof either actually or constructively through the application of Section 318 of the Code, as modified by Section 

  

 6 

 
856(d)(5) of the Code. The terms “Constructively Own,” “Constructively Owned,” “Constructively Owns” and “Constructive
Owner” shall have the correlative meanings. 
  
 “Contribution Agreement” means the Contribution and Purchase Agreement of even date herewith, by and between the Managing Member, the Company and the parties identified on the signature pages thereto. 
  
 “Contribution Indemnity” means the rights and
remedies of the Company contained in Section 9.2(c) of the Contribution Agreement. 
  
 “Debt” means, as to any Person, as of any date of determination, (i) all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services; (ii) all
amounts owed by such Person to banks or other Persons in respect of reimbursement obligations under letters of credit, surety bonds and other similar instruments guaranteeing payment or other performance of obligations by such Person; (iii) all
indebtedness for borrowed money or for the deferred purchase price of property or services secured by any lien on any property owned by such Person, to the extent attributable to such Person’s interest in such property, even though such Person
has not assumed or become liable for the payment thereof; (iv) all indebtedness guaranteed by such Person directly or indirectly; (v) lease obligations of such Person that, in accordance with GAAP, are required to be capitalized and (vi) all amounts
required to be paid by such Person under Sections 5.1.A, 5.4, 7.3.G and 8.6.A hereunder. 
  
 “Depreciation” means, for each Fiscal Year or other applicable period, an amount equal to the federal income tax depreciation, amortization or other cost recovery deduction allowable with
respect to an asset for such year or other period, except that, if the Gross Asset Value of an asset differs from its adjusted basis for federal income tax purposes at the beginning of such year or period, Depreciation shall be in an amount that
bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization or other cost recovery deduction for such year or other period bears to such beginning adjusted tax basis; provided, however, that,
if the federal income tax depreciation, amortization or other cost recovery deduction for such year or period is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the
Managing Member. 
  
 “Disposition
Proceeds” means with respect to any real property, the net proceeds (including a reduction for any amount used for the repayment of any Debt of the Company and the payment of any costs related thereto) received by the Company upon the
taxable disposition (other that a Terminating Capital Transaction) of such real property. 
  
 “Distribution Date” has the meaning set forth in Section 5.1.A hereof. 
  
 “Effective Date” means the date on which the transactions contemplated by the Contribution Agreement to be consummated on the
Closing Date are consummated at which time the contributions set forth on Exhibit A that are to be effective on the Effective Date shall become effective. With respect to any future contributions, the Effective Date shall be the date that
such contributions are completed. 
  

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 “Equity Coverage” means an amount equal to the then current fair market value of
the Company’s assets as determined in good faith by the Managing Member consistently with the method of valuing the Transferred Properties contributed to the Company by the Initial Member minus all of the Company’s Debt and liabilities.

  
 “ERISA” means the Employee Retirement
Income Security Act of 1974, as amended. 
  
 “Excess
LLC Units” means any LLC Units held by a Non-Managing Member to the extent that, if such LLC Units were redeemed pursuant to Section 8.6 hereof, such Non-Managing Member would Beneficially Own or Constructively Own REIT Shares in excess
of the Ownership Limit or otherwise in violation of the Charter. 
  
 “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder. 
  
 “Fiscal Year” means the fiscal year of the Company, which shall be the calendar year. 
  
 “Flip-Over Event” means the occurrence of a merger of
the Managing Member with and into another Person or the consolidation of the Managing Member with another Person, or the merger of another Person with and into the Managing Member or the sale or transfer of assets of the Managing Member to another
Person if, as a result of such merger, consolidation or transfer of assets the holder of Rights issued under the Rights Agreement would be entitled under Section 13 of the Rights Agreement (or a comparable provision in the event the Rights Agreement
is amended) to purchase shares of common stock of such other Person (including the Managing Member as the successor to such other Person or as the surviving corporation) (the “Successor Person”). 
  
 “flow through entity” has the meaning set forth in
Section 11.6.E hereof. 
  
 “GAAP” means
generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of comparable stature and authority within the accounting profession), or in such other statements by such entity as may be in general use by significant segments of the United States accounting
profession, which are applicable to the facts and circumstances on the date of determination. 
  
 “Gross Asset Value” means, with respect to any asset, the asset’s adjusted basis for federal income tax purposes, except as follows: 
  
 (a) The initial Gross Asset Value of each Property
contributed to the Company pursuant to Section 4.1 hereof shall be such Property’s Initial Value as agreed to by the Initial Member and the Managing Member. Any other Property contributed by a Member to the Company shall be its fair market
value, as agreed to by such Member and the Managing Member, and set forth on Exhibit A with respect to that Member; provided, however, the initial Gross Asset Value of any asset contributed by the 

  

 8 

 
Managing Member to the Company shall be its fair market value, as determined by by the Managing Member with the Consent of the Non-Managing Members.

  
 (b) The Gross Asset Values of all Company
assets immediately prior to the occurrence of any event described in clause (1), clause (2) or clause (3) hereof shall be adjusted to equal their respective gross fair market values, as determined by the Managing Member with the Consent of the
Non-Managing Members, using such reasonable method of valuation as the Managing Member may adopt, as of the following times: 
  
 (1) the acquisition of an additional interest in the Company (other than in connection with the execution of this Agreement but including,
without limitation, acquisitions pursuant to Section 4.2 hereof or contributions or deemed contributions by the Managing Member pursuant to Section 4.4 hereof) by a new or existing Member in exchange for more than a de minimis Capital
Contribution; 
  
 (2) the distribution by the
Company to a Member of more than a de minimis amount of Company property as consideration for an interest in the Company; and 
  
 (3) the liquidation of the Company within the meaning of Regulations Section 1.704-1(b) (2)(ii)(g). 
  
 (c) The Gross Asset Value of any Company asset distributed
to a Member shall be the gross fair market value of such asset on the date of distribution as determined by the distributee and the Managing Member, provided that, if the distributee is the Managing Member or if the distributee and the Managing
Member cannot agree on such a determination, such gross fair market value shall be determined by Appraisal. 
  
 (d) The Gross Asset Values of Company assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such
assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section 1.704-1(b) (2)(iv)(m); provided,
however, that Gross Asset Values shall not be adjusted pursuant to this subsection (d) to the extent that the Managing Member reasonably determines that an adjustment pursuant to subsection (b) above is necessary or appropriate in connection
with a transaction that would otherwise result in an adjustment pursuant to this subsection (d). 
  
 (e) If the Gross Asset Value of a Company asset has been determined or adjusted pursuant to subsection (a), subsection (b) or subsection
(d) above, such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Net Income and Net Loss. 
  
 “HCPI Property” means the “HCPI Property” as such term is defined in the Contribution
Agreement. 
  

 9 

 “Incapacity” or “Incapacitated” means, (i) as to any
Member who is an individual, death, total physical disability or entry by a court of competent jurisdiction adjudicating such Member incompetent to manage his or her person or his or her estate; (ii) as to any Member that is a corporation or limited
liability company, the filing of a certificate of dissolution, or its equivalent, for the corporation or limited liability company or the revocation of its charter, if not promptly reinstated; (iii) as to any Member that is a partnership, the
dissolution and commencement of winding up of the partnership; (iv) as to any Member that is an estate, the distribution by the fiduciary of the estate’s entire interest in the Company; (v) as to any trustee of a trust that is a Member, the
termination of the trust (but not the substitution of a new trustee); or (vi) as to any Member, the bankruptcy of such Member. For purposes of this definition, bankruptcy of a Member shall be deemed to have occurred when (a) the Member commences a
voluntary proceeding seeking liquidation, reorganization or other relief of or against such Member under any bankruptcy, insolvency or other similar law now or hereafter in effect, (b) the Member is adjudged as bankrupt or insolvent, or a final and
non-appealable order for relief under any bankruptcy, insolvency or similar law now or hereafter in effect has been entered against the Member, (c) the Member executes and delivers a general assignment for the benefit of the Member’s creditors,
(d) the Member files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against the Member in any proceeding of the nature described in clause (b) above, (e) the Member seeks, consents to or
acquiesces in the appointment of a trustee, receiver or liquidator for the Member or for all or any substantial part of the Member’s properties, (f) any proceeding seeking liquidation, reorganization or other relief under any bankruptcy,
insolvency or other similar law now or hereafter in effect has not been dismissed within 120 days after the commencement thereof, (g) the appointment without the Member’s consent or acquiescence of a trustee, receiver or liquidator has not been
vacated or stayed within 90 days of such appointment, or (h) an appointment referred to in clause (g) above is not vacated within 90 days after the expiration of any such stay. 
  
 “Indemnitee” means (i) any Person made a party to a proceeding by reason of its status as (a) a
Non-Managing Member, (b) the Managing Member, (c) the Non-Managing Member Representative or (d) a director of the Managing Member or an officer or employee of the Company or the Managing Member and (ii) such other Persons (including Affiliates of
the Managing Member or the Company) as the Managing Member may designate from time to time (whether before or after the event giving rise to potential liability) with the Consent of the Non-Managing Members. 
  
 “Initial Member” shall have the meaning set forth in
the Recitals of this Agreement. 
  
 “Initial Value” of (i) each Real Property contributed to the Company as of the date hereof shall mean the amount set forth with respect to such Real Property on Exhibit C attached hereto and made a part hereof
for all purposes and (ii) each other real property contributed to or purchased by the Company, the Gross Asset Value of such real property on such date of contribution or purchase. 
  
 “IRS” means the Internal Revenue Service, which administers the internal revenue laws of the United
States. 
  

 10 

 “Liquidating Event” has the meaning set forth in Section 13.1 hereof. 

 
 “Liquidator” has the meaning set forth in Section
13.3.A hereof. 
  
 “LLC Distribution Date”
means the date established by the Managing Member for the payment of actual distributions declared by the Managing Member pursuant to Section 5.1, which date shall be the same as the date established by the Managing Member for the payment of
dividends to holders of REIT Shares. 
  
 “LLC Record
Date” means the record date established by the Managing Member for the distribution of Available Cash pursuant to Section 5.1.A hereof, which record date shall be the same as the record date established by the Managing Member for a
dividend to holders of REIT Shares. 
  
 “LLC
Units” means the Managing Member Units and the Non-Managing Member Units, collectively. 
  
 “Majority in Interest of the Non-Managing Members” means those Non-Managing Members (other than the Managing Member in its
capacity as a holder of Non-Managing Member Units) holding in the aggregate more than 50% of the aggregate outstanding Non-Managing Member Units (other than those held by the Managing Member). 
  
 “Make-Whole Payment” has the meaning set forth in
Section 7.3.G hereof. 
  
 “Managing
Member” means Health Care Property Investors, Inc., a Maryland corporation, in its capacity as a managing member, or any successor Managing Member designated pursuant to the terms of this Agreement. 
  
 “Managing Member Shortfall” has the meaning set forth
in Section 5.1.A(2) hereof. 
  
 “Managing Member
Unit” means a single unit of Membership Interest of the Managing Member issued pursuant to Article 4 hereof or deemed to be a Managing Member Unit in accordance with the definition of “Non-Managing Member Unit,” as the
same may be modified from time to time as provided in this Agreement. The ownership of Managing Member Units may (but need not in the sole and absolute discretion of the Managing Member) be evidenced in the form of a certificate for Managing Member
Units. 
  
 “Member Minimum Gain” means an
amount, with respect to each Member Nonrecourse Debt, equal to the Company Minimum Gain that would result if such Member Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with Regulations Section 1.704-2(i)(3) with
respect to “partner nonrecourse debt minimum gain.” 
  
 “Member Nonrecourse Debt” has the meaning set forth in Regulations Section 1.704-2(b) (4) for the phrase “partner nonrecourse debt.” 
  
 “Member Nonrecourse Deductions” has the meaning set forth in Regulations Section 1.704-2(i)(2) for
the phrase “partner nonrecourse deductions,” and the amount of 

  

 11 

 
Member Nonrecourse Deductions with respect to a Member Nonrecourse Debt for a Fiscal Year shall be determined in accordance with the rules of Regulations
Section 1.704-2(i)(2). 
  
 “Members” means
the Persons owning Membership Interests, including the Managing Member, Non-Managing Members and any Additional and Substituted Members, named as Members in Exhibit A attached hereto, which Exhibit A may be amended from time to time.

  
 “Membership Interest” means an
ownership interest in the Company representing a Capital Contribution by a Member and includes any and all benefits to which the holder of such a Membership Interest may be entitled as provided in this Agreement, together with all obligations of
such Person to comply with the terms and provisions of this Agreement. A Membership Interest may be expressed as a number of Managing Member Units or Non-Managing Member Units, as applicable. 
  
 “Net Income” or “Net Loss”
means, for each Fiscal Year of the Company, an amount equal to the Company’s taxable income or loss for such year, determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be
stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or loss), with the following adjustments: 
  
 Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Net Income (or Net
Loss) pursuant to this definition of “Net Income” or “Net Loss” shall be added to (or subtracted from, as the case may be) such taxable income (or loss); 
  
 Any expenditure of the Company described in Code Section
705(a)(2)(b) or treated as a Code Section 705(a)(2)(b) expenditure pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Net Income (or Net Loss) pursuant to this definition of “Net
Income” or “Net Loss,” shall be subtracted from (or added to, as the case may be) such taxable income (or loss); 
  
 In the event that the Gross Asset Value of any Company asset is adjusted pursuant to subsection (b) or subsection (c) of the definition of
“Gross Asset Value,” the amount of such adjustment shall be taken into account as gain or loss from the disposition of such asset for purposes of computing Net Income or Net Loss; 
  
 In lieu of the depreciation, amortization and other cost
recovery deductions that would otherwise be taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such Fiscal Year; 
  
 To the extent that an adjustment to the adjusted tax basis of any Company asset pursuant to Code Section
734(b) is required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member’s interest in the Company, the
amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the 

  

 12 

 
disposition of the asset and shall be taken into account for purposes of computing Net Income or Net Loss; and 
  
 Notwithstanding any other provision of this definition of
“Net Income” or “Net Loss,” any item allocated pursuant to Section 6.3.A hereof shall not be taken into account in computing Net Income or Net Loss. The amounts of the items of Company income, gain, loss or
deduction available to be allocated pursuant to Section 6.3.A hereof shall be determined by applying rules analogous to those set forth in this definition of “Net Income” or “Net Loss.” 
  
 “Non-Managing Member” means any Member other than the
Managing Member. 
  
 “Non-Managing Member
Representative” means Charles A. Elcan until a successor Non-Managing Member Representative shall have been appointed pursuant to Section 15.15 hereof and, thereafter, shall mean the person appointed and then acting as the Non-Managing
Member Representative hereunder. 
  
 “Non-Managing Member Unit” means a single unit of Membership Interest issued to a Non-Managing Member pursuant to Section 4.1 hereof, as the same may be modified from time to time as provided in this Agreement;
provided, however, that any Non-Managing Member Unit held by the Managing Member shall be deemed to be a Managing Member Unit for all purposes of this Agreement. The ownership of Non-Managing Member Units shall, except at the option of such Member,
be uncertificated and shall not be evidenced in the form of a certificate for Non-Managing Member Units. 
  
 “Nonrecourse Liability” has the meaning set forth in Regulations Section 1.752-1(a)(2). 
  
 “Notice of Redemption” means the Notice of Redemption
substantially in the form of Exhibit B attached to this Agreement. 
  
 “Notice of Registration” has the meaning set forth in Section 15.1. 
  
 “One Hundred Member Limit” has the meaning set forth in Section 11.6.E hereof. 
  
 “Ownership Limit” means 9.8% of the number or value
(whichever is more restrictive) of outstanding REIT Shares. The number of REIT Shares shall be determined by the Board of Directors of the Managing Member, in good faith, which determination shall be conclusive for all purposes hereof. 

 
 “Percentage Interest” means, as to a Member
holding a Membership Interest, its interest in the Company as determined by dividing the LLC Units owned by such Member by the total number of LLC Units then outstanding as specified in Exhibit A attached hereto, as it may be modified or
supplemented from time to time. 
  

 13 

 “Person” means an individual or a corporation, partnership, trust, unincorporated
organization, association, limited liability company or other entity. 
  
 “Preferred Return Per Unit” means with respect to each Non-Managing Member Unit outstanding on a LLC Record Date an amount initially equal to zero, and increased cumulatively on each LLC Record Date by an amount
equal to the product of (i) the cash dividend per REIT Share declared by the Managing Member for holders of REIT Shares on that LLC Record Date, multiplied by (ii) the Adjustment Factor in effect on that LLC Record Date; provided, however,
that the increase that shall occur in accordance with the foregoing on the first LLC Record Date shall be the foregoing product of (i) and (ii) above multiplied by a fraction, the numerator of which shall be the number of days in the period
commencing on the date hereof and ending on the first LLC Record Date, and the denominator of which shall be the number of days in the period commencing on August 4, 2003 and ending on the first LLC Record Date. 
  
 “Preferred Return Shortfall” means, for any holder of
Non-Managing Member Units, the amount (if any) by which (i) the Preferred Return Per Unit with respect to all Non-Managing Member Units held by such holder exceeds (ii) the aggregate amount previously distributed with respect to such Non-Managing
Member Units pursuant to Section 5.1.A(1), Section 5.6.A(1) or Section 5.6.B(1) hereof, together with cumulative simple interest accruing thereon at the Prime Rate from the applicable LLC Distribution Date to the date of distribution. 
  
 “Preferred Return Shortfall Per Unit” means, for any
holder of Non-Managing Member Units, an amount equal to the quotient of (a) such Non-Managing Member’s Preferred Return Shortfall divided by (b) the number of Non-Managing Member Units held by such Non-Managing Member immediately prior to the
day on which such Non-Managing Member delivers a Notice of Redemption. 
  
 “Prime Rate” means on any date, a rate equal to the annual rate on such date announced by the Bank of New York to be its prime, base or reference rate for 90-day unsecured loans to its corporate borrowers of the
highest credit standing but in no event greater than the maximum rate then permitted under applicable law. If the Bank of New York discontinues its use of such prime, base or reference rate or ceases to exist, the Managing Member shall designate the
prime, base or reference rate of another state or federally chartered bank based in New York to be used for the purpose of calculating the Prime Rate hereunder (which rate shall be subject to limitation by all applicable usury laws). 
  
 “Properties” means any assets and property of the
Company such as, but not limited to, interests in real property (including the Real Properties and the HCPI Property) and personal property, including, without limitation, fee interests, interests in ground leases, interests in limited liability
companies, joint ventures or partnerships, interests in mortgages, and Debt instruments as the Company may hold from time to time. “Property” means any one of such Properties. 
  
 “Property Appreciation” means that portion of Disposition Proceeds which is in excess of the Initial
Value of the real property that is the subject of the disposition. 
  
 “Real Properties” has the meaning set forth in Section 7.3.E(2) hereof. 
  

 14 

 “Reasonable” with respect to any judgment of the Managing Member means the
reasonable judgment of the Managing Member; provided, however, that any judgment of the Managing Member made after the Managing Member’s consultation with nationally recognized outside legal counsel to the Managing Member specializing in the
area of law under consideration that is consistent with advice given by such outside counsel shall be deemed to be reasonable for all purposes of this Agreement except in cases in which an opinion of counsel is expressly required by this Agreement.

  
 “Redemption” has the meaning set forth
in Section 8.6.A hereof. 
  
 “Redemption
Date” means, in the case of a Redemption pursuant to Section 8.6.A hereof (i) if the related Notice of Redemption was delivered on or prior to December 5th in any calendar year, the fifteenth (15th) calendar day (or, if such day is not a Business Day, the next following Business Day) after the receipt by the Managing Member of a Notice of Redemption, and (ii) otherwise, the thirtieth (30th) calendar day (or, if such day is not a Business Day, the next following Business Day) after the receipt by the Managing Member of a Notice of
Redemption; provided, however, that, notwithstanding any other provisions set forth herein, in no event shall a Redemption Date as to any LLC Unit occur prior to the first anniversary of the issuance of such LLC Unit by the Company;
provided, further, that the Redemption Date, as well as the closing of an Redemption on any Redemption Date, may be deferred for such time (but in any event not more than 90 days in the aggregate) as may reasonably be required to effect, as
applicable, compliance with the Securities Act or other law (including, but not limited to, (a) state “blue sky” or other securities laws and (b) the expiration or termination of the applicable waiting period, if any, under the Hart Scott
Rodino Antitrust Improvements Act of 1976, as amended). 
  
 “Reduction Distribution” has the meaning set forth in Section 8.6.D hereof. 
  
 “Reduction Date” has the meaning set forth in Section 8.6.D hereof. 
  
 “Reduction Units” has the meaning set forth in
Section 8.6.D hereof. 
  
 “Registration”
has the meaning set forth in Section 15.1. 
  
 “Regulations” means the applicable income tax regulations under the Code, whether such regulations are in proposed, temporary or final form, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations). 
  
 “Regulatory Allocations” has the meaning set forth in Section 6.3.A(7) hereof. 
  
 “REIT” means a real estate investment trust qualifying under Code Section 856, et seq. 
  
 “REIT Payment” has the meaning set forth in Section
15.13 hereof. 
  
 “REIT Requirements”
means the requirements for qualifying as a REIT under the Code and Regulations. 
  

 15 

 “REIT Share” means a share of the Common Stock of the Managing Member, par value
$1.00 per share. 
  
 “REIT Shares Amount”
means a number of REIT Shares equal to the sum of (i) the product of (a) the number of Tendered Units and (b) the Adjustment Factor, (ii) the quotient of (x) the product of (a) the number of Tendered Units and (b) Preferred Return Shortfall Per Unit
divided by (y) the average closing share price of the common stock of Health Care Property Investors, Inc., a Maryland corporation, for the ten (10) trading days ending on the second trading day immediately prior to the day on which a Non-Managing
Member delivers a Notice of Redemption with respect to such Tendered Units and (iii) an amount equal to the product of (a) the Tendered Units and (b) the cash dividend per REIT Share declared by the Managing Member for holders of REIT Shares on any
date between the Notice of Redemption and the Redemption Date (without duplication or omission as a result of any such dividend paid after the issuance of the REIT Shares to the Tendering Party) to the extent not taken into account in the
computation of Preferred Return Per Unit above; provided, however, that, in the event that the Managing Member issues Rights to all holders of REIT Shares as of a certain record date, with the record date for such Rights issuance falling
within the period starting on the date of the Notice of Redemption and ending on the day immediately preceding the Redemption Date, which Rights will not be distributed before the relevant Redemption Date, then the REIT Shares Amount shall also
include such Rights that a holder of that number of REIT Shares would be entitled to receive, expressed, where relevant hereunder, in a number of REIT Shares determined by the Managing Member in good faith. So long as the holder of Tendered Units is
not an Acquiring Person or an Affiliate or Associate of an Acquiring Person (as those terms are defined in the Rights Agreement), the number of REIT Shares referenced in the preceding sentence shall be adjusted for the issuance, distribution and
triggering of exercisability of the Rights governed by the Rights Agreement (so long as the Rights shall not previously have been redeemed or expired pursuant to the Rights Agreement) which adjustment shall be satisfied by issuing, together with the
REIT Shares Amount, either (i) if Rights may be issued under the Rights Agreement, the aggregate number of Rights issuable under the Rights Agreement with respect to a number of REIT Shares equal to the REIT Shares Amount, or (ii) in the event
Rights may no longer be issued under the Rights Agreement, a number of REIT Shares necessary to reflect equitably the dilution in REIT Shares resulting from the exercise of Rights (but only if the REIT Shares Amount is issued subsequent to the
occurrence of an event that results in a reduction in the purchase price attributable to the Rights in the manner provided in Section 11(a)(ii) of the Rights Agreement (or any comparable provision in the event the Rights Agreement is amended), and
prior to a Flip-Over Event), or (iii) if the REIT Shares Amount is issued concurrently with or subsequent to a Flip-Over Event, the number of shares of common stock of the Successor Person necessary to reflect equitably the dilution in REIT Shares
resulting from the exercise of Rights. 
  
 “Related
Party” means, with respect to any Person, any other Person whose actual ownership, Beneficial Ownership or Constructive Ownership of shares of the Managing Member’s capital stock would be attributed to the first such Person under
either (i) Code Section 544 (as modified by Code Section 856(h)(1)(B) ) or (ii) Code Section 318 (as modified by Code Section 856(d)(5)). 
  

 16 

 “Rights” means rights, options, warrants or convertible or exchangeable
securities entitling the Managing Member’s shareholders to subscribe for or purchase REIT Shares, or any other securities or property. 
  
 “Rights Agreement” means the Rights Agreement, dated as of July 27, 2000, by and between the Managing Member and The Bank of New
York, as the same may be supplemented or amended from time to time. 
  
 “SEC” means the Securities and Exchange Commission. 
  
 “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder. 
  
 “Substituted Member” means an Assignee who is admitted as a Member to the Company pursuant to
Section 11.4 hereof. The term “Substituted Member” shall not include any Additional Member. 
  
 “Subsidiary” means, with respect to any Person other than the Company, any corporation or other entity of which a majority of (i)
the voting power of the voting equity securities or (ii) the outstanding equity interests is owned, directly or indirectly, by such Person; provided, however, that, with respect to the Company, “Subsidiary” means solely a
partnership or limited liability company (taxed, for federal income tax purposes, as a partnership or a disregarded entity and not as an association or publicly traded partnership taxable as a corporation) of which the Company is a member unless the
Managing Member has received an unqualified opinion from independent counsel of recognized standing, or a ruling from the IRS, that the ownership of shares of stock of a corporation or other entity will not jeopardize the Managing Member’s
status as a REIT, in which event the term “Subsidiary” shall include the corporation or other entity which is the subject of such opinion or ruling. 
  
 “Successor Person” has the meaning set forth in the definition of Flip-Over Event. 
  
 “Successor Properties” means real properties acquired
by the Company in connection with a Tax-Free Disposition of any Real Property or Successor Property. 
  
 “Tax-Free Disposition” means the disposition of property in a transaction that is not subject to tax under the Code, including by
virtue of the provisions of Section 1031 of the Code. 
  
 “Tax Items” has the meaning set forth in Section 6.4.A hereof. 
  
 “Tax Protection Period” means the period of time beginning on the Effective Date and ending on the tenth (10th) anniversary of the
Effective Date. 
  
 “Tendered Units” has
the meaning set forth in Section 8.6.A hereof. 
  
 “Tendering Party” has the meaning set forth in Section 8.6.A hereof. 
  

