Document:

Exhibit 10.2

 

Execution Version

 

STOCK AND WARRANT PURCHASE AGREEMENT

 

 

This Stock and Warrant Purchase Agreement (“Agreement”)
is made and entered into this 7th day of January, 2016, by and between PharmaCyte Biotech, Inc., a Nevada corporation, with a business
address of 12510 Prosperity Drive, Suite 310, Silver Spring, Maryland 20904 (“Seller”), and SPYR, Inc., a Nevada
corporation, with a business address of 4643 S. Ulster St., Suite 1510, Denver CO 80237 (“Purchaser”). Both
Seller and Purchaser are referred to individually as a “Party” and jointly as the “Parties.”

 

RECITALS

 

WHEREAS, Seller is a clinical stage biotechnology
company focused on developing targeted treatments for cancer and diabetes;

 

WHEREAS, Seller is a “reporting company”
that has a class of stock registered under the Securities and Exchange Act of 1934, as amended (“Exchange Act”).
Seller is subject to the periodic reporting requirements of the Exchange Act and the regulations implementing the Exchange Act
promulgated by the U.S. Securities and Exchange Commission (“Commission”). Seller’s common stock is quoted
on the OTC Markets, Inc. electronic quotation system under the trading symbol “PMCB”; and

 

WHEREAS, Seller desires to sell and Purchaser
desires to purchase eight million five hundred thousand (8,500,000) restricted shares of Seller’s common stock (“Purchased
Shares”) and warrants to purchase eight million five hundred thousand (8,500,000) shares of Seller’s common stock
(“Warrants,” which term shall include the Warrant Shares (as defined below), except where context requires otherwise)
on the terms and subject to the conditions set forth in this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, the sufficiency and adequacy of which are acknowledged by the Parties, and in order to consummate
the purchase and the sale of the Purchased Shares and Warrants, it is hereby agreed as follows:

 

1. Purchase and Sale. Subject to the terms and conditions
hereinafter set forth, at the Closing (defined below), Seller shall sell, convey, transfer, and deliver to Purchaser: (i) a certificate
representing the Purchased Shares; and (ii) a certificate representing the Warrants to purchase Seller’s common stock, substantially
in the form attached hereto as Exhibit A, in consideration of the Purchase Price. The certificates representing the Purchased Shares
and Warrants shall be duly issued in the name of the Purchaser. The Purchaser’s delivery address is 670 White Plains Road,
Suite 120, Scarsdale, New York 10583.

 

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2. Amount of Purchase Price. As total consideration
for the purchase of the Purchased Shares and Warrants, Purchaser shall pay to Seller at the Closing the purchase price (“Purchase
Price”) of five hundred ten thousand dollars ($510,000.00).

 

3. Representations and Warranties of Seller. Seller
hereby warrants and represents:

 

(a) Seller has all requisite power and authority to execute, deliver,
and perform its obligations under this Agreement, and, when executed and delivered by Seller, shall constitute the valid and binding
obligation of Seller, enforceable against Seller in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws affecting creditors’ rights and remedies generally, and subject,
as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in
equity);

 

(b) The Purchased Shares have been duly authorized and, when conveyed
by Seller to Purchaser at the Closing, all in accordance with the terms of this Agreement, will be duly and validly issued, fully
paid and non-assessable;

 

(c) Neither the execution or delivery of this Agreement, nor any
other documents required to be executed and delivered by Seller hereunder, nor the consummation of the transaction contemplated
hereby: (i) conflicts with or constitutes any violation or breach, or gives any other person any rights (including, but not limited
to, any legal rights to acceleration, termination, cancellation or recession) under any document or agreement to which Seller is
a party. Neither Seller’s entry into this Agreement, nor Seller’s representations made in this Agreement, constitute
a violation of any order or applicable law that Seller or to which Seller’s assets are bound by or subject; and

 

(d) Seller is a corporation validly existing and in good standing
under the laws of the State of Nevada.

 

4. Representations and Warranties of Purchaser. Purchaser
hereby warrants and represents:

 

(a) Purchaser has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Agreement, and the execution, delivery, and performance by Purchaser of
its obligations under the Agreement has been duly authorized by all requisite action on the part of Purchaser and the Agreement,
when executed and delivered by Purchaser, shall constitute the valid and binding obligation of Purchaser, enforceable against Purchaser
in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles
of equity (regardless of whether enforcement is sought in a proceeding at law or in equity);

 

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(b) With respect to the Purchased Shares acquired by Purchaser and
the common stock of the Seller issuable upon exercise of the Warrants (“Warrant Shares”), Purchaser acknowledges
that neither the Purchased Shares nor the Warrant Shares have been registered under the Securities Act of 1933, as amended (“Securities
Act”) and are “Restricted Securities” within the meaning of Rule 144 under the Securities Act. As
such, neither the Purchased Shares nor the Warrant Shares may be resold in or transferred unless Seller registers them under Section
5 of the Securities Act, or has received an opinion of counsel to Purchaser or any successor in interest thereto reasonably satisfactory
to Seller that such resale or transfer is exempt from the registration requirements of the Securities Act. Purchaser acknowledges
that a no public market exists for the Purchased Shares or the Warrants. Purchaser understands that no assurance can be given that
such a trading market will further develop at any time, or, if so developed, that it will continue;

 

(c) Purchaser further acknowledges and agrees that its purchase
of the Purchased Shares and of the Warrants involves risks. Purchaser: (i) either alone or together with its representatives has
such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of this
investment, and make an informed decision to so invest, and has so evaluated the risks and merits of such investment; (ii) has
the ability to bear the economic risks of this investment for an indefinite period and can afford a complete loss of such investment;
(iii) understands the terms of, and the risks associated with the acquisition of the Purchased Shares and of the Warrants, including,
without limitation, a lack of liquidity, price transparency or pricing availability and risks associated with the industry in which
Seller operates; (iv) has had the opportunity to review such disclosures regarding Sellers’s business, financial condition
and prospects as Purchaser has determined to be necessary in connection with the acquisition of the Purchased Shares and of the
Warrants, including Seller’s public filings of Forms 10-K, 10-Q, and 8-K with the Commission, and the risk factors set forth
therein, (v) has had the opportunity to review the Form 8-K that Seller filed with the Commission on December 31, 2015 pursuant
to which it advised the public that that the previously issued audited financial statements for the year ended April 30, 2015 and
the unaudited financial statements for the interim periods ended July 31, 2015 and October 31, 2015 should no longer be relied
upon and that disclosure should be made to prevent future reliance on these financial statements and that Purchaser is aware that
the items listed in such Form 8-K are preliminary and subject to change and that there can be no assurance that the final adjustments
in the financial statements being restated will not differ materially from the estimated amounts set forth therein or that additional
adjustments will not be identified; (vi) is an “accredited investor" as
that term is defined in Regulation D promulgated under Securities Act; (vii) acknowledges and agrees that the Purchased Shares
and the Warrants are being offered and sold to it in reliance on specific exemptions from the registration requirements of United
States federal and state securities laws and that the Seller is relying upon the truth and accuracy of, and such Purchaser’s
compliance with, the representations, warranties, agreements, acknowledgments and understandings of such Purchaser set forth herein
in order to determine the availability of such exemptions and the eligibility of such Purchaser to acquire the Purchased Shares
and the Warrants; and (viii) understands and acknowledges that no United States federal or state agency or any other government
or governmental agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability
of the investment in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities.

 

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(d) Purchaser has received or has had full access to all the information
Purchaser considers necessary or appropriate to make an informed investment decision with respect to the Purchased Shares and Warrants.
Purchaser further has had an opportunity to ask questions of and receive answers from the management of Seller regarding the Purchased
Shares and Warrants and to obtain additional information necessary to verify any information furnished to Purchaser or to which
Purchaser had access. Further, Purchaser has undertaken its own review of the business of Seller and the wisdom of an investment
in the Purchased Shares and of the Warrants. Purchaser has had the opportunity to review all of the books, records and all Commission
filings of Seller, including all of Seller’s audited financial statements and disclosures, the above referenced Form 8-K
and risk factors that Seller has published concerning its operations as a company reporting to the Commission;

 

(e) Purchaser is acquiring the Purchased Shares and Warrants for
its own account, and not with a view towards a public distribution of those Purchased Shares and Warrants as an underwriter for
Seller, as that term is defined in the Securities Act. Purchaser acknowledges that it is not acquiring the Purchased Shares and
Warrants as the result of any advertisement or solicitation, including any publicly issued or circulated newspaper, mail, radio,
television or other form of general advertising or solicitation in connection with the offer, sale and purchase from Seller regarding
Purchaser’s investment pursuant to this Agreement; and

 

(f) Purchaser represents that Purchaser is familiar with the requirements
of Rule 144 of the Securities Act, as presently in effect, and understands the resale limitations imposed thereby. Purchaser understands
that Seller is under no obligation to register any of the Purchased Shares, the Warrants or the Warrant Shares. Purchaser acknowledges
that the certificates for the Purchased Shares, the Warrants and the Warrant Shares will bear a legend substantially in the form
set forth below:

 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (“ACT”), OR UNDER THE SECURITIES LAWS OF ANY OTHER JURISDICTION. THESE SECURITIES
ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT
AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. PURCHASERS SHOULD BE AWARE THAT THEY
MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

 

(g) Purchaser is a corporation validly existing and in good standing
under the laws of the State of Nevada.

 

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5. Representations, Warranties and Covenants of Seller and
Purchaser.

 

(a) Seller and Purchaser hereby represent and warrant that there
has been no act or omission by Seller or Purchaser which would give rise to any valid claim against any of the Parties for a brokerage
commission, finder's fee or other like payment in connection with the transaction contemplated hereby, except for such claims as
shall have been waived on or before the Closing Date (defined below) and a fee in the amount of $30,000 owed by Seller to Chardan
Capital Markets, LLC;

 

(b) The representations and warranties of Seller and Purchaser contained
herein or in any document furnished pursuant hereto shall survive the Closing of this transaction. Each Party acknowledges and
agrees that, except as expressly set forth in this Agreement or any closing document, no Party has made (and no Party is relying
on) any representation or warranties of any nature, express or implied, regarding anything relating to the transaction contemplated
by this Agreement that are not contained herein; and

 

(c) Purchaser and Seller agree that each will, at any time and from
time to time after the Closing, upon the request of the other Party, do, execute, acknowledge and deliver, or will cause to be
done, executed, acknowledged and delivered, all such further acts, assignments, transfers, conveyances, powers of attorney and
assurances as may be reasonably required from time to time in order to effectuate the provisions and purposes of this Agreement.

 

6. Conditions to Purchaser’s Obligations at Closing.

 

(a) Representations and Warranties. Each of the representations
and warranties of Seller shall be true and complete on and as of the Closing; and

 

(b) Performance. Seller shall have performed and complied
with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with
by him on or before the Closing.

 

7. Conditions to Seller’s Obligations at Closing.

 

(a) Representations and Warranties. Each of the representations
and warranties of Purchaser shall be true and complete on and as of the Closing; and

 

(b) Payment of Purchase Price. Purchaser shall have delivered
to Seller, in accordance with the terms of Section 8, the Purchase Price for the Purchased Shares and Warrants to be acquired by
Purchaser pursuant to this Agreement.

 

8. The Closing. Subject to the satisfaction or waiver
of the conditions in this Agreement, the closing of the sale to the Purchaser (“Closing”) shall take place on
or before January 8, 2016 (or on such other date as is mutually agreed upon by the Parties) (“Closing Date”).
On the Closing Date, Purchaser shall pay the Purchase Price to Seller by wire transfer of immediately available funds to Seller’s
account at Bank of America, located at 100 West 33rd Street, New York, NY 10001. Purchaser acknowledges that Purchaser
has been provided wire transfer information that enables the Purchase Price to be transferred to Seller’s bank for the benefit
of Seller.

 

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9. General Provisions.

 

(a) Entire Agreement. This Agreement constitutes the entire
agreement between the parties (except the rights and obligations of the Parties as set forth in the Warrants) and supersedes all
prior agreements and understandings, oral and written, between the Parties with respect to the subject matter hereof. This Agreement
may not be amended except by a written agreement signed by Purchaser and Seller.

 

(b) Sections and Other Headings; Interpretation. The section
and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation
of this Agreement. Whenever the context requires, words used in the singular shall be construed to mean or include the plural and
vice versa, and pronouns of any gender shall be deemed to include and designate the masculine, feminine or neuter gender.

 

(c) Governing Law; Jurisdiction. This Agreement shall be
deemed to be a contract made under the laws of the State of New York. This Agreement and the construction, validity, enforcement,
performance and interpretation of, or any dispute or claim arising out of or in relation to, this Agreement (whether in contract,
tort or otherwise) shall be construed in accordance with the laws of the State of New York without giving effect to the rules of
the State of New York governing the conflicts of laws (other than Section 5-1401 of the General Obligations Law of the State of
New York). Each Party agrees that all legal proceedings concerning the interpretations, enforcement and defense of this Agreement
and the transactions herein contemplated (“Proceedings”) (whether brought against a Party or its respective
Affiliates, employees or agents) shall be commenced exclusively in the New York Courts. Each Party hereto hereby irrevocably submits
to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any Proceeding,
any claim that it is not personally subject to the jurisdiction of any New York Court, or that such Proceeding has been commenced
in an improper or inconvenient forum. Each Party hereby irrevocably waives personal service of process and consents to process
being served in any such Proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence
of delivery) to such Party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. Each Party hereby irrevocably, knowingly and voluntarily waives, to the fullest
extent permitted by applicable law, any and all right to trial by jury in any Proceeding arising out of or relating to this Agreement
or the transactions contemplated hereby. For purposes of this Agreement, “New York Courts” means the state and
federal courts sitting in the State of New York, City of New York, Borough of Manhattan.