 17 

 “Terminating Capital Transaction” means any sale or other disposition of all or
substantially all of the assets of the Company or a related series of transactions that, taken together, result in the sale or other disposition of all or substantially all of the assets of the Company. 
  
 “Termination Transaction” has the meaning set forth
in Section 11.2.B hereof. 
  
 “Threshold
Date” means the date on which less than twenty percent (20%) of the LLC Units issued by the Company to the Non-Managing Members on the Effective Date remain outstanding. 
  
 “Transfer,” when used with respect to an LLC Unit or all or any portion of a Membership Interest,
means any sale, assignment, bequest, conveyance, devise, gift (outright or in trust), pledge, encumbrance, hypothecation, mortgage, exchange, transfer or other disposition or act of alienation, whether voluntary or involuntary or by operation of
law. The terms “Transferred” and “Transferring” have correlative meanings. 
  
 “Transferred Properties” means the “DownREIT Properties” as that term is defined in the Contribution Agreement which
were contributed to the Company, directly or indirectly through the transfer or limited liability company interests in limited liability companies owning one or more DownREIT Properties. 
  
 “Triggering Event” has the meaning set forth in Section 7.3.G hereof. 
  
 ARTICLE 2. 
 ORGANIZATIONAL MATTERS 
  
 Section 2.1 Formation 
  
 The Company is a limited liability company formed pursuant to the provisions of the Act for the purposes stated in Section 3.1 and upon the terms and subject to the conditions set forth in this Agreement. Except as expressly provided
herein, the rights and obligations of the Company and the Members and the administration and termination of the Company shall be governed by the Act. 
  
 Section 2.2 Name 
  
 The name of the Company is HCPI/Tennessee, LLC. The Company’s business may be conducted under any other name or names deemed advisable by the
Managing Member, including combinations of the name of the Managing Member or any Affiliate thereof with other words, but excluding the name “Health Care Property Investors.” The Managing Member in its sole and absolute discretion may
change the name of the Company at any time and from time to time in accordance with applicable law and shall notify the Members of such change in the next regular communication to the Members. 
  

 18 

 Section 2.3 Registered Office and Agent; Principal Place of Business; Other Places of Business

  
 The address of the registered office of the Company in
the State of Delaware is located at c/o National Registered Agents, Inc., 9 East Lockerman Street, Dover, Delaware 19901, and the registered agent for service of process on the Company in the State of Delaware at such registered office is National
Registered Agents, Inc., 9 East Lockerman Street, Dover, Delaware 19901. The principal office of the Company is located at 4675 MacArthur Court, Suite 900, Newport Beach, California 92660, or such other place as the Managing Member may from time to
time designate by notice to the Members. The Company may maintain offices at such other place or places within or outside the State of Delaware as the Managing Member deems advisable. 
  
 Section 2.4 Power of Attorney 
  
 A. Each Member (other than the Managing Member) and each Assignee hereby irrevocably constitutes and appoints the Managing
Member, any Liquidator, and authorized officers and attorneys in fact of each, and each of those acting singly, in each case with full power of substitution, as its true and lawful agent and attorney-in-fact, with full power and authority in its
name, place and stead to execute, swear to, acknowledge, deliver, file and record in the appropriate public offices (a) all certificates, documents and other instruments (including, without limitation, this Agreement and the Certificate and all
amendments or restatements thereof) that are appropriate or necessary to form, qualify or continue the existence or qualification of the Company as a limited liability company in the State of Delaware and in all other jurisdictions in which the
Company may conduct business or own property; (b) all instruments that are appropriate or necessary to reflect any amendment, change, modification or restatement of this Agreement in accordance with its terms; (c) all conveyances and other
instruments or documents that are appropriate or necessary to reflect the dissolution and liquidation of the Company pursuant to the terms of this Agreement, including, without limitation, a certificate of cancellation; (d) all instruments relating
to the admission, withdrawal, removal or substitution of any Member pursuant to, or other events described in, Articles 11, 12 or 13 hereof or the Capital Contribution of any Member; and (e) all certificates, documents and other
instruments relating to the determination of the rights, preferences and privileges of Membership Interests in accordance with the terms of this Agreement. Nothing contained in this Section 2.4 shall be construed as (i) authorizing the Managing
Member or any Liquidator to amend this Agreement except in accordance with Article 14 hereof or as may be otherwise expressly provided for in this Agreement or (ii) authorizing the Managing Member or any Liquidator to take any action in
contravention of this Agreement or which is outside the scope of the powers specified in Sections 3.2 and 13.3. 
  
 B. The foregoing power of attorney is hereby declared to be irrevocable and a special power coupled with an interest, in recognition of the fact that each
of the Members and Assignees will be relying upon the power of the Managing Member to act as contemplated by this Agreement, and it shall survive and not be affected by the subsequent Incapacity of any Member or Assignee and the Transfer of all or
any portion of such Member’s or Assignee’s LLC Units or Membership Interest and shall extend to such Member’s or Assignee’s heirs, successors, assigns and personal representatives. Each Member or Assignee shall execute and
deliver to the 

  

 19 

 
Managing Member or any Liquidator, within 15 days after receipt of the Managing Member’s or Liquidator’s request therefor, such further
designation, powers of attorney and other instruments as the Managing Member or the Liquidator, as the case may be, reasonably deems necessary to effectuate this Agreement and the purposes of the Company. 
  
 Section 2.5 Term 
  
 The term of the Company commenced on September 24, 2003, the date that the
original Certificate was filed in the office of the Secretary of State of Delaware in accordance with the Act, and shall continue until terminated pursuant the provisions of Article 13 hereof or as otherwise provided by law. 
  
 ARTICLE 3. 
 PURPOSE 
  
 Section 3.1 Purpose and Business 
  
 The sole
purposes of the Company are (i) to acquire, own, manage, operate, repair, renovate, maintain, improve, expand, redevelop, encumber, lease, hold for appreciation, sell or otherwise dispose of, in accordance with the terms of this Agreement, the HCPI
Property, the Transferred Properties and any other Properties acquired by the Company and to invest and ultimately distribute funds, including without limitation funds obtained from owning or otherwise operating the HCPI Property, the Transferred
Properties and any other Properties acquired by the Company and the proceeds from the sale or other disposition of the HCPI Property, the Transferred Properties and any other Properties acquired by the Company, all in the manner permitted by this
Agreement, and (ii) subject to and in accordance with the terms of this Agreement, to do anything necessary or incidental to the foregoing. 
  
 Section 3.2 Powers 
  
 The Company is empowered to do any and all acts and things necessary, appropriate, proper, advisable, incidental to or convenient for the furtherance and
accomplishment of the purposes and business described herein and for the protection and benefit of the Company including, without limitation, full power and authority, directly or through its ownership interest in other entities, to enter into,
perform and carry out contracts of any kind, borrow money and issue evidences of indebtedness, whether or not secured by mortgage, deed of trust, pledge or other lien, acquire, own, manage, improve and develop real property, and lease, sell,
transfer and dispose of real property; provided, however, that notwithstanding any other provision in this Agreement, but subject to Sections 7.3.E, 7.3.F, and 7.3.G, the Managing Member may cause the Company to take any action to avoid a
result that, or to refrain from taking any action that, in the Reasonable judgment of the Managing Member, after consultation with outside counsel of the Managing Member (i) could adversely affect the ability of the Managing Member to continue to
qualify as a REIT, (ii) could subject the Managing Member to any additional taxes under Code Section 857 or Code Section 4981 or (iii) could violate any law or regulation of any governmental body or agency having jurisdiction over the Managing
Member, its securities or the Company; provided, further, however, that if any action (or inaction) proposed to be taken by the Managing Member to avoid the consequences referred to in 

  

 20 

 
clauses (i), (ii) or (iii) of the preceding proviso would have a detrimental effect on the distributions and allocations to the Non-Managing Member pursuant
to Articles 5, 6 or 13 or would impair the obligation of the Company to make Make-Whole Payments pursuant to Section 7.3.E, 7.3.F or 7.3.G, the obligation of the Managing Member to make the Make-Whole Payment as provided in the
last sentence of Section 7.3G, the obligation of the Company to comply with Section 7.3.J, the obligation of the Managing Member to make contributions as provided in Section 4.4.B, or alter or modify the restrictions on the Transfer of a Managing
Member’s interest in the Company under Section 11.2, the Managing Member shall not take such action unless (a) such action (or inaction) was consented to by the Non-Managing Member Representative in a writing specifically mentioning this
Section 3.2 or (b) it has received an opinion of a nationally recognized law firm specializing in the area of law under consideration selected by the Managing Member, addressed to the Non-Managing Members that the failure to take such action (or
inaction) poses a material risk of the occurrence of the consequences referred to in clauses (i), (ii) or (iii) of the preceding proviso. 
  
 Section 3.3 Specified Purposes 
  
 This Agreement shall not be deemed to create a company, venture or partnership between or among the Members with respect to any activities whatsoever
other than the activities within the purposes of the Company as specified in Section 3.1 hereof. Except as otherwise provided in this Agreement, no Member in its capacity as a Member hereunder shall have any authority to act for, bind, commit or
assume any obligation or responsibility on behalf of the Company, its properties or any other Member. No Member, in its capacity as a Member under this Agreement, shall be responsible or liable for any indebtedness or obligation of another Member,
nor shall the Company be responsible or liable for any indebtedness or obligation of any Member, incurred either before or after the execution and delivery of this Agreement by such Member, except as to those responsibilities, liabilities,
indebtedness or obligations incurred pursuant to and as limited by the terms of this Agreement and the Act. 
  
 Section 3.4 Representations and Warranties by the Members; Disclaimer of Certain Representations 
  
 A. Each Member that is an individual (including, without limitation, each
Additional Member or Substituted Member as a condition to becoming an Additional Member or a Substituted Member) represents and warrants to the Company, the Managing Member and each other Member that (i) such Member has the legal capacity to enter
into this Agreement and perform such Member’s obligations hereunder, (ii) the consummation of the transactions contemplated by this Agreement to be performed by such Member will not result in a breach or violation of, or a default under, any
material agreement by which such Member or any of such Member’s property is bound, or any statute, regulation, order or other law to which such Member is subject, (iii) such Member is neither a “foreign person” within the
meaning of Code Section 1445(f) nor a “foreign partner” within the meaning of Code Section 1446(e), and (iv) this Agreement is binding upon, and enforceable against, such Member in accordance with its terms. 
  
 B. Each Member that is not an individual (including, without limitation, each
Additional Member or Substituted Member as a condition to becoming an Additional Member or a Substituted Member) represents and warrants to the Company, the Managing Member and each 

  

 21 

 
other Member that (i) all transactions contemplated by this Agreement to be performed by it have been duly authorized by all necessary action, including,
without limitation, that of its managing member(s) (or, if there is no managing member, a majority in interest of all members), committee(s), trustee(s), general partner(s), beneficiaries, directors and shareholder(s), as the case may be, as
required, (ii) the consummation of such transactions will not result in a breach or violation of, or a default under, its partnership or operating agreement, trust agreement, charter or bylaws, as the case may be, any material agreement by which
such Member or any of such Member’s properties or any of its partners, members, beneficiaries, trustees or shareholders, as the case may be, is or are bound, or any statute, regulation, order or other law to which such Member or any of its
partners, members, trustees, beneficiaries or shareholders, as the case may be, is or are subject, (iii) such Member is neither a “foreign person” within the meaning of Code Section 1445(f) nor a “foreign partner”
within the meaning of Code Section 1446(e), and (iv) this Agreement is binding upon, and enforceable against, such Member in accordance with its terms. 
  
 C. Each Member (including, without limitation, each Additional Member or Substituted Member as a condition to becoming an Additional Member or a
Substituted Member) represents, warrants and agrees that it has acquired and continues to hold its interest in the Company for its own account for investment only and not for the purpose of, or with a view toward, the resale or distribution of all
or any part thereof, nor with a view toward selling or otherwise distributing such interest or any part thereof at any particular time or under any predetermined circumstances. 
  
 D. The representations and warranties contained in Sections 3.4.A, 3.4.B and 3.4.C hereof shall survive the execution and
delivery of this Agreement by each Member (and, in the case of an Additional Member or a Substituted Member, the admission of such Additional Member or Substituted Member as a Member in the Company). 
  
 E. Each Member (including, without limitation, each Additional Member or
Substituted Member as a condition to becoming an Additional Member or a Substituted Member) hereby represents that it has had the opportunity to consult with its legal counsel and tax advisor in connection with, and acknowledges that no
representations as to potential profit, tax consequences of any sort (including, without limitation, the tax consequences resulting from forming or operating the Company, conducting the business of the Company, executing this Agreement, consummating
the transaction provided for in or contemplated by the Contribution Agreement, making a Capital Contribution, being admitted to the Company, receiving or not receiving distributions from the Company, redeeming LLC Units or being allocated Tax
Items), cash flows, funds from operations or yield, if any, in respect of the Company, such Member or the Managing Member have been made by the Company, any Member or any employee or representative or Affiliate of the Company or any Member, and that
projections and any other information, including, without limitation, financial and descriptive information and documentation, that may have been in any manner submitted to such Member shall not constitute any representation or warranty of any kind
or nature, express or implied; provided that the foregoing shall not qualify, limit or otherwise affect any express representation or warranty given by any Member in any agreement executed by such Member. 
  

 22 

 F. The Members acknowledge and agree that each Non-Managing Member Unit is a security governed by Article
8 of the uniform commercial code as enacted in the State of New York. 
  
 ARTICLE 4. 
 CAPITAL CONTRIBUTIONS 
  
 Section 4.1 Capital Contributions of the Initial Members 
  
 The Members acknowledge the Capital Contribution of the Initial Member and
that such Capital Contribution is, as of the receipt of their Non-Managing Member Units, attributed to the Non-Managing Members as set forth on Exhibit A. At the time of its execution of this Agreement, the Managing Member shall make Capital
Contributions of the Cash Contribution and the HCPI Property as set forth in Exhibit A to this Agreement. The Members shall own Managing Member Units and Non-Managing Member Units, as applicable, in the amounts set forth on Exhibit A.
Except as required by the Act, as provided by the Contribution Agreement or as otherwise provided in Sections 4.2 and 4.4 hereof, no Member shall be required or permitted to make any additional Capital Contributions or loans to the Company.

  
 Section 4.2 Additional Members 
  
 With the Consent of the Non-Managing Members, the Managing Member is
authorized to admit one or more Additional Members to the Company from time to time, in accordance with the provisions of Section 12.2 hereof, on terms and conditions and for such Capital Contributions as may be established by the Managing Member.
Consent of the Non-Managing Members shall be required in connection with the admission of any Additional Members as set forth in Section 12.2. The provisions of Section 12.2 shall govern the acquisition by the Company in the future of additional
Properties by means of Capital Contributions by other Persons, which Capital Contributions shall be set forth in Exhibit A. As a condition to being admitted to the Company, each Additional Member shall execute an agreement to be bound by the
terms and conditions of this Agreement. 
  
 Section 4.3 Loans

  
 The Company may incur or assume Debt, enter into other
similar credit, guarantee, financing (including, without limitation, the encumbrance of the Properties for the debt of the Managing Member and/or Affiliates of the Managing Member pursuant to so-called cross-collateralized loans, or otherwise) or
refinancing arrangements, repay or prepay Debt, for any purpose (including, without limitation, in connection with any further acquisition of Properties from any Person), upon such terms as the Managing Member determines appropriate. 
  
 Section 4.4 Additional Funding and Capital Contributions 

 
 A. General. The Managing Member may, at any time and from time to
time, determine that the Company requires additional funds (“Additional Funds”) for the operation of the Company or in connection with the purchase, lease or other acquisition of assets or properties. Additional Funds may be
raised by the Company in accordance with the terms of this Section 4.4 or the terms of Section 4.3 hereof. No Person, including, without limitation, any 

  

 23 

 
Member or Assignee, shall have any preemptive, preferential, participation or similar right or rights to subscribe for or acquire any Membership Interest.

  
 B. Additional Contributions. The Managing Member on
behalf of the Company may raise all or any portion of the Additional Funds by making additional Capital Contributions. Subject to the terms of this Section 4.4 and to the definition of “Gross Asset Value,” the Managing Member
shall determine in good faith the amount of such additional Capital Contributions. Notwithstanding anything in this Agreement to the contrary, the Managing Member shall make additional Capital Contributions in an amount sufficient to cure any breach
of Section 7.3.J. The Managing Member shall receive that number of additional Managing Member Units in consideration for additional Capital Contributions made by the Managing Member that represent the same percentage of the total outstanding LLC
Units (including the newly issued LLC Units) as the initial Gross Asset Value of the additional Capital Contribution (net of the amount of liabilities of the Managing Member assumed by the Company or that are secured by the property contributed to
the Company) (or, in the event of a contribution of cash, the amount of cash so contributed) represents of the Gross Asset Value of the assets of the Company (including the additional Capital Contributions) as of the date of such contribution.

  
 C. Timing of Additional Capital Contributions. If
additional Capital Contributions are made by a Member on any day other than the first day of a Fiscal Year, then Net Income, Net Loss, each item thereof and all other items of income, gain, loss, deduction and credit allocable among Members for such
Fiscal Year, if necessary, shall be allocated among such Members by taking into account their varying interests during the Fiscal Year in accordance with Code Section 706(d), using the “interim closing of the books” method or such
other method as determined by the Managing Member with the Consent of the Non-Managing Members. 
  
 Section 4.5 No Interest; No Return 
  
 Except as provided herein, no Member shall be entitled to interest on its Capital Contribution or on such Member’s Capital Account. Except as
provided herein or by law, no Member shall have any right to demand or receive the return of its Capital Contribution from the Company. 
  
 ARTICLE 5. 
 DISTRIBUTIONS

  
 Section 5.1 Requirement and Characterization of
Distributions 
  
 A. The Managing Member shall, subject to
Section 5.3, cause the Company to distribute on each LLC Distribution Date and may, in its sole and absolute discretion, cause the Company to distribute on any other date (any such date of distribution pursuant to this Section 5.1.A a
“Distribution Date”), Available Cash and any Property Appreciation as of such Distribution Date as follows: 
  
 (1) First, to the holders of the Non-Managing Member Units in accordance with their relative Preferred Return Shortfalls as of such
Distribution Date until the Preferred Return Shortfall is zero; 
  

 24 

 (2) Second, to the holders of Managing Member Units until the holders of Managing Member
Units have received cumulative distributions in an aggregate amount per unit equal to the excess (the “Managing Member Shortfall”) of (x) the amounts previously distributed with respect to each Non-Managing Member Unit
pursuant to Section 5.1.A(1), 5.6.A(1), and 5.6.B(1) over (y) all amounts previously distributed with respect to each Managing Member Unit pursuant to this Section 5.1.A.(2) and 5.6.A(2) and 5.6.B(2); 
  
 provided, however, that in the event a Reduction Date occurs during period beginning
after the immediately preceding Distribution Date (or if there is no prior Distribution Date, the date hereof) and ending on such Distribution Date, a distribution shall be made under this Section 5.1.A to the holder or holders of the Reduction
Units in an amount determined by multiplying the amount that would have been distributed on the Distribution Date under Section 5.1.A in respect of the Reduction Units had they been outstanding on the last day of such Distribution Date by a
fraction, the numerator of which shall be the number of days beginning on the first day of such period and ending on the Reduction Date and the denominator of which shall be the number of days in such period. 
  
 B. The Managing Member may, in its sole and absolute discretion, cause the
Company to distribute on any date on which the Preferred Return Shortfall is zero all Available Cash remaining after making any distributions required pursuant to Section 5.1.A as follows: (x) one percent (1%) to the Non-Managing Member Unit holders
in proportion to the number of Non-Managing Member Units held by such holders and (y) ninety-nine percent (99%) to the Managing Member Unit holders in proportion to the number of Managing Member Units held by such holders. 
  
 Section 5.2 Distributions in Kind 
  
 No right is given to any Member to demand and receive property other than
cash. The Managing Member may determine, with the Consent of the Non-Managing Members, to make a distribution in kind to the Members of Company assets, and such assets shall be distributed in such a fashion as to ensure that the fair market value is
distributed and allocated in accordance with Articles 5 and 6 hereof. The fair market value of any Property distributed in kind shall be determined (i) prior to the Threshold Date, by the Managing Member with the Consent of the
Non-Managing Members, and (ii) thereafter, by the Managing Member in its good faith determination. 
  
 Section 5.3 Amounts Withheld 
  
 Each Member hereby authorizes the Company to withhold from or pay on behalf of or with respect to such Member any amount of federal, state, local or
foreign taxes that the Managing Member determines that the Company is required to withhold or pay with respect to any amount distributable or allocable to such Member pursuant to this Agreement, including, without limitation, any taxes required to
be withheld or paid by the Company pursuant to Code Section 1441, Code Section 1442, Code Section 1445 or Code Section 1446. Any amount paid on behalf of or with respect to a Member shall constitute a loan by the Company to such Member, which loan
shall be repaid by such Member within 15 days after notice from the 

  

 25 

 
Managing Member that such payment must be made unless (i) the Company withholds such payment from a distribution that would otherwise be made to the Member
or (ii) the Managing Member determines that such payment may be satisfied out of the Available Cash of the Company that would, but for such payment, be distributed to the Member. Any amounts withheld pursuant to the foregoing clauses (i) or (ii)
shall be treated as having been distributed to such Member. Each Member hereby unconditionally and irrevocably grants to the Company a security interest in such Member’s Membership Interest solely to secure such Member’s obligation to pay
to the Company any amounts required to be paid pursuant to this Section 5.3. In the event that a Member fails to pay any amounts owed to the Company pursuant to this Section 5.3 when due, the Managing Member may, in its sole and absolute discretion,
elect to make the payment to the Company on behalf of such defaulting Member, and in such event shall be deemed to have loaned such amount to such defaulting Member and shall succeed to all rights and remedies of the Company as against such
defaulting Member (including, without limitation, the right to receive distributions). Any amounts payable by a Member hereunder shall bear interest at the Prime Rate (but not higher than the maximum lawful rate) from the date such amount is due
(i.e., 15 days after demand) until such amount is paid in full. Each Member shall take such actions as the Company or the Managing Member shall request in order to perfect or enforce the security interest created hereunder. 
  
 Section 5.4 Distributions Upon Liquidation 
  
 Notwithstanding the other provisions of this Article 5, net proceeds
from a Terminating Capital Transaction and any other cash received or reductions in reserves made after commencement of the liquidation of the Company shall be distributed to the Members in accordance with Section 13.3 hereof. 
  
 Section 5.5 Restricted Distributions 
  
 Notwithstanding any provision to the contrary contained in this Agreement,
neither the Company nor the Managing Member, on behalf of the Company, shall make a distribution to any Member on account of its Membership Interest or interest in LLC Units if such distribution would violate Section 18-607 of the Act or other
applicable law. 
  
 Section 5.6 Distributions of Proceeds from
Sale of Real Properties and the Incurrence of Debt 
  
 A. In
the event of a taxable disposition of any Real Property (other than as part of a Terminating Capital Transaction), the Managing Member shall cause the Company to (i) reinvest the Disposition Proceeds to the extent the Managing Member elects to do so
and in the amount determined by the Managing Member to be appropriate (and to hold the Disposition Proceeds in an interest bearing account pending such reinvestment) or (ii) if the Managing Member so elects in its sole and absolute discretion, to
distribute all or any portion of the Disposition Proceeds in an amount no greater than an amount equal to the Disposition Proceeds less the Property Appreciation with respect to such Real Property as follows: 
  
 (1) First, to the holders of Non-Managing Member Units in
accordance with their Preferred Return Shortfalls until the Preferred Return Shortfall for each holder of Non-Managing Member Units is zero; 
  

 26 

 (2) Second, to the holders of Managing Member Units in accordance with its Managing
Member Shortfalls until the Managing Member Shortfall is zero; and 
  
 (3) Third, to the holders of LLC Units pro rata in proportion to their Percentage Interests until the amount of cash distributed under this Section 5.6.A(3) with respect to the disposition in question is equal to the
Initial Value of the Real Property that was the subject of such disposition. The distribution pursuant to this Section 5.6.A(3) shall reduce the number of LLC Units as provided in Section 8.6.D. 
  
 B. Upon the incurrence of Debt, the Managing Member shall cause the Company
to (i) reinvest the proceeds therefrom to the extent the Managing Member elects to do so and in the amount determined by the Managing Member to be appropriate (and to hold the proceeds therefrom in an interest bearing account pending such
reinvestment) and (ii) if the Managing Member elects to distribute all or any portion of such proceeds in its sole and absolute discretion, distribute such portion of such proceeds, to the extent thereof, as follows: 
  
 (1) First, to the holders of the Non-Managing Member Units
in accordance with their Preferred Return Shortfalls until the Preferred Return Shortfall for each holder of Non-Managing Member Units is zero; and 
  
 (2) Second, to the holders of Managing Member Units in accordance with its Managing Member Shortfalls until the Managing Member Shortfall
is zero; and 
  
 (3) Thereafter, to the Managing
Member. 
  
 C. The Managing Member shall have no obligation to
incur Debt for the purpose of making distributions pursuant to this Section 5.6 or for any other purpose. 
  
 ARTICLE 6. 
 ALLOCATIONS 
  
 Section 6.1 Timing and Amount of Allocations of Net Income and Net Loss

  
 Net Income and Net Loss of the Company shall be
determined and allocated with respect to each Fiscal Year of the Company as of the end of each such year. Except as otherwise provided in this Article 6, an allocation to a Member of a share of Net Income or Net Loss shall be treated as an
allocation of the same share of each item of income, gain, loss or deduction that is taken into account in computing Net Income or Net Loss. 
  
 Section 6.2 General Allocations 
  
 A. Operating Net Income, Depreciation, and Net Loss. Except as otherwise provided in Sections 6.2.B or 6.3: 
  
 (1) Net Loss with respect to any Fiscal Year of the Company,
other than Net Loss referred to in Section 6.2.B, shall be allocated to the Members and Assignees in proportion to their Percentage Interests. 
  