 

 

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(d) Severability. If any provision of this Agreement is determined
by any court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such provision will be enforced
to the maximum extent possible given the intent of the Parties hereto. If such clause or provision cannot be so enforced, such
provision shall be stricken from this Agreement and the remainder of this Agreement shall be enforced as if such invalid, illegal
or unenforceable clause or provision had (to the extent not enforceable) never been contained in this Agreement.

 

(e) Counterparts. This Agreement may be executed in one or
more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together,
will be deemed to constitute one and the same agreement. In the event that any signature is delivered by facsimile transmission
or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the
Party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf”
signature page were an original thereof.

 

(f) Waiver. The rights and remedies of the Parties are cumulative
and not alternative. Neither the failure nor any delay by any Party in exercising any right, power, or privilege under this Agreement,
or the documents referred to in this Agreement, will operate as a waiver of such right, power, or privilege, and no single or partial
exercise of any such right, power, or privilege will preclude any other or further exercise of such right, power, or privilege
or the exercise of any other right, power, or privilege.

 

(g) Successors and Assigns. Except as otherwise provided
in this Agreement, this Agreement, and the rights and obligations of the Parties hereunder, will be binding upon and inure to the
benefit of the Parties’ respective successors, assigns, heirs, executors, administrators and legal representatives.

 

(h) Survival of Warranties. The representations, warranties
and covenants of Seller and Purchaser contained in or made pursuant to this Agreement shall survive the execution and delivery
of this Agreement and the Closing.

 

(i) Notices. All notices, requests and demands (“Notice”)
to or upon a Party, to be effective, shall be in writing and shall be sent: (i) certified or registered mail, return receipt requested;
(ii) by personal delivery against receipt; (iii) by overnight courier; or (iv) by email and, unless otherwise expressly provided
herein, and shall be deemed to have been validly served, given, delivered and received: (x) on the date indicated on the receipt,
when delivered by personal delivery against receipt or by certified or registered mail; (y) one business day after deposit with
an overnight courier; or (z) in the case of email notice, when sent. Notices shall be addressed as follows:

 

 

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To Seller:

 

PharmaCyte Biotech, Inc.

Attention: Chief Executive Officer

12510 Prosperity Drive, Suite 310

Silver Spring, Maryland 20904

Email: kwaggoner@PharmaCyte.com

 

To Purchaser:

 

SPYR, Inc.

Attention: James R. Thompson

4643 S. Ulster St., Suite 1510

Denver CO 80237

Email: thompson@spyr.com

 

With a copy to:

Mailander Law Office, Inc.

835 5th Avenue, Ste. 312

San Diego, CA 92101

tmailander@gmail.com

 

Either Party may change the address to which Notices for him or
it shall be addressed by providing Notice of such change to the other Party in the manner set forth in this subsection 9(i).

 

 

(j) Third Parties. Nothing in this Agreement, express or
implied, is intended to confer upon any person, other than the Parties hereto and their successors and assigns, any rights or remedies
under or by reason of this Agreement.

 

(k) Preparation of Agreement. Purchaser prepared this Agreement
solely on its behalf. Each Party to this Agreement acknowledges that: (i) the Party had the advice of, or sufficient opportunity
to obtain the advice of, legal counsel separate and independent of legal counsel for any other Party hereto; (ii) the terms of
the transactions contemplated by this Agreement are fair and reasonable to such Party; and (iii) such Party has voluntarily entered
into the transactions contemplated by this Agreement without duress or coercion. Each Party further acknowledges that such Party
was not represented by the legal counsel of the other Party in connection with the transactions contemplated by this Agreement,
nor was he or it under any belief or understanding that such legal counsel was representing his or its interests. Each Party agrees
that no conflict, omission or ambiguity in this Agreement, or the interpretation thereof, shall be presumed, implied, or otherwise
construed against the other Party on the basis that such Party was responsible for drafting this Agreement.

 

[Signature page follows]

 

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IN WITNESS WHEREOF, each of the undersigned has duly executed this
Stock and Warrant Purchase Agreement as of the date first written above.

 

SELLER

 

PharmaCyte Biotech, Inc.

 

 

By:     _/s/ Kenneth L. Waggoner ______________

Printed Name: Kenneth L. Waggoner

Title: Chief Executive Officer

 

PURCHASER

 

SPYR, Inc.

 

 

By:     _/s/ Joseph Fiore_______________________

Printed Name: Joseph Fiore

Title: Chairman

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT A

 

FORM OF WARRANT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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NEITHER THESE SECURITIES NOR THE SECURITIES
ISSUABLE UPON THE EXERCISE OF THESE SECURITIES HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH
EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY (AS DEFINED BELOW). 

 

PHARMACYTE BIOTECH, INC.

 

COMMON STOCK WARRANT AGREEMENT

 

    Original Issue Date: January 7, 2016                    

 

This Common Stock Warrant
Agreement (“Warrant Agreement”) certifies that, for value received, SPYR, Inc., a Nevada corporation, or its
assigns (“Holder”) is entitled to purchase from PharmaCyte Biotech, Inc., a Nevada corporation (“Company”),
up to a total of 8,500,000 shares of Common Stock (as defined below) (each, a “Warrant” and collectively, the
“Warrants,” and each such share of Common Stock, a “Warrant Security” and all such shares
of Common Stock, the “Warrant Securities”), at any time and from time to time through and including January
7, 2021 (“Expiration Date”), all on the terms and subject to the conditions set forth below:

 

1. Definitions.
As used in this Warrant Agreement, the following terms shall have the definitions set forth in this Section 1. Other capitalized
terms used and not otherwise defined shall have the meanings set forth in that certain Stock and Warrant Purchase Agreement, dated
January 7, 2016, between the Company and the Holder.

 

“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule 144.

 

“Business Day”
means any day except a Saturday, Sunday and any day that is a federal legal holiday or a day on which banking institutions in the
State of New York or the State of Maryland are authorized or required by law or other governmental action to close.

 

“Common Stock”
means the common stock of the Company, $0.0001 par value per share, and any securities into which such common stock may hereafter
be reclassified or for which it may be exchanged as a class.

 

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

 

“Exercise Price”
means $0.12 in United States Dollars, subject to adjustment in accordance with Section 9 of this Warrant Agreement.

 

“Fundamental
Transaction” means any of the following: (i) the Company effects any merger or consolidation of the Company with or into
another Person as a result of which transaction, the stockholders of the Company as of a time immediately prior to such transaction
no longer hold at least 50% of the voting securities of the surviving entity; (ii) the Company effects any sale of all or substantially
all of its assets in one or a series of related transactions; (iii) any tender offer or exchange offer (whether by the Company
or another Person), as defined under the federal securities laws, is completed pursuant to which holders of Common Stock are permitted
to tender or exchange their shares for other securities, cash or property; or (iv) the Company effects any reclassification of
the Common Stock or any compulsory share exchange pursuant to which the Common Stock is converted into or exchanged for other securities,
cash or property.

 

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“New York Courts”
means the state and federal courts sitting in the State of New York, City of New York, Borough of Manhattan.

 

“Original Issue
Date” means the Original Issue Date first set forth on the first page of this Warrant Agreement.

 

“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

“Rule 144”
means Rule 144 promulgated by the Securities and Exchange Commission pursuant to the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by the Securities and Exchange Commission having substantially
the same effect as such Rule.

 

“Securities
Act” means the Securities Act of 1933, as amended.

 

“Trading Day”
means a day on which the Common Stock is traded or quoted on a Trading Market; provided, that if the Common Stock is not traded
or quoted on a Trading Market, then “Trading Day” shall mean a Business Day.

 

“Trading Market”
means whichever of the New York Stock Exchange, the NYSE MKT, The NASDAQ Global Select Market, The NASDAQ Global Market, The NASDAQ
Capital Market, the OTC Bulletin Board or any market owned or operated by OTC Markets Group Inc. (or any similar organization or
agency succeeding to its functions of reporting prices) on which the Common Stock is listed or quoted for trading on the date in
question.

 

2. Registration of
Warrants. The Company shall register these Warrants upon records to be maintained by the Company for that purpose (“Warrant
Register”), in the name of the record Holder from time to time. The Company may deem and treat the registered Holder
of these Warrants as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for
all other purposes, absent actual notice to the contrary.

 

3. Registration of
Transfers. On the terms and subject to the conditions set forth in this Warrant Agreement, the Company shall register the transfer
of any portion of these Warrants in the Warrant Register, upon surrender of these Warrants, with the Form of Assignment attached
hereto duly completed and signed, to the Company at its address specified in this Warrant Agreement. Upon any such registration
or transfer, a new certificate representing the right to purchase Warrant Securities in substantially the form of this Warrant
Agreement (a “New Warrant Certificate”), evidencing the portion of these Warrants so transferred shall
be issued to the transferee and a New Warrant Certificate evidencing the remaining portion of these Warrants not so transferred,
if any, shall be issued to the transferring Holder. The acceptance of the New Warrant Certificate by the transferee thereof shall
be deemed the acceptance by such transferee of all of the rights and obligations of a holder of a Warrant.

 

4. Exercise and Duration
of Warrants. These Warrants shall be exercisable by the registered Holder at any time and from time to time through and including
the Expiration Date. At 5:00 p.m., Eastern Standard Time, on the Expiration Date, the portion of these Warrants not exercised prior
thereto shall be and become void and of no value.

 

5. Delivery of Warrant
Securities. Upon delivery of the Exercise Notice (in the form attached hereto) to the Company (with the attached Warrant Exercise
Log) at its address for notice set forth herein and upon payment of the Exercise Price in accordance with Section 10, the Company
shall promptly (but in no event later than five Trading Days after the Date of Exercise (as defined herein)) issue and deliver
to the Holder, a certificate for the Warrant Securities issuable upon such exercise. A “Date of Exercise” means
the date on which the Holder shall have delivered to the Company: (i) the Exercise Notice (with the Warrant Exercise Log attached
to it), appropriately completed and duly signed; and (ii) payment of the Exercise Price for the number of Warrant Securities so
indicated by the Holder to be purchased.

 

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6. Charges, Taxes
and Expenses. Issuance and delivery of Warrant Securities upon exercise of any Warrants shall be made without charge to the
Holder for any issue or transfer tax, withholding tax, transfer agent fee or other incidental tax or expense in respect of the
issuance of such certificates, all of which taxes and expenses shall be paid by the Company; provided, however, that the Company
shall not be required to pay any tax which may be payable in respect of any transfer involved in the registration of any certificates
for Warrant Securities or Warrants in a name other than that of the Holder. The Holder shall be responsible for all other tax liability
that may arise as a result of holding or transferring these Warrants or receiving Warrant Securities upon exercise hereof.

 

7. Replacement of
Warrant. If this Warrant Agreement is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in
exchange and substitution for and upon cancellation hereof, or in lieu of and substitution for this Warrant Agreement, a New Warrant,
but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction and customary and reasonable
indemnity (which shall not include a surety bond), if requested. Applicants for a New Warrant under such circumstances shall also
comply with such other reasonable regulations and procedures and pay such other reasonable third-party costs as the Company may
prescribe. If a New Warrant Certificate is requested as a result of a mutilation of this Warrant Agreement, then the Holder shall
deliver such mutilated Warrant Agreement to the Company as a condition precedent to the Company’s obligation to issue the
New Warrant.

 

8. Warrant Securities.
The Company covenants that all Warrant Securities issuable pursuant to this Warrant shall, upon issuance and the payment of the
applicable Exercise Price in accordance with the terms hereof, be duly authorized, validly issued and fully paid and non-assessable
and not subject to the preemptive rights of any other holder of common stock.

 

(a)                
Reservation of Securities. Company shall at all times reserve and keep available out of its authorized common
stock, solely for the purpose of issuance upon the exercise of the Warrant Shares, such number of shares of its common stock as
shall be issuable upon the exercise thereof.

 

9. Certain Adjustments.
The Exercise Price and number of Warrant Securities issuable upon exercise of this Warrant are subject to adjustment from time
to time as set forth in this Section 9.

 

(a) Stock Dividends
and Splits. If the Company, at any time while these Warrants are outstanding: (i) pays a stock dividend on its Common Stock
or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock; (ii) subdivides outstanding
shares of Common Stock into a larger number of shares; or (iii) combines outstanding shares of Common Stock into a smaller number
of shares, then in each such case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number
of shares of Common Stock outstanding immediately before such event and of which the denominator shall be the number of shares
of Common Stock outstanding immediately after such event. Any adjustment made pursuant to clause (i) of this paragraph shall become
effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution,
and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the effective date
of such subdivision or combination.

 

(b) Fundamental Transactions.
If, at any time while these Warrants are outstanding there is a Fundamental Transaction, then the Holder shall have the right thereafter
to receive, upon exercise of these Warrants, the same amount and kind of securities, cash or property as it would have been entitled
to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction,
the holder of the number of Warrant Securities then issuable upon exercise in full of these Warrants (“Alternate Consideration”).
For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate
Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental
Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting
the relative value of any different components of the Alternate Consideration. The terms of any agreement pursuant to which a Fundamental
Transaction is effected shall include terms requiring any such successor or surviving entity to comply with the provisions of this
paragraph.

 

    	13

     

    

 

(c) Adjustments for
Other Distributions. In the event the Company shall declare a distribution on the outstanding Common Stock that is payable
in securities of other Persons, evidences of indebtedness issued by the Company or other Persons, assets (excluding cash dividends
or distributions to the holders of Common Stock paid out of current or retained earnings and declared by the Company’s Board
of Directors) or options or rights, then, in each such case for the purpose of this Section 9(c), upon exercise of any Warrants,
the Holder shall be entitled to a proportionate share of any such distribution as though the Holder was the actual record holder
of the number of shares of Common Stock which might have been purchased upon exercise of any Warrants immediately prior to the
record date fixed for the determination of the holders of Common Stock of the Company entitled to receive such distribution (or
the date of such distribution if no record date is fixed).

 

(d) Number of Warrant
Securities. Simultaneously with any adjustment to the Exercise Price pursuant to this Section 9, the number of Warrant Securities
that may be purchased upon exercise of these Warrants shall be increased or decreased proportionately, so that after such adjustment
the aggregate Exercise Price payable hereunder for the adjusted number of Warrant Securities shall be the same as the aggregate
Exercise Price in effect immediately prior to such adjustment.

 

(e) Calculations.
All calculations under this Section 9 shall be made to the nearest cent or the nearest 1/100th of a share, as applicable.
The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account
of the Company, and the disposition of any such shares shall be considered an issue or sale of Common Stock.

 

(f) Notice of Adjustments.
Upon the occurrence of each adjustment pursuant to this Section 9, the Company at its expense will promptly compute such adjustment
in accordance with the terms of this Warrant Agreement and prepare a certificate setting forth such adjustment, including a statement
of the adjusted Exercise Price and adjusted number or type of Warrant Securities or other securities issuable upon exercise of
these Warrants (as applicable). Upon written request, the Company will promptly deliver a copy of each such certificate to the
Holder.

 

10. Payment of Exercise
Price. The Holder may pay the Exercise Price in one of the following manners:

 

(a) Cash Exercise.
The Holder may deliver immediately available funds; or

 

(b) Cashless Exercise.
The Holder may notify the Company in an Exercise Notice of its election to utilize cashless exercise, in which event the Company
shall issue to the Holder the number of Warrant Securities determined as follows:

 

X = Y(A-B)/A

 

where:

 

X = the number of Warrant Securities
to be issued to the Holder.

 

Y = the number of Warrant Securities
with respect to which these Warrants are being exercised (inclusive of the Warrant Securities surrendered to the Company in payment
of the aggregate Exercise Price).

 

A = the arithmetic average of the
Closing Sale Prices (as defined below) of one share of Common Stock for the five (5) consecutive Trading Days ending on the date
immediately preceding the date of the Exercise Notice.

 

B = the Exercise Price.

 

    	14

     

    

 

The term “Closing Sale Price”
means, for any security as of any date, the last closing bid price and last closing trade price, respectively, for such security
on the Trading Market, as reported by Bloomberg, or, if the Trading Market operates on an extended hours basis and does not designate
the closing bid price or the closing trade price, as the case may be, then the last bid price or the last trade price, respectively,
of such security prior to 4:00:00 p.m., New York City time, as reported by Bloomberg, or if the foregoing do not apply, the last
closing bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin
board for such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for
such security by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security
as reported in the OTC Link by OTC Markets Group Inc.. If the Closing Sale Price cannot be calculated for a security on a particular
date on any of the foregoing bases, the Closing Sale Price of such security on such date shall be the fair market value as mutually
determined by the Company and the Registered Holder. If the Company and the Registered Holder are unable to agree upon the fair
market value of such security, then such dispute shall be resolved pursuant to Section 14(b) hereof. All such determinations are
to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during the applicable
calculation period.

 

For purposes of Rule 144 promulgated under
the Securities Act, it is intended, understood and acknowledged that the Warrant Securities issued in a cashless exercise transaction
shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Securities shall be deemed to have
commenced, on the Original Issue Date appearing on page one.

 

11. Limitations on
Exercise. Notwithstanding anything to the contrary contained herein, the number of Warrant Securities that may be acquired
by the Holder upon any exercise of these Warrants (or otherwise in respect hereof) shall be limited to the extent necessary to
insure that, following such exercise (or other issuance), the total number of shares of Common Stock then beneficially owned by
such Holder and its Affiliates and any other Persons whose beneficial ownership of Common Stock would be aggregated with the Holder’s
for purposes of Section 13(d) of the Exchange Act, does not exceed 9.99% of the total number of issued and outstanding shares of
Common Stock (including for such purpose the shares of Common Stock issuable upon such exercise). For such purposes, beneficial
ownership shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder.
Notwithstanding anything to the contrary contained in this Warrant Agreement: (i) no term of this Section 11 may be waived by any
party, nor may any term of this Section 11 be amended such that the threshold percentage of ownership as set forth above would
be directly or indirectly increased; (ii) this restriction runs with these Warrants and may not be modified or waived by any subsequent
Holder hereof; and (iii) any attempted waiver, modification or amendment of this Section 11 will be void ab initio.

 

12. No Fractional
Shares. No fractional Warrant Securities will be issued in connection with any exercise of these Warrants. In lieu of any fractional
shares, which would otherwise be issuable, the Company shall pay cash equal to the product of such fraction multiplied by the closing
price of one share of Common Stock as reported by the applicable Trading Market on the date of exercise.

 

13. Notices. Any
and all notices or other communications or deliveries hereunder (including, without limitation, any Exercise Notice) shall be in
writing and shall be deemed given and effective on the earliest of: (i) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number specified in this Section 13 prior to 5:00 p.m. (Eastern Standard Time) on a
Trading Day; (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile
at the facsimile number specified in this Section 13 on a day that is not a Trading Day or later than 6:30 p.m. (Eastern Standard
Time) on any Trading Day, (iii) the Trading Day following the date of mailing, if sent by nationally recognized overnight courier
service; or (iv) upon actual receipt by the party to whom such notice is required to be given. The addresses for such communications
shall be: (i) if to the Company, to PharmaCyte Biotech, Inc., 12510 Prosperity Drive, Suite 310, Silver Spring, Maryland 20904,
Attention: Chief Executive Officer (or such other address as the Company shall indicate in writing in accordance with this Section
13), or via facsimile to (631) 240-8900, or (ii) if to the Holder, to the address or facsimile number appearing on the Warrant
Register or such other address or facsimile number as the Holder may provide to the Company in accordance with this Section 13.

 

    	15

     

    

 

14. Miscellaneous.

 

(a) This Warrant Agreement
shall be binding on and inure to the benefit of the parties hereto and their respective successors and assigns. Subject to the
preceding sentence, nothing in this Warrant Agreement shall be construed to give to any Person other than the Company and the Holder
any legal or equitable right, remedy or cause of action under these Warrants. This Warrant Agreement may be amended only in writing
signed by the Company and the Holder and their successors and assigns. The foregoing sentence shall be subject to the restrictions
on waivers and amendments set forth in Section 11 of this Warrant Agreement.

 

 (b) All questions concerning the construction,
validity, enforcement, performance and interpretation of this Warrant Agreement shall be governed by and construed and enforced
in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof (other
than Section 5-1401 of the General Obligations Law of the State of New York). Each party agrees that all legal proceedings concerning
the interpretations, enforcement and defense of this Warrant Agreement and the transactions herein contemplated (“Proceedings”)
(whether brought against a party hereto or its respective Affiliates, employees or agents) shall be commenced exclusively in the
New York Courts. Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for the adjudication
of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any Proceeding, any claim that it is not personally subject to the jurisdiction
of any New York Court, or that such Proceeding has been commenced in an improper or inconvenient forum. Each party hereto hereby
irrevocably waives personal service of process and consents to process being served in any such Proceeding by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices
to it under this Warrant Agreement and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.
Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury
in any legal proceeding arising out of or relating to this Warrant Agreement or the transactions contemplated hereby. If either
party shall commence a Proceeding to enforce any provisions of this Warrant Agreement, then the prevailing party in such Proceeding
shall be reimbursed by the other party for its attorney’s fees and other costs and expenses incurred with the investigation,
preparation and prosecution of such Proceeding.

 

(c) The failure of any
of the parties hereto to at any time enforce any of the provisions of this Warrant Agreement shall not be deemed or construed to
be a waiver of any such provision, nor to in any way effect the validity of this Warrant Agreement or the Warrants or any provision
hereof or the right of any of the parties hereto to thereafter enforce each and every provision of this Warrant Agreement. No waiver
of any breach, non-compliance or non-fulfillment of any of the provisions of this Warrant Agreement shall be effective unless set
forth in a written instrument executed by the party or parties against whom or which enforcement of such waiver is sought; and
no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent
breach, non-compliance or non-fulfillment.

 

(d) The headings herein
are for convenience only, do not constitute a part of this Warrant Agreement and shall not be deemed to limit or affect any of
the provisions hereof. Whenever the context requires, words used in the singular shall be construed to mean or include the plural
and vice versa, and pronouns of any gender shall be deemed to include and designate the masculine, feminine or neuter gender.

 

 

    	16

     

    

 

(e) In case any one or
more of the provisions of this Warrant Agreement shall be invalid or unenforceable in any respect, the validity and enforceability
of the remaining terms and provisions of this Warrant Agreement shall not in any way be affected or impaired thereby and the parties
will attempt in good faith to agree upon a valid and enforceable provision which shall be a commercially reasonable substitute
therefor, and upon so agreeing, shall incorporate such substitute provision in this Warrant Agreement.

 

(f) Prior to exercise
of a Warrant, the Holder hereof shall not, by reason of being a Holder, be entitled to any rights of a stockholder with respect
to the Warrant Securities.

 

(g) Wherever possible,
each provision of this Warrant Agreement shall be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Warrant Agreement shall be prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant Agreement.

 

[Signature page follows.]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	17

     

    

 

IN WITNESS WHEREOF, the Company has caused this Warrant Agreement
to be duly executed by its authorized officer as of the date first indicated above.

 

 

	 	PHARMACYTE BIOTECH, INC.
	 	 	 
	 	By:	  
	 	Name: Kenneth L. Waggoner
	 	Title: Chief Executive Officer

 

     

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	18

     

    

 

 

EXERCISE NOTICE

PHARMACYTE BIOTECH, INC.

WARRANT AGREEMENT DATED JANUARY 7, 2016

 

The undersigned Holder
hereby irrevocably elects to purchase Warrant Securities pursuant to the above referenced Warrant Agreement. Capitalized terms
used herein and not otherwise defined have the meanings set forth in the Warrant Agreement.

 

	(1)	The undersigned Holder hereby exercises its right to purchase Warrant Securities pursuant to the Warrant Agreement. 

 

	(2)	
        (PLEASE CHECK ONE METHOD OF PAYMENT)

         

         ̈ The Holder shall
        pay the sum of $___ to the Company in accordance with the terms of the Warrant Agreement; or

         

         ̈
        The Holder shall exercise one or more Warrants through a cashless exercise in accordance with the terms of the Warrant Agreement.

	 	 
	(3)	Pursuant to this Exercise Notice, the Company shall deliver to the holder Warrant Securities in accordance with the terms of the Warrant Agreement.  
	 	 
	(4)	Please issue said Warrant Securities in the name of the undersigned or in such other name as is specified here:

 ______________________________________.
	 	 
	(5)	By its delivery of this Exercise Notice, the undersigned represents and warrants to the Company that in giving effect to the exercise evidenced hereby the Holder will not beneficially own in excess of the number of shares of Common Stock (determined in accordance with Section 13(d) of the Securities Exchange Act of 1934) permitted to be owned under Section 11 of this Warrant to which this notice relates.

 

 

	Dated:  __________________________	 	Name of Holder:
	 	 	 
	 	 	(Print) 
	 	 	 
	 	 	Name: 
	 	 	Title: 
	 	 	Date: 
	 	 	 
	 	 	(Signature must conform in all respects to name of holder as specified on the face of the Warrant.)

 

  

 

    	19

     

    

 

 

WARRANT EXERCISE LOG

 

	Date	 	Number of Warrant

Securities Available to

be Exercised	 	Number of Warrant

Securities Exercised	 	Number of Warrant

Securities Remaining

to be Exercised
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	20

     

    

 

 

PHARMACYTE BIOTECH, INC.

WARRANT AGREEMENT DATED JANUARY 7, 2016

 

ASSIGNMENT
FORM

 

(To assign the foregoing warrant or warrants,
execute

this form and supply required information.

Do not use this form to exercise the warrant.)

 

FOR VALUE RECEIVED, [____] all of or [_______]
Warrants and all rights evidenced thereby are hereby assigned to

 

_______________________________________________
whose address is

 

_______________________________________________________________.

 

_______________________________________________________________

 

Date: ______________, _______

 

Holder’s Signature: _____________________________

 

Holder’s Address: ______________________________

 

                              _______________________________

 

Signature Guaranteed: ___________________________________________

 

NOTE: The signature to this Assignment Form
must correspond with the name as it appears on the face of the Warrant Agreement, without alteration or enlargement or any change
whatsoever, and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or other
representative capacity should file proper evidence of authority to assign the Warrant Agreement.