 27 

 (2) Net Income with respect to any Fiscal Year of the Company, other than Net Income
referred to in Section 6.2.B, shall be allocated as follows: 
  
 (a) First, to the Non-Managing Members or their Assignees in an amount that will cause such allocation, together with the amount of all previous allocations of Net Income under this Section 6.2.A(2)(a) and Section
6.2.B(2)(a), to equal to the cumulative distributions received by such Member or Assignee pursuant to Sections 5.1.A(1), 5.6.A(1) and 5.6.B(1) for the current and all prior Fiscal Years; 
  
 (b) Second, to the Managing Member or its Assignees in an amount that will cause such allocation, together
with the amount of all previous allocations of Net Income under this Section 6.2.A(2)(b) and Section 6.2.B(2)(b), to equal the cumulative distributions received by the Managing Member and such Assignees pursuant to Sections 5.1.A(2), 5.6.A(2) and
5.6.B(2) for the current and all prior Fiscal Years; and 
  
 (c) Thereafter, (x) ninety-nine percent (99%) to the Managing Member or its Assignees and (y) one percent (1%) to the Non-Managing Members or their Assignees in proportion to the number of Non-Managing Member Units
held by each such Non-Managing Member. 
  
 B. Net Income and
Net Loss Upon Terminating Capital Transaction or from the Disposition of Real Properties. Except as otherwise provided in Section 6.3: 
  
 (1) Net Loss attributable to a disposition of any of the Real Properties, including upon a Terminating Capital Transaction, shall be
allocated to the Members and Assignees in proportion to their Percentage Interests. 
  
 (2) Net Income attributable to a disposition of any of the Real Properties, including upon a Terminating Capital Transaction, shall be
allocated as follows: 
  
 (a) First, to each
Non-Managing Member or their Assignees in an amount that will cause such allocation, together with the amount of all previous allocations of Net Income under this Section 6.2.B(2)(a) and Section 6.2.A(2)(a), to equal to the cumulative distributions
received by such Member or Assignee pursuant to Sections 5.1.A(1), 5.6.A(1) and 5.6.B(1) for the current and all prior Fiscal Years; 
  
 (b) Second, to the Managing Member or its Assignees in an amount that will cause such allocation, together with the amount of all previous
allocations of Net Income under this Section 6.2.B(2)(b) and Section 6.2.A(2)(b), to equal the cumulative distributions received by the Managing Member and such Assignees pursuant to Sections 5.1.A(2), 5.6.A(2) and 5.6.B(2) for the current and all
prior Fiscal Years; and 
  

 28 

 (c) Thereafter, (x) ninety-nine percent (99%) to the Managing Member or its Assignees and
(y) one percent (1%) to the Non-Managing Members or their Assignees in proportion to the number of Non-Managing Member Units held by each such Non-Managing Member. 
  
 Section 6.3 Additional Allocation Provisions 
  
 A. Regulatory Allocations. 
  

(1) Minimum Gain Chargeback. 
  
 Except as otherwise provided in Regulations Section 1.704-2(f), notwithstanding the provisions of Section 6.2 hereof, or any other provision of this
Article 6, if there is a net decrease in Company Minimum Gain during any Fiscal Year, each Member shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such
Member’s share of the net decrease in Company Minimum Gain, as determined under Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each
Member pursuant thereto. The items to be allocated shall be determined in accordance with Regulations Sections 1.704-2(f)(6) and 1.704-2(j)(2). This Section 6.3.A(1) is intended to qualify as a “minimum gain chargeback” within the
meaning of Regulations Section 1.704-2(f) and shall be interpreted consistently therewith. 
  
 (2) Member Minimum Gain Chargeback. 
  
 Except as otherwise provided in Regulations Section 1.704-2(i)(4) or in Section 6.3.A(1) hereof, if there is a net decrease in Member Minimum Gain
attributable to a Member Nonrecourse Debt during any Fiscal Year, each Member who has a share of the Member Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(5), shall be
specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member’s share of the net decrease in Member Minimum Gain attributable to such Member Nonrecourse Debt,
determined in accordance with Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so
allocated shall be determined in accordance with Regulations Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Section 6.3.A(2) is intended to qualify as a “chargeback of partner nonrecourse debt minimum gain” within the meaning of
Regulations Section 1.704-2(i) and shall be interpreted consistently therewith. 
  
 (3) Member Nonrecourse Deductions. 
  
 Any Member Nonrecourse Deductions for any Fiscal Year shall be specially allocated to the Member(s) who bears the economic risk of loss with respect to
the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable, in accordance with Regulations Section 1.704-2(i). 
  

 29 

 (4) Qualified Income Offset. 
  
 If any Member unexpectedly receives an adjustment, allocation or
distribution described in Regulations Section 1.704-1(b) (2)(ii)(d)(4), (5) or (6), items of Company income and gain shall be allocated, in accordance with Regulations Section 1.704-1(b) (2)(ii)(d), to such Member
in an amount and manner sufficient to eliminate, to the extent required by such Regulations, the Adjusted Capital Account Deficit of such Member as quickly as possible, provided that an allocation pursuant to this Section 6.3.A(4) shall be made if
and only to the extent that such Member would have an Adjusted Capital Account Deficit after all other allocations provided in this Article 6 have been tentatively made as if this Section 6.3.A(4) were not in the Agreement. It is intended
that this Section 6.3.A(4) qualify and be construed as a “qualified income offset” within the meaning of Regulations Section 1.704-1(b) (2)(ii)(d) and shall be interpreted consistently therewith. 
  
 (5) Limitation on Allocation of Net Loss. 

 
 To the extent that any allocation of Net Loss would cause or increase an
Adjusted Capital Account Deficit as to any Member, such allocation of Net Loss shall be reallocated among the other Members in accordance with their respective LLC Units, subject to the limitations of this Section 6.3.A(5). 
  
 (6) Section 754 Adjustment. 
  
 To the extent that an adjustment to the adjusted tax basis of any Company
asset pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulations Section 1.704-1(b) (2)(iv)(m)(2) or Regulations Section 1.704-1(b) (2)(iv)(m)(4), to be taken into account in determining
Capital Accounts as the result of a distribution to a Member in complete liquidation of its interest in the Company, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of
the asset) or loss (if the adjustment decreases such basis), and such gain or loss shall be specially allocated to the Members in accordance with their LLC Units in the event that Regulations Section 1.704-1(b) (2)(iv)(m)(2) applies,
or to the Members to whom such distribution was made in the event that Regulations Section 1.704-1(b) (2)(iv)(m)(4) applies. 
  
 (7) Curative Allocations. 
  
 The allocations set forth in Sections 6.3.A(1) through (6) hereof (the “Regulatory Allocations”) are intended to comply
with certain regulatory requirements, including the requirements of Regulations Sections 1.704-1(b) and 1.704-2. Notwithstanding the provisions of Sections 6.1 and 6.2 hereof, the Regulatory Allocations shall be taken into account in allocating
other items of income, gain, loss and deduction among the Members so that, to the extent possible without violating the requirements giving rise to the Regulatory Allocations, the net amount of such allocations of other items and the Regulatory
Allocations to each Member shall be equal to the net amount that would have been allocated to each such Member if the Regulatory Allocations had not occurred. 
  

B. Allocation of Excess Nonrecourse Liabilities. For purposes of determining a Member’s proportional share of the “excess
nonrecourse liabilities” of the Company within 

  

 30 

 
the meaning of Regulations Section 1.752-3(a)(3), each Member’s interest in Company profits shall be such Member’s Percentage Interest.

  
 Section 6.4 Tax Allocations 
  
 A. In General. Except as otherwise provided in this Section 6.4, for
income tax purposes under the Code and the Regulations each of the Company’s items of income, gain, loss or deduction as determined for federal income tax purposes (collectively “Tax Items”) shall be allocated among the
Members in the same manner as its correlative item of “book” income, gain, loss or deduction is allocated pursuant to Sections 6.2 and 6.3 hereof. 
  
 B. Allocations Respecting Section 704(c) Revaluations. Notwithstanding Section 6.4.A hereof, Tax Items with respect
to Property that is contributed to the Company with a Gross Asset Value that varies from its basis in the hands of the contributing Member immediately preceding the date of contribution shall be allocated among the Members for income tax purposes
pursuant to the “traditional method” as described in Regulations Section 1.704-3(b). In the event that the Gross Asset Value of any Company asset is adjusted pursuant to subsection (b) of the definition of
“Gross Asset Value” (provided in Article 1 hereof), subsequent allocations of Tax Items with respect to such asset shall take account of the variation, if any, between the adjusted basis of
such asset and its Gross Asset Value in the same manner as under Code Section 704(c) and the applicable Regulations and this Section 6.4.B, pursuant to any method permitted under Regulations Section 1.704-3 as selected by the Managing Member which
selection, at any time prior to the Threshold Date, shall be made only with the Consent of the Non-Managing Members. 
  
 Section 6.5 Other Provisions 
  
 A. Other Allocations. In the event that (i) any modifications are made to the Code or any Regulations, (ii) any changes occur in any case law
applying or interpreting the Code or any Regulations, (iii) the IRS changes or clarifies the manner in which it applies or interprets the Code or any Regulations or any case law applying or interpreting the Code or any Regulations or (iv) the IRS
adjusts the reporting of any of the transactions contemplated by this Agreement which, in each case, in the opinion of an independent tax counsel, either (a) requires allocations of items of income, gain, loss, deduction or credit or (b) requires
reporting of any of the transactions contemplated by this Agreement in a manner different from that set forth in this Article 6, the Managing Member is hereby authorized to make new allocations or report any such transactions (as the case may
be) in reliance of the foregoing, and such new allocations and reporting shall be deemed to be made pursuant to the fiduciary duty of the Managing Member to the Company and the other Members, and no such new allocation or reporting shall give rise
to any claim or cause of action by any Member. 
  
 B.
Consistent Tax Reporting. The Members acknowledge and are aware of the income tax consequences of the allocations made by this Article 6 and hereby agree to be bound by the provisions of this Article 6 in reporting their shares
of Net Income, Net Loss and other items of income, gain, loss, deduction and credit for federal, state and local income tax purposes. 
  

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 ARTICLE 7. 
 MANAGEMENT AND OPERATION OF BUSINESS 
  
 Section 7.1 Management 
  
 A. Except as otherwise expressly provided in this Agreement, the Managing Member, in its capacity as a managing member of the Company under the Act, shall have sole and complete charge and management over the business and affairs of the
Company, in all respects and in all matters. The Managing Member shall at all times act in good faith in exercising its powers hereunder. The Managing Member shall be an agent of the Company’s business, and the actions of the Managing Member
taken in such capacity and in accordance with this Agreement shall bind the Company. The Managing Member shall at all times be a Member of the Company. Except as otherwise expressly provided in this Agreement or required by any non-waivable
provisions of applicable law, the Non-Managing Members, in their capacity as Members of the Company, shall not participate in the control of the Company, shall have no right, power or authority to act for or on behalf of, or otherwise bind, the
Company and shall have no right to vote on or consent to any other matter, act, decision or document involving the Company or its business. The Managing Member may not be removed by the Members with or without cause, except with the consent of the
Managing Member. In addition to the powers that are granted to the Managing Member under any other provision of this Agreement, the Managing Member, subject to the other provisions hereof including the limitations on the authority of the Managing
Member set forth in Section 7.3, shall have full power and authority to do all things deemed necessary or desirable by it to conduct the business of the Company, to exercise all powers set forth in Section 3.2 hereof and to effectuate the purposes
set forth in Section 3.1 hereof, including, without limitation: 
  
 (1) the making of any expenditures, the lending or borrowing of money making prepayments on loans, the assumption or guarantee of, or other contracting for, indebtedness and other liabilities (including, but not
limited to indebtedness of Managing Member or any of its Affiliates), the issuance of evidences of indebtedness (including the securing of same by deed to secure debt, mortgage, deed of trust or other lien or encumbrance on the Company’s
assets) and the incurring of any obligations that it deems necessary for the conduct of the activities of the Company; 
  
 (2) the making of tax, regulatory and other filings, or rendering of periodic or other reports to governmental or other agencies having
jurisdiction over the business or assets of the Company; 
  
 (3) the acquisition, sale, transfer, exchange or other disposition of any assets of the Company on commercially reasonable terms as determined in the good faith judgment of the Managing Member (including, but not
limited to, the exercise or grant of any conversion, option, privilege or subscription right or any other right available in connection with any assets at any time held by the Company); 
  
 (4) the mortgage, pledge, encumbrance or hypothecation of any assets of the Company (including, without
limitation, any Transferred Property) and the use of the assets of the Company (including, without limitation, cash on hand) for any purpose 

  

 32 

 
consistent with the terms of this Agreement which the Managing Member believes will directly benefit the Company and on any terms that the Managing Member
sees fit, including, without limitation, the financing of the conduct or the operations of the Company, the lending of funds to other Persons (including, without limitation, the Managing Member (if necessary to permit the financing or capitalization
of a Subsidiary of the Managing Member or the Company)), the repayment of obligations of the Company and the securing of obligations of the Managing Member or any of its Affiliates; 
  
 (5) the management, operation, leasing, landscaping, repair, alteration, demolition, replacement or
improvement of any Property, including, without limitation, any Transferred Property, or other asset of the Company or any Subsidiary, subject to any management agreements to which the Company is a party; 
  
 (6) the negotiation, execution and performance of any
contracts, leases, conveyances or other instruments in the ordinary course of the Company’s operations or which are necessary for the implementation of the Managing Member’s powers under this Agreement, including, without limitation, (i)
contracting with property managers (including, without limitation, as to any Transferred Property or other Property, contracting with the contributing or any other Member or its Affiliates for property management services), contractors, developers,
consultants, accountants, legal counsel, other professional advisors and other agents and the payment of their expenses and compensation out of the Properties, and (ii) the execution, delivery and performance of the Contribution Agreement and the
agreements and instruments referred to therein or contemplated thereby; 
  
 (7) the distribution of Company cash or other Company assets in accordance with this Agreement, the holding, management, investment and reinvestment of cash and other assets of the Company consistent with the
established investment policies of the Managing Member, and the collection and receipt of revenues, rents and income of the Company; 
  
 (8) the selection and dismissal of employees of the Company or the Managing Member (including, without limitation, employees having titles
or offices such as “president,” “vice president,” “secretary” and “treasurer”), and agents, outside attorneys, accountants, consultants and contractors of the Company or the Managing Member and
the determination of their compensation and other terms of employment or hiring; 
  
 (9) the maintenance of necessary or appropriate insurance including (i) liability insurance for the Indemnitees hereunder and (ii)
casualty, liability, earthquake and other insurance on the Properties of the Company for the benefit of the Company and the Members comparable in coverage to that maintained by the Managing Member with respect to the properties it owns; 

 
 (10) the control of any matters affecting the rights and
obligations of the Company, including the settlement, compromise, submission to arbitration or any 

  

 33 

 
other form of dispute resolution, or abandonment, of any claim, cause of action, liability, debt or damages, due or owing to or from the Company, the
commencement or defense of suits, legal proceedings, administrative proceedings, arbitrations or other forms of dispute resolution, and the representation of the Company in all suits or legal proceedings, administrative proceedings, arbitrations or
other forms of dispute resolution, the incurring of legal expense, and the indemnification of any Person against liabilities and contingencies to the extent permitted by law; 
  
 (11) the enforcement of any rights against any Member pursuant to representations, warranties, covenants and
indemnities relating to such Member’s contribution of property or assets to the Company; 
  
 (12) the collection and receipt of revenues and income of the Company; 
  
 (13) the exercise, directly or indirectly, through any attorney-in-fact acting under a general or limited
power of attorney, of any right, including the right to vote, appurtenant to any asset or investment held by the Company; 
  
 (14) the exercise of any of the powers of the Managing Member enumerated in this Agreement on behalf of or in connection with any
Subsidiary of the Company or any other Person in which the Company has a direct or indirect interest, or jointly with any such Subsidiary or other Person; 
  
 (15) the exercise of any of the powers of the Managing Member enumerated in this Agreement on behalf of any Person in which the Company
does not have an interest pursuant to contractual or other arrangements with such Person; 
  
 (16) subject to Section 7.3.A(4), the maintenance of working capital and other reserves in such amounts as the Managing Member deems
appropriate and reasonable from time to time; 
  
 (17) the making, execution and delivery of any and all deeds, leases, notes, deeds to secure debt, mortgages, deeds of trust, security agreements, conveyances, contracts, guarantees, warranties, indemnities, waivers, releases or legal
instruments or agreements in writing necessary or appropriate in the judgment of the Managing Member for the accomplishment of any of the powers of the Managing Member enumerated in this Agreement; 
  
 (18) the distribution of cash to acquire LLC Units held by a
Member in connection with a Member’s exercise of its Redemption Right under Section 8.6 hereof; 
  
 (19) the amendment and restatement of Exhibit A hereto to reflect accurately at all times the Capital Accounts, LLC Units, and
Percentage Interests of the Members as the same are adjusted from time to time to the extent necessary to reflect redemptions, Capital Contributions, the issuance of or reduction in the number of LLC Units, the admission of any Substituted Member or
otherwise, as long as the matter or event being reflected in Exhibit A hereto otherwise is authorized by this Agreement; and 
  

 34 

 (20) the formation of corporations, trusts, limited liability companies or other entities
as wholly-owned subsidiaries of the Company for purposes of holding title to all or a portion of the Properties. 
  
 B. Each of the Non-Managing Members agrees that, except as otherwise provided in this Agreement, the Managing Member is authorized to execute, deliver and
perform the above-mentioned agreements and transactions on behalf of the Company without any further act, approval or vote of the Non-Managing Members, notwithstanding any other provision of the Act or any applicable law, rule or regulation that may
be waived by a Non-Managing Member. 
  
 C. At all times from and
after the date hereof, the Managing Member may cause the Company to establish (subject to Section 7.3.A(4)) and maintain working capital reserves in such amounts as the Managing Member, in its sole and absolute discretion, deems appropriate and
reasonable from time to time. 
  
 D. Except as otherwise expressly
provided in this Agreement, in exercising its permitted authority under this Agreement, the Managing Member may, but shall be under no obligation to, take into account the tax consequences to any Member (including the Managing Member) of any action
taken by it. Except as otherwise expressly provided in this Agreement, the Managing Member and the Company shall not have liability to a Member under any circumstances as a result of an income tax liability incurred by such Member as a result of an
action (or inaction) by the Managing Member pursuant to its authority under this Agreement so long as the action or inaction is taken in good faith. 
  
 Section 7.2 Certificate of Formation 
  
 To the extent that such action is determined by the Managing Member to be reasonable and necessary or appropriate, the Managing Member shall file
amendments to (except for amendments that are inconsistent with this Agreement or vary the rights or duties of the Members, which shall be made only with the Consent of the Non-Managing Members) and restatements of the Certificate and do all the
things to maintain the Company as a limited liability company under the laws of the State of Delaware and each other state, the District of Columbia or any other jurisdiction in which the Company may elect to do business or own property. Subject to
the terms of Section 8.5.A(4) hereof, the Managing Member shall not be required, before or after filing, to deliver or mail a copy of the Certificate or any amendment thereto to any Member. The Managing Member shall use all reasonable efforts to
cause to be filed such other certificates or documents as may be commercially reasonable and necessary or appropriate for the formation, continuation, qualification and operation of a limited liability company in the State of Delaware and any other
state, or the District of Columbia or other jurisdiction in which the Company may elect to do business or own property. 
  
 Section 7.3 Restrictions on Managing Member’s Authority 
  
 A. The Managing Member may not take any action in contravention of an express prohibition or limitation of this Agreement,
including, without limitation: 
  
 (1) take any
action that would make it impossible to carry on the ordinary business of the Company, except as otherwise provided in this Agreement; 
  

 35 

 (2) possess Company property, or assign any rights in specific Company property, for
other than a Company purpose except for purposes of securing any obligation of Managing Member or any of its Affiliates or as otherwise provided in this Agreement; 
  
 (3) perform any act that would subject a Member to liability as a Managing Member in any jurisdiction or any
other liability except as provided herein or under the Act; 
  
 (4) establish or increase reserves in amounts such that the Company will not be able to make distributions pursuant to Article 5, or enter into any contract, mortgage, loan or other agreement that expressly
prohibits or restricts, or has the effect of prohibiting or restricting, the ability of the Company to make distributions of Available Cash as required by Article 5, except, in any such case, with the written consent of any Member affected by
the prohibition or restriction; or 
  
 (5) except
pursuant to Section 4.2, issue any class of equity security (other than additional Managing Member Units pursuant to Section 4.4 or otherwise in accordance with the terms of this Agreement) or any other security convertible into or exchangeable for
an equity security of the Company that would not be subordinate to the rights of the Non-Managing Members. 
  
 B. The Managing Member shall not, without the prior Consent of the Non-Managing Members, undertake or have the authority to do or undertake, on behalf of
the Company, any of the following actions or enter into any transaction which would have the effect of: 
  
 (1) except as provided in Section 7.3.C, amending, modifying or terminating this Agreement other than to reflect the permitted admission,
substitution, termination or withdrawal of Members pursuant to Article 11 or Article 12 hereof; 
  
 (2) approving or acquiescing to the Transfer of the Membership Interest of the Managing Member to any Person other than the Company or an
Affiliate of the Managing Member except pursuant to Section 11.2; 
  
 (3) admitting into the Company any Additional Managing Member or Substitute Managing Member; 
  
 (4) instituting or acquiescing in or otherwise permitting any proceeding for bankruptcy on behalf of, against or involving the Company
whether voluntary or involuntary; 
  
 (5) prior
to the first anniversary of the Effective Date, make any distribution of Disposition Proceeds or cause the Company to have a Liquidating Event; 
  
 (6) prior to the Threshold Date, confessing a judgment against the Company in an amount in excess of $2,000,000; 
  

 36 

 (7) making a general assignment for the benefit of creditors or appoint or acquiesce in
the appointment of any receiver, trustee, assignee, liquidator or other similar official under any Bankruptcy Law; 
  
 (8) cause the Company to have a Liquidating Event at any time on or after the first anniversary of the Effective Date unless the Managing
Member shall have provided not less than sixty (60) days prior written notice to the Members of such Liquidating Event, provided, however, if the Managing Member extends or delays the time for a Redemption Date pursuant to the last proviso of the
definition of Redemption Date or otherwise in accordance with the terms hereof, the Managing Member shall not permit a Liquidating Event on or prior to such Redemption Date, as so extended or delayed; or 
  
 (9) make any distribution of Disposition Proceeds under
Section 5.6.A(3) at any time the Cash Amount determined as of the date of such distribution is less than a fraction, the numerator of which is the amount that would be distributed to the Members pursuant to Section 5.6.A(3) and the denominator of
which is the number of Reduction Units resulting from such distribution. 
  
 C. Notwithstanding Section 7.3.B or Section 14.2, the Managing Member shall have the exclusive power to amend this Agreement as may be required to facilitate or implement any of the following purposes: 
  
 (1) to reflect the issuance of additional Membership
Interests pursuant to Section 4.2 or Section 4.4, to reflect the admission, substitution, termination, or withdrawal of Members in accordance with this Agreement and to amend Exhibit A in connection therewith and to reflect the redemption or
other reduction in the number of LLC Units outstanding pursuant to Sections 8.6.A or 8.6.D hereof and as otherwise permitted by this Agreement; 
  
 (2) to satisfy any requirements, conditions, or guidelines contained in any order, directive, opinion, ruling or regulation of a federal
or state agency or contained in federal or state law; 
  
 (3) subject to second the proviso to Section 3.2, to reflect such changes that the Managing Member determines are necessary in its Reasonable judgment, after consultation with outside counsel to the Managing Member, for the Managing Member
to maintain its status as a REIT or to satisfy the REIT Requirements; and 
  
 (4) to modify, as set forth in the definition of “Capital Account,” the manner in which Capital Accounts are computed. 
  
 D. Notwithstanding Section 7.3.B and 7.3.C hereof, this Agreement shall not be amended with respect to any Member adversely
affected, and no action may be taken by the Managing Member, without the consent of such Member adversely affected if such amendment or action would (i) convert a Non-Managing Member’s interest in the Company into a Managing Member’s
interest, (ii) modify the limited liability of a Non-Managing Member, (iii) alter rights of the Member to receive distributions pursuant to Article 5 or Section 13.3.A, or the allocations 

  

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specified in Article 6 (except as permitted pursuant to Section 4.4 and Section 7.3.C(1) hereof), (iv) materially alter or modify the rights to a
Redemption as set forth in Section 8.6 or the rights to a Make-Whole Payment as set forth in Sections 7.3.E, 7.3.F and 7.3.G, and related definitions hereof, (v) amend this Section 7.3.D, (vi) alter or modify the Company’s obligations under
7.3.J, (vii) alter or modify Section 11.2.A or (vii) alter or modify the Managing Member’s obligation to make Additional Capital Contribution pursuant to Section 4.4.B. Further, no amendment may alter the restrictions on the Managing
Member’s authority set forth elsewhere in this Section 7.3 without the Consent specified in such section. Any such amendment or action consented to by any Member shall be effective as to that Member, notwithstanding the absence of such consent
by any other Member. 
  
 E. The Company shall pay to each
Non-Managing Member the Make-Whole Payment, if any, as provided below if the Company takes any of the following actions during the Tax Protection Period without the prior Consent of the Non-Managing Members, which consent expressly state that the
right to the Make-Whole Payment is being waived: 
  
 (1) cause or permit the Company to merge, consolidate or combine with or into any other partnership, limited partnership, limited liability company, corporation or other person, to sell or otherwise dispose of all or substantially all of
its assets, or to reclassify or change its outstanding equity interests or to enter into any Termination Transaction; or 
  
 (2) sell, dispose, convey or otherwise transfer any of the real properties the Company acquired in connection with the transactions
consummated pursuant to the Contribution Agreement (collectively, the “Real Properties”) or any Successor Properties, in a transaction that causes holders of Non-Managing Member Units to recognize taxable income under the
Code on account of a Built-in Gain, other than a (i) casualty loss, (ii) taking by eminent domain, (iii) pursuant to the exercise of a put right by the Company (or any Subsidiary of the Company) pursuant to which the Company (or such Subsidiary) may
require another Person to purchase one or more Real Properties, which put right was granted pursuant to any document or instrument executed in accordance with the Contribution Agreement or (iv) pursuant to the exercise of a call or other purchase
right by any other Person pursuant to which such Person has the right to purchase one or more Real Properties, which call or other purchase right was granted pursuant to any document or instrument executed in accordance with the Contribution
Agreement or in effect at the time such Properties were contributed to the Company; provided that the Company shall use commercially reasonable efforts to apply the proceeds of any such casualty or taking to the restoration or replacement of such
Real Properties or Successor Properties in a transaction qualifying under Code Section 1033; 
  
 In the event that the prior Consent of the Non-Managing Members is not required for the Managing Member, on behalf of the Company, to take or engage in any of the actions described in the foregoing subparagraphs (1)
and (2), the Managing Member may take such action only after providing the Non-Managing Members with not less than if prior to November 5 or after December 1 of any calendar year, forty-five (45) days, and otherwise, sixty (60) days notice of its
intention to do so. 
  