 

 

 

 

 

 

 

 

 

 

 

    	21notepurchaseagreementedg

Exhibit 10.1      EXECUTION VERSION                  PHYSICIANS REALTY L.P.,    as Issuer         PHYSICIANS REALTY TRUST,   as Parent Guarantor      $150,000,000         $15,000,000 4.03% Senior Notes, Series A, due January 7, 2023   $45,000,000 4.43% Senior Notes, Series B, due January 7, 2026   $45,000,000 4.57% Senior Notes, Series C, due January 7, 2028   $45,000,000 4.74% Senior Notes, Series D, due January 7, 2031         ______________      NOTE PURCHASE AND GUARANTEE AGREEMENT      ______________         Dated January 7, 2016                          

 

      TABLE OF CONTENTS   SECTION HEADING PAGE   SECTION 1. AUTHORIZATION OF NOTES ..........................................................................1   SECTION 2. SALE AND PURCHASE OF NOTES ...................................................................1   Section 2.1. Notes ......................................................................................................1   Section 2.2. Parent Guarantee ....................................................................................2   Section 2.3. Subsidiary Guarantees ...........................................................................2   SECTION 3. CLOSING .......................................................................................................2   SECTION 4. CONDITIONS TO CLOSING..............................................................................2   Section 4.1. Representations and Warranties .............................................................3   Section 4.2. Performance; No Default .......................................................................3   Section 4.3. Organizational Documents.....................................................................3   Section 4.4. Opinions of Counsel ..............................................................................3   Section 4.5. Financial Projections ..............................................................................3   Section 4.6. Purchase Permitted By Applicable Law, Etc .........................................4   Section 4.7. Sale of Other Notes ................................................................................4   Section 4.8. Payment of Special Counsel Fees ..........................................................4   Section 4.9. Private Placement Number ....................................................................4   Section 4.10. Changes in Corporate Structure .............................................................4   Section 4.11. Escrow Funding Instructions .................................................................4   Section 4.12. Consents and Amendments ....................................................................4   Section 4.13. Closing Fee ............................................................................................5   Section 4.14. Escrow Agreement .................................................................................5   Section 4.15. Proceedings and Documents ..................................................................5   SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE OBLIGORS .............................5   Section 5.1. Organization; Requisite Power and Authority;   Qualification ..........................................................................................5   Section 5.2. Capital Stock and Ownership.................................................................5   Section 5.3. Due Authorization ..................................................................................6   Section 5.4. No Conflict.............................................................................................6   Section 5.5. Governmental Consents .........................................................................6   Section 5.6. Binding Obligation.................................................................................6   Section 5.7. Financial Statements ..............................................................................6   Section 5.8. No Material Adverse Effect; No Default ...............................................7   Section 5.9. Tax Matters ............................................................................................7   Section 5.10. Properties ...............................................................................................8   Section 5.11. Environmental Matters...........................................................................8   Section 5.12. No Defaults ............................................................................................9   Section 5.13. No Litigation or other Adverse Proceedings .........................................9     

 

 -ii-   Section 5.14. Compliance with ERISA........................................................................9   Section 5.15. Private Offering by the Obligors..........................................................10   Section 5.16. Use of Proceeds; Margin Regulations..................................................10   Section 5.17. Existing Indebtedness; Future Liens ....................................................11   Section 5.18. Foreign Assets Control Regulations, Etc .............................................11   Section 5.19. Status under Certain Statutes ...............................................................13   Section 5.20. Employee Matters ................................................................................13   Section 5.21. Solvency ...............................................................................................14   Section 5.22. Disclosure Documents .........................................................................14   Section 5.23. Insurance; No Casualty or Condemnation ...........................................14   Section 5.24. Compliance with Laws ........................................................................14   Section 5.25. Healthcare Facility Representations and Warranties ...........................15   Section 5.26. REIT Status ..........................................................................................16   Section 5.27. Unencumbered Pool Properties............................................................16   Section 5.28. Notes Rank Pari Passu .........................................................................17   SECTION 6. REPRESENTATIONS OF THE PURCHASERS ....................................................17   Section 6.1. Purchase for Investment .......................................................................17   Section 6.2. Source of Funds ...................................................................................17   SECTION 7. [RESERVED] ................................................................................................19   SECTION 8. PAYMENT AND PREPAYMENT OF THE NOTES ..............................................19   Section 8.1. Maturity................................................................................................19   Section 8.2. Optional Prepayments with Make-Whole Amount..............................19   Section 8.3. Allocation of Partial Prepayments .......................................................19   Section 8.4. Maturity; Surrender, Etc. .....................................................................20   Section 8.5. Purchase of Notes ................................................................................20   Section 8.6. Make-Whole Amount ..........................................................................20   Section 8.7. Prepayment in Connection with a Noteholder Sanctions   Event ....................................................................................................21   Section 8.8. Repayment Upon Failure to Obtain Investment Grade   Rating ...................................................................................................23   Section 8.9. Payments Due on Non-Business Days .................................................23   SECTION 9. AFFIRMATIVE COVENANTS. ........................................................................23   Section 9.1. Financial Statements and Other Reports ..............................................24   Section 9.2. Existence ..............................................................................................27   Section 9.3. Payment of Taxes and Claims..............................................................27   Section 9.4. Maintenance of Properties ...................................................................27   Section 9.5. Insurance ..............................................................................................28   Section 9.6. Inspections ...........................................................................................28   Section 9.7. Noteholder Meetings ............................................................................28   Section 9.8. Compliance with Laws and Material Contracts ...................................28   Section 9.9. Use of Proceeds....................................................................................28     

 

 -iii-   Section 9.10. Environmental Matters.........................................................................29   Section 9.11. Books and Records ..............................................................................29   Section 9.12. Unencumbered Pool Properties Subject to Eligible   Ground Leases. ....................................................................................29   Section 9.13. REIT Status ..........................................................................................31   Section 9.14. Leasing Matters Regarding Unencumbered Pool   Properties .............................................................................................32   Section 9.15. Subsidiary Guarantors; Release ...........................................................32   Section 9.16. Rating Matters ......................................................................................33   SECTION 10. NEGATIVE COVENANTS. .............................................................................34   Section 10.1. Indebtedness .........................................................................................34   Section 10.2. Liens .....................................................................................................36   Section 10.3. No Further Negative Pledges ...............................................................38   Section 10.4. Restricted Payments .............................................................................38   Section 10.5. Burdensome Agreements .....................................................................39   Section 10.6. Investments ..........................................................................................39   Section 10.7. Use of Proceeds....................................................................................41   Section 10.8. Financial Covenants .............................................................................41   Section 10.9. Capital Expenditures ............................................................................42   Section 10.10. Fundamental Changes; Disposition of Assets;   Acquisitions .........................................................................................43   Section 10.11. Disposal of Subsidiary Interests ...........................................................43   Section 10.12. Transactions with Affiliates and Insiders ............................................44   Section 10.13. Prepayment of Other Funded Debt ......................................................44   Section 10.14. Conduct of Business ............................................................................45   Section 10.15. Fiscal Year ...........................................................................................45   Section 10.16. Amendments to Organizational Documents/Material   Agreements ..........................................................................................45   Section 10.17. Addition/Removal of Unencumbered Pool Properties ........................45   Section 10.18. Property Management Agreements Regarding   Unencumbered Pool Properties............................................................46   Section 10.19. Terrorism Sanctions Regulations .........................................................46   SECTION 11. EVENTS OF DEFAULT ..................................................................................47   SECTION 12. REMEDIES ON DEFAULT, ETC ......................................................................50   Section 12.1. Acceleration .........................................................................................50   Section 12.2. Other Remedies ....................................................................................50   Section 12.3. Rescission ............................................................................................51   Section 12.4. No Waivers or Election of Remedies, Expenses, Etc ..........................51   SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES ...............................51   Section 13.1. Registration of Notes ...........................................................................51   Section 13.2. Transfer and Exchange of Notes ..........................................................52     

 

 -iv-   Section 13.3. Replacement of Notes ..........................................................................52   SECTION 14. PAYMENTS ON NOTES .................................................................................52   Section 14.1. Place of Payment..................................................................................52   Section 14.2. Home Office Payment..........................................................................53   SECTION 15. EXPENSES, ETC ...........................................................................................53   Section 15.1. Transaction Expenses...........................................................................53   Section 15.2. Survival ................................................................................................54   SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE   AGREEMENT ...............................................................................................54   SECTION 17. AMENDMENT AND WAIVER ........................................................................54   Section 17.1. Requirements .......................................................................................54   Section 17.2. Solicitation of Holders of Notes ..........................................................55   Section 17.3. Binding Effect, etc ...............................................................................55   Section 17.4. Notes Held by Obligors, etc .................................................................55   SECTION 18. NOTICES ......................................................................................................56   SECTION 19. REPRODUCTION OF DOCUMENTS .................................................................56   SECTION 20. CONFIDENTIAL INFORMATION.....................................................................57   SECTION 21. SUBSTITUTION OF PURCHASER ....................................................................58   SECTION 22. PARENT GUARANTEE ..................................................................................58   Section 22.1. Guarantee .............................................................................................58   Section 22.2. Parent Guarantor’s Obligations Unconditional ....................................59   Section 22.3. Full Recourse Obligations....................................................................64   Section 22.4. Waiver ..................................................................................................65   Section 22.5. Waiver of Subrogation .........................................................................65   Section 22.6. Subordination .......................................................................................66   Section 22.7. Effect of Bankruptcy Proceedings, Etc ................................................66   Section 22.8. Term of Guarantee ...............................................................................67   SECTION 23. MISCELLANEOUS ........................................................................................67   Section 23.1. Successors and Assigns........................................................................67   Section 23.2. Accounting Terms ................................................................................67   Section 23.3. Severability ..........................................................................................67   Section 23.4. Construction, etc ..................................................................................68   Section 23.5. Counterparts .........................................................................................68   Section 23.6. Governing Law ....................................................................................68     

 

 -v-   Section 23.7. Jurisdiction and Process; Waiver of Jury Trial ....................................68     

 

 -vi-   SCHEDULE A  INFORMATION RELATING TO PURCHASERS   SCHEDULE B  DEFINED TERMS      SCHEDULE B(1)  APPROVED MANAGER    SCHEDULE 5.1  ORGANIZATION; REQUISITE POWER AND AUTHORITY; QUALIFICATION   SCHEDULE 5.2  CAPITAL STOCK AND OWNERSHIP   SCHEDULE 5.10(b) REAL ESTATE ASSETS   SCHEDULE 5.17    EXISTING INDEBTEDNESS   SCHEDULE 5.22 DISCLOSURE DOCUMENTS   SCHEDULE 5.27    UNENCUMBERED POOL PROPERTIES   SCHEDULE 10.2    EXISTING LIENS   SCHEDULE 10.6    EXISTING INVESTMENTS      EXHIBIT 1(a)  FORM OF 4.03% SENIOR NOTES, SERIES A, DUE JANUARY 7, 2023   EXHIBIT 1(b)  FORM OF 4.43% SENIOR NOTES, SERIES B, DUE JANUARY 7, 2026   EXHIBIT 1(c)  FORM OF 4.57% SENIOR NOTES, SERIES C, DUE JANUARY 7, 2028   EXHIBIT 1(d)  FORM OF 4.74% SENIOR NOTES, SERIES D, DUE JANUARY 7, 2031   EXHIBIT 2.3   FORM OF SUBSIDIARY GUARANTEE   EXHIBIT 4.4(a)   FORM OF OPINION OF SPECIAL COUNSEL FOR THE OBLIGORS   EXHIBIT 4.4(b)  FORM OF OPINION OF SPECIAL COUNSEL FOR THE PURCHASERS   EXHIBIT 9.1(C)-1  FORM OF COMPLIANCE CERTIFICATE   EXHIBIT 9.1(C)-2   FORM OF BORROWING BASE CERTIFICATE        

 

      PHYSICIANS REALTY L.P.   PHYSICIANS REALTY TRUST         $15,000,000 4.03% Senior Notes, Series A, due January 7, 2023   $45,000,000 4.43% Senior Notes, Series B, due January 7, 2026   $45,000,000 4.57% Senior Notes, Series C, due January 7, 2028   $45,000,000 4.74% Senior Notes, Series D, due January 7, 2031         Dated as of January 7, 2016         TO EACH OF THE PURCHASERS LISTED IN    SCHEDULE A HERETO:   Ladies and Gentlemen:   Each of PHYSICIANS REALTY L.P., a Delaware limited partnership (together with any   successor thereto that becomes a party hereto pursuant to Section 10.10, the “Issuer”), and   PHYSICIANS REALTY TRUST, a Maryland real estate investment trust (the “Parent   Guarantor” and, together with the Issuer, the “Obligors”), hereby jointly and severally agree   with each of the Purchasers as follows:   SECTION 1. AUTHORIZATION OF NOTES.   The Issuer will authorize the issue and sale of $150,000,000 aggregate principal amount   of its Senior Notes consisting of (i) $15,000,000 aggregate principal amount of its 4.03% Senior   Notes, Series A, due January 7, 2023 (the “Series A Notes”), (ii) $45,000,000 aggregate   principal amount of its 4.43% Senior Notes, Series B, due January 7, 2026 (the “Series B   Notes”), (iii) $45,000,000 aggregate principal amount of its 4.57% Senior Notes, Series C, due   January 7, 2028 (the “Series C Notes”) and (iv) $45,000,000 aggregate principal amount of its   4.74% Senior Notes, Series D, due January 7, 2031 (the “Series D Notes” and, together with the   Series A Notes, Series B Notes and Series C Notes, the “Notes”, such term to include any Notes,   as amended, restated or otherwise modified from time to time pursuant to Section 17, and any   such Notes issued in substitution therefor pursuant to Section 13). The Notes shall be   substantially in the form set out in Exhibits 1(a), 1(b), 1(c) and 1(d), respectively.  Certain   capitalized and other terms used in this Agreement are defined in Schedule B.  References to a   “Schedule” or “Exhibit” are references to a Schedule or Exhibit attached to this Agreement   unless otherwise specified.  References to a “Section” are references to a Section of this   Agreement unless otherwise specified.   SECTION 2. SALE AND PURCHASE OF NOTES.    Section 2.1. Notes. Subject to the terms and conditions of this Agreement, the Issuer   will issue and sell to each Purchaser and each Purchaser will purchase from the Issuer, at the     

 

-2-      Closing provided for in Section 3, Notes in the principal amount specified opposite such   Purchaser’s name in Schedule A at the purchase price of 100% of the principal amount thereof.    The Purchasers’ obligations hereunder are several and not joint obligations and no Purchaser   shall have any liability to any Person for the performance or non-performance of any obligation   by any other Purchaser hereunder.    Section 2.2. Parent Guarantee.  The payment and performance by the Issuer of its   obligations hereunder and under the Notes are absolutely and unconditionally guaranteed by the   Parent Guarantor pursuant and subject to the terms of the Parent Guarantee contained in   Section 22 hereof.    Section 2.3. Subsidiary Guarantees.  On the Closing Date, there will not be any   Subsidiary Guarantors under this Agreement. After the Closing Date, the payment and   performance by the Issuer of all amounts due on the Notes and all of its other payment   obligations under this Agreement may from time to time be absolutely and unconditionally   guaranteed by the Subsidiary Guarantors pursuant to and subject to the terms of the Subsidiary   Guarantee of each Subsidiary Guarantor, which shall be substantially in the form of Exhibit 2.3   attached hereto (as amended, modified or supplemented from time to time, each a “Subsidiary   Guarantee,” and collectively, the “Subsidiary Guarantees”), and otherwise in accordance with   the provisions of Section 9.15 hereof.   SECTION 3. CLOSING.   The sale and purchase of the Notes to be purchased by each Purchaser shall occur at the   offices of Chapman and Cutler LLP, 111 West Monroe Street, Chicago, IL 60603, at 10:00 a.m.,   Central time, at a closing (the “Closing”) on January 7, 2016, or on such other Business Day   thereafter on or prior to January 13, 2016 as may be agreed upon by the Issuer and the   Purchasers (the “Closing Date”).  At the Closing the Issuer will deliver to each Purchaser the   Notes to be purchased by such Purchaser in the form of a single Note (or such greater number of   Notes in denominations of at least $100,000 as such Purchaser may request) dated the date of the   Closing and registered in such Purchaser’s name (or in the name of its nominee), against delivery   by such Purchaser to the Escrow Agent of immediately available funds in the amount of the   purchase price therefor by wire transfer to the Escrow Account pursuant to the instructions   required by Section 4.11.  If at the Closing the Issuer shall fail to tender such Notes to any   Purchaser as provided above in this Section 3, or any of the conditions specified in Section 4   shall not have been fulfilled to such Purchaser’s satisfaction, such Purchaser shall, at its election,   be relieved of all further obligations under this Agreement, without thereby waiving any rights   such Purchaser may have by reason of any of the conditions specified in Section 4 not having   been fulfilled to such Purchaser’s satisfaction or such failure by the Issuer to tender such Notes.   SECTION 4. CONDITIONS TO CLOSING.   Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such   Purchaser at the Closing is subject to the fulfillment to such Purchaser’s satisfaction, prior to or   at the Closing, of the following conditions:     

 

-3-       Section 4.1. Representations and Warranties.  The representations and warranties of   each Obligor in the Financing Agreements to which it is a party shall be correct as of the date of   the Closing.    Section 4.2. Performance; No Default.  Each Obligor shall have performed and   complied with all agreements and conditions contained in the Financing Agreements required to   be performed or complied with by each such Obligor prior to or at the Closing.  Before and after   giving effect to the issue and sale of the Notes (and the application of the proceeds thereof as   contemplated by Section 5.16), no Default or Event of Default shall have occurred and be   continuing.    Section 4.3. Organizational Documents.   (a) Charter Documents.  The Obligors shall have delivered copies of articles of   incorporation, certificate of organization or formation, or other like document for   each of the Obligors certified as of a recent date by the appropriate Governmental   Authority.   (b) Officer’s Certificate.  Each Obligor shall have delivered to such Purchaser an   Officer’s Certificate, dated the date of the Closing, certifying that the conditions   specified in Sections 4.1, 4.2 and 4.10 have been fulfilled.   (c) Organizational Documents Certificate.  The Obligors shall have delivered   (i) copies of bylaws, operating agreement, partnership agreement or like   document, (ii) copies of resolutions approving the transactions contemplated in   connection with the financing and authorizing execution and delivery of the   Financing Agreements and (iii) incumbency certificates, for each of the Obligors,   in each case certified by an Authorized Officer.   (d) Unencumbered Pool Property Deliverables and Borrowing Base Certificate. The   Obligors shall have delivered, with respect to each Unencumbered Pool Property,   the Unencumbered Pool Property Deliverables related thereto requested by the   Purchasers together with a Borrowing Base Certificate.    Section 4.4. Opinions of Counsel.  Such Purchaser shall have received customary   opinions in form and substance satisfactory to such Purchaser, dated the date of the Closing   (a) from counsel for the Obligors, covering the matters set forth in Exhibit 4.4(a) and covering   such other matters incident to the transactions contemplated hereby as such Purchaser or its   counsel may reasonably request (and the Obligors hereby instruct their counsel to deliver such   opinion to the Purchasers) and (b) from Chapman and Cutler LLP, the Purchasers’ special   counsel in connection with such transactions, substantially in the form set forth in Exhibit 4.4(b)   and covering such other matters incident to such transactions as such Purchasers may reasonably   request.    Section 4.5. Financial Projections.  The Purchasers shall have received pro forma   financial projections for the Obligors and their respective Subsidiaries for the Fiscal Years ended     

 

-4-      December 31, 2016, 2017 and 2018, which financial projections shall include a balance sheet,   income statement and cash flow statement.    Section 4.6. Purchase Permitted By Applicable Law, Etc.  On the date of the Closing   such Purchaser’s purchase of Notes shall (a) be permitted by the laws and regulations of each   jurisdiction to which such Purchaser is subject, without recourse to provisions (such as   section 1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance   companies without restriction as to the character of the particular investment, (b) not violate any   applicable law or regulation (including, without limitation, Regulation T, U or X of the FRB) and   (c) not subject such Purchaser to any tax, penalty or liability under or pursuant to any applicable   law or regulation, which law or regulation was not in effect on the date hereof.  If requested by   such Purchaser, such Purchaser shall have received an Officer’s Certificate certifying as to such   matters of fact as such Purchaser may reasonably specify to enable such Purchaser to determine   whether such purchase is so permitted.    Section 4.7. Sale of Other Notes.  Contemporaneously with the Closing the Issuer shall   sell to each other Purchaser and each other Purchaser shall purchase the Notes to be purchased   by it at the Closing as specified in Schedule A.    Section 4.8. Payment of Special Counsel Fees. Without limiting Section 15.1, the   Issuer shall have paid on or before the Closing the fees, charges and disbursements of the   Purchasers’ special counsel referred to in Section 4.4 to the extent reflected in a statement of   such counsel rendered to the Issuer at least one Business Day prior to the Closing.    Section 4.9. Private Placement Number.  A Private Placement Number issued by   Standard & Poor’s CUSIP Service Bureau (in cooperation with the SVO) shall have been   obtained by Chapman and Cutler LLP for each series of the Notes.    Section 4.10. Changes in Corporate Structure.  Neither of the Obligors shall have   changed its jurisdiction of incorporation or organization, as applicable, or been a party to any   merger or consolidation or succeeded to all or any substantial part of the liabilities of any other   entity, at any time following the date of the most recent financial statements referred to in   Section 5.7.      Section 4.11. Escrow Funding Instructions.  Prior to the date of the Closing, each   Purchaser shall have received written instructions from the Obligors regarding instructions for   deposit of the proceeds of the sale of the Notes in an account held by the Escrow Agent (the   “Escrow Account”) pursuant to Section 3 of this Agreement and the other Financing   Agreements, including specifying (i) the name and address of the transferee bank, (ii) such   transferee bank’s ABA/routing number and (iii) the account name and number into which the   purchase price for the Notes is to be deposited.    Section 4.12. Consents and Amendments.  To the extent that any approval or consent is   required under the Existing Credit Facility for the execution, delivery and performance of the   transactions contemplated hereunder, the Obligors shall have delivered to the Purchasers   evidence of such written approval or consent from the requisite lenders thereunder.     

 

-5-       Section 4.13. Closing Fee.  In consideration of each Purchaser’s commitment to purchase   the Notes, the Obligors jointly and severally agree to pay each Purchaser on the Closing Date a   closing fee in an amount equal to 0.10% of the aggregate principal amount of the Notes to be   purchased by such Purchaser (the “Closing Fee”).  Such Closing Fee shall be fully earned upon   Closing.    Section 4.14. Escrow Agreement.  The Purchasers shall have received a fully executed   copy of the Escrow Agreement.     Section 4.15. Proceedings and Documents.  All corporate and other proceedings in   connection with the transactions contemplated by the Financing Agreements and all documents   and instruments incident to such transactions shall be satisfactory to such Purchaser and its   special counsel, and such Purchaser and its special counsel shall have received all such   counterpart originals or certified or other copies of such documents as such Purchaser or such   special counsel may reasonably request.   SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE OBLIGORS.   Each Obligor jointly and severally represents and warrants to each Purchaser that, as of   the date of the Closing:    Section 5.1. Organization; Requisite Power and Authority; Qualification.  Each   Obligor and each Unencumbered Property Owner (a) is duly organized, validly existing and in   good standing under the laws of its jurisdiction of organization as identified in Schedule 5.1, (b)   has all requisite power and authority to own and operate its properties, to carry on its business as   now conducted and as proposed to be conducted, (c) as to each Obligor only, to enter into the   Financing Agreements to which it is a party and to carry out the transactions contemplated   thereby and (d) is qualified to do business and in good standing in every jurisdiction where   necessary to carry out its business and operations, except in jurisdictions where the failure to be   so qualified or in good standing has not had, and could not be reasonably expected to have, a   Material Adverse Effect.    Section 5.2. Capital Stock and Ownership.  Schedule 5.2 correctly sets forth the   ownership interest of the Parent Guarantor in its Subsidiaries (including the Issuer) as of the   Closing Date.  The Capital Stock of each Obligor and its Subsidiaries has been duly authorized   and validly issued and, to the extent applicable, is fully paid and non assessable.  Except as set   forth on Schedule 5.2, as of the Closing Date, there is no existing option, warrant, call, right,   commitment, buy-sell, voting trust or other shareholder agreement or other agreement to which   any Subsidiary is a party requiring, and there is no membership interest or other Capital Stock of   any Subsidiary outstanding which upon conversion or exchange would require, the issuance by   any Subsidiary of any additional membership interests or other Capital Stock of any Subsidiary   or other Securities convertible into, exchangeable for or evidencing the right to subscribe for or   purchase, a membership interest or other Capital Stock of any Subsidiary.     

 

-6-       Section 5.3. Due Authorization.  The execution, delivery and performance of each   Financing Agreement to which an Obligor is a party (including in the case of the Issuer, the   Notes) have been duly authorized by all necessary action on the part of each Obligor.    Section 5.4. No Conflict.  The execution, delivery and performance by the Obligors of   the Financing Agreements to which they are parties and the consummation of the transactions   contemplated by the Financing Agreements do not and will not (a) violate in any material respect   any provision of any Applicable Laws relating to either Obligor, any of the Organizational   Documents of either Obligor, or any order, judgment or decree of any court or other agency of   government binding on either Obligor; (b) except as would not reasonably be expected to have a   Material Adverse Effect, conflict with, result in a breach of or constitute (with due notice or   lapse of time or both) a default under any other Contractual Obligations of either Obligor; (c)   result in or require the creation or imposition of any Lien upon any of the properties or assets of   either Obligor (other than any Liens subsequently created under any of the Financing   Agreements in favor of the holders of the Notes) whether now owned or hereafter acquired; or   (d) require any approval of stockholders, members or partners or any approval or consent of any   Person under any Contractual Obligation of either Obligor (other than those which have already   been obtained or to the extent the failure to obtain any such approval or consent would not   reasonably be expected to have a Material Adverse Effect).    Section 5.5. Governmental Consents.  The execution, delivery and performance by   each Obligor of the Financing Agreements to which it is a party and the consummation of the   transactions contemplated by the Financing Agreements do not and will not require, as a   condition to the effectiveness thereof, any registration with, consent or approval of, or notice to,   or other action to, with or by, any Governmental Authority except for any filings, recordings or   consents which heretofore have been obtained or made, as applicable.     Section 5.6. Binding Obligation.  Each Financing Agreement has been duly executed   and delivered by each Obligor that is a party thereto and is the legally valid and binding   obligation of such Obligor, enforceable against such Obligor in accordance with its respective   terms, except as may be limited by Debtor Relief Laws or by equitable principles relating to   enforceability.    Section 5.7. Financial Statements.     (a) The audited consolidated and consolidating balance sheet of the Parent Guarantor   and its Subsidiaries for December  31, 2014, and the related consolidated and   consolidating statements of income or operations, shareholders’ equity and cash   flows for such fiscal year, including the notes thereto (i) were prepared in   accordance with GAAP consistently applied throughout the period covered   thereby, except as otherwise expressly noted therein; and (ii) fairly present in all   material respects the financial condition of the Consolidated Parties as of the date   thereof and their results of operations for the period covered thereby in   accordance with GAAP consistently applied throughout the period covered   thereby, except as otherwise expressly noted therein.      