 38 

 F. The Company shall pay to the Non-Managing Members the Make Whole Payment as provided in Section 7.3.G
if the Company takes any action to dissolve or otherwise terminate the Company during the Tax Protection Period. In addition, a Non-Managing Member shall be entitled to the Make Whole Payment in the event of the exercise of such Non-Managing
Member’s right to a Redemption under 8.6.A after receipt by such Non-Managing Member of a written notice of a Liquidating Event provided by the Company to the same extent such Non-Managing Member would have been entitled to such Make Whole
Payment had such Non-Managing Member not have been redeemed pursuant to such Redemption. In the event the Managing Member intends to dissolve or otherwise terminate the Company following the Tax Protection Period, it shall give not less than
forty-five (45) days notice of such intent to the Non-Managing Members prior to taking any action in furtherance of such intent. 
  
 G. Any event in Sections 7.3.E and 7.3.F that triggers the obligation of the Company to make a Make-Whole Payment (as defined below) is called a
“Triggering Event.” The Company shall pay to each Non-Managing Member an amount (the “Make-Whole Payment”) equal to the aggregate federal, state and local income taxes, if any, incurred by the
Non-Managing Member as a result of a Triggering Event. Any such federal, state and local income taxes shall be deemed to be the amount of gain or income recognized by the Non-Managing Members multiplied by the then highest rate or rates applicable
to such gain or income for the year in which such gain or income is recognized grossed up to include any federal, state and local income taxes incurred by the Non-Managing Member by reason of the receipt of the payment from the Company. No effect
shall be given in determining the amount of the Make-Whole Payment of a Non-Managing Member’s taxable income, tax deductions, tax credits, tax carry forwards nor to any other of their tax benefits or tax attributes. The Make-Whole Payment shall
be made within a reasonable period of time after the Triggering Event, but in no event later than the date by which the Non-Managing Member would be required to make the applicable tax payment. In addition to any other rights available under law or
equity, in the event that the Company fails to pay any amounts owed pursuant to this Section 7.3 when due, the Non-Managing Member to whom such payment is owed shall be deemed to have loaned such amount to the Company. Any amounts payable to a
Non-Managing Member shall be increased by an amount equal to the greater of (x) interest accrued on such amount at the Prime Rate from the date such amount is due until such amount is paid in full and (y) actual interest and penalties accrued by the
relevant taxing authorities with respect to such amounts plus any penalties actually imposed thereon by the relevant taxing authorities. In the event that any Member becomes entitled to a Make Whole Payment and the Company, for any reason, fails to
satisfy such obligation, then the Managing Member shall make the Make Whole Payment promptly following such failure by the Company to make such Make Whole Payment. 
  
 H. The parties agree that the sole and exclusive rights and remedies to which the Non-Managing Members may be entitled at
law or in equity in connection with any Triggering Event shall be for payment of the Make-Whole Payment pursuant to Section 7.3.G, and no Non-Managing Member shall be entitled to enjoin or otherwise object to any transaction that would result in a
taxable event or pursue any other claim with respect to a Triggering Event unless, independent of the tax consequences, such transaction is or would be in violation of this Agreement or applicable law. If any Non-Managing Member notifies the Company
of a claim that the Company owes a Make-Whole Payment, the Managing Member, on behalf of the Company, and the Non-Managing Member shall negotiate in good faith to resolve any 

  

 39 

 
disagreements regarding any such Triggering Event. If any such disagreement cannot be resolved by the parties within thirty (30) days after the receipt by
the Company of the notice in accordance with the preceding sentence, the Managing Member, on behalf of the Company, and the Non-Managing Member shall jointly retain a nationally recognized independent public accounting firm that is not the Managing
Member’s accounting firm (an “Accounting Firm”) to act as an arbitrator to resolve as expeditiously as possible all points of any such disagreement (including, without limitation, whether a Triggering Event has occurred
and, if so, the amount of the applicable Make-Whole Payment that the Non-Managing Member is entitled to as a result thereof, determined as set forth in Section 7.3.G). If the parties cannot agree on an Accounting Firm, each of the Managing Member,
on behalf of the Company, and the Non-Managing Member shall retain an Accounting Firm, and the Accounting Firms selected shall jointly retain a third Accounting Firm. If the two Accounting Firms cannot agree upon a third Accounting Firm within
thirty (30) days, such matter shall be referred to a court of competent jurisdiction to select the third Accounting Firm. The Accounting Firms shall be instructed to resolve as expeditiously as possible all points of any such disagreement
(including, without limitation, whether a Triggering Event has occurred and, if so, the amount of the applicable Make-Whole Payment that the Non-Managing Member is entitled to as a result thereof, determined as set forth in Section 7.3.G). All
determinations made by the Accounting Firm or the Accounting Firms, as the case may be, with respect to the resolution of whether a Triggering Event has occurred shall be final, conclusive and binding on the Company and the Non-Managing Member. The
fees and expenses of any Accounting Firms incurred in connection with any such determination shall be shared equally by the Company and the Non-Managing Member. 
  

I. The Managing Member agrees that it will operate and maintain the Company’s Properties in substantially the same manner as it would if such
Properties were owned directly by the Managing Member. 
  
 J. If
the Company or, after assumption by the Managing Member in accordance with Section 8.6.A, the Managing Member fails to satisfy its Redemption obligation under Section 8.6.A as of any Redemption Date and such failure continues for a period of thirty
days or more after such Redemption Date then, at all times thereafter, the Company shall maintain Equity Coverage of no less than one hundred and twenty percent (120%) of the product of (a) the Cash Amount determined as if a Notice of Redemption had
been delivered to the Company with respect to all Non-Managing Member Units as of the end of the immediately preceding calendar quarter, multiplied by (b) the number of Non-Managing Member Units outstanding at the end of that quarter. 
  
 K. The Managing Member shall provide the Non-Managing Member Representative
written notice, in reasonable detail in light of the then available information, of any breach of any representation or warranty of the Managing Member made in Section 7.8 of the Contribution Agreement and any breach of a covenant or agreement of
Managing Member or Operating Company in Section 2.1(c), 4.1(b) or Article X of the Contribution Agreement promptly upon Managing Member becoming aware of such breach. Such notice shall include a description of the actions Managing Member proposes to
take to remedy the breach and the anticipated time frame for taking such actions and resolving such breach. In the event a Majority in Interest of the Non-Managing Members do not approve the remedy proposed by the Managing Member or, if such remedy
is approved and the Managing member fails to promptly complete or 

  

 40 

 
perform such remedy, then a Majority in Interest of the Non-Managing Members shall be entitled and authorized to enforce on behalf of the Company or cause
the Company to enforce the Contribution Indemnity. Such right shall include the right, on behalf of the Company, to commence, prosecute, control and resolve litigation or other enforcement action against the Managing Member. 
  
 Section 7.4 Compensation of the Managing Member 
  
 A. The Managing Member shall not be compensated for its services as the
manager of the Company. Distributions, payments and allocations to which the Managing Member may be entitled in its capacity as the Managing Member shall not constitute compensation for services rendered by the Managing Member as provided in this
Agreement (including the provisions of Articles 5 and 6 hereof). 
  
 B. Subject to Sections 7.4.C and 15.13 hereof, the Company shall be liable, and shall reimburse the Managing Member on a monthly basis (or such other basis as the Managing Member may determine in its reasonable
discretion), for all sums expended in connection with the Company’s business. Any such reimbursements shall be in addition to any reimbursement of the Managing Member as a result of indemnification pursuant to Section 7.7 hereof. 
  
 C. To the extent practicable, Company expenses shall be billed directly to
and paid by the Company. Subject to Section 15.13 hereof, reimbursements to the Managing Member or any of its Affiliates by the Company shall be allowed, however, for the actual cost to the Managing Member or any of its Affiliates of operating and
other expenses of the Company, including, without limitation, the actual cost of goods, materials and administrative services related to (i) Company operations, (ii) company accounting, (iii) communications with Members, (iv) legal services, (v) tax
services, (vi) computer services, (vii) risk management, (viii) mileage and travel expenses and (ix) such other related operational and administrative expenses as are necessary for the prudent organization and operation of the Company. “Actual
cost of goods and materials” means the actual cost to the Managing Member or any of its Affiliates of goods and materials used for or by the Company obtained from entities not affiliated with the Managing Member, and “actual cost of
administrative services” means the pro rata cost of personnel (as if such persons were employees to the Company) providing administrative services to the Company. The cost for such services to be reimbursed to the Managing Member or any
Affiliate thereof shall be the lesser of the Managing Member’s or Affiliate’s actual cost, or the amount the Company would be required to pay to independent parties for comparable administrative services in the same geographic location.

  
 D. The Managing Member shall also be reimbursed by the Company
for all expenses it incurs relating to any issuance of additional Membership Interests, Debt of the Company, or rights, options, warrants or convertible or exchangeable securities of the Company pursuant to Article 8 hereof (including,
without limitation, all costs, expenses, damages and other payments resulting from or arising in connection with litigation related to any of the foregoing), all of such expenses are considered by the Members to constitute expenses of, and for the
benefit of, the Company. 
  

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 To the extent that reimbursements to the Managing Member or any of its Affiliates by the Company pursuant
to this Section 7.4 would constitute gross income to the Managing Member for purposes of Code Section 856(c)(2) or 856(c)(3), then such amounts shall be treated as “guaranteed payments” within the meaning of Code Section 707(c).

  
 Section 7.5 Other Business of Managing Member

  
 The Managing Member shall devote to the Company such time
as may be necessary for the performance of its duties as Managing Member, but the Managing Member is not required, and is not expected, to devote its full time to the performance of such duties. The Managing Member may engage independently or with
others in other business ventures of every nature and description, including, without limitation, the ownership of other properties and the making or management of other investments. Nothing in this Agreement shall be deemed to prohibit the Managing
Member or any Affiliate of the Managing Member from dealing, or otherwise engaging in business with, Persons transacting business with the Company, or from providing services related to the purchase, sale, financing, management, development or
operation of real or personal property and receiving compensation therefor, not involving any rebate or reciprocal arrangement that would have the effect of circumventing any restriction set forth herein upon dealings with the Managing Member or any
Affiliate of the Managing Member; provided, however, that neither the Managing Member nor any Affiliate of the Managing Member shall deal or engage in business with any such Person or provide any such services if such business or services would
violate any contractual obligation of the Managing Member or any Affiliate of the Managing Member with any Non-Managing Member or an Affiliate of any Non-Managing Member. Except as provided in any contractual agreement between the Company, the
Members and/or their Affiliates, neither the Company nor any Member shall have any right by virtue of this Agreement or the relationship created hereby in or to such other ventures or activities or to the income or proceeds derived therefrom, and
the pursuit of such ventures, even if competitive with the business of the Company, shall not be deemed wrongful or improper. 
  
 Section 7.6 Contracts with Affiliates 
  
 A. Subject to Section 7.6.B below, the Company may lend or contribute to Affiliates in which it has an equity investment, and such Affiliates may borrow
funds from the Company, on terms and conditions established in the sole and absolute discretion of the Managing Member. The foregoing authority shall not create any right or benefit in favor of any Person. 
  
 B. The Company shall not enter into or modify transactions with any of its
Affiliates or Affiliates of the Managing Member except for transactions evidenced by written agreements that are at arm’s-length and fair market value and otherwise on terms and conditions that are fair and reasonable to the Company; provided,
however, that, subject to Section 7.3.J, the Managing Member shall at all times be entitled to cause the Company to mortgage, pledge, encumber or hypothecate the Properties, any property owned by a Subsidiary of the Company or any portion thereof as
security for the debt of the Managing Member or any of its Affiliates. 
  

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 Section 7.7 Indemnification 
  
 A. To the fullest extent permitted by applicable law, the Company shall indemnify each Indemnitee from and against any and
all losses, claims, damages, liabilities, joint or several, expenses (including, without limitation, attorney’s fees and other legal fees and expenses), judgments, fines, settlements and other amounts arising from any and all claims, demands,
actions, suits or proceedings, civil, criminal, administrative or investigative, that relate to the operations of the Company (“Actions”) as set forth in this Agreement in which such Indemnitee may be involved, or is
threatened to be involved, as a party or otherwise unless it is established that: (i) the act or omission of the Indemnitee was material to the matter giving rise to the proceeding and either was committed in bad faith or was the result of active
and deliberate dishonesty; (ii) the Indemnitee actually received an improper personal benefit in money, property or services; or (iii) in the case of any criminal proceeding, the Indemnitee had reasonable cause to believe that the act or omission
was unlawful. Without limitation the foregoing indemnity shall extend to any liability of any Indemnitee, pursuant to a loan guaranty or otherwise, for any indebtedness of the Company or any Subsidiary of the Company (including, without limitation,
any indebtedness which the Company or any Subsidiary of the Company has assumed or taken subject to), and the Managing Member is hereby authorized and empowered, on behalf of the Company, to enter into one or more indemnity agreements consistent
with the provisions of this Section 7.7 in favor of any Indemnitee having or potentially having liability for any such indebtedness. The termination of any proceeding by judgment, order or settlement does not create a presumption that the Indemnitee
did not meet the requisite standard of conduct set forth in this Section 7.7.A. The termination of any proceeding by conviction or upon a plea of nolo contendere or its equivalent, or an entry of an order of probation prior to judgment,
creates a rebuttable presumption that the Indemnitee acted in a manner contrary to that specified in this Section 7.7.A with respect to the subject matter of such proceeding. Any indemnification pursuant to this Section 7.7 shall be made only out of
the assets of the Company, and any insurance proceeds from the liability policy covering the Managing Member and any Indemnitees, and neither the Managing Member nor any Non-Managing Member shall have any obligation to contribute to the capital of
the Company or otherwise provide funds to enable the Company to fund its obligations under this Section 7.7. 
  
 B. Reasonable expenses incurred by an Indemnitee who is a party to a proceeding or otherwise subject to or the focus of or is involved in any Action shall
be paid or reimbursed by the Company as incurred by the Indemnitee in advance of the final disposition of the Action upon receipt by the Company of (i) a written affirmation by the Indemnitee of the Indemnitee’s good faith belief that the
standard of conduct necessary for indemnification by the Company as authorized in Section 7.7.A has been met, and (ii) a written undertaking by or on behalf of the Indemnitee to repay the amount if it shall ultimately be determined that the standard
of conduct has not been met. 
  
 C. The indemnification provided
by this Section 7.7 shall be in addition to any other rights to which an Indemnitee or any other Person may be entitled under any agreement, pursuant to any vote of the Members, as a matter of law or otherwise, and shall continue as to an Indemnitee
who has ceased to serve in such capacity unless otherwise provided in a written agreement with such Indemnitee or in the writing pursuant to which such Indemnitee is indemnified. 
  

 43 

 D. The Company may, but shall not be obligated to, purchase and maintain insurance, on behalf of any of
the Indemnitees and such other Persons as the Managing Member shall determine, against any liability that may be asserted against or expenses that may be incurred by such Person in connection with the Company’s activities, regardless of whether
the Company would have the power to indemnify such Person against such liability under the provisions of this Agreement. 
  
 E. In no event may an Indemnitee subject any of the Members to personal liability by reason of the indemnification provisions set forth in this Agreement.

  
 F. An Indemnitee shall not be denied indemnification in whole
or in part under this Section 7.7 because the Indemnitee had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement. 
  
 G. The provisions of this Section 7.7 are for the benefit of the Indemnitees,
their heirs, successors, assigns and administrators and shall not be deemed to create any rights for the benefit of any other Persons. Any amendment, modification or repeal of this Section 7.7 or any provision hereof shall be prospective only and
shall not in any way affect the limitations on the Company’s liability to any Indemnitee under this Section 7.7 as in effect immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters
occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted. 
  
 H. If and to the extent any reimbursements to the Managing Member pursuant to this Section 7.7 constitute gross income to the Managing Member (as opposed
to the repayment of advances made by the Managing Member on behalf of the Company) such amounts shall constitute guaranteed payments within the meaning of Code Section 707(c), shall be treated consistently therewith by the Company and all Members,
and shall not be treated as distributions for purposes of computing the Members’ Capital Accounts. 
  
 Section 7.8 Liability of the Managing Member and the Non-Managing Member Representative 
  
 A. Notwithstanding anything to the contrary set forth in this Agreement,
neither the Managing Member nor any of its directors or officers or the Non-Managing Member Representative shall be liable or accountable in damages or otherwise to the Company, any Members or any Assignees for losses sustained, liabilities incurred
or benefits not derived as a result of errors in judgment or mistakes of fact or law or of any act or omission if the Managing Member or such director or officer or Non-Managing Member Representative acted in good faith. 
  
 B. The Non-Managing Members expressly acknowledge that the Managing Member is
acting for the benefit of the Company, the Members and the Managing Member’s shareholders collectively, that the Managing Member is under no obligation to give priority to the separate interests of the Members or the Managing Member’s
shareholders (including, 

  

 44 

 
without limitation, the tax consequences to Members, Assignees or the Managing Member’s shareholders) in deciding whether to cause the Company to take
(or decline to take) any actions. 
  
 C. Subject to its
obligations and duties as Managing Member set forth in Section 7.1.A hereof, the Managing Member may exercise any of the powers granted to it by this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through
its employees or agents. The Managing Member shall not be responsible for any misconduct or negligence on the part of any such agent appointed by it in good faith. 
  
 D. Any amendment, modification or repeal of this Section 7.8 or any provision hereof shall be prospective only and shall not
in any way affect the limitations on the Managing Member’s, and its officers’ and directors’, and the Non-Managing Member Representative’s liability to the Company and the Non-Managing Members under this Section 7.8 as in effect
immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be
asserted. 
  
 Section 7.9 Other Matters Concerning the Managing
Member 
  
 A. The Managing Member and the Non-Managing Member
Representative may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture or other paper or document believed by it
in good faith to be genuine and to have been signed or presented by the proper party or parties. 
  
 B. The Managing Member and the Non-Managing Member Representative may consult with legal counsel, accountants, appraisers, management consultants,
investment bankers, architects, engineers, environmental consultants and other consultants and advisers selected by it, and any act taken or omitted to be taken in reliance upon the opinion of such Persons as to matters that the Managing Member
reasonably believes to be within such Person’s professional or expert competence shall be conclusively presumed to have been done or omitted in good faith and in accordance with such opinion. 
  
 C. The Managing Member shall have the right, in respect of any of its powers
or obligations hereunder, to act through any of its duly authorized officers and a duly appointed attorney or attorneys-in-fact. Each such attorney shall, to the extent provided by the Managing Member in the power of attorney, have full power and
authority to do and perform all and every act and duty that is permitted or required to be done by the Managing Member hereunder. 
  
 D. Notwithstanding any other provisions of this Agreement or the Act, any action of the Managing Member on behalf of the Company or any decision of the
Managing Member to refrain from acting on behalf of the Company undertaken in the good faith belief, after consultation with outside counsel to the Managing Member, that such action or omission is necessary or advisable in order (i) to protect the
ability of the Managing Member to continue to qualify as a REIT, (ii) for the Managing Member otherwise to satisfy the REIT Requirements or (iii) to allow the Managing Member to avoid incurring any liability for taxes under Section 857 or Section
4981 of the Code, is expressly authorized under this Agreement and is deemed 

  

 45 

 
approved by all of the Non-Managing Members; provided, however, if in the opinion of the Managing Member any such action or omission will adversely affect
the rights of a Non-Managing Member hereunder, the Managing Member shall give the Non-Managing Member Representative notice of such intended action or omission; provided, further, however, that if any action or omission proposed to be taken by the
Managing Member to avoid the consequences referred to in clauses (i), (ii) or (iii) of this Section 7.9.D would have a detrimental effect on the distributions and allocations to the Non-Managing Member pursuant to Articles 5, 6 or
13 or would impair the obligation of the Company to make Make-Whole Payments pursuant to Section 7.3.E, 7.3.F or 7.3.G, the obligation of the Managing Member to make the Make-Whole Payment as provided in the last sentence of Section 7.3G, the
obligation of the Company to comply with Section 7.3.J, the obligation of the Managing Member to make contributions as provided in Section 4.4.B, or alter or modify the restrictions on the Transfer of a Managing Member’s interest in the Company
under Section 11.2.A, , the Managing Member shall not take such action or omission unless it has received an opinion of a nationally recognized law firm specializing in the law regarding taxation of REITs, selected by the Managing Member, addressed
to the Non-Managing Members that the failure to take such action or omission poses a material risk of the occurrence of the consequences referred to in clauses (i), (ii) or (iii) of this Section 7.9.D. 
  
 Section 7.10 Title to Company Assets 
  
 Title to Company assets, whether real, personal or mixed and whether
tangible or intangible, shall be deemed to be owned by the Company as an entity, and no Member, individually or collectively with other Members or Persons, shall have any ownership interest in such Company assets or any portion thereof. All Company
assets shall be recorded as the property of the Company in its books and records, irrespective of the name in which legal title to such Company assets is held. 
  

Section 7.11 Reliance by Third Parties 
  
 Any Person dealing with the Company shall be entitled to assume that the Managing Member has full power and authority, without the consent or approval of
any other Member or Person, to encumber, sell or otherwise use in any manner any and all assets of the Company and to enter into any contracts on behalf of the Company, and take any and all actions on behalf of the Company, and such Person shall be
entitled to deal with the Managing Member as if it were the Company’s sole party in interest, both legally and beneficially. In no event shall any Person dealing with the Managing Member or its representatives be obligated to ascertain that the
terms of this Agreement have been complied with or to inquire into the necessity or expediency of any act or action of the Managing Member or its representatives. Each and every certificate, document or other instrument executed on behalf of the
Company by the Managing Member or its representatives shall be conclusive evidence in favor of any and every Person relying thereon or claiming thereunder that (i) at the time of the execution and delivery of such certificate, document or
instrument, this Agreement was in full force and effect, (ii) the Person executing and delivering such certificate, document or instrument was duly authorized and empowered to do so for and on behalf of the Company and (iii) such certificate,
document or instrument was duly executed and delivered in accordance with the terms and provisions of this Agreement and is binding upon the Company. 
  

 46 

 Section 7.12 Exculpation. 
  
 Neither the Managing Member nor the Non-Managing Member Representative shall be personally liable for the return of any
portion of the Capital Contributions (or any return thereon) of any Member. The return of such Capital Contributions (or any return thereon) shall be made solely from the Company’s assets. Neither the Managing Member nor the Non-Managing Member
Representative shall be required to pay to the Company or to any Member any deficit in the Capital Account of any Member upon dissolution of the Company or otherwise. No Member shall have the right to demand or receive property other than cash for
its Membership Interest in the Company. None of the Managing Member, any of its Affiliates, any member, officer, agent or employee of the Managing Member or any of its Affiliates or the Non-Managing Member Representative, shall be liable,
responsible or accountable in damages or otherwise to the Company or any Member for any loss incurred as a result of any act or failure to act by such Person on behalf of the Company unless such loss is finally determined by a court of competent
jurisdiction to have resulted from such Person’s fraud, willful misconduct, gross negligence or a willful breach of this Agreement. 
  
 ARTICLE 8. 
 RIGHTS AND OBLIGATIONS OF
MEMBERS 
  
 Section 8.1 Limitation of Liability

  
 The Non-Managing Members shall have no liability under
this Agreement except as expressly provided in this Agreement or under the Act. 
  
 Section 8.2 Managing of Business 
  
 Except as provided, in Section 7.3.K, no Non-Managing Members or Assignee (other than the Managing Member, any of its Affiliates or any officer, director, employee, partner, agent or trustee of the Managing Member,
the Company or any of their Affiliates, in their capacity as such) shall take part in the operations, management or control (within the meaning of the Act) of the Company’s business, transact any business in the Company’s name or have the
power to sign documents for or otherwise bind the Company. The transaction of any such business by the Managing Member, any of its Affiliates or any officer, director, employee, partner, agent or trustee of the Managing Member, the Company or any of
their Affiliates, in their capacity as such, shall not affect, impair or eliminate the limitations on the liability of the Non-Managing Members or Assignees under this Agreement. 
  
 Section 8.3 Outside Activities of Members 
  
 Subject to any agreements entered into by a Member or its Affiliates with the Managing Member, the Company or a Subsidiary
(including, without limitation, any employment agreement), any Member and any Assignee, officer, director, employee, agent, trustee, Affiliate or shareholder of any Member shall be entitled to and may have business interests and engage in business
activities in addition to those relating to the Company, including business interests and activities that are in direct or indirect competition with the Company or that are enhanced by the activities of the Company. Neither the Company nor any
Member shall have any rights by virtue of this Agreement in any business ventures of any Member or 

  

 47 

 
Assignee. Subject to such agreements, none of the Members nor any other Person shall have any rights by virtue of this Agreement or the relationship
established hereby in any business ventures of any other Person (other than the Managing Member, to the extent expressly provided herein), and such Person shall have no obligation pursuant to this Agreement, subject to any agreements entered into by
a Member or its Affiliates with the Managing Member, the Company or a Subsidiary, to offer any interest in any such business ventures to the Company, any Member or any such other Person, even if such opportunity is of a character that, if presented
to the Company, any Member or such other Person, could be taken by such Person. The Non-Managing Members shall not, by virtue of their ownership of Non-Managing Member Units, owe a fiduciary duty to the other Members or the Company. 
  
 Section 8.4 Return of Capital 
  
 Except pursuant to the rights of Redemption set forth in Section 8.6 hereof,
no Member shall be entitled to the withdrawal or return of its Capital Contribution, except to the extent of distributions made pursuant to this Agreement or upon termination of the Company as provided herein. Except to the extent provided in
Article 5, Article 6 and Article 13 hereof or otherwise expressly provided in this Agreement, no Member or Assignee shall have priority over any other Member or Assignee either as to the return of Capital Contributions or as to
profits, losses, distributions and credits. 
  
 Section 8.5
Rights of Non-Managing Members Relating to the Company 
  
 A.
In addition to other rights provided by this Agreement or by the Act, and except as limited by Section 8.5.C hereof, each Non-Managing Member shall have the right, for a purpose reasonably related to such Non-Managing Member’s Membership
Interest in the Company, upon written demand with a statement of the purpose of such demand and at such Non-Managing Member’s own expense: 
  
 (1) to obtain a copy of (i) the most recent annual and quarterly reports filed with the SEC by the Managing Member pursuant to the
Exchange Act and (ii) each report or other written communication sent to the shareholders of the Managing Member; 
  
 (2) to obtain a copy of the Company’s federal, state and local income tax returns for each Fiscal Year; 
  
 (3) to obtain a current list of the name and last known
business, residence or mailing address of each Member; 
  
 (4) to obtain a copy of this Agreement and the Certificate and all amendments thereto, together with executed copies of all powers of attorney pursuant to which this Agreement, the Certificate and all amendments thereto have been executed;
and 
  
 (5) to obtain true and full information
regarding the amount of cash and a description and statement of any other property or services contributed by each Member, and the date on which each became a Member. 
  