 

-7-      (b) The unaudited consolidated balance sheet of the Parent Guarantor and its   Subsidiaries for September 30, 2015, and the related consolidated statements of   income or operations, shareholders’ equity and cash flows for such Fiscal Quarter   (i) were prepared in accordance with GAAP consistently applied throughout the   period covered thereby, except as otherwise expressly noted therein, (ii) fairly   present the financial condition of the Consolidated Parties as of the date thereof   and their results of operations for the period covered thereby, subject, in the case   of clauses (i) and (ii), to the absence of footnotes and to normal year end audit   adjustments, and (iii) show all material indebtedness and other liabilities, direct or   contingent, of the Consolidated Parties as of the date of such financial statements,   including liabilities for taxes, material commitments and Indebtedness.   (c) The consolidated and consolidating pro forma balance sheet of the Issuer and its   Subsidiaries as the date of the formation of the Parent Guarantor, and the related   consolidated and consolidating pro forma statements of income and cash flows of   the Issuer and its Subsidiaries for the period covered thereby, with a Financial   Officer Certification, copies of which have been furnished to each Purchaser,   fairly present the consolidated and consolidating pro forma financial condition of   the Issuer and its Subsidiaries as at such date and the consolidated and   consolidating pro forma results of operations of the Issuer and its Subsidiaries for   such period, all in accordance with GAAP.   (d) The annual operating budget consisting of statements of income or operations and   cash flows and other information for each of the Unencumbered Pool Properties   (or any Real Estate Assets or other properties proposed to be included as   Unencumbered Pool Properties) supporting pro forma covenant compliance   calculations hereunder and delivered prior to the Closing Date or otherwise   pursuant to Section 9.1(d) were prepared in good faith on the basis of the   assumptions stated therein, which assumptions were fair in light of the conditions   existing at the time of delivery of such statements or other information, and   represented, at the time of delivery, the Issuer’s reasonable estimate of the future   income, operations or cash flows for such Unencumbered Pool Properties (or   other Real Estate Assets or other properties).    Section 5.8. No Material Adverse Effect; No Default.     (a) No Material Adverse Effect.  Since December 31, 2014, no event, circumstance or   change has occurred that has caused or evidences, either in any case or in the   aggregate, a Material Adverse Effect.    (b) No Default.  No Default has occurred and is continuing.    Section 5.9. Tax Matters.  Each Obligor and its Subsidiaries have filed all federal, state   and other material tax returns and reports required to be filed, and have paid all federal, state and   other material taxes, assessments, fees and other governmental charges levied or imposed upon   them or their respective properties, assets, income, businesses and franchises otherwise due and     

 

-8-      payable, except those being actively contested in good faith and by appropriate proceedings and   for which adequate reserves have been provided in accordance with GAAP.  There is no   proposed tax assessment against either Obligor or any of their Subsidiaries that would, if made,   have a Material Adverse Effect.    Section 5.10. Properties.     (a) Title.  Each of the Obligors and its Subsidiaries has (i) good, insurable and fee   simple title to (in the case of fee interests in real property), (ii) valid leasehold   interests in (in the case of leasehold interests in real or personal property), and   (iii) good title to (in the case of all other personal property), all of their respective   properties and assets (including without limitation each of the Unencumbered   Pool Properties) reflected in their financial statements and other information   referred to in Section 5.7 and in the most recent financial statements delivered   pursuant to Section 9.1, in each case except for assets disposed of since the date   of such financial statements as permitted under Section 10.10.  All such properties   and assets are free and clear of Liens other than Permitted Liens.    (b) Real Estate Assets.  As of the Closing Date, Schedule 5.10(b) contains a true,   accurate and complete list of all Real Estate Assets of the Obligors and the   Unencumbered Property Owners.   (c) Intellectual Property.  Each of the Obligors and its Subsidiaries owns or is validly   licensed to use all Intellectual Property that is necessary for the present conduct of   its business, free and clear of Liens (other than Permitted Liens), without conflict   with the rights of any other Person unless the failure to own or benefit from such   valid license could not, individually or in the aggregate, reasonably be expected to   have a Material Adverse Effect.  To the knowledge of each Obligor, no Obligor   nor any of its Subsidiaries is infringing, misappropriating, diluting, or otherwise   violating the Intellectual Property rights of any other Person unless such   infringement, misappropriation, dilution or violation could not, individually or in   the aggregate, reasonably be expected to have a Material Adverse Effect.     Section 5.11.  Environmental Matters.  No Obligor nor any of its Subsidiaries nor any   of their respective current Facilities (solely during and with respect to such Person’s ownership   thereof) or operations, and to their knowledge, no former Facilities (solely during and with   respect to an Obligor’s or its Subsidiary’s ownership thereof), is or are subject to any outstanding   order, ongoing consent decree or settlement agreement with any Person relating to any   Environmental Law, any Environmental Claim, or any Hazardous Materials Activity that,   individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect;   (b) no Obligor nor any of its Subsidiaries has received any letter or request for information under   Section 104 of the Comprehensive Environmental Response, Compensation, and Liability Act   (42 U.S.C. § 9604) or any comparable state law; (c) to each Obligor’s and its Subsidiaries’   knowledge after due inquiry, there are no, and have been no, Hazardous Materials Activities   which could reasonably be expected to form the basis of an Environmental Claim against such   Obligor or any of its Subsidiaries that, individually or in the aggregate, could reasonably be     

 

-9-      expected to have a Material Adverse Effect; (d) no Obligor nor any of their Subsidiaries has filed   any notice under any Environmental Law indicating past or present treatment of Hazardous   Materials at any Facility (solely during and with respect to such Obligor or its Subsidiary’s   ownership thereof), and neither the Obligors’ nor any of their Subsidiaries’ operations involves   the generation, transportation, treatment, storage or disposal of hazardous waste, as defined   under 40 C.F.R. Parts 260-270 or any equivalent state rule defining hazardous waste.    Compliance by the Obligors and their respective Subsidiaries with all current requirements   pursuant to or under Environmental Laws could not be reasonably expected to have, individually   or in the aggregate, a Material Adverse Effect.    Section 5.12. No Defaults.  No Obligor nor any of its Subsidiaries is in default in the   performance, observance or fulfillment of any of the obligations, covenants or conditions   contained in any of its Contractual Obligations, except in each case where the consequences,   direct or indirect, of such default or defaults, if any, could not reasonably be expected to have a   Material Adverse Effect.     Section 5.13. No Litigation or other Adverse Proceedings.  There are no Adverse   Proceedings that (a) purport to affect or pertain to this Agreement or any other Financing   Agreement, or any of the transactions contemplated hereby or thereby or (b) could reasonably be   expected to have a Material Adverse Effect.  Neither Obligor nor any of its Subsidiaries is   subject to or in default with respect to any final judgments, writs, injunctions, decrees, rules or   regulations of any Governmental Authority that, individually or in the aggregate, could   reasonably be expected to have a Material Adverse Effect.    Section 5.14. Compliance with ERISA.     (a) Each Obligor and each ERISA Affiliate has operated and administered each Plan   in compliance with all Applicable Laws except for such instances of   noncompliance as have not resulted in and could not, individually or in the   aggregate, reasonably be expected to result in a Material Adverse Effect.  Neither   Obligor nor any ERISA Affiliate has incurred any liability pursuant to Title I or   IV of ERISA or the penalty or excise tax provisions of the Code relating to   employee benefit plans (as defined in section 3 of ERISA), and no event,   transaction or condition has occurred or exists that could, individually or in the   aggregate, reasonably be expected to result in the incurrence of any such liability   by an Obligor or any ERISA Affiliate, or in the imposition of any Lien on any of   the rights, properties or assets of an Obligor or any ERISA Affiliate, in either case   pursuant to Title I or IV of ERISA or to section 430(k) of the Code or to any such   penalty or excise tax provisions under the Code or federal law or section 4068 of   ERISA or by the granting of a security interest in connection with the amendment   of a Plan, other than such liabilities or Liens as would not be individually or in the   aggregate Material.   (b) The present value of the aggregate benefit liabilities under each of the Plans   (other than Multiemployer Plans), determined as of the end of such Plan’s most   recently ended plan year on the basis of the actuarial assumptions specified for     

 

-10-      funding purposes in such Plan’s most recent actuarial valuation report, did not   exceed the aggregate current value of the assets of such Plan allocable to such   benefit liabilities by an amount that, individually or in the aggregate, for all Plans,   is Material.  The term “benefit liabilities” has the meaning specified in   section 4001 of ERISA and the terms “current value” and “present value” have   the meaning specified in section 3 of ERISA.   (c) Neither Obligor nor any ERISA Affiliate has incurred withdrawal liabilities (or is   subject to contingent withdrawal liabilities) under section 4201 or 4204 of ERISA   in respect of Multiemployer Plans that individually or in the aggregate are   Material.   (d) The expected postretirement benefit obligation (determined as of the last day of   the most recently ended Fiscal Year in accordance with Financial Accounting   Standards Board Accounting Standards Codification Topic 715-60, without   regard to liabilities attributable to continuation coverage mandated by section   4980B of the Code) of the Obligors and their Subsidiaries is not Material.   (e) The execution and delivery of this Agreement and the issuance and sale of the   Notes hereunder will not involve any transaction that is subject to the prohibitions   of section 406 of ERISA or in connection with which a tax could be imposed   pursuant to section 4975(c)(1)(A)-(D) of the Code.  The representation by the   Obligors to each Purchaser in the first sentence of this Section 5.14(e) is made in   reliance upon and subject to the accuracy of such Purchaser’s representation in   Section 6.2 as to the sources of the funds to be used to pay the purchase price of   the Notes to be purchased by such Purchaser.    Section 5.15.  Private Offering by the Obligors.  Neither Obligor nor anyone acting on   its behalf has offered the Notes, the Parent Guarantee, or any similar Securities for sale to, or   solicited any offer to buy any of the same from, or otherwise approached or negotiated in respect   thereof with, any Person other than the Purchasers, each of which has been offered the Notes at a   private sale for investment.  Neither Obligor nor anyone acting on its behalf has taken, or will   take, any action that would subject the issuance or sale of the Notes to the registration   requirements of Section 5 of the Securities Act or to the registration requirements of any   Securities or blue sky laws of any applicable jurisdiction.    Section 5.16.  Use of Proceeds; Margin Regulations.  On the Closing Date, the proceeds   of the sale of the Notes will be deposited in the Escrow Account in accordance with the terms of   this Agreement and the other Financing Agreements.  If such proceeds are released to the   Obligors in accordance with the terms of this Agreement and the other Financing Agreements,   the proceeds of the sale of the Notes will be used for (a) retiring or repaying outstanding debt, (b)   working capital, capital expenditures, payment of dividends and redemptions, and other lawful   corporate purposes (including, but not limited to, the Acquisition of Healthcare Facilities), and   (c) to pay transaction fees, costs and expenses related to the transactions being consummated   pursuant to this Agreement and the other Financing Agreements.  Neither Obligor nor any of its   Subsidiaries is engaged principally, or as one of its important activities, in the business of     

 

-11-      extending credit for the purpose of purchasing or carrying any Margin Stock.  No part of the   proceeds of the Notes will be used to purchase or carry any such Margin Stock or to extend   credit to others for the purpose of purchasing or carrying any such Margin Stock or for any   purpose that violates, or is inconsistent with, the provisions of Regulation T, U or X of the FRB   as in effect from time to time.  Margin Stock does not constitute more than 25% of the value of   the consolidated assets of the Obligors and their subsidiaries.    Section 5.17. Existing Indebtedness; Future Liens.     (a) Except as described therein, Schedule 5.17 sets forth a complete and correct list of   all outstanding Indebtedness of the Parent Guarantor and its Subsidiaries as of   September 30, 2015 (including descriptions of the obligors and obligees, principal   amounts outstanding, any collateral therefor and any Guaranties thereof), since   which date there has been no Material change in the amounts, interest rates,   sinking funds, installment payments or maturities of the Indebtedness of the   Parent Guarantor or its Subsidiaries.  Neither Obligor nor any of its Subsidiaries is   in default and no waiver of default is currently in effect, in the payment of any   principal or interest on any Indebtedness of either Obligor or such Subsidiary and   no event or condition exists with respect to any Indebtedness of either Obligor or   any Subsidiary that would permit (or that with notice or the lapse of time, or both,   would permit) one or more Persons to cause such Indebtedness to become due and   payable before its stated maturity or before its regularly scheduled dates of   payment.   (b) Except as disclosed in Schedule 5.17, neither Obligor nor any Subsidiary has   agreed or consented to cause or permit any of its property, whether now owned or   hereafter acquired, to be subject to a Lien that secures Indebtedness or to cause or   permit in the future (upon the happening of a contingency or otherwise) any of its   property, whether now owned or hereafter acquired, to be subject to a Lien that   secures Indebtedness.   (c) Neither Obligor nor any Subsidiary is a party to, or otherwise subject to any   provision contained in, any instrument evidencing Indebtedness of such Obligor   or such Subsidiary, any agreement relating thereto or any other agreement   (including, but not limited to, its charter or other Organizational Document)   which limits the amount of, or otherwise imposes restrictions on the incurring of,   Indebtedness of such Obligor, except as specifically indicated in Schedule 5.17.   (d) No Subsidiary of either Obligor is currently a guarantor with respect to any   Indebtedness under the Existing Credit Facility, and neither Obligor nor any   Subsidiary of either Obligor has granted any Lien on any of its Property in favor   of the administrative agent or lenders securing any Indebtedness under the   Existing Credit Facility.    Section 5.18. Foreign Assets Control Regulations, Etc.       

 

-12-      (a)   Neither Obligor nor any Controlled Entity is (i) a Person whose name appears on   the list of Specially Designated Nationals and Blocked Persons published by the   Office of Foreign Assets Control, United States Department of the Treasury   (“OFAC”) (an “OFAC Listed Person”) (ii) an agent, department, or   instrumentality of, or is otherwise beneficially owned by, controlled by or acting   on behalf of, directly or indirectly, (x) any OFAC Listed Person or (y) any Person,   entity, organization, foreign country or regime that is subject to any OFAC   Sanctions Program, or (iii) otherwise blocked, subject to sanctions under or   engaged in any activity in violation of other United States economic sanctions,   including but not limited to, the Trading with the Enemy Act, the International   Emergency Economic Powers Act, the Comprehensive Iran Sanctions,   Accountability and Divestment Act (“CISADA”) or any similar law or regulation   with respect to Iran or any other country, the Sudan Accountability and   Divestment Act, any OFAC Sanctions Program, or any economic sanctions   regulations administered and enforced by the United States or any enabling   legislation or executive order relating to any of the foregoing (collectively, “U.S.   Economic Sanctions”) (each OFAC Listed Person and each other Person, entity,   organization and government of a country described in clause (i), clause (ii) or   clause (iii), a “Blocked Person”).  Neither Obligor nor any Controlled Entity has   been notified that its name appears or may in the future appear on a state list of   Persons that engage in investment or other commercial activities in Iran or any   other country that is subject to U.S. Economic Sanctions.   (b)  No part of the proceeds from the sale of the Notes hereunder constitutes or will   constitute funds obtained on behalf of any Blocked Person or will otherwise be   used by either Obligor or any Controlled Entity, directly or indirectly, (i) in   connection with any investment in, or any transactions or dealings with, any   Blocked Person or (ii) otherwise in violation of U.S. Economic Sanctions.   (c)  Neither Obligor nor any Controlled Entity (i) has been found in violation of,   charged with, or convicted of, money laundering, drug trafficking, terrorist-   related activities or other money laundering predicate crimes under the Currency   and Foreign Transactions Reporting Act of 1970 (otherwise known as the Bank   Secrecy Act), the USA PATRIOT Act or any other United States law or   regulation governing such activities (collectively, “Anti-Money Laundering   Laws”) or any U.S. Economic Sanctions violations, (ii) to the actual knowledge   of the Obligors after making due inquiry, is under investigation by any   Governmental Authority for possible violation of Anti-Money Laundering Laws   or any U.S. Economic Sanctions violations, (iii) has been assessed civil penalties   under any Anti-Money Laundering Laws or any U.S. Economic Sanctions, or (iv)   has had any of its funds seized or forfeited in an action under any Anti-Money   Laundering Laws. The Obligors have established procedures and controls which   they reasonably believes are adequate (and otherwise comply with Applicable   Law) to ensure that each Obligor and each Controlled Entity is and will continue   to be in compliance with all applicable current and future Anti-Money Laundering   Laws and U.S. Economic Sanctions.     

 

-13-      (d)  (1) Neither Obligor nor any Controlled Entity (i) has been charged with, or   convicted of bribery or any other anti-corruption related activity under any   applicable law or regulation in a U.S. or any non-U.S. country or jurisdiction,   including but not limited to, the U.S. Foreign Corrupt Practices Act and the U.K.   Bribery Act 2010 (collectively, “Anti-Corruption Laws”), (ii) to the actual   knowledge of the Obligors after making due inquiry, is under investigation by any   U.S. or non-U.S. Governmental Authority for possible violation of Anti-   Corruption Laws, (iii) has been assessed civil or criminal penalties under any   Anti-Corruption Laws or (iv) has been or is the target of sanctions imposed by the   United Nations or the European Union;   (2) To the actual knowledge of the Obligors after making due inquiry, neither of   the Obligors nor any Controlled Entity has, within the last five years, directly or   indirectly offered, promised, given, paid or authorized the offer, promise, giving   or payment of anything of value to a Governmental Official or a commercial   counterparty for the purposes of: (i) influencing any act, decision or failure to act   by such Government Official in his or her official capacity or such commercial   counterparty, (ii) inducing a Governmental Official to do or omit to do any act in   violation of the Governmental Official’s lawful duty, or (iii) inducing a   Governmental Official or a commercial counterparty to use his or her influence   with a government or instrumentality to affect any act or decision of such   government or entity; in each case in order to obtain, retain or direct business or   to otherwise secure an improper advantage in violation of any Applicable Law or   regulation or which would cause any holder to be in violation of any law or   regulation applicable to such holder; and   (3) No part of the proceeds from the sale of the Notes hereunder will be used,   directly or indirectly, for any improper payments, including bribes, to any   Governmental Official or commercial counterparty in order to obtain, retain or   direct business or obtain any improper advantage.  The Obligors have established   procedures and controls which they reasonably believe are adequate (and   otherwise comply with Applicable Law) to ensure that each Obligor and each   Controlled Entity is and will continue to be in compliance with all applicable   current and future Anti-Corruption Laws.    Section 5.19. Status under Certain Statutes.  Neither Obligor nor any Subsidiary is   subject to regulation under the Investment Company Act of 1940, as amended, the Public Utility   Holding Company Act of 2005, as amended, the ICC Termination Act of 1995, as amended, or   the Federal Power Act, as amended.    Section 5.20. Employee Matters.  Neither Obligor nor any Subsidiary is engaged in any   unfair labor practice that could reasonably be expected to have a Material Adverse Effect.  There   is (a) no unfair labor practice complaint pending against either Obligor or any Subsidiary, or to   the best knowledge of each Obligor, threatened against any of them before the National Labor   Relations Board and no grievance or arbitration proceeding arising out of or under any collective   bargaining agreement that is so pending against either Obligor or any of its Subsidiaries or to the     

 

-14-      best knowledge of each Obligor, threatened against any of them, (b) no strike or work stoppage   in existence or to the knowledge of each Obligor, threatened that involves either Obligor or any   Subsidiary, and (c) to the best knowledge of each Obligor, no union representation question   existing with respect to the employees of either Obligor or any Subsidiary and, to the best   knowledge of each Obligor, no union organization activity that is taking place, except (with   respect to any matter specified in clause (a), (b) or (c) above, either individually or in the   aggregate) such as could not reasonably be expected to have a Material Adverse Effect.    Section 5.21. Solvency. The Obligors, individually and taken as a whole, are Solvent.    Section 5.22. Disclosure Documents. This Agreement, the other Financing Agreements,   the financial statements referred to in Section 5.7 and the documents, certificates or other   writings delivered to the Purchasers by or on behalf of the Obligors prior to October 21, 2015 in   connection with the transactions contemplated hereby (other than projections and pro forma   financial information contained in such materials) and identified in Schedule 5.22 (this   Agreement, the other Financing Agreements and such documents, certificates or other writings   and such financial statements delivered to each Purchaser being referred to, collectively, as the   “Disclosure Documents”), taken as a whole, do not contain any untrue statement of a material   fact or omit to state a material fact (known to an Obligor, in the case of any document not   furnished by any of them) necessary in order to make the statements contained herein or therein   not misleading in any material manner in light of the circumstances in which the same were   made. Any projections and pro forma financial information contained in such Disclosure   Documents are based upon good faith estimates and assumptions believed by the Obligors to be   reasonable at the time made, it being recognized by the Purchasers that such projections as to   future events are not to be viewed as facts and that actual results during the period or periods   covered by any such projections may differ from the projected results and that such differences   may be Material.  There are no facts known to either Obligor (other than matters of a general   economic nature) that, individually or in the aggregate, could reasonably be expected to result in   a Material Adverse Effect and that have not been set forth herein or in the Disclosure   Documents.    Section 5.23. Insurance; No Casualty or Condemnation. The properties of the Obligors   and their Subsidiaries are insured with financially sound and reputable insurance companies that   are not Affiliates of such Persons, in such amounts, with such deductibles and covering such   risks as are customarily carried by companies engaged in similar businesses and owning similar   properties in localities where the applicable Obligor or the applicable Subsidiary operates.  As of   the Closing Date, to the best knowledge of the Obligors no uninsured casualty has occurred and   no condemnation or condemnation proceeding shall have been instituted with respect to any of   the Real Estate Assets owned by each Obligor and its Subsidiaries.    Section 5.24. Compliance with Laws.  Each Obligor and its Subsidiaries is in   compliance with all Applicable Laws, except such noncompliance with such other Applicable   Laws that, individually or in the aggregate, could not reasonably be expected to result in a   Material Adverse Effect.  Each Obligor and its Subsidiaries possesses all certificates, authorities   or permits issued by appropriate Governmental Authorities necessary to conduct the business   now operated by them and the failure of which to have could reasonably be expected to have a     

 

-15-      Material Adverse Effect and have not received any notice of proceedings relating to the   revocation or modification of any such certificate, authority or permit the failure of which to   have or retain could reasonably be expected to have a Material Adverse Effect.    Section 5.25. Healthcare Facility Representations and Warranties.    (a) Compliance With Healthcare Laws.  Without limiting the generality of   Sections 5.18 and 5.24 hereof or any other representation or warranty made   herein, neither Obligor and, to the knowledge of the Obligors, no Tenant, is in   material violation of any applicable statutes, laws, ordinances, rules and   regulations of any Governmental Authority with respect to regulatory matters   primarily relating to patient healthcare (including without limitation Section   1128B of the Social Security Act, as amended, 42 U.S.C. Section 1320a 7b   (Criminal Penalties Involving Medicare or State Health Care Programs),   commonly referred to as the “Federal Anti-Kickback Statute,” and Section 1877   of the Social Security Act, as amended, 42 U.S.C. Section 1395nn (Prohibition   Against Certain Referrals), commonly referred to as “Stark Statute” (collectively,   “Healthcare Laws”) where such violation would result in a Material Adverse   Effect.  Each Obligor and, to the knowledge of the Obligors, each of the Tenants,   have maintained in all material respects all records required to be maintained by   the Food and Drug Administration, Drug Enforcement Agency and State Boards   of Pharmacy and the federal and state Medicare and Medicaid programs as   required by the Healthcare Laws and, to the knowledge of the Obligors, there are   no notices of material violations of the Healthcare Laws with respect to an   Obligor, any Tenant or any of the Real Estate Assets owned by an Obligor.   (b) Licenses, Permits, and Certifications.     i. To the knowledge of each Obligor and each Unencumbered Property   Owner, each Tenant has such permits, licenses, franchises, certificates and   other approvals or authorizations of Governmental Authorities as are   necessary under applicable law or regulations to own its properties and to   conduct its business and to receive reimbursement under Medicare and   Medicaid (including without limitation such permits as are required under   such federal, state and other health care laws, and under such HMO or   similar licensure laws and such insurance laws and regulations, as are   applicable thereto), if the failure to obtain such permits, licenses, franchises,   certificates and other approvals or authorizations could reasonably be   expected to result in a Material Adverse Effect.  Notwithstanding the   foregoing, no Obligor or Unencumbered Property Owner is the owner of   any licenses or permits required for the provision of Medical Services at any   of the Real Estate Assets owned by an Obligor or Unencumbered Property   Owner.   ii. To the knowledge of each Obligor and the Unencumbered Property Owners,   each Tenant has all Medicare, Medicaid and related agency supplier billing     

 

-16-      number(s) and related documentation necessary to receive reimbursement   from Medicare and/or Medicaid for any Medical Service furnished by such   Person in any jurisdiction where it conducts business if the failure to obtain   billing number(s) or related documentation could reasonably be expected to   result in a Material Adverse Effect.  To the knowledge of each Obligor and   the Unencumbered Property Owners, no Tenant is currently subject to   suspension, revocation, renewal or denial of its Medicare and/or Medicaid   certification, supplier billing number(s), or Medicare and/or Medicaid   participation agreement(s).   (c) HIPAA Compliance.  No Obligor or Unencumbered Property Owner is a   “covered entity” within the meaning of HIPAA.  In addition, to the knowledge of   each Obligor, no Obligor or Unencumbered Property Owner is the subject of any   civil or criminal penalty, process, claim, action or proceeding, or any   administrative or other regulatory review, survey, process or proceeding (other   than routine surveys or reviews conducted by any government health plan or other   accreditation entity) that could reasonably be expected to cause a Material   Adverse Effect.   (d) Medical Services.  No Obligor or Unencumbered Property Owner is in the   business of providing Medical Services.    Section 5.26. REIT Status. The Parent Guarantor is qualified as a REIT.  The Issuer is a   partnership or other disregarded entity for federal income tax purposes under the Code.    Section 5.27. Unencumbered Pool Properties. Schedule 5.27 is, in all material respects,   a true and complete list of (i) the street address of each Unencumbered Pool Property, (ii) the   Unencumbered Property Owner which owns or leases, pursuant to an Eligible Ground Lease,   each such Unencumbered Pool Property, (iii) the facility type of each such Unencumbered Pool   Property, (iv) the name and address of the Approved Manager with respect to such   Unencumbered Pool Property (if such Unencumbered Pool Property is managed by a third-party   property manager), and (iv) the Tenant Leases to which each such Unencumbered Pool Property   is subject, together with the name of the applicable Tenants thereunder.  Each parcel of real   property identified on Schedule 5.27 is a Real Estate Asset that qualifies as an Unencumbered   Pool Property pursuant to the terms hereof.  To the extent any such Unencumbered Pool Property   is leased by an Unencumbered Property Owner pursuant to an Eligible Ground Lease, (i) such   Eligible Ground Lease is in full force and effect and remains unmodified except to the extent   expressly permitted by Section 9.12; (ii) except as expressly permitted by Section 9.12, no rights   in favor of the applicable Unencumbered Property Owner lessee have been waived, canceled or   surrendered; (iii) except as expressly permitted by Section 9.12, no election or option under such   Eligible Ground Lease has been exercised by the Unencumbered Property Owner ground lessee   (other than options to renew or extend the term thereof); (iv) all rental and other charges due and   payable thereunder have been paid in full (except to the extent such payment is not yet overdue   subject to applicable cure or grace periods); (v) no Unencumbered Property Owner is in default   under such Eligible Ground Lease (beyond any applicable cure or grace periods) which would   permit the applicable ground lessor to terminate or exercise any other remedy with respect to the     