 48 

 B. The Company shall notify any Non-Managing Member of the then current Adjustment Factor or any change
made to the Adjustment Factor or to the REIT Shares Amount within 30 days following such change or adjustment. 
  
 C. Notwithstanding any other provision of this Section 8.5, the Managing Member may keep confidential from the Non-Managing Members, for such period of
time as the Managing Member determines to be reasonable, any information that (i) the Managing Member believes to be in the nature of trade secrets or other information the disclosure of which the Managing Member in good faith believes is not in the
best interests of the Company or could damage the Company or its business or (ii) the Company or the Managing Member is required by law or by agreements with unaffiliated third parties to keep confidential. 
  
 Section 8.6 Redemption Rights 
  
 A. Beginning after the first year anniversary of the Effective Date and
ending on the ninth anniversary of the Effective Date, each Non-Managing Member shall have the right (the “Redemption Right”) (subject to the terms and conditions set forth herein) to require the Company to redeem all or a
portion of the Non-Managing Member Units held by such Non-Managing Member (all such Non-Managing Member Units being hereafter called “Tendered Units”) for the Cash Amount (the
”Redemption”); provided, however, that at the election of and in the sole and absolute discretion of the Managing Member, the Managing Member may elect to assume the Company’s obligation with respect to the
Redemption (though such assumption shall not relieve the Company from such obligation in the event the Managing Member fails to fulfill such obligation) and, at the election of and in the sole and absolute discretion of the Managing Member, to
satisfy the Redemption by paying (i) either the Cash Amount or (ii) a number of REIT Shares equal to the REIT Shares Amount payable on the Redemption Date. Notwithstanding the foregoing, a third party lender that has acquired a Membership Interest
upon the foreclosure of debt secured by such Membership Interest in accordance with Section 11.3.A hereof shall have the right to tender such Non-Managing Member Units for Redemption (subject to the terms and conditions set forth herein) and require
the Company to acquire all of those Non-Managing Member Units which were acquired by such lender pursuant to such foreclosure and which were issued by the Company at least one year prior to the related Redemption Date. 
  
 Any Redemption shall be exercised pursuant to a Notice of Redemption
delivered to the Company by the Non-Managing Member exercising the Redemption Right (the “Tendering Party”). On the Redemption Date, the Tendering Party shall sell the Tendered Units to the Company
or the Managing Member, as the case may be, in accordance with this Section 8.6.A. Any Tendered Units assumed by the Managing Member pursuant to this Section 8.6.A shall be held by the Managing Member as Managing Member Units with all the rights and
preferences relating thereto as provided in this Agreement. The Tendering Party shall submit (i) such information, certification or affidavit as the Company may reasonably require in connection with the Ownership Limit and (ii) in the event the REIT
Shares issuable upon such Redemption are not registered for resale under the Securities Act, such written representations, investment letters, legal opinions or other instruments necessary, in the Company’s view, to effect compliance with the
Securities Act. If a Cash Amount is to be delivered upon the Redemption, the Cash Amount shall be delivered as a certified check payable to the Tendering Party or, in the Company’s or Managing Member’s sole discretion, as the case may be,
in immediately available funds. If 

  

 49 

 
REIT Shares are to be delivered upon the Redemption, the REIT Shares Amount shall be delivered by the Managing Member as duly authorized, validly issued,
fully paid and nonassessable REIT Shares (and, if applicable, Rights), free of any pledge, lien, encumbrance or restriction, other than the Ownership Limit, and other restrictions provided in the Charter or the Bylaws of the Managing Member in the
event the REIT Shares issuable upon such Redemption are not registered for resale under the Securities Act, the Securities Act and relevant state securities or “blue sky” laws. The Tendering Party shall be deemed the owner of such
REIT Shares and Rights for all purposes, including, without limitation, rights to vote or consent, receive dividends, and exercise rights, as of the Redemption Date. REIT Shares issued upon an acquisition of the Tendered Units by the Managing Member
pursuant to this Section 8.6.A may contain such legends regarding restrictions on Transfer or ownership to protect the Managing Member’s tax status as a REIT and in the event the REIT Shares issuable upon such Redemption are not registered for
resale under the Securities Act, restrictions under the Securities Act and applicable state securities laws as the Managing Member in good faith determines to be necessary or advisable in order to ensure compliance with such laws. 
  
 B. Notwithstanding the provisions of Section 8.6.A hereof and anything herein
to the contrary, with respect to any Redemption pursuant to this Section 8.6.A: 
  
 (1) The consummation of any Redemption shall be subject to the expiration or termination of the applicable waiting period, if any, under
the Hart Scott Rodino Antitrust Improvements Act of 1976, as amended. 
  
 (2) Each Tendering Party shall continue to own all LLC Units subject to any Redemption, and be treated as a Member with respect to such LLC Units for all purposes of this Agreement, until such LLC Units are
Transferred to the Company or the Managing Member, as the case may be, and paid for or exchanged on the Redemption Date. Until a Redemption Date and an acquisition of the Tendered Units by the Company or Managing Member, as the case may be, pursuant
to Section 8.6.A hereof, the Tendering Party shall have no rights as a shareholder of the Managing Member with respect to the REIT Shares issuable in connection with such acquisition. 
  
 (3) No Non-Managing Member or any Substituted Member of a Non-Managing Member shall have any right to redeem
(whether for the REIT Shares Amount or the Cash Amount) any Excess LLC Units held by such Non-Managing Member and the Managing Member shall have no obligation to acquire Excess LLC Units, whether for the REIT Shares Amount or the Cash Amount.

  
 (4) Each Non-Managing Member may not exercise
the Redemption Rights pursuant to Section 8.6.A hereof more than one (1) time during any calendar quarter. In determining whether such limit has been reached during any calendar year, it is understood and agreed that the exercise of the Redemption
Rights by any Assignee of a Non-Managing Member or Substituted Member shall be counted for all purposes as the exercise of such Redemption Rights by such Non-Managing Member or Substituted Member assignor. Notwithstanding the foregoing, each
Non-Managing Member may exercise the Redemption Rights after the receipt of a notice of a Liquidating Event. 
  

 50 

 (5) No Tendering Party may exercise the Redemption Rights pursuant to Section 8.6.A as to
fewer than five hundred Non-Managing Member Units and all such exercises shall be in one hundred Non-Managing Member Units increments (in each case unless such Non-Managing Member Units constitute all of the Non-Managing Member Units held by such
Tendering Party). 
  
 C. In connection with an exercise of
Redemption Rights pursuant to this Section 8.6, the Tendering Party shall submit the following to the Company, in addition to the Notice of Redemption: 
  
 (1) Any information reasonably required by the Managing Member in order to allow it to determine (a) the actual and Constructive
Ownership, as determined for purposes of Code Sections 856(a)(6), 856(h), 856(d)(2)(b) and 856(d)(5), of REIT Shares by (i) such Tendering Party and (ii) any Related Party and (b) that, after giving effect to the Redemption, neither the Tendering
Party nor any Related Party will have actual, Beneficial Ownership or Constructive Ownership of a number of REIT Shares that is in excess of the Ownership Limit; 
  
 (2) A written representation that neither the Tendering Party nor any Related Party has any intention to
acquire any additional REIT Shares prior to the closing of the Redemption on the Redemption Date; and 
  
 (3) An undertaking to certify, at and as a condition to the closing of the Redemption that either (a) the actual, Beneficial Ownership and
Constructive Ownership of REIT Shares by the Tendering Party and any Related Party remain unchanged from that disclosed pursuant to Section 8.6.C(1) or (b) after giving effect to the Redemption, neither the Tendering Party nor any Related Party
shall have actual, Beneficial Ownership or Constructive Ownership of a number of REIT Shares that is in violation of the Ownership Limit. 
  
 D. The number of LLC Units outstanding on the date of a distribution pursuant to Section 5.6.A(3) (the “Reduction Distribution”)
will be reduced on the date of the distribution (the “Reduction Date”) by a number of LLC Units (the “Reduction Units”) which is the product of (i) the total number of LLC Units issued and outstanding
as of the Effective Date and (ii) a fraction the numerator of which is the amount of the Distribution Proceeds with respect to such Real Property distributed pursuant to the Reduction Distribution and the denominator of which is the Initial Value of
all Property contributed to the Company as of the Effective Date. The LLC Units of each Member will be reduced by an amount of Reduction Units equal to the product of the Reduction Units and a fraction, the numerator of which is the amount of
Disposition Proceeds received by such Member pursuant to Section 5.6.A(3) and the denominator of which is the Distribution Proceeds distributed pursuant to Section 5.6.A(3) to all Members. With respect to each Reduction Date, Reduction Units shall
be determined on a Real Property by Real Property basis. To reflect the foregoing reduction, Exhibit A shall be amended to reflect the reduction and with respect to any Reduction Units evidenced by a certificate, each Member shall return to
the Managing Member such certificate which will be canceled and a new certificate evidencing the reduced number of Managing Member Units or Non-Managing Member Units which were evidenced by such certificate, as applicable, shall be immediately
issued to such 

  

 51 

 
Member by the Managing Member on behalf of the Company. In the event the number of outstanding Non-Managing Member Units held by a Non-Managing Member or
Assignee is reduced (pursuant to this Section 8.6.D or otherwise) to zero, such Non-Managing Member or Assignee shall cease to have an interest in the Company (other than the right to receive final distributions and allocations resulting from the
liquidation of their interest). 
  
 E. If any Member’s LLC
Unit is redeemed or reduced pursuant to this Section 8.6 (whether pursuant to the exercise of Redemption Rights or pursuant to Section 8.6D), then Net Income, Net Loss, each item thereof and all other items of income, gain, loss, deduction, and
credit allocable among Members and Assignees for such Fiscal Year shall be allocated among the Members by taking into account the varying interests during the Fiscal Year in accordance with Code Section 706(d) using the “interim closing of the
books” method or another permissible method selected by the Managing Member with the consent of the Non-Managing Member. 
  
 Section 8.7 Confidentiality 
  
 Each Non-Managing Member shall keep confidential the provisions of this Agreement, all understandings, agreements and other arrangements between and among
the parties, and all other non-public information received from or otherwise relating to, the Company or its Affiliates, except that a Member shall be entitled to disclose such confidential information to its lawyers, accountants and other service
providers as reasonably necessary in the furtherance of such Member’s bona fide interests or as otherwise required by law or judicial process; provided, however, that any Non-Managing Member may disclose to any and all Persons the
tax treatment and tax structure of the transaction contemplated by this Agreement and all materials of any kind that are provided to such party relating to such tax treatment and tax structure. 
  
 ARTICLE 9. 
 BOOKS, RECORDS, ACCOUNTING AND REPORTS 
  
 Section 9.1 Records and Accounting 
  
 A. The Managing Member shall keep or cause to be kept at the principal office of the Company those records and documents required to be maintained by the
Act and such other books and records which are appropriate and commercially reasonable with respect to the Company’s business, including, without limitation, all books and records necessary to provide to the Members any information, lists and
copies of documents required to be provided pursuant to Section 9.3 hereof. Any records maintained by or on behalf of the Company in the regular course of its business may be kept on, or be in the form of, punch cards, magnetic tape, photographs,
micrographics or any other information storage device, provided that the records so maintained are convertible into clearly legible written form within a reasonable period of time. 
  
 B. The books of the Company shall be maintained, for financial and tax reporting purposes, on an accrual basis in accordance
with GAAP. To the extent permitted by sound accounting practices and principles, the Company and the Managing Member may operate with integrated or consolidated accounting records, operations and principles. 
  

 52 

 Section 9.2 Fiscal Year 
  
 The Fiscal Year of the Company shall be the calendar year. 
  
 Section 9.3 Reports 
  
 As soon as practicable, but in no event later than ninety (90) days after the close of each calendar quarter, the Managing Member shall cause to be mailed
to each Member of record as of the last day of the calendar year (i) a copy of the income statement and balance sheet of the Company and any Subsidiary of the Company, and (ii) beginning with the first calendar quarter in which the covenant
contained in Section 7.3.J becomes effective, a certificate confirming the Company’s compliance with Section 7.3.J hereof and providing a reasonably detailed calculation of the Company’s Equity Coverage. Each of the foregoing shall be
accompanied by a certificate of an officer of the Managing Member certifying the same to be true, complete and correct. The Company will immediately notify each Member of any breach of Section 7.3.J and of any event or condition which, with the
giving of notice, the passage of time, or both would constitute a breach of Section 7.3.J, and provide a detailed statement of the steps being taken to cure such breach or potential breach. 
  
 ARTICLE 10. 
 TAX MATTERS 
  
 Section 10.1 Preparation of Tax Returns 
  
 The
Managing Member shall arrange for the preparation and timely filing of all returns with respect to Company income, gains, deductions, losses and other items required of the Company for federal and state income tax purposes and shall use all
commercially reasonable efforts to furnish, within ninety (90) days of the close of each taxable year, the tax information reasonably required by Members for federal and state income tax reporting purposes. 
  
 Section 10.2 Tax Elections 
  
 A. Subject to Section 10.2.B below and except as otherwise provided herein,
the Managing Member shall determine whether to make any available election pursuant to the Code, including, without limitation, the election under Section 754 of the Code. Subject to Section 10.2.B below, the Managing Member shall have the right to
seek to revoke any such election (including, without limitation, any election under Code Sections 754). 
  
 B. Prior to the Threshold Date, the Consent of the Non-Managing Members shall be required prior to making or revoking any election under the Code pursuant
to Section 10.2.A. 
  
 Section 10.3 Tax Matters Partner

  
 A. The Managing Member shall be designated and shall
operate as “Tax Matters Partner” (as defined in Code Section 6231), to oversee or handle matters relating to the taxation of the Company; provided, however, that prior to the Threshold Date, the Consent
of the Non-Managing Members shall be required to settle any administrative proceeding or institute or settle any litigation with respect to tax issues if such action (i) is reasonably likely to affect materially 

  

 53 

 
the Non-Managing Members, and (ii) does not relate to the Managing Member’s tax status as a REIT. 
  
 B. Income tax returns of the Company shall be prepared by such certified
public accountant(s) as the Managing Member shall retain at the expense of the Company. 
  
 Section 10.4 Organizational Expenses 
  
 The Company shall elect to deduct expenses, if any, incurred by it in organizing the Company ratably over a sixty (60) month period as provided in Code Section 709. 
  
 ARTICLE 11. 
 TRANSFERS AND WITHDRAWALS 
  
 Section 11.1 Transfer 
  
 A. No part of the interest of a Member shall be subject to the claims of any creditor, to any spouse for alimony or support, or to legal process, and may not be voluntarily or involuntarily alienated or encumbered except as may be
specifically provided for in this Agreement. 
  
 B. No Membership
Interest shall be Transferred, in whole or in part, except in accordance with the terms and conditions set forth in this Article 11. Any Transfer or purported Transfer of a Membership Interest not made in accordance with this Article
11 shall be null and void ab initio. 
  
 Section
11.2 Transfer of Managing Member’s Membership Interest 
  
 A. Except in connection with a transaction described in Section 11.2.B, the Managing Member shall not withdraw from the Company and shall not Transfer all or any portion of its interest in the Company without the Consent of the Non-Managing
Members, which consent shall not be unreasonably withheld; provided, however, that the Managing Member may Transfer all or any portion of its interest in the Company without consent to any Affiliate of the Managing Member, provided that the Managing
Member guarantees the obligations of such Affiliate under this Agreement (the “Guarantee”). Upon any Transfer of the Membership Interest of the Managing Member in accordance with the provisions of this Section 11.2, the
transferee shall become a Managing Member for all purposes herein, and shall be vested with the powers and rights of the transferor Managing Member, and shall be liable for all obligations and responsible for all duties of the Managing Member, once
such transferee has executed such instruments as may be necessary to effectuate such admission and to confirm the agreement of such transferee to be bound by all the terms and provisions of this Agreement with respect to the Membership Interest so
acquired. It is a condition to any Transfer otherwise permitted hereunder that the transferee assumes, by operation of law or express agreement, all of the obligations of the transferor Managing Member under this Agreement with respect to such
Transferred Membership Interest, and such Transfer shall relieve the transferor Managing Member of its obligations under this Agreement accruing subsequent to the date of such Transfer except for the Guarantee. In the event the Managing Member
withdraws from the Company, in violation of this Agreement or otherwise, or otherwise dissolves or terminates, or upon the 

  

 54 

 
Incapacity of the Managing Member, all of the remaining Members may elect to continue the Company business by selecting a Substitute Managing Member in
accordance with the Act. 
  
 B. The Managing Member shall not
engage in any merger, consolidation or other combination with or into another person, sale of all or substantially all of its assets or any reclassification, or change of its outstanding equity interests (a “Termination
Transaction”), unless either (i) the Termination Transaction has been approved by the Consent of the Non-Managing Members or (ii) in connection with the Termination Transaction, all holders of LLC Units (other than the
Managing Member) either will receive for each LLC Unit, or will be entitled to receive, for each LLC Unit (in lieu of the REIT Shares Amount) upon a Redemption of the LLC Unit pursuant to Section 8.6 hereof, an amount of cash, securities, or other
property equal to the amount that would have been paid to the holder had the LLC Unit been redeemed for REIT Shares pursuant to Section 8.6 hereof immediately prior to the consummation of the Termination Transaction subject, in the event of a
Redemption of the LLC Unit pursuant to Section 8.6 hereof subsequent to the consummation of the Termination Transaction, to further adjustment to the extent provided in this Agreement to compensate for the dilutive effect of certain transactions
described herein; provided, however, that, if, in connection with the Termination Transaction, a purchase, tender or exchange offer shall have been made to and accepted by the holders of more than fifty percent (50%) of the outstanding REIT
Shares, each Member shall receive, or shall have the right to elect to receive, the greatest amount of cash, securities, or other property which such Member would have received had it exchanged its LLC Units for REIT Shares pursuant to Section 8.6
immediately prior to the expiration of such purchase, tender or exchange offer and had thereupon accepted such purchase, tender or exchange offer. 
  
 Section 11.3 Non-Managing Members’ Rights to Transfer 
  
 A. General. No Non-Managing Member shall Transfer all or any portion of its Membership Interest, or any of such
Non-Managing Member’s economic rights as a Non-Managing Member, to any transferee without first offering such Membership Interest first to the other Non-Managing Members by written notice delivered to such other Non-Managing Members and second,
to the extent such offer is not accepted by such other Non-Managing Members within ten (10) Business Days of such notice, to the Managing Member and otherwise obtaining the consent of the Managing Member, which consent shall not be unreasonably
withheld; provided, however, that notwithstanding the foregoing or any other provisions of this Agreement, any Non-Managing Member may, without the consent of the Managing Member, (x) pledge all or any portion of its Membership Interest to a
lender to such Member to secure indebtedness to such lender and Transfer such Membership Interest to such lender upon foreclosure of the debt secured by such Membership Interest, so long as any such pledge or other Transfer would not otherwise
violate the provisions of this Agreement, (y) transfer all or any portion of its Membership Interest or economic rights as a Non-Managing Member to a partner of such Non-Managing Member in liquidation of such partner’s interest in such
Non-Managing Member, to a family member of such Non-Managing Member, a trust all of the beneficiaries of which are such Non-Managing Member and family members of such Non-Managing Member, a corporation, general or limited partnership or limited
liability company all of the owners of which are such Non-Managing Member and family members of such Non-Managing Member or to an organization described in Sections 170(b)(1)(A), 170(c)(2) or 501(c)(3) of the Code, so 

  

 55 

 
long as any such Transfer would not otherwise violate the provisions of this Agreement and (z) pledge all or any portion of its Non-Managing Members pursuant
to the Security Agreement (as defined in the Contribution Agreement). 
  
 B. Conditions to Transfer. It is a condition to any Transfer otherwise permitted hereunder that the transferee assume by operation of law or express agreement all of the obligations of the transferor Member under this Agreement with
respect to such Transferred Membership Interest and that the Managing Member be reimbursed by the transferor for all actual out-of-pocket costs and expenses incurred by the Managing Member in connection with any such Transfer, including, without
limitation, attorneys’ fees and costs and any other expenses incurred by Managing Member, including the costs of filing any amendment or prospectus supplement to any registration statement or prospectus as necessary to reflect such Transfer.
Notwithstanding the foregoing, any transferee of any Transferred Membership Interest shall be subject to the Ownership Limits and any and all ownership limitations contained in the Charter. Any transferee, whether or not admitted as a Substituted
Member, shall take subject to the obligations of the transferor hereunder. Unless admitted as a Substituted Member, no transferee, whether by a voluntary Transfer, by operation of law or otherwise, shall have any rights hereunder, other than the
rights of an Assignee as provided in Section 11.5 hereof. 
  
 C.
Incapacity. If a Non-Managing Member is subject to Incapacity, the executor, administrator, trustee, committee, guardian, conservator or receiver of such Non-Managing Member’s estate shall have all the rights of a Non-Managing
Member, but not more rights than those enjoyed by other Non-Managing Members, for the purpose of settling or managing the estate, and such power as the Incapacitated Non-Managing Member possessed to Transfer all or any part of its interest in the
Company. The Incapacity of a Non-Managing Member, in and of itself, shall not dissolve or terminate the Company. 
  
 D. Opinion of Counsel. In connection with any Transfer of a Membership Interest, the Managing Member shall have the right to receive an
opinion of counsel reasonably satisfactory to it to the effect that the proposed Transfer may be effected without registration under the Securities Act and will not otherwise violate any federal or state securities laws or regulations applicable to
the Company or the Membership Interests Transferred. If, in the opinion of such counsel, such Transfer would require the filing of a registration statement under the Securities Act or would otherwise violate any federal or state securities laws or
regulations applicable to the Company or the LLC Units, the Managing Member may prohibit any Transfer by a Member of Membership Interests otherwise permitted under this Section 11.3. 
  
 Section 11.4 Substituted Members 
  
 A. Each Non-Managing Member shall have the right to substitute a transferee (including any transferees pursuant to Transfers
permitted by Section 11.3 hereof) as a Member in its place so long as the Transfer of such Non-Managing Member’s LLC Units is otherwise made pursuant to the terms and in satisfaction of the conditions of this Agreement, specifically including
the provisions of Section 11.3 and Sections 11.4.B and C. hereof. 
  
 B. A transferee who has been admitted as a Substituted Member in accordance with this Article 11 shall have all the rights and powers and be subject to all the restrictions and 

  

 56 

 
liabilities of a Member under this Agreement. The admission of any transferee as a Substituted Member shall be subject to the transferee executing and
delivering to the Company an acceptance of all of the terms and conditions of this Agreement (including without limitation, the provisions of Section 2.4 and such other documents or instruments as may be required to effect the admission).

  
 C. Upon receipt of written notice from a Non-Managing Member
that the transferee of its LLC Units is to be admitted by the Company as a Substituted Member, the Managing Member shall amend Exhibit A to reflect the name, address, Capital Account, number of LLC Units and Percentage Interest of such
Substituted Member and to eliminate or adjust, if necessary, the name, address, Capital Account, number of LLC Units and Percentage Interest of the predecessor of such Substituted Member (and any other Member, as necessary). 
  
 Section 11.5 Assignees 
  
 If upon the Transfer of its LLC Units, the transferring Non-Managing Member
does not substitute the transferee as a Member in its place as a Substituted Member as described in Section 11.4 hereof, such transferee shall be considered an Assignee for purposes of this Agreement. An Assignee shall be entitled to all the rights
of an assignee of a limited liability company interest under the Act, including the right to receive distributions from the Company and the share of Net Income, Net Loss and other items of income, gain, loss, deduction and credit of the Company
attributable to the LLC Units assigned to such transferee, the rights to Transfer the LLC Units provided in this Article 11, and the right of Redemption provided in Section 8.6, but shall not be deemed to be a Member of LLC Units for any
other purpose under this Agreement, and shall not be entitled to effect a Consent or vote with respect to such LLC Units on any matter presented to the Members for approval (such right to Consent or vote, to the extent provided in this Agreement or
under the Act, fully remaining with the transferor Member). In the event that any such transferee desires to make a further assignment of any such LLC Units, such transferee shall be subject to all the provisions of this Article 11 to the
same extent and in the same manner as any Members desiring to make an assignment of LLC Units. The Managing Member shall have no liability under any circumstance with respect to any Assignee as to which it does not have notice. 
  
 Section 11.6 General Provisions 
  
 A. No Non-Managing Member may withdraw from the Company other than (i) as a
result of a permitted Transfer of all of such Non-Managing Member’s LLC Units in accordance with this Article 11 and the transferee(s) of such LLC Units being admitting to the Company as a Substituted Member, (ii) pursuant to a
Redemption by the Non-Managing Member or a reduction of all of its LLC Units under Section 8.6 hereof or (iii) pursuant to a Call Notice under Section 13.2 hereof. 
  
 B. Any Non-Managing Member who shall Transfer all of its LLC Units in a Transfer (i) permitted pursuant to this Article
11 where such transferee was admitted as a Substituted Member; (ii) pursuant to the exercise of its rights to effect a Redemption of all of its LLC Units under Section 8.6 hereof; (iii) as a result of a Reduction; (iv) pursuant to a Call 

  

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Notice under Section 13.2 hereof; or (v) pursuant to a combination of Transfers of the types specified in the foregoing (i) - (iv), shall cease to be a
Member. 
  
 C. Transfers pursuant to this Article 11 may
only be made on the first day of a fiscal quarter of the Company, unless the Managing Member otherwise agrees. 
  
 D. All distributions of Available Cash attributable to an LLC Unit with respect to which the LLC Record Date is before the date of a Transfer or a
Redemption of the LLC Unit shall be made to the transferor Member and all distributions of Available Cash thereafter attributable to such LLC Unit shall be made to the transferee Member. 
  
 E. Notwithstanding anything to the contrary set forth herein, in addition to any other restrictions on Transfer herein
contained, in no event may any Transfer or assignment of a Membership Interest by any Member (including any redemption or any Redemption or any other acquisition of LLC Units by the Company) be made: 
  

	 	(a)	to any person or entity who lacks the legal right, power or capacity to own a Membership Interest; 

  

	 	(b)	in violation of applicable law; 

  

	 	(c)	without the consent of the Managing Member, if such Transfer would, in the opinion of counsel to the Company or the Managing Member, cause an increased tax liability to any other
Member or Assignee as a result of the termination of the Company, in either case for federal or state income or franchise tax purposes (except in the case of a Terminating Capital Transaction or as a result of the Redemption of LLC Units pursuant to
Section 8.6 hereof); 

  

	 	(d)	without the consent of the Managing Member, if such Transfer could, as determined in the Reasonable judgment of the Managing Member after consultation with outside counsel to the
Managing Member, (i) result in the Company being treated as an association taxable as a corporation for federal income tax or for state income or franchise tax purposes, (ii) adversely affect the ability of the Managing Member to continue to qualify
as a REIT or would subject the Managing Member to any additional taxes under Code Section 857 or Code Section 4981 or (iii) such Transfer could be treated as having been effectuated through an “established securities market” or a
“secondary market (or the substantial equivalent thereof)” within the meaning of Code Section 7704, or such Transfer fails to satisfy a “safe-harbor” preventing such treatment (as set forth in Treasury Regulations under
Code Section 7704 or any successor provision) subject to, in the case of a Redemption, the second proviso to Section 3.2; 

  

	 	(e)	 if such Transfer would cause the Company to become, with respect to any employee benefit plan subject to Title I of ERISA, a “party-in-interest”

  

 58 

	 	 
(as defined in ERISA Section 3(14)) or a “disqualified person” (as defined in Code Section 4975(c)); 

  

	 	(f)	if such Transfer would, in the opinion of legal counsel to the Company, cause any portion of the assets of the Company to constitute assets of any employee benefit plan pursuant to
Department of Labor Regulations Section 2510.2-101; 

  

	 	(g)	if such Transfer causes the Company (as opposed to the Managing Member) to become a reporting company under the Exchange Act; 

  

	 	(h)	if such Transfer subjects the Company to regulation under the Investment Company Act of 1940, the Investment Advisors Act of 1940 or ERISA, each as amended; or

  

	 	(i)	without the consent of the Managing Member, if such Transfer would result in the Company having more than 100 Members (including as Members those persons indirectly owning an
interest in the Company through a partnership, limited liability company, S corporation or grantor trust (such entity, a “flow through entity”), but only if substantially all of the value of such person’s interest in the
flow through entity is attributable to the flow through entity’s interest (direct or indirect) in the Company) (the “One Hundred Member Limit”). 

  
 F. No Non-Managing Member will take or allow any Affiliate to take any action that would cause a violation of the One
Hundred Member Limit. 
  
 ARTICLE 12. 
 ADMISSION OF MEMBERS 
  
 Section 12.1 Admission of Successor Managing Member 
  
 A successor to all of the Managing Member’s Membership Interest pursuant to Section 11.2 hereof who is proposed to be admitted as a successor
Managing Member shall be admitted to the Company as the Managing Member, effective immediately upon such Transfer. Any such successor shall carry on the business of the Company without dissolution. In each case, the admission shall be subject to the
successor Managing Member executing and delivering to the Company an acceptance of all of the terms, conditions and applicable obligations of this Agreement and such other documents or instruments as may be required to effect the admission.

  
 Section 12.2 Admission of Additional Members

  
 A. A Person (other than an existing Member) who makes a
Capital Contribution to the Company in accordance with this Agreement shall be admitted to the Company as an Additional Member, only upon furnishing to the Managing Member (i) evidence of acceptance, in form and substance satisfactory to the
Managing Member, of all of the terms and conditions of this Agreement, including, without limitation, the power of attorney granted in Section 2.4 hereof, and (ii) such other documents or instruments as may be required in the sole and absolute

  

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discretion of the Managing Member in order to effect such Person’s admission as an Additional Member. 
  
 B. Notwithstanding anything to the contrary in this Section 12.2, except
pursuant to the transactions contemplated by the Contribution Agreement, no Person shall be admitted as an Additional Member without the Consent of the Non-Managing Members and Managing Member, which may be given or withheld by each Non-Managing
Member and Managing Member in its sole and absolute discretion. The admission of any Person as an Additional Member shall become effective on the date upon which the name of such Person is recorded on the books and records of the Company, following
the Consent of the Non-Managing Members and Managing Member to such admission. 
  
 C. If any Additional Member is admitted to the Company on any day other than the first day of a Fiscal Year, then Net Income, Net Loss, each item thereof and all other items of income, gain, loss, deduction and credit
allocable among Members and Assignees for such Fiscal Year shall be allocated among such Additional Member and all other Members and Assignees by taking into account their varying interests during the Fiscal Year in accordance with Code Section
706(d), using the “interim closing of the books” method or another permissible method selected by the Managing Member with the Consent of the Non-Managing Members. Solely for purposes of making such allocations, each of such items
for the calendar month in which an admission of any Additional Member occurs shall be allocated among all the Members and Assignees including such Additional Member, in accordance with the principles described in Section 11.6.D hereof. All
distributions of Available Cash with respect to which the LLC Record Date is before the date of such admission shall be made solely to Members and Assignees other than the Additional Member, and all distributions of Available Cash thereafter shall
be made to all the Members and Assignees including such Additional Member. 
  
 Section 12.3 Amendment of Agreement and Certificate 
  
 For the admission to the Company of any Member, the Managing Member shall take all steps necessary and appropriate under the Act to amend the records of the Company and, if necessary, to prepare as soon as practical
an amendment of this Agreement (including an amendment of Exhibit A) and, if required by law, shall prepare and file an amendment to the Certificate and may for this purpose exercise the power of attorney granted pursuant to Section 2.4
hereof. 
  
 Section 12.4 Limitation on Admission of Members

  
 No Person shall be admitted to the Company as a
Substituted Member or an Additional Member if, in the opinion of legal counsel for the Company, it would result in the Company being treated as a corporation for federal income tax purposes or otherwise cause the Company to become a reporting
company under the Exchange Act. 
  

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 ARTICLE 13. 
 DISSOLUTION, LIQUIDATION AND TERMINATION 
  
 Section 13.1 Dissolution 
  
 The Company shall not be dissolved by the admission of Substituted Members or Additional Members or by the admission of a successor Managing Member in accordance with the terms of this Agreement. Upon the withdrawal of the Managing Member,
any successor Managing Member shall continue the business of the Company without dissolution. Subject to the notice required under Section 7.3.B(8), however, the Company shall dissolve, and its affairs shall be wound up, upon the first to occur of
any of the following (each a “Liquidating Event”): 
  
 A. an event of withdrawal of the Managing Member, as defined in the Act (other than an event of bankruptcy), unless, within 90 days after the withdrawal, a Majority in Interest of the Non-Managing Members agree in
writing to continue the business of the Company and to the appointment, effective as of the date of withdrawal, of a substitute Managing Member; 
  
 B. subject to the provisions of Section 7.3.F hereof, an election to dissolve the Company made by the Managing Member; 
  
 C. entry of a decree of judicial dissolution of the Company pursuant to the
provisions of the Act; 
  
 D. a final and non-appealable judgment
is entered by a court of competent jurisdiction ruling that the Managing Member is bankrupt or insolvent, or a final and non-appealable order for relief is entered by a court with appropriate jurisdiction against the Managing Member, in each case
under any Bankruptcy Law as now or hereafter in effect, unless prior to or within 90 days after the entry of such order or judgment a Majority in Interest of the Non-Managing Members Consent in writing to continue the business of the Company and to
the appointment, effective as of a date prior to the date of such order or judgment, of a substitute Managing Member; or 
  
 E. the Incapacity of the Managing Member that continues following the Managing Member’s good faith, commercially reasonable efforts to remedy such
Incapacity, unless prior to or within 90 days after such Incapacity a Majority in Interest of the Non-Managing Members agree in writing to continue the business of the Company and to the appointment, effective as of a date prior to the date of such
Incapacity, of a substitute Managing Member. 
  
 Section 13.2
Exchange of Non-Managing Member Units 
  
 Notwithstanding
anything in this Agreement to the contrary, the Managing Member may, at any time following the ten year anniversary of the Effective Date, in its sole and absolute discretion, require each Non-Managing Member (by delivering a Call Notice to such
Non-Managing Member) to tender all of its Non-Managing Member Units to the Managing Member in exchange for, at the election of and in the sole and absolute discretion of the Managing Member, either (i) the Cash Amount or (ii) the REIT Shares Amount
payable on the 

  

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Redemption Date and otherwise in accordance with the procedures and provisions set forth in Section 8.6.A. 
  
 Section 13.3 Winding Up 
  
 A. Upon the occurrence of a Liquidating Event, the Company shall continue
solely for the purposes of winding up its affairs in an orderly manner, liquidating its assets and satisfying the claims of its creditors and Members. After the occurrence of a Liquidating Event, no Member shall take any action that is inconsistent
with, or not necessary to or appropriate for, the winding up of the Company’s business and affairs. The Managing Member (or, in the event that there is no remaining Managing Member, any Person elected by a Majority in Interest of the
Non-Managing Members (the Managing Member or such other Person being referred to herein as the “Liquidator”)) shall be responsible for overseeing the winding up and dissolution of the Company and shall take full account of
the Company’s liabilities and property, and the Company property shall be liquidated as promptly as is consistent with obtaining the fair value thereof, and the proceeds therefrom (which may, to the extent determined by the Managing Member,
include shares of stock in the Managing Member) shall be applied and distributed in the following order: 
  
 (1) First, to the satisfaction of all of the Company’s debts and liabilities to creditors other than the Members and their Assignees
(whether by payment or the making of reasonable provision for payment thereof); 
  
 (2) Second, to the satisfaction of all of the Company’s debts and liabilities to the Members (whether by payment or the making of
reasonable provision for payment thereof); and 
  
 (3) The balance, if any, in proportion to the Members’ positive Capital Account balances after giving effect to all contributions, distributions and allocations for all periods. 
  
 The Managing Member shall not receive any compensation for any services performed pursuant to
this Article 13. 
  
 B. Notwithstanding the provisions of
Section 13.3.A hereof that require liquidation of the assets of the Company, but subject to the order of priorities set forth therein, if prior to or upon dissolution of the Company the Liquidator determines that an immediate sale of part or all of
the Company’s assets would be impractical or would cause undue loss to the Members, the Liquidator may defer for a reasonable time the liquidation of any assets except those necessary to satisfy liabilities of the Company (including to those
Members as creditors) and/or distribute to the Members, in lieu of cash, as tenants in common and in accordance with the provisions of Section 13.3.A hereof, undivided interests in such Company assets as the Liquidator deems not suitable for
liquidation. Any such distributions in kind shall be made only if, in the good faith judgment of the Liquidator, such distributions in kind are in the best interest of the Members, and shall be subject to such conditions relating to the disposition
and management of such properties as the Liquidator deems reasonable and equitable and to any agreements governing the operation of such properties at such time. The Liquidator shall 

  

 62 

 
determine the fair market value of any property distributed in kind using such reasonable method of valuation as it may adopt. 
  
 C. In the event that the Company is “liquidated” within the
meaning of Regulations Section 1.704-1(b) (2)(ii)(g), distributions shall be made pursuant to this Article 13 to the Members and Assignees that have positive Capital Accounts in compliance with Regulations Section 1.704-1(b) (2)(ii)(b)
(2) to the extent of, and in proportion to, their positive Capital Account balances. If any Member has a deficit balance in its Capital Account (after giving effect to all contributions, distributions and allocations for all taxable years,
including the year during which such liquidation occurs), such Member shall have no obligation to make any contribution to the capital of the Company with respect to such deficit, and such deficit shall not be considered a debt owed to the Company
or to any other Person for any purpose whatsoever. A pro rata portion of the distributions that would otherwise be made to the Members pursuant to this Article 13 may be withheld or escrowed to provide a reasonable reserve for Company
liabilities (contingent or otherwise) and to reflect the unrealized portion of any installment obligations owed to the Company, provided that such withheld or escrowed amounts shall be distributed to the Members in the manner and order of priority
set forth in Section 13.3.A hereof as soon as practicable. 
  
 Section 13.4 Deemed Distribution and Recontribution 
  
 Notwithstanding any other provision of this Article 13, in the event that the Company is liquidated within the meaning of Regulations Section 1.704-1(b) (2)(ii)(g), but no Liquidating Event has occurred, the Company’s
Property shall not be liquidated, the Company’s liabilities shall not be paid or discharged and the Company’s affairs shall not be wound up. Instead, for federal and state income tax purposes, the Company shall be deemed to have
distributed its assets in kind to the Members, who shall be deemed to have assumed and taken such assets subject to all Company liabilities, all in accordance with their respective Capital Accounts. Immediately thereafter, the Members shall be
deemed to have recontributed the Company assets in kind to the Company, which shall be deemed to have assumed and taken such assets subject to all such liabilities. 
  
 Section 13.5 Rights of Members 
  
 Except as otherwise provided in this Agreement, (a) each Member shall look solely to the assets of the Company for the
return of its Capital Contribution, (b) no Member shall have the right or power to demand or receive property other than cash from the Company and (c) except as provided in this Agreement, no Member shall have priority over any other Member as to
the return of its Capital Contributions, distributions or allocations. 
  
 Section 13.6 Cancellation of Certificate 
  
 Upon
the completion of the liquidation of the Company’s cash and property as provided in Section 13.3 hereof, the Company shall be terminated and the Certificate and all qualifications of the Company as a foreign limited liability company in
jurisdictions other than the State of Delaware shall be canceled and such other actions as may be necessary to terminate the Company shall be taken. 
  

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 Section 13.7 Reasonable Time for Winding-Up 
  
 A reasonable time shall be allowed for the orderly winding-up of the
business and affairs of the Company and the liquidation of its assets pursuant to Section 13.3 hereof, in order to minimize any losses otherwise attendant upon such winding-up, and the provisions of this Agreement shall remain in effect between the
Members during the period of liquidation. 
  
 Section 13.8
Liability of Liquidator 
  
 The Liquidator shall be
indemnified and held harmless by the Company from and against any and all claims, liabilities, costs, damages, and causes of action of any nature whatsoever arising out of or incidental to the Liquidator’s taking of any action authorized under
or within the scope of this Agreement; provided, however, that the Liquidator shall not be entitled to indemnification, and shall not be held harmless, where the claim, demand, liability, cost, damage or cause of action at issue arises out of
(i) a matter entirely unrelated to the Liquidator’s action or conduct pursuant to the provisions of this Agreement or (ii) the proven willful misconduct or gross negligence of the Liquidator. 
  
 ARTICLE 14. 
 PROCEDURES FOR ACTIONS AND CONSENTS 
 OF MEMBERS; AMENDMENTS; MEETINGS

  
 Section 14.1 Procedures for Actions and Consents of
Members 
  
 The actions requiring consent or approval of
Non-Managing Members pursuant to this Agreement, including Section 7.3 hereof, or otherwise pursuant to applicable law, are subject to the procedures set forth in this Article 14 and shall require approval of a Majority in Interest of the
Non-Managing Members unless a different percentage is expressly required by this Agreement for the action in question. 
  
 Section 14.2 Amendments 
  
 Except for amendments to Exhibit A as provided in Sections 7.3.C, 11.4.C and 12.3 hereof, amendments to this Agreement may be proposed by the
Managing Member or by a Majority in Interest of the Non-Managing Members. Following such proposal, the Managing Member shall submit any proposed amendment to the Members. The Managing Member shall seek the written Consent of the Members on the
proposed amendment or shall call a meeting to vote thereon and to transact any other business that the Managing Member may deem appropriate. The affirmative vote or consent, as applicable, of a Majority in Interest of the Non-Managing Members is
required for the approval of a proposed amendment. For purposes of obtaining a written consent, the Managing Member may require a response within a reasonable specified time, but not less than 15 days, and failure to respond in such time period
shall constitute a consent that is consistent with the Managing Member’s recommendation with respect to the proposal; provided, however, that an action shall become effective at such time as requisite consents are received even if prior
to such specified time. 
  

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 Section 14.3 Meetings of the Members 
  
 A. Meetings of the Members may be called by the Managing Member and shall be
called upon the receipt by the Managing Member of a written request by a Majority in Interest of the Non-Managing Members. The call shall state the nature of the business to be transacted. Notice of any such meeting shall be given to all Members not
less than seven days nor more than 30 days prior to the date of such meeting. The meeting shall be held at the headquarters office of the Managing Member or at such other location as may be designated by the Managing Member. Members may vote in
person or by proxy at such meeting. Whenever the vote or Consent of Members is permitted or required under this Agreement, such vote or Consent may be given at a meeting of Members or may be given in accordance with the procedure prescribed in
Section 14.3.B hereof. 
  
 B. Any action required or permitted to
be taken at a meeting of the Members may be taken without a meeting if a written consent setting forth the action so taken is signed by Members holding a majority of the LLC Units (or such other percentage as is expressly required by this Agreement
for the action in question, including a Majority in Interest of the Non-Managing Members where required). Such consent may be in one instrument or in several instruments, and shall have the same force and effect as a vote of Members holding a
majority of the LLC Units (or such other percentage as is expressly required by this Agreement). Such consent shall be filed with the Managing Member. An action so taken shall be deemed to have been taken at a meeting held on the effective date so
certified. 
  
 C. Each Member may authorize any Person or Persons
to act for it by proxy on all matters in which a Member is entitled to participate, including waiving notice of any meeting, or voting or participating at a meeting. Every proxy must be signed by the Member or its attorney-in-fact. No proxy shall be
valid after the expiration of eleven (11) months from the date thereof unless otherwise provided in the proxy (or there is receipt of a proxy authorizing a later date). Every proxy shall be revocable at the pleasure of the Member executing it, such
revocation to be effective upon the Company’s receipt of written notice of such revocation from the Member executing such proxy. 
  
 D. Each meeting of Members shall be conducted by the Managing Member or such other Person as the Managing Member may appoint pursuant to such rules for
the conduct of the meeting as the Managing Member or such other Person deems appropriate in its Reasonable discretion. Without limitation, meetings of Members may be conducted in the same manner as meetings of the Managing Member’s shareholders
and may be held at the same time as, and as part of, the meetings of the Managing Member’s shareholders. 
  
 ARTICLE 15. 
 GENERAL PROVISIONS 
  
 Section 15.1 Registration 
  
 If the Company, or any successor to the Company at any time proposes to
effect a registration (the “Registration”) of LLC Units (or shares or other interests of any successor to the Company) under the Securities Act for sale for the account of the Managing Member, the 

  

 65 

 
Company shall give prior written notice (a “Notice of Registration”) to each Non-Managing Member of its intention to do so. The
Company will use its commercially reasonable efforts to include in the Registration each Non-Managing Member Unit (or share or other interest of such successor) which the Company has been so requested to register, as evidenced by a written election
delivered to the Company by such Non-Managing Member within ten (10) Business Days of receipt of the Notice of Registration identifying the number of Non-Managing Member Units (or shares or other interest of such successor) which such non-Managing
Member wishes to include in such Registration; provided, however, that the Company shall not be obligated to include in the Registration Non-Managing Member Units of any Non-Managing Member in excess of the product of (x) a fraction, the numerator
of which is the number of LLC Units (or shares or other interest of such successor) to be included in such Registration by the Managing Member and the denominator of which is the aggregate number of LLC Units (or shares or other interest of such
successor) held by the Managing Member multiplied by (y) the aggregate number of LLC Units (or shares or other interest of such successor) held by such Non-Managing Member. 
  
 Section 15.2 Addresses and Notice 
  
 Any notice, demand, request or report required or permitted to be given or made to a Member or Assignee under this
Agreement, including any pursuant to Article 14, shall be in writing and shall be deemed given or made when delivered in person or when sent by first class United States mail or by commercial courier service (i) in the case of a Member, to
that Member at the address set forth in Exhibit A or such other address of which the Member shall notify the Managing Member in writing and (ii) in the case of an Assignee, to the address of which such Assignee shall notify the Managing
Member in writing. 
  
 Section 15.3 Titles and Captions

  
 All article or section titles or captions in this
Agreement are for convenience only. They shall not be deemed part of this Agreement and in no way define, limit, extend or describe the scope or intent of any provisions hereof. Except as specifically provided otherwise, references to
“Articles” or “Sections” are to Articles and Sections of this Agreement. 
  
 Section 15.4 Pronouns and Plurals 
  
 Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the
singular form of nouns, pronouns and verbs shall include the plural and vice versa. 
  
 Section 15.5 Further Action 
  
 The parties hereto shall execute and deliver all documents, provide all information and take or refrain from taking action as may be necessary or appropriate to achieve the purposes of this Agreement. 
  

 66 

 Section 15.6 Binding Effect 
  
 This Agreement shall be binding upon and inure to the benefit of the parties hereto and their heirs, executors,
administrators, successors, legal representatives and permitted assigns. 
  
 Section 15.7 Creditors 
  
 Other than as expressly set forth herein with respect to Indemnitees, none of the provisions of this Agreement shall be for the benefit of, or shall be enforceable by, any creditor of the Company. 
  
 Section 15.8 Waiver 
  
 No failure by any party hereto to insist upon the strict performance of any
covenant, duty, agreement or condition of this Agreement or to exercise any right or remedy consequent upon a breach thereof shall constitute waiver of any such breach or any other covenant, duty, agreement or condition. 
  
 Section 15.9 Counterparts 
  
 This Agreement may be executed in counterparts, all of which together shall
constitute one agreement binding on all the parties hereto, notwithstanding that all such parties are not signatories to the original or the same counterpart. 
  

Section 15.10 Applicable Law 
  
 Except as provided in Section 3.4.F, this Agreement shall be construed and enforced in accordance with and governed by the laws of the State of Delaware,
without regard to the principles of conflicts of law. In the event of a conflict between any provision of this Agreement and any non-mandatory provision of the Act, the provisions of this Agreement shall control and take precedence. 
  
 Section 15.11 Entire Agreement 
  
 This Agreement, the Contribution Agreement and the other agreements executed
on the Effective Date as provided in the Contribution Agreement contain all of the understandings and agreements between and among the Members with respect to the subject matter of this Agreement and the rights, interests and obligations of the
Members with respect to the Company. 
  
 Section 15.12
Invalidity of Provisions 
  
 If any provision of this
Agreement is or becomes invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not be affected thereby. 
  

 67 

 Section 15.13 Limitation to Preserve REIT Status 
  
 Notwithstanding anything else in this Agreement, to the extent any amount
paid, credited or reimbursed to the Managing Member or its officers, directors, employees or agents, whether as a reimbursement, fee, expense or indemnity (a “REIT Payment”), would constitute gross income to the Managing
Member for purposes of Sections 856(c)(2) or 856(c)(3) of the Code, then, notwithstanding any other provision of this Agreement, the amount of such REIT Payments, as selected by the Managing Member in its discretion from among items of potential
reimbursement, fees, expenses and indemnities, shall be reduced for any Fiscal Year so that the REIT Payments, as so reduced, to, for or with respect to the Managing Member shall not exceed the lesser of: 
  
 (i) an amount equal to the excess, if any, of (a) four and seventeen one-hundredths percent
(4.17%) of the Managing Member’s total gross income (but not including the amount of any REIT Payments) for the Fiscal Year that is described in subsections (A) through (H) of Section 856(c)(2) of the Code over (b) the amount of gross income
(within the meaning of Section 856(c)(2) of the Code) derived by the Managing Member from sources other than those described in subsections (A) through (H) of Section 856(c)(2) of the Code (but not including the amount of any REIT Payments); or

  
 (ii) an amount equal to the excess, if any, of (a) twenty-five percent (25%)
of the Managing Member’s total gross income (but not including the amount of any REIT Payments) for the Fiscal Year that is described in subsections (A) through (I) of Section 856(c)(3) of the Code over (b) the amount of gross income (within
the meaning of Section 856(c)(3)) of the Code derived by the Managing Member from sources other than those described in subsections (A) through (I) of Section 856(c)(3) of the Code (but not including the amount of any REIT Payments); 
  
 provided, however, that REIT Payments in excess of the amounts set forth in
subparagraphs (i) and (ii) above may be made if the Managing Member, as a condition precedent, obtains an opinion of tax counsel that the receipt of such excess amounts would not adversely affect the Managing Member’s ability to qualify as a
REIT. To the extent that REIT Payments may not be made in a Fiscal Year as a consequence of the limitations set forth in this Section 15.13, such REIT Payments shall carry over and be treated as arising in the following Fiscal Year; provided,
however, that such amount shall not carry over for more than five (5) years, and if not paid within such five (5) year period, shall expire; provided, further, that (a) as REIT Payments are made, such payments shall be applied first to carry over
amounts outstanding, if any, and (b) with respect to carry over amounts for more than one Fiscal Year, such payment shall be applied to the earliest Fiscal Year prior to being applied to any other fiscal year. 
  
 Section 15.14 No Partition 
  
 No Member nor any successor-in-interest to a Member shall have the right
while this Agreement remains in effect to have any property of the Company partitioned, or to file a complaint or institute to any proceeding at law or in equity to have such property of the Company partitioned, and each Member, on behalf of itself
and its successors and assigns hereby waives any such right. It is the intention of the Members that the rights of the parties hereto and their successors-in-interest to Company property, as among themselves, shall be governed by the 

  

 68 

 
terms of this Agreement, and that the rights of the Members and their successors-in-interest shall be subject to the limitations and restrictions as set
forth in this Agreement. 
  
 Section 15.15 Non-Managing Member
Representative 
  
 A. All actions taken by the Non-Managing
Member Representative pursuant to those provisions of this Agreement which authorize the Non-Managing Member Representative to so act shall be binding upon all Non-Managing Members as if they had individually taken such action and each Non-Managing
Member, by entering into or agreeing to be bound by the provisions of this Agreement, authorize the Non-Managing Member Representative to take such actions on his, her or its behalf and agree that the actions so taken shall be binding upon him, her
or it to the same extent as if he, she or it had taken the action directly. 
  
 B. The holders of a majority of the outstanding Non-Managing Members Units shall be entitled to replace the Non-Managing Member Representative by delivering to the Managing Member and the then current Non-Managing
Member Representative a written notice signed by the holders of a majority of the outstanding Non-Managing Members Units stating (i) that the notice is being provided to the Managing Member pursuant to this Section 15.15.B, (ii) that the Members
signing the notice own of record on the books of the Company a majority of the outstanding Non-Managing Members Units, (iii) that the Members signing the notice desire to replace the person then serving as the Non-Managing Member Representative with
the person named in the notice, and (iv) specifying the date on which the appointment of the named individual to replace the then serving Non-Managing Member Representative shall be effective (which shall be a date not earlier than the fourteenth
day after the date on which the notice shall have been delivered to the Managing Member). The appointment of the new Non-Managing Member Representative specified in the notice shall be effective on the date specified in the notice and upon
effectiveness, the individual previously serving as the Non-Managing Member Representative shall cease to be entitled to act in that capacity under this Agreement. 
  