 

-17-      applicable Eligible Ground Lease, nor has any Unencumbered Property Owner received any   notice of default with respect to such Eligible Ground Lease that has not been delivered to   holders of the Notes pursuant to Section 9.12; (vi) to the knowledge of the Unencumbered   Property Owners, the ground lessor under such Eligible Ground Lease is not in default with   respect to its material obligations thereunder; (vii) a true and correct copy of such Eligible   Ground Lease (together with any amendments, modifications, restatements or supplements   thereof) has been delivered to the holders of the Notes and (viii) there exist no adverse claims as   to the applicable Unencumbered Property Owner’s title or right to possession of the leasehold   premises referenced in such Eligible Ground Lease.    Section 5.28. Notes Rank Pari Passu.  The payment obligations of each Obligor under   this Agreement (including the Parent Guarantor) rank and, upon issuance, the Notes (in the case   of the Issuer) will rank, at least pari passu in right of payment with all other unsecured and   unsubordinated Indebtedness (actual or contingent) of such Obligor, including, without   limitation, all unsecured Indebtedness of the Obligors described on Schedule 5.17 hereto, which   is not therein designated as subordinated Indebtedness.   SECTION 6. REPRESENTATIONS OF THE PURCHASERS.    Section 6.1. Purchase for Investment.  Each Purchaser severally represents that it is   purchasing the Notes for its own account or for one or more separate accounts maintained by   such Purchaser or for the account of one or more pension or trust funds and not with a view to   the distribution thereof, provided that the disposition of such Purchaser’s or their property shall   at all times be within such Purchaser’s or their control.  Each Purchaser understands that the   Notes have not been registered under the Securities Act and may be resold only if registered   pursuant to the provisions of the Securities Act or if an exemption from registration is available,   except under circumstances where neither such registration nor such an exemption is required by   law, and that the Issuer is not required to register the Notes.    Section 6.2. Source of Funds.  Each Purchaser severally represents that at least one of   the following statements is an accurate representation as to each source of funds (a “Source”) to   be used by such Purchaser to pay the purchase price of the Notes to be purchased by such   Purchaser hereunder:   (a) the Source is an “insurance company general account” (as the term is defined in   the United States Department of Labor’s Prohibited Transaction Exemption   (“PTE”) 95-60) in respect of which the reserves and liabilities (as defined by the   annual statement for life insurance companies approved by the NAIC (the “NAIC   Annual Statement”)) for the general account contract(s) held by or on behalf of   any employee benefit plan together with the amount of the reserves and liabilities   for the general account contract(s) held by or on behalf of any other employee   benefit plans maintained by the same employer (or affiliate thereof as defined in   PTE 95-60) or by the same employee organization in the general account do not   exceed 10% of the total reserves and liabilities of the general account (exclusive   of separate account liabilities) plus surplus as set forth in the NAIC Annual   Statement filed with such Purchaser’s state of domicile; or     

 

-18-      (b) the Source is a separate account that is maintained solely in connection with such   Purchaser’s fixed contractual obligations under which the amounts payable, or   credited, to any employee benefit plan (or its related trust) that has any interest in   such separate account (or to any participant or beneficiary of such plan (including   any annuitant)) are not affected in any manner by the investment performance of   the separate account; or   (c) the Source is either (i) an insurance company pooled separate account, within the   meaning of PTE 90-1 or (ii) a bank collective investment fund, within the   meaning of the PTE 91-38 and, except as disclosed by such Purchaser to the   Issuer in writing pursuant to this clause (c), no employee benefit plan or group of   plans maintained by the same employer or employee organization beneficially   owns more than 10% of all assets allocated to such pooled separate account or   collective investment fund; or   (d) the Source constitutes assets of an “investment fund” (within the meaning of Part   VI of PTE 84-14 (the “QPAM Exemption”)) managed by a “qualified   professional asset manager” or “QPAM” (within the meaning of Part VI of the   QPAM Exemption), no employee benefit plan’s assets that are managed by the   QPAM in such investment fund, when combined with the assets of all other   employee benefit plans established or maintained by the same employer or by an   affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such   employer or by the same employee organization and managed by such QPAM,   represent more than 20% of the total client assets managed by such QPAM, the   conditions of Part I(c) and (g) of the QPAM Exemption are satisfied, neither the   QPAM nor a person controlling or controlled by the QPAM maintains an   ownership interest in the Issuer that would cause the QPAM and the Issuer to be   “related” within the meaning of Part VI(h) of the QPAM Exemption and (i) the   identity of such QPAM and (ii) the names of any employee benefit plans whose   assets in the investment fund, when combined with the assets of all other   employee benefit plans established or maintained by the same employer or by an   affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such   employer or by the same employee organization, represent 10% or more of the   assets of such investment fund, have been disclosed to the Issuer in writing   pursuant to this clause (d);or   (e) the Source constitutes assets of a “plan(s)” (within the meaning of Part IV(h) of   PTE 96-23 (the “INHAM Exemption”)) managed by an “in-house asset   manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM   Exemption), the conditions of Part I(a), (g) and (h) of the INHAM Exemption are   satisfied, neither the INHAM nor a person controlling or controlled by the   INHAM (applying the definition of “control” in Part IV(d)(3) of the INHAM   Exemption) owns a 10% or more interest in the Issuer and (i) the identity of such   INHAM and (ii) the name(s) of the employee benefit plan(s) whose assets   constitute the Source have been disclosed to the Issuer in writing pursuant to this   clause (e); or     

 

-19-      (f) the Source is a governmental plan; or   (g) the Source is one or more employee benefit plans, or a separate account or trust   fund comprised of one or more employee benefit plans, each of which has been   identified to the Issuer in writing pursuant to this clause (g); or   (h) the Source does not include assets of any employee benefit plan, other than a plan   exempt from the coverage of ERISA.   As used in this Section 6.2, the terms “employee benefit plan,” “governmental plan,” and   “separate account” shall have the respective meanings assigned to such terms in section 3 of   ERISA.   SECTION 7. [RESERVED].   SECTION 8. PAYMENT AND PREPAYMENT OF THE NOTES.    Section 8.1. Maturity.  As provided therein, the entire unpaid principal balance of the   Series A Notes, the Series B Notes, the Series C Notes and the Series D Notes shall be due and   payable on the respective stated maturity dates thereof. No regularly scheduled prepayments are   due on the Notes of any series prior to their stated maturity.     Section 8.2. Optional Prepayments with Make-Whole Amount.  Except as otherwise   provided in Section 8.8, the Issuer may, at its option, upon notice as provided below, prepay at   any time all, or from time to time any part of, the Notes in an amount not less than $10,000,000   in the aggregate in the case of a partial prepayment, at 100% of the principal amount so prepaid,   and the Make-Whole Amount determined for the prepayment date with respect to such principal   amount.  The Issuer will give each holder of Notes written notice of each optional prepayment   under this Section 8.2 not less than thirty (30) days and not more than sixty (60) days prior to the   date fixed for such prepayment.  Each such notice shall specify such date (which shall be a   Business Day), the aggregate principal amount of the Notes to be prepaid on such date, the   principal amount of each Note held by such holder to be prepaid (determined in accordance with   Section 8.3), and the interest to be paid on the prepayment date with respect to such principal   amount being prepaid, and shall be accompanied by an Officer’s Certificate as to the estimated   Make-Whole Amount due in connection with such prepayment (calculated as if the date of such   notice were the date of the prepayment), setting forth the details of such computation.  Two (2)   Business Days prior to such prepayment, the Issuer shall deliver to each holder of Notes an   Officer’s Certificate specifying the calculation of such Make-Whole Amount as of the specified   prepayment date.    Section 8.3. Allocation of Partial Prepayments.  In the case of each partial prepayment   of Notes pursuant to Section 8.2, the principal amount of the Notes to be prepaid shall be   allocated among all of the Notes (without regard to series) at the time outstanding in proportion,   as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called   for prepayment.     

 

-20-       Section 8.4. Maturity; Surrender, Etc.   In the case of each prepayment of Notes   pursuant to this Section 8, the principal amount of each Note to be prepaid shall mature and   become due and payable on the date fixed for such prepayment (which shall be a Business Day),   together with interest on such principal amount accrued to such date and the applicable Make-   Whole Amount, if any. From and after such date, unless the Issuer shall fail to pay such principal   amount when so due and payable, together with the interest and Make-Whole Amount, if any, as   aforesaid, interest on such principal amount shall cease to accrue. Any Note paid or prepaid in   full shall be surrendered to the Issuer and canceled and shall not be reissued, and no Note shall   be issued in lieu of any prepaid principal amount of any Note.    Section 8.5. Purchase of Notes.  The Issuer will not and will not permit any Affiliate to   purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of the outstanding   Notes except upon the payment or prepayment of the Notes in accordance with the terms of this   Agreement and the Notes. The Issuer will promptly cancel all Notes acquired by it or any   Affiliate pursuant to any payment or prepayment of Notes pursuant to any provision of this   Agreement and no Notes may be issued in substitution or exchange for any such Notes.    Section 8.6. Make-Whole Amount.   “Make-Whole Amount” means, with respect to any Note, an amount equal to the   excess, if any, of the Discounted Value of the Remaining Scheduled Payments with respect to   the Called Principal of such Note over the amount of such Called Principal, provided that the   Make-Whole Amount may in no event be less than zero.  For the purposes of determining the   Make-Whole Amount, the following terms have the following meanings:   “Called Principal” means, with respect to any Note, the principal of such Note that is to   be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and   payable pursuant to Section 12.1, as the context requires.   “Discounted Value” means, with respect to the Called Principal of any Note, the amount   obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal   from their respective scheduled due dates to the Settlement Date with respect to such Called   Principal, in accordance with accepted financial practice and at a discount factor (applied on the   same periodic basis as that on which interest on the Notes is payable) equal to the Reinvestment   Yield with respect to such Called Principal.   “Reinvestment Yield” means, with respect to the Called Principal of any Note, 0.50%   over the yield to maturity implied by the yield(s) reported as of 10:00 a.m. (New York City time)   on the second Business Day preceding the Settlement Date with respect to such Called Principal,   on the display designated as “Page PX1” (or such other display as may replace Page PX1) on   Bloomberg Financial Markets for the most recently issued actively traded on-the-run U.S.   Treasury securities (“Reported”) having a maturity equal to the Remaining Average Life of   such Called Principal as of such Settlement Date.  If there are no such U.S. Treasury securities   Reported having a maturity equal to such Remaining Average Life, then such implied yield to   maturity will be determined by (a) converting U.S. Treasury bill quotations to bond equivalent   yields in accordance with accepted financial practice and (b) interpolating linearly between the     

 

-21-      yields Reported for the applicable most recently issued actively traded on-the-run U.S. Treasury   securities with the maturities (1) closest to and greater than such Remaining Average Life and   (2) closest to and less than such Remaining Average Life.  The Reinvestment Yield shall be   rounded to the number of decimal places as appears in the interest rate of the applicable Note.     If such yields are not Reported or the yields Reported as of such time are not   ascertainable (including by way of interpolation), then “Reinvestment Yield” means, with   respect to the Called Principal of any Note, 0.50% over the yield to maturity implied by the U.S.   Treasury constant maturity yields reported, for the latest day for which such yields have been so   reported as of the second Business Day preceding the Settlement Date with respect to such   Called Principal, in Federal Reserve Statistical Release H.15 (or any comparable successor   publication) for the U.S. Treasury constant maturity having a term equal to the Remaining   Average Life of such Called Principal as of such Settlement Date.  If there is no such U.S.   Treasury constant maturity having a term equal to such Remaining Average Life, such implied   yield to maturity will be determined by interpolating linearly between (1) the U.S. Treasury   constant maturity so reported with the term closest to and greater than such Remaining Average   Life and (2) the U.S. Treasury constant maturity so reported with the term closest to and less   than such Remaining Average Life.  The Reinvestment Yield shall be rounded to the number of   decimal places as appears in the interest rate of the applicable Note.   “Remaining Average Life” means, with respect to any Called Principal, the number of   years obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by   multiplying (a) the principal component of each Remaining Scheduled Payment with respect to   such Called Principal by (b) the number of years, computed on the basis of a 360-day year   composed of twelve 30-day months and calculated to two decimal places, that will elapse   between the Settlement Date with respect to such Called