 Section 15.16 Venue 
  
 Each party hereto agrees that all judicial proceedings brought arising out of or relating to this Agreement or any Member’s obligations hereunder may
only be brought in any state or federal court of competent jurisdiction in the State of Delaware, County of New Castle, and each Member accepts generally and unconditionally the exclusive jurisdiction and venue of such courts. 
  
 [Signatures appear on following page] 
  

 69 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

  

	 MANAGING MEMBER:
	 	 	 	 HEALTH CARE PROPERTY INVESTORS,
 INC., a Maryland corporation

					
	 	 	 	 	 	 	By:	 	 /s/ Edward J. Henning

	 	 	 	 	 	 	Name:	 	Edward J. Henning
	 	 	 	 	 	 	Title:	 	Senior Vice President, General Counsel and Corporate Secretary

  

 70 

 NON-MANAGING MEMBERS: 
  

	 
	
	 /s/ Charles Crews

	

	Charles Crews
	 
	
	 /s/ Charles A. Elcan

	

	Charles A. Elcan
	 
	
	 /s/ Thomas W. Hulme

	

	Thomas W. Hulme
	 
	
	 /s/ Thomas M. Klaritch

	

	Thomas M. Klaritch
	 
	
	 /s/ R. Wayne Price

	

	R. Wayne Price
	 
	
	 /s/ Glenn T. Preston

	

	Glenn T. Preston
	 
	
	 /s/ Janet Reynolds-Preston

	

	Janet Reynolds-Preston
	 
	
	 /s/ Angela M. Playle

	

	Angela M. Playle
	 
	
	 /s/ James A. Croy

	

	James A. Croy

  

 71 

	 JOHN KLARITCH, AS TRUSTEE OF THE
 2002 TRUST
 F/B/O ERICA ANN KLARITCH

		
	By:	 	/s/ John Klaritch
	 	

	 	 	 John Klaritch, Trustee

	
	 JOHN KLARITCH, AS TRUSTEE OF THE
 2002 TRUST
 F/B/O ADAM JOSEPH KLARITCH

		
	By:	 	/s/ John Klaritch
	 	

	 	 	 John Klaritch, Trustee

	
	 JOHN KLARITCH, AS TRUSTEE OF THE
 2002 TRUST
 F/B/O THOMAS MICHAEL KLARITCH, JR.

		
	By:	 	/s/ John Klaritch
	 	

	 	 	 John Klaritch, Trustee

	
	 JOHN KLARITCH, AS TRUSTEE OF THE
 2002 TRUST
 F/B/O NICHOLAS JAMES KLARITCH

		
	By:	 	/s/ John Klaritch
	 	

	 	 	 John Klaritch, Trustee

  

 72Employment Agreement dated Oct. 1, 2003

 EXHIBIT 10.29 
  
 EMPLOYMENT AGREEMENT 
  
 THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into as of October 1, 2003 (the “Effective Date”) by and
between HEALTH CARE PROPERTY INVESTORS, INC., a Maryland corporation (“HCPI”), and CHARLES A. ELCAN (“Executive”). 
  
 RECITALS 
  
 A. HCPI and Executive desire to enter into an employment agreement upon the terms set forth in this Agreement; and 
  
 B. HCPI desires to employ Executive as Chief Executive Officer of HCPI’s
subsidiary, Medcap Management Company (the “Management Company”), and Executive is willing to accept such employment by HCPI, on the terms and subject to the conditions set forth in this Agreement. 
  
 NOW, THEREFORE, in consideration of the mutual covenants herein contained and
for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: 
  
 AGREEMENT 
  
 1. Duties. During the Employment Period (as defined below), Executive agrees to be employed by and to serve HCPI as Executive Vice President of
HCPI and Chief Executive Officer of the Management Company. Executive shall report to the Chief Executive Officer of HCPI (the “HCPI CEO”). HCPI agrees to employ and retain Executive in such capacity. Executive will be responsible
for the customary management responsibilities expected of an individual holding such position and such other responsibilities consistent with the position as may be assigned to Executive from time to time by the Board of Directors of HCPI (the
“Board”). Subject to the oversight and control of the Board and the HCPI CEO, the Executive will have responsibility for coordinating HCPI’s acquisition, disposition, development and management of medical office buildings
(“MOBs”) and related properties. In addition, during the Employment Period, the Executive will be one of the HCPI designated members of the executive committee of HCP Medical Office Portfolio, LLC. Notwithstanding the foregoing,
Executive’s responsibility for the acquisition, development and management of MOBs may be limited by (a) agreements currently in effect (as set forth on Schedule A hereto), and (b) with respect to MOBs acquired after the Effective Date,
agreements or arrangements entered into in connection with the acquisition of portfolios of MOBs. 
  
 2. Term of Employment. 
  
 (a) Definitions. For purposes of this Agreement the following terms shall have the following meanings: 
  

	 	(i)	“Termination For Cause” shall mean termination by HCPI of Executive’s employment with HCPI by reason of Executive’s: 

  

 Page 1 of 26 

	 	A.	willful and continued failure to perform his duties with HCPI after a written demand for performance is delivered to Executive by the Board, which demand specifically identifies the
manner in which the Board believes that Executive has not performed his duties; 

  

	 	B.	willful and continued failure to follow and comply with the specific and lawful directives of the Board, as reasonably determined by the Board, after a written demand for
performance is delivered to Executive by the Board, which demand specifically identifies the manner in which the Board believes that Executive has not performed his duties; 

  

	 	C.	willful commission of an act of fraud or dishonesty resulting in economic or financial injury to HCPI or injury to HCPI’s reputation; 

  

	 	D.	willful engagement in illegal conduct or gross misconduct, in each case which is injurious to HCPI; or 

  

	 	E.	indictment for, conviction of or a plea of guilty or nolo contendre to, any felony. 

  

	 	(ii)	“Termination Without Cause” shall mean termination by HCPI of Executive’s employment by HCPI before a Change in Control (as defined in Section 2(a)(vi))
or more than two (2) years after a Change in Control, other than a Termination For Cause, or due to Executive’s death or Disability. 

  

	 	(iii)	“Good Reason” shall mean, without Executive’s express written consent, the occurrence of any of the following circumstances : 

  

	 	A.	the assignment to Executive of any duties inconsistent with the position in HCPI that Executive held immediately prior to Notice of Termination, a significant adverse alteration in
the nature or status of Executive’s responsibilities or the conditions of Executive’s employment from those in effect immediately prior to such Notice of Termination, or any other action by HCPI that results in a material diminution in
Executive’s position, authority, duties or responsibilities; 

  

	 	B.	HCPI’s reduction of Executive’s Base Salary (as defined below) as in effect on the Effective Date or as the same may be increased from time to time;

  

 Page 2 of 26 

	 	C.	the relocation of HCPI’s offices at which Executive is principally employed immediately prior to the date of the Notice of Termination (Executive’s “Principal
Location”) to a location more than twenty-five (25) miles from such location, or HCPI’s requiring Executive, without Executive’s written consent, to be based anywhere other than Executive’s Principal Location, except for
required travel on HCPI’s business to an extent consistent with Executive’s business travel obligations prior to the date of the Notice of Termination; 

  

	 	D.	HCPI’s failure to pay to Executive any portion of Executive’s current compensation or to pay to Executive any portion of an installment of deferred compensation due under
any deferred compensation program of HCPI within seven (7) days of the date such compensation is due; 

  

	 	E.	HCPI’s failure to continue in effect any material benefit plan in which Executive participated immediately prior to the Notice of Termination, unless an equitable arrangement
(embodied in an ongoing substitute or alternative plan) has been made with respect to such plan, or HCPI’s failure to continue Executive’s participation therein (or in such substitute or alternative plan) on a basis not materially less
favorable, both in terms of the amount of benefits provided and the level of Executive’s participation relative to other participants, as existed prior to the Notice of Termination; 

  

	 	F.	HCPI’s failure to obtain a satisfactory agreement from any successor to assume and agree to perform this Agreement, as contemplated in Section 9(g) hereof; or

  

	 	G.	any purported termination of Executive’s employment that is not effected pursuant to a Notice of Termination satisfying the requirements of Section 2(ix) hereof (and, if
applicable, the requirements of Section 2(a)(i) hereof), which purported termination shall not be effective for purposes of this Agreement; 

  

	 	    	provided, however, that no termination for Good Reason shall be effective unless and until Executive gives a Notice of Termination (as described in Section
2(a)(vii)) to HCPI specifying the reason(s) for such termination and provides HCPI with at least sixty (60) days’ opportunity to cure or remedy such reasons, and provided, further, that Executive’s continued

  

 Page 3 of 26 

	 	    	employment shall not constitute consent to, or a waiver of rights with respect to, any circumstance constituting Good Reason hereunder. 

  

	 	(iv)	“Voluntary Termination” shall mean termination by Executive of Executive’s employment by HCPI without Good Reason. 

  

	 	(v)	“Termination Upon a Change in Control” shall mean (A) a termination by Executive of Executive’s employment with HCPI for Good Reason following a Change in
Control (as defined below), or (B) a Termination Without Cause following a Change in Control. 

  

	 	(vi)	“Change in Control” shall be deemed to occur if: 

  

	 	A.	any Person (as defined in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) is or becomes the Beneficial Owner (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of HCPI representing twenty-five percent (25%) or more of the combined voting power of HCPI’s then outstanding securities (“Outstanding HCPI Voting
Securities”); provided, however, that for purposes of this Subsection 2(a)(vi)(A), the following shall not constitute a Change in Control: (1) any acquisition by HCPI or any corporation controlled by HCPI, (2) any
acquisition by any employee benefit plan (or related trust) sponsored or maintained by HCPI or any corporation controlled by HCPI, or (3) any acquisition by a Person of twenty-five percent (25%) of the Outstanding HCPI Voting Securities as a result
of an acquisition of common stock of HCPI by HCPI which, by reducing the number of shares of common stock of HCPI outstanding, increases the proportionate number of shares beneficially owned by such Person to twenty-five percent (25%) or more of the
Outstanding HCPI Voting Securities; and provided, further, that if a Person shall become the beneficial owner of twenty-five percent (25%) or more of the Outstanding HCPI Voting Securities by reason of a share acquisition by HCPI as
described above and shall, after such share acquisition by HCPI, become the beneficial owner of any additional shares of common stock of HCPI, then such acquisition of additional shares shall constitute a Change in Control; 

 

 Page 4 of 26 

	 	B.	during any period of two (2) consecutive years after the execution of this Agreement, individuals who at the beginning of such period constitute the Board, together with any new
director(s) whose election by the Board or nomination for election by HCPI’s stockholders was approved by a vote of at least two-thirds ( 2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved (hereinafter referred to as
“Continuing Directors”) (which shall not include any director designated by a person who has entered into an agreement with HCPI to effect a transaction described in Sections 2(a)(vi)(A), (C) or (D)), cease for
any reason to constitute at least a majority thereof; 

  

	 	C.	the consummation by HCPI of a merger or consolidation of HCPI with any other entity, except for a merger or consolidation which would result in the voting securities of HCPI
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than sixty-six and two-thirds percent (66 2/3%) of the combined voting power of the voting securities of HCPI or such surviving entity outstanding immediately
after such merger or consolidation; provided, however, that a merger or consolidation effected to implement a recapitalization of HCPI (or similar transaction) in which no Person acquires more than twenty-five percent (25%) of the
combined voting power of HCPI’s then outstanding securities shall not constitute a Change in Control; or 

  

	 	D.	the stockholders of HCPI approve a plan of complete liquidation of HCPI or an agreement for the sale or disposition by HCPI of all or substantially all of HCPI’s assets.

  

	 	(vii)	“Notice of Termination” shall mean a notice that indicates the specific termination provision in this Agreement relied upon and sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated. 

  

	 	(viii)	“Date of Termination” shall mean (A) if Executive’s employment is terminated due to Executive’s death, the date of Executive’s death; (B) if
Executive’s employment is terminated due to Disability, five (5) days after Notice of Termination is given 

  

 Page 5 of 26 

	 	    	(provided that Executive shall not have returned to the full-time performance of Executive’s duties during such five (5)-day period), and (C) if Executive’s employment is
terminated pursuant to Sections 2(a)(i), (ii), (iii), (iv) or (v) for any other reason (other than death or Disability (as defined in Section 2(e)), the date specified in the Notice of Termination (which, in
the case of a Termination Without Cause shall not be less than thirty (30) days from the date such Notice of Termination is given, and in the case of a termination for Good Reason shall not be less than sixty (60) days from the date such Notice of
Termination is given). 

  
 (b)
Term of Employment. The initial term of employment hereunder shall commence on the Effective Date and continue for a continuous period of three (3) years, subject to any extension or termination as provided in this Agreement. The
Executive’s employment shall be extended automatically for additional one (1) year periods at the end of the initial three (3) period, unless either party gives notice to the other of its or his election not to extend not less than three (3)
months prior to the applicable expiration date. The initial term of employment and any extensions thereof, unless sooner terminated, shall be referred to as the “Employment Period.” 
  
 (c) Termination For Cause. Termination For Cause may
be effected by HCPI at any time during the Employment Period and shall be effected by written notification to Executive. Upon a Termination For Cause, Executive shall immediately be paid all accrued Base Salary, any annual incentive plan bonus
compensation to the extent awarded but unpaid, vested deferred compensation (other than pension plan or profit sharing plan benefits which will be paid in accordance with the applicable plan), any benefits under any plans of HCPI in which Executive
is a participant to the full extent of Executive’s rights under such plans, accrued vacation pay and any appropriate business expenses incurred by Executive in connection with his duties hereunder, all to the Date of Termination, but Executive
shall not be paid any other compensation or reimbursement of any kind, including without limitation, severance compensation. 
  
 (d) Termination Without Cause. Notwithstanding anything else in this Agreement, HCPI may effect a Termination Without Cause at any
time upon giving a Notice of Termination to Executive of such termination. Upon any Termination Without Cause, Executive shall immediately be paid all accrued Base Salary, any annual incentive plan bonus compensation to the extent earned, vested
deferred compensation (other than pension plan or profit sharing plan benefits which will be paid in accordance with the applicable plan), any benefits under any plans of HCPI in which Executive is a participant to the full extent of
Executive’s rights under such plans, accrued vacation pay and any appropriate business expenses incurred by Executive in connection with his duties hereunder, all to the Date of Termination, and all severance compensation provided in Section
5(b), but no other compensation or reimbursement of any kind, including severance compensation under any severance plan maintained by HCPI generally for its employees. 
  

 Page 6 of 26 

 (e) Termination by Reason of Disability. If, during the Employment Period,
Executive has failed to perform his duties under this Agreement on account of illness or physical or mental incapacity, and such illness or incapacity continues for a period of more than one hundred twenty (120) days total in any twelve (12) month
period (a “Disability”), HCPI shall have the right to terminate Executive’s employment hereunder by written Notice of Termination to Executive and payment to Executive of all accrued Base Salary, any annual incentive plan bonus
compensation to the extent awarded but unpaid, vested deferred compensation (other than pension plan or profit sharing plan benefits which will be paid in accordance with the applicable plan), any benefits under any plans of HCPI in which Executive
is a participant to the full extent of Executive’s rights under such plans, accrued vacation pay and any appropriate business expenses incurred by Executive in connection with his duties hereunder, all to the Date of Termination. In addition,
HCPI shall continue Executive’s group health and dental insurance through the expiration of the Employment Period, but Executive shall not be paid any other compensation or reimbursement of any kind, including without limitation, severance
compensation. The term “Disability” shall, for the purposes of this Agreement, be determined by either of the following: (i) a licensed healthcare professional selected by HCPI; or (ii) any disability insurance provided to the
Executive pursuant to this Agreement. 
  
 (f)
Death. In the event of Executive’s death during the Employment Period, Executive’s employment shall be deemed to have terminated as of the last day of the month during which his death occurs, and HCPI shall pay to his estate or such
beneficiaries as Executive may from time to time designate all accrued Base Salary, any annual incentive plan bonus compensation to the extent awarded but unpaid, vested deferred compensation (other than pension plan or profit sharing plan benefits
which will be paid in accordance with the applicable plan), any benefits under any plans of HCPI in which Executive is a participant to the full extent of Executive’s rights under such plans, accrued vacation pay and any appropriate business
expenses incurred by Executive in connection with his duties hereunder, all to the Date of Termination, but Executive’s estate shall not be paid any other compensation or reimbursement of any kind, including without limitation, severance
compensation. 
  
 (g) Voluntary
Termination. In the event of a Voluntary Termination, HCPI shall immediately pay all accrued Base Salary, any annual incentive plan bonus compensation to the extent awarded but unpaid, vested deferred compensation (other than pension plan or
profit sharing plan benefits which will be paid in accordance with the applicable plan), any benefits under any plans of HCPI in which Executive is a participant to the full extent of Executive’s rights under such plans, accrued vacation pay
and any appropriate business expenses incurred by Executive in connection with his duties hereunder, all to the Date of Termination, but Executive shall not be paid any other compensation or reimbursement of any kind, including without limitation,
severance compensation. 
  

 Page 7 of 26 

 (h) Termination Upon a Change in Control. In the event of a Termination Upon a
Change in Control, Executive shall immediately be paid all accrued Base Salary, annual incentive plan bonus compensation to the extent awarded but unpaid, vested deferred compensation (other than pension plan or profit sharing plan benefits which
will be paid in accordance with the applicable plan), any benefits under any plans of HCPI in which Executive is a participant to the full extent of Executive’s rights under such plans, accrued vacation pay and any appropriate business expenses
incurred by Executive in connection with his duties hereunder, all to the Date of Termination, and all severance compensation provided in Section 5(a), but Executive shall not be paid any other compensation or reimbursement of any kind,
including severance compensation under any severance plan maintained by HCPI generally for its employees. 
  
 3. Salary, Benefits and Bonus Compensation. 
  
 (a) Base Salary. As payment for the services to be rendered by Executive as provided in Section 1 and subject to the terms
and conditions of Section 2, HCPI agrees to pay to Executive a base salary (the “Base Salary”) for the period beginning on the Effective Date at the rate of $350,000 per annum, payable in equal semi-monthly installments.
Executive’s Base Salary shall be reviewed annually for increase but not decrease by the Compensation Committee of the Board of Directors (the “Compensation Committee”). 
  
 (b) Annual Incentive Plan Bonus. 
  

	 	(i)	Annually, the HCPI CEO will recommend to the Compensation Committee an incentive compensation plan consisting of metrics that reward Management Company financial performance and
HCPI corporate-wide achievement of goals and that will be based upon a multiple of the Base Salary and achievement of the goals. 

  

	 	(ii)	The plan metrics for the first full year of the Employment Period (2004) will be determined no later than thirty (30) days after the Effective Date. The parties anticipate that the
2004 plan parameters will be: 

  

	 	A.	Weighted seventy-five percent (75%) for Management Company performance and twenty-five (25%) for HCPI overall performance. 

  

	 	B.	Management Company specific measures will be weighted thirty-seven and five-tenths percent (37.5%) for Net Operating Income (“NOI”), thirty-seven and five-tenths
percent (37.5%) for NOI less leasing commissions and tenant improvements (Cashflow”), ten percent (10%) for Tenant Satisfaction (as described below), and fifteen percent (15%) for individual specific goals established by the Compensation
Committee, subject to the following: 

  

 Page 8 of 26 

 i. NOI and Cashflow will be measured annually. 
  
 ii. Target goals for NOI and Cashflow will be calculated as a percentage of
budget in the following increments: Low = ninety-five percent (95%) of budget; Target = one hundred percent (100%) of budget and Maximum = one hundred and five percent (105%) of budget. 
  
 iii. Tenant Satisfaction will be based upon achievement of predetermined standards using an independent survey conducted
annually. Satisfaction will be determined as a percentage of respondents answering either “satisfied” or “very satisfied” to the questions on the survey. 
  
 iv. Individual goals will include management, acquisition, disposition and development activities relating to HCPI’s
MOBs and other goals established from time to time by the Compensation Committee. 
  
 v. Annual Incentive Plan Targets will be set at the following percentage of Base Salary: Less than Low = zero percent (0%); Low = twenty percent (20%); Target = eighty percent (80%), and Maximum or above = one hundred
sixty percent (160%). 
  

	 	(iii)	Funding for the above shall be subject to audit by HCPI’s accountants and approved by the HCPI CEO and the Compensation Committee. Awards will be payable within ninety (90)
days after the incentive compensation plan year end. For purposes of this Section 3(b), the NOI and Cashflow budgets shall be based on “same-store” NOI and Cashflows and will be subject to amendment from time to time to reflect
acquisitions and dispositions. 

  
 (c) Restricted Stock Grant. As an incentive to support corporate-wide performance and as an additional reward for a smooth transition of the businesses, HCPI will provide Executive with a one-time award of thirty-three thousand five
hundred (33,500) shares of restricted stock under HCPI’s 2000 Stock Incentive Plan (as amended and restated effective as of May 7, 2003) (the “Stock Plan”), subject to all terms and conditions of the Plan and to the following
provisions: 
  

	 	(i)	Restrictions with respect to the award will lapse in one-fifth increments on the first (1st), second (2nd), third (3rd), fourth (4th)
and fifth (5th) anniversaries of the grant date and will be subject to Executive’s continued employment.

  

 Page 9 of 26 

	 	(ii)	Restricted stock will be forfeited upon termination of Executive’s employment, unless (A) Executive’s termination is due to a Termination Upon Change in Control of HCPI,
or (B) Executive has a qualified retirement defined as age sixty (60) and fifteen (15) years of service or age sixty-five (65) and five (5) years of service. 

  

	 	(iii)	Dividends on restricted stock awards will be paid to Executive. 

  
 (d) Stock Options. As of the Effective Date, HCPI will grant to Executive under the Stock Plan options to purchase a total of fifty
thousand (50,000) shares of common stock at a price per share (the “Strike Price”) equal to the closing price on the Effective Date (the “Grant Date”), subject to all terms and conditions of the Stock Plan. The
options shall vest and shall become exercisable in accordance with the Stock Plan in equal annual increments over a period of five (5) years commencing on the first (1st) anniversary of the Grant Date, and any unvested options shall be forfeited if Executive’s employment is terminated, except that the provisions of the
Stock Plan which accelerate vesting upon Retirement (as defined in the Stock Plan), death, Disability or a Termination Upon a Change in Control shall apply. 
  
 (e) Additional Benefits. During the Employment Period, Executive shall be entitled to the following fringe benefits: 
  

	 	(i)	Executive Benefits. Executive shall be eligible to participate in such of HCPI’s benefits and deferred compensation plans as are generally available as of the Effective
Date or later made generally available to executive of HCPI, including, without limitation, HCPI’s 2000 Stock Incentive Plan, profit sharing plans, annual physical examination, dental and medical plans (but HCPI shall separately pay any
deductible or co-payment amounts), personal catastrophe and disability insurance and retirement plans. 

  

	 	(ii)	Vacation. Executive shall be entitled to four (4) weeks of vacation during each year during the term of this Agreement and any extensions thereof, prorated for partial years.

  

	 	(iii)	Reimbursement for Expenses. During the Employment Term, HCPI shall reimburse Executive for reasonable and properly documented (in accordance with HCPI’s policies as in
effect from time to time) out-of-pocket business and/or entertainment expenses incurred by Executive in connection with his duties under this Agreement. 

  

 Page 10 of 26 

 4. Accelerated Vesting Upon a Change in Control. 
  
 (a) Restricted Stock. Notwithstanding any provisions
of HCPI’s stock option plans, incentive plans, or other similar plans, in the event of a Change in Control the restricted period with respect to any restricted stock granted to Executive thereunder shall lapse and such shares shall be
distributed to Executive immediately prior to any Change in Control. 
  
 (b) Stock Options. All outstanding options granted to Executive under any of HCPI’s stock option plans, incentive plans or other similar plans (or options substituted therefor covering the stock of a
successor corporation) shall in the event of a Change in Control become fully vested and exercisable immediately prior to any Change in Control as to all shares of stock covered thereby. 
  
 5. Severance Compensation. 
  

(a) Severance Compensation in the Event of a Termination Upon a Change in Control. In the event Executive’s employment is
terminated in a Termination Upon a Change in Control within the two (2) year period immediately following the date of a Change in Control, Executive shall be entitled to the payments and benefits provided below: 
  

	 	(i)	HCPI shall pay to Executive (A) Executive’s full Base Salary, when due, through the Date of Termination at the rate in effect at the time Notice of Termination is given, at the
time specified in Section 5(a)(vi), (B) the unpaid portion, if any, of any annual incentive plan bonus, plus an amount equal to Executive’s annual incentive plan bonus, pro rated from January 1 of the termination year through the Date of
Termination, and (C) all other amounts to which Executive is entitled under any compensation plan of HCPI at the time such payments are due; 

  

	 	(ii)	In lieu of any further Base Salary payments to Executive for periods subsequent to the Date of Termination, HCPI shall pay as severance pay to Executive, at the time specified in
Section 5(a)(vi), a lump sum severance payment (together with the payments provided in Sections 5(a)(iii) and (iv) below, the “Severance Payments”) equal to the sum of three (3) times Executive’s annual
Base Salary as in effect as of the Date of Termination or immediately prior to the Change in Control, whichever is greater, and three (3) times Executive’s targeted annual incentive plan bonus as in effect as of the Date of Termination or the
highest annual incentive plan bonus received by Executive in the three (3) years immediately prior to the Change in Control, whichever is greater; 

  

 Page 11 of 26 

	 	(iii)	For a period of three (3) years, HCPI shall continue to provide Executive and Executive’s eligible family members, based on the cost sharing arrangement between Executive and
HCPI on the date of the Change in Control, with medical and dental health coverage at least equal to those which would have been provided to Executive and his eligible family members if Executive’s employment had not been terminated or, if more
favorable to Executive, as in effect generally at any time thereafter, provided, however, that Executive shall advise HCPI if Executive becomes re-employed with another employer, and he and his eligible dependents are eligible to
receive medical and dental health benefits under another employer’s plans, and HCPI’s obligations under this Section 5(a)(iii) shall cease. In the event Executive and his dependents are ineligible under the terms of HCPI’s
benefit plans or programs to continue coverage under this Section 5(a)(iii), HCPI shall provide Executive and his dependents with substantially equivalent coverage through other sources or shall provide Executive with a lump sum payment in
such amount that, after all taxes on that amount, is equal to the cost to Executive of providing Executive such benefit coverage. The lump sum shall be determined on a present value basis using the interest rate provided in section 1274(b)(2)(B) of
the Code on the Date of Termination. Upon the termination of the benefits coverage under the first sentence of this Section 5(a)(iii), Executive, Executive’s spouse and Executive’s dependents shall be entitled to continuation
coverage pursuant to section 4980B of the Internal Revenue Code of 1986, as amended (the “Code”), sections 601-608 of the Employee Retirement Income Security Act of 1974, as amended, and under any other applicable law, to the extent
required by such laws, as if Executive had terminated employment with HCPI on the date such benefits coverage terminates. 

  

	 	(iv)	Executive shall be fully vested in Executive’s accrued benefits under any qualified or nonqualified pension, profit sharing, deferred compensation or supplemental plans
maintained by HCPI for Executive’s benefit, except to the extent the acceleration of vesting of such benefits would violate any applicable law or require HCPI to accelerate the vesting of the accrued benefits of all participants in such plan or
plans, in which case HCPI may elect to pay Executive a lump sum payment at the time specified in Section 5(a)(vii) in an amount equal to the value of such unvested accrued benefits in lieu of accelerating the vesting of Executive’s
benefits, plus HCPI shall pay Executive an amount equal to the amount HCPI would have contributed to Executive’s account under HCPI’s 401(k) plan as a matching contribution had Executive remained employed by HCPI for three (3) years after
Executive’s Date of Termination and had Executive made the maximum elected deferral contributions. 

  

 Page 12 of 26 

	 	(v)	HCPI shall furnish Executive for six (6) years following the Date of Termination (without reference to whether the term of this Agreement continues in effect) with directors’
and officers’ liability insurance insuring Executive against insurable events which occur or have occurred while Executive was a director or officer of HCPI, such insurance to have policy limits aggregating not less than the amount in effect
immediately prior to the Change in Control, and otherwise to be in substantially the same form and to contain substantially the same terms, conditions and exceptions as the liability issuance policies provided for officers and directors of HCPI in
force from time to time, provided, however, that such terms, conditions and exceptions shall not be, in the aggregate, materially less favorable to Executive than those in effect on the Effective Date; and provided,
further, that if the aggregate annual premiums for such insurance at any time during such period exceed one hundred and fifty percent (150%) of the per annum rate of premium currently paid by HCPI for such insurance, then HCPI shall provide
the maximum coverage that will then be available at an annual premium equal to one hundred and fifty percent (150%) of such rate. 

  

	 	(vi)	Gross-Up Payment. 

  

	 	A.	Anything in this Agreement to the contrary notwithstanding, if it shall be determined that any payment or distribution to Executive or for Executive’s benefit (whether paid or
payable or distributed or distributable) pursuant to the terms of this Agreement or otherwise pursuant to or by reason of any other agreement, policy, plan, program or arrangement, including without limitation any stock option, stock appreciation
right or similar right, or the lapse or termination of any restriction on or the vesting or exercisability of any of the foregoing (the “Payments”) would be subject to the excise tax imposed by section 4999 of the Code by reason of
being “contingent on a change in the ownership or control” of HCPI, within the meaning of Section 280G of the Code or to any similar tax imposed by state or local law, or any interest or penalties with respect to such excise tax (such tax
or taxes, together with any such interest or penalties, are collectively referred to as the “Excise Tax”), then Executive shall be entitled to receive from HCPI an additional payment (the “Gross-Up Payment”) in an

  

 Page 13 of 26 

	 	  	amount such that the net amount of the Payments and the Gross-Up Payment retained by Executive after the calculation and deduction of all Excise Taxes (including any interest or
penalties imposed with respect to such taxes) on the Payments and all federal, state and local income tax, employment tax and Excise Tax (including any interest or penalties imposed with respect to such taxes) on the Gross-Up Payment provided for in
this Section 5(a)(vi), and taking into account any lost or reduced tax deductions on account of the Gross-Up Payment, shall be equal to the Payments. 

  

	 	B.	All determinations required to be made under this Section 5(a)(vi), including whether and when the Gross-Up Payment is required and the amount of such Gross-Up Payment, and
the assumptions to be utilized in arriving at such determinations shall be made by the Accountants (as defined below) which shall provide Executive and HCPI with detailed supporting calculations with respect to such Gross-Up Payment within fifteen
(15) business days of the receipt of notice from Executive or HCPI that Executive has received or will receive Payments. For purposes of making the determinations and calculations required herein, the Accountants may make reasonable assumptions and
approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Section 280G and 4999 of the Code, provided that the Accountants’ determinations must be made on the basis of
“substantial authority” (within the meaning of Section 6662 of the Code). For the purposes of this Section 5(a)(v), the “Accountants” shall mean HCPI’s independent certified public accountants serving
immediately prior to the Change in Control to the extent they may lawfully perform such services. In the event that the Accountants are prohibited from providing such services or are also serving as accountant or auditor for the individual, entity
or group effecting the Change in Control, HCPI shall appoint another nationally recognized public accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accountants hereunder). All fees
and expenses of the Accountants shall be borne solely by HCPI. 

  

 Page 14 of 26 

	 	C.	For the purposes of determining whether any of the Payments will be subject to the Excise Tax and the amount of such Excise Tax, such Payments will be treated as “parachute
payments” within the meaning of section 280G of the Code, and all “parachute payments” in excess of the “base amount” (as defined under section 280G(b)(3) of the Code) shall be treated as subject to the Excise Tax, unless
and except to the extent that in the opinion of the Accountants such Payments (in whole or in part) either do not constitute “parachute payments” or represent reasonable compensation for services actually rendered (within the meaning of
section 280G(b)(4) of the Code) in excess of the “base amount,” or such “parachute payments” are otherwise not subject to such Excise Tax. For purposes of determining the amount of the Gross-Up Payment Executive shall be deemed
to pay Federal income taxes at the highest applicable marginal rate of Federal income taxation for the calendar year in which the Gross-Up Payment is to be made and to pay any applicable state and local income taxes at the highest applicable
marginal rate of taxation for the calendar year in which the Gross-Up Payment is to be made, net of the maximum reduction in Federal income taxes which could be obtained from the deduction of such state or local taxes if paid in such year
(determined without regard to limitations on deductions based upon the amount of Executive’s adjusted gross income), and to have otherwise allowable deductions for Federal, state and local income tax purposes at least equal to those disallowed
because of the inclusion of the Gross-Up Payment in Executive’s adjusted gross income. To the extent practicable, any Gross-Up Payment with respect to any Payments shall be paid by HCPI at the time Executive is entitled to receive the Payments
and in no event will any Gross-Up Payment be paid later than five (5) days after the receipt by Executive of the Accountants’ determination. Any determination by the Accountants shall be binding upon HCPI and Executive.

  

	 	D.	As a result of uncertainty in the application of section 4999 of the Code at the time of the initial determination by the Accountants hereunder, it is possible that the Gross-Up
Payment made will have been an amount less than HCPI should have paid pursuant to this Section 5(a)(v) (the “Underpayment”). In the event that HCPI exhausts its remedies pursuant to Section 5(a)(vi)(F) and Executive is
required to make a payment of any Excise 

  

 Page 15 of 26 

	 	  	Tax, the Underpayment shall be promptly paid by HCPI to or for Executive’s benefit. In the event that HCPI provides Executive with a Gross-Up Payment in an amount that is
greater than the amount that HCPI should have paid pursuant to this Section 5(a)(vi) (the “Overpayment”), the Overpayment shall be promptly repaid by Executive to HCPI. 

  

	 	E.	Executive and HCPI shall each provide the Accountants access to and copies of any books, records and documents in the possession of HCPI or Executive, as the case may be, reasonably
requested by the Accountants, and otherwise cooperate with the Accountants in connection with the preparation and issuance of the determination contemplated by this Section 5(a)(vi). 

  

	 	F.	Executive shall notify HCPI in writing of any claim by the Internal Revenue Service (the “IRS”) that, if successful, would require the payment by HCPI of the
Gross-Up Payment. Such notification shall be given as soon as practicable after Executive is informed in writing of such claim and shall apprise HCPI of the nature of such claim and the date on which such claim is requested to be paid. Executive
shall not pay such claim prior to the expiration of the thirty (30)-day period following the date on which Executive gives such notice to HCPI (or such shorter period ending on the date that any payment of taxes, interest and/or penalties with
respect to such claim is due). If HCPI notifies Executive in writing prior to the expiration of such period that it desires to contest such claim, Executive shall: 

  
 i. give HCPI any information reasonably requested by HCPI relating to such claim; 
  
 ii. take such action in connection with contesting such claim as HCPI shall
reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by HCPI; 
  
 iii. cooperate with HCPI in good faith in order to effectively contest such claim; and 
  
 iv. permit HCPI to participate in any proceedings relating to such claims;
provided, however, that HCPI shall bear and pay directly all costs and expenses 
  

 Page 16 of 26 

	 	  	(including additional interest and penalties) incurred in connection with such contest and shall indemnify Executive for and hold Executive harmless from, on an after-tax basis, any
Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of all related costs and expenses. Without limiting the foregoing provisions of this Section 5(a)(vi, HCPI
shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at
its sole option, either direct Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of
initial jurisdiction and in one or more appellate courts, as HCPI shall determine; provided, however, that if HCPI directs Executive to pay such claim and sue for a refund, HCPI shall make such payment on behalf of Executive, and shall
indemnify Executive for and hold Executive harmless from, on an after-tax basis, any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such payment, but shall be entitled to any refund received
by or on behalf of Executive because of the claim HCPI has directed him to pay; provided, further, that any extension of the statute of limitations relating to the payment of taxes for the taxable year of Executive with respect to
which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, HCPI’s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Executive
shall be entitled to settle or contest, as the case may be, any other issue raised by the IRS or any other taxing authority. 

  

	 	(vii)	The payments provided for in Sections 5(a)(i), (ii) and (iii) shall be made not later than the fifth (5th) day following the Date of Termination; provided, however, that if the amounts of such payments cannot be finally determined on or before such
day, HCPI shall pay to Executive on such day an estimate, as determined in good faith by HCPI, of the minimum amount of such payments and shall pay the remainder of such payments (together with interest at the rate provided in section 1274(b)(2)(B)
of the Code) as soon as the amount thereof can be 

  

 Page 17 of 26 

	 	  	determined but in no event later than the thirtieth (30th) day after the Date of Termination. In the event that the amount of the estimated payments exceeds the amount subsequently determined to have been due, or that Executive becomes entitled to a refund of any such amount paid, such
excess or refund shall be paid to HCPI by Executive on the fifth (5th) day after demand by HCPI (together with
interest at the rate provided in section 1274(b)(2)(B) of the Code). 

  
 (b) Severance Compensation in the Event of a Termination Without Cause or for Good Reason Unrelated to a Change in Control. In the
event Executive’s employment is terminated in a Termination Without Cause or a Termination for Good Reason prior to a Change in Control or more than two (2) years thereafter, Executive shall be entitled to the benefits provided below:

  

	 	(i)	HCPI shall pay to Executive (A) Executive’s full Base Salary, when due, through the Date of Termination at the rate in effect at the time Notice of Termination is given, at the
time specified in Section 5(b)(iv), (B) the unpaid portion, if any, of any annual incentive compensation bonus, plus an amount equal to Executive’s annual incentive compensation bonus, pro rated from January 1 of the termination year
through the Date of Termination, and (C) all other amounts to which Executive is entitled under any compensation plan of HCPI at the time such payments are due. 

  

	 	(ii)	In lieu of any further Base Salary payments to Executive for periods subsequent to the Date of Termination, HCPI shall pay as severance pay to Executive, at the time specified in
Section 5(b)(iv), a lump sum severance payment (together with the payments provided in Section 5(b)(iii) below, the “Severance Payments”) equal to the sum of two (2) times Executive’s Base Salary as in effect as
of the Date of Termination, and two (2) times Executive’s targeted annual incentive plan bonus as in effect as of the Date of Termination or the highest annual incentive plan bonus received by Executive in the three (3) years immediately prior
to the Date of Termination, whichever is greater; and 

  

	 	(iii)	Executive shall be entitled to be paid for any accrued but unused vacation. 

  

	 	(iv)	For a period of two (2) years, HCPI shall continue to provide Executive and Executive’s eligible family members, based on the cost sharing arrangement between Executive and
HCPI on the date immediately prior to the Date of Termination, with medical and dental health coverage at least equal to those which would 

  

 Page 18 of 26 

	 	  	have been provided to Executive and his eligible family members if Executive’s employment had not been terminated or, if more favorable to Executive, as in effect generally at
any time thereafter, provided, however, that Executive shall advise HCPI if Executive becomes re-employed with another employer, and he and his eligible dependents are eligible to receive medical and dental health benefits under
another employer’s plans, and HCPI’s obligations under this Section 5(b)(iv) shall cease. In the event Executive and his dependents are ineligible under the terms of HCPI’s benefit plans or programs to continue coverage under
this Section 5(b)(iv), HCPI shall provide Executive and his dependents with substantially equivalent coverage through other sources or shall provide Executive with a lump sum payment in such amount that, after all taxes on that amount, is
equal to the cost to Executive of providing Executive such benefit coverage. The lump sum shall be determined on a present value basis using the interest rate provided in section 1274(b)(2)(B) of the Code on the Date of Termination. Upon the
termination of the benefits coverage under the first sentence of this Section 5(b)(iv), Executive, Executive’s spouse and Executive’s dependents shall be entitled to continuation coverage pursuant to section 4980B of the Internal
Revenue Code of 1986, as amended (the “Code”), sections 601-608 of the Employee Retirement Income Security Act of 1974, as amended, and under any other applicable law, to the extent required by such laws, as if Executive had
terminated employment with HCPI on the date such benefits coverage terminates. 

  

	 	(v)	The payments provided for in Sections 5(b)(i) and (ii) shall be made not later than the fifth (5th) day following the Date of Termination; provided, however, that if the amounts of such payments cannot be finally determined on or before such
day, HCPI shall pay to Executive on such day an estimate, as determined in good faith by HCPI, of the minimum amount of such payments and shall pay the remainder of such payments (together with interest at the rate provided in section 1274(b)(2)(B)
of the Code) as soon as the amount thereof can be determined but in no event later than the thirtieth (30th) day
after the Date of Termination. In the event that the amount of the estimated payments exceeds the amount subsequently determined to have been due, such excess shall constitute a loan by HCPI to Executive, payable on the fifth (5th) day after demand by HCPI (together with interest at the rate provided in section 1274(b)(2)(B) of the Code).

  

 Page 19 of 26 

 (c) No Severance Compensation Upon Other Termination. In the event of a Voluntary
Termination, Termination For Cause, termination by reason of Executive’s Disability pursuant to Section 2(e), or termination by reason of Executive’s death pursuant to Section 2(f), Executive or his estate shall not be paid
any Severance Payments pursuant to this Section 5 or any other termination payments under any other plan maintained by HCPI. 
  
 (d) Executive shall not be required to mitigate the amount of any Severance Payments provided for in this Section 5 by seeking
other employment or otherwise, nor shall the amount of any Severance Payment or benefit provided for in this Section 5 be reduced by any compensation earned by Executive as the result of employment by another employer or by self-employment,
by retirement benefits, by offset against any amount claimed to be owed by Executive to HCPI, or otherwise. 
  
 (e) Waiver and Release. No payments and benefits will be provided to the Executive pursuant to this Section 5 unless and
until the Executive executes a waiver and release of all claims he may have against HCPI, any of its affiliates or Management Company and any of their officers, directors, employees, stockholder, members, partners, agents, representatives and
successors and assigns in a form reasonably satisfactory to HCPI. 
  
 6. Covenants. 
  
 (a)
Confidentiality. Executive will not, during the Employment Period, except to the extent reasonably necessary in performance of the duties under this Agreement, or at any time after termination of his employment, directly or indirectly,
disclose or make available to any person, firm, corporation, association or other entity for any reason or purpose whatsoever, any Confidential Information (as defined below). Executive agrees that, upon termination of Executive’s employment
with HCPI, all Confidential Information in Executive’s possession that is in written or other tangible form (together with all copies or duplicates thereof, including computer files) shall be returned to HCPI and shall not be retained by
Executive or furnished to any third party, in any form except as provided herein; provided, however, that Executive shall not be obligated to treat as confidential, or return to HCPI copies of any Confidential Information that (i) was
publicly known at the time of disclosure to Executive, (ii) becomes publicly known or available thereafter other than by any means in violation of this Agreement or any other duty owed to HCPI by any person or entity, or (iii) is lawfully disclosed
to Executive by a third party. As used in this Agreement, the term “Confidential Information” means: all trade secrets and proprietary or confidential information disclosed to Executive or known by Executive as a consequence of or
through Executive’s relationship with HCPI, about the customers, employees, business methods, public relations methods, organization, procedures or finances, including, without limitation, information of or relating to customer lists, of HCPI
and its affiliates. 
  

 Page 20 of 26 

 (b) Noncompetition. 
  

	 	(i)	Executive acknowledges and agrees that: (A) Executive’s services pursuant to this Agreement are unique and extraordinary, and that Executive will have access to and control of
Confidential Information of HCPI which is vital to the success of HCPI’s business, (B) because of Executive’s knowledge of HCPI’s Confidential Information it is unlikely that Executive could work for a Competitor of HCPI (as defined
below) without divulging such Confidential Information; and (C) the business of HCPI is national in scope and cannot be confined to any particular geographic area of the United States. 

  

	 	(ii)	For the foregoing reasons, and in consideration for the payments and benefits offered by HCPI under this Agreement, Executive hereby agrees to the following:

  

	 	A.	During the Employment Period and for a twelve (12) month period commencing with Executive’s Date of Termination (collectively, the “Covenant Period”),
Executive shall not, either on his own account or jointly with or as a manager, agent, officer, employee, consultant, partner, joint venturer, owner or shareholder or otherwise on behalf of any other person, firm or corporation, directly or
indirectly, engage in any activity with a competitor of HCPI in the health care real estate acquisition, development, management, investment or financing industry (a “Competitor”). Notwithstanding the foregoing, the parties agree
that Executive will serve as a Governor and Chief Manager of MedCap Holding IX L.L.C. for the purpose of owning the Sparks properties in Arkansas with intention of selling the same, oversight of that certain Swap Agreement with Wachovia and certain
interest rate caps, and other limited business activities related to post closing adjustments and claims and other matters directly related to the foregoing and that such service will not be deemed to be a violation of the foregoing.

  

	 	B.	Eligibility for Severance Payments and other benefits under this Agreement is contingent upon Executive’s agreement and compliance with the covenant as stated in this
Section 6(b). No further payments or eligibility for benefits continuation will be available to Executive if Executive violates the covenants stated herein, and Executive shall be required to repay any Severance Payments and benefits
previously provided by HCPI, in addition to any other remedies that HCPI may have. 

  

 Page 21 of 26 

	 	C.	It is a specific condition of this Agreement that Executive shall advise in writing any person or entity whom a reasonable person would believe to be a Competitor and with whom
Executive is contemplating entering into a business relationship of Executive’s obligations pursuant to this Agreement and specifically to disclose all covenants contained in this Section 6. It is also a specific condition of this
Agreement that so long as Executive is receiving any Severance Payments or benefits under this Agreement with respect to any type of termination, Executive shall be obligated to immediately notify HCPI as to the specifics of any new position or
business venture that Executive is planning to commence as an employee or consultant or otherwise, and to take affirmative steps to assure HCPI that Executive will not divulge any of HCPI’s Confidential Information or otherwise violate the
covenants in this Section 6 in such position or business venture. 

  
 (c) Non-Solicitation. Executive hereby agrees that during the Employment Period and for the period commencing on the Date of
Termination and terminating on the first (1st) anniversary thereof, Executive shall not, either on his own account
or jointly with or as a manager, agent, officer, employee, consultant, partner, joint venturer, owner or shareholder or otherwise on behalf of any other person, firm or corporation, directly or indirectly, solicit or attempt to solicit away from
HCPI or hire any of HCPI’s officers or employees or offer employment to any person who, on or during the six (6) months immediately preceding the date of such solicitation or offer, is or was an officer or employee of HCPI; provided,
however, that a general advertisement to which an employee of HCPI responds shall not be deemed to result in a breach of this Section 6(c). 
  
 7. Indemnification. HCPI will indemnify Executive to the fullest extent permitted by applicable law and the certificate of incorporation and
by-laws of HCPI, whichever affords the greater protection to Executive. 
  
 8. Arbitration; Dispute Resolution. Any disagreement, dispute, controversy, claim, suit, action or proceeding (collectively, a “Dispute”) arising out of or relating to this Agreement or the interpretation of this
Agreement or any arrangements relating to this Agreement or contemplated in this Agreement or the breach, termination or invalidity thereof shall be settled by final and binding arbitration in accordance with the following: 
  
 (a) The arbitration shall be administered by the
JAMS/Endispute in New York, New York, in accordance with its then existing JAMS/Endispute Arbitration Rules and Procedures for Employment Disputes. 
  

 Page 22 of 26 

 (b) In the event of such an arbitration proceeding, Executive and HCPI shall each select
an arbitrator from among the JAMS/Endispute panel of arbitrators, and the two party-appointed arbitrators shall select a neutral third arbitrator. 
  
 (c) Neither Executive nor HCPI nor the arbitration tribunal shall disclose the existence, content, or results of any arbitration hereunder
without the prior written consent of all parties. 
  
 (d) Except as provided herein, the Federal Arbitration Act shall govern the interpretation, enforcement and all proceedings under this Section 8.  
  
 (e) The arbitration tribunal shall apply the substantive law (and the law of remedies, if applicable) of the
State of Tennessee, or federal law, or both, as applicable, and the arbitration tribunal is without jurisdiction to apply any different substantive law. 
  
 (f) The arbitration tribunal shall have the authority to entertain a motion to dismiss and/or a motion for summary judgment by any party
and shall apply the standards governing such motions under the Federal Rules of Civil Procedure. The arbitration tribunal shall render an award and a written, reasoned opinion in support thereof. Judgment upon the award may be entered in any court
having jurisdiction thereof. 
  
 (g) HCPI shall
pay all fees and expenses of the arbitration tribunal regardless of the result. 
  
 9. Miscellaneous. 
  
 (a) Waiver. The waiver of the breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach of the same or other provision hereof. 
  
 (b) Entire Agreement; Modifications. Except as
otherwise provided herein, this Agreement represents the entire understanding among the parties with respect to the subject matter hereof, and this Agreement supersedes any and all prior understandings, agreements, plans and negotiations, whether
written or oral, with respect to the subject matter hereof, including without limitation, any understandings, agreements or obligations respecting any past or future compensation, bonuses, reimbursements or other payments to Executive from HCPI. All
modifications to the Agreement must be in writing and signed by the party against whom enforcement of such modification is sought. 
  
 (c) Notices. All notices and other communications under this Agreement shall be in writing and shall be given by telegraph or first
class mail, certified or registered with return receipt requested, and shall be deemed to have been duly given three days after mailing or twelve (12) hours after transmission of a telegram to the respective persons named below: 
  

 Page 23 of 26 

	 If to HCPI:
	  	Health Care Property Investors, Inc.
	 	  	4675 MacArthur Court, 9th Floor, Suite 900
	 	  	Newport Beach, California 92660
	 	  	Attention: Chairman of the Board
		
	 If to Executive:                    
	  	Charles A. Elcan
	 	  	508 Belle Meade Blvd.
	 	  	Nashville, TN 37205

  
 Any party may change
such party’s address for notices by notice duly given pursuant to this Section 9(c). 
  
 (d) Headings. The Section headings herein are intended for reference and shall not by themselves determine the construction or
interpretation of this Agreement. 
  
 (e)
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Tennessee applicable to contracts entered into and wholly to be performed within the State of Tennessee by residents of Tennessee.

  
 (f) Severability. Should a court or
other body of competent jurisdiction determine that any provision of this Agreement is excessive in scope or otherwise invalid or unenforceable, such provision shall be adjusted rather than voided, if possible, and all other provisions of this
Agreement shall be deemed valid and enforceable to the extent possible. 
  
 (g) Survival of HCPI’s Obligations. HCPI’s obligations hereunder shall not be terminated by reason of any liquidation, dissolution, bankruptcy, cessation of business, or similar event relating to
HCPI. This Agreement shall not be terminated by any merger or consolidation or other reorganization of HCPI. In the event any such merger, consolidation or reorganization shall be accomplished by transfer of stock or by transfer of assets or
otherwise, the provisions of this Agreement shall be binding upon and inure to the benefit of the surviving or resulting corporation or person. This Agreement shall be binding upon and inure to the benefit of the executors, administrators, heirs,
successors and assigns of the parties; provided, however, that except as herein expressly provided, this Agreement shall not be assignable either by HCPI (except to an affiliate of HCPI in which event HCPI shall remain liable if the
affiliate fails to meet any obligations to make payments or provide benefits or otherwise) or by Executive. The provisions of Section 5(a) shall survive the expiration or non-renewal of this Agreement, and the provisions of Section
5(b) shall apply to any Termination Without Cause within twelve (12) months following the expiration of this Agreement. 
  
 (h) Counterparts. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one and
the same Agreement. 
  
 (i) Withholdings.
All compensation and benefits to Executive hereunder shall be reduced by all federal, state, local and other withholdings and similar taxes and payments required by applicable law. 
  

 Page 24 of 26 

 10. Acknowledgement. Executive represents and acknowledges the following: 
  
 (a) He has carefully read this Agreement in its entirety;

  
 (b) He understands the terms and conditions
contained herein; 
  
 (c) He has had the
opportunity to review this Agreement with legal counsel of his own choosing and has not relied on any statements made by HCPI or its legal counsel as to the meaning of any term or condition contained herein or in deciding whether to enter into this
Agreement; and 
  
 (d) He is entering into this
Agreement knowingly and voluntarily. 
  
 [Remainder of page
intentionally left blank.] 
  

 Page 25 of 26 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above
written. 
  

	 HEALTH CARE PROPERTY INVESTORS, INC.

		
	 By:
	 	 /s/ EDWARD J. HENNING

	 	 	 Edward J. Henning

	 	 	 Senior Vice President, General Counsel
 and Corporate Secretary

	
	 EXECUTIVE

		
	 	 	 /s/ CHARLES A. ELCAN

	 	 	 CHARLES A. ELCAN

  

 Page 26 of 26

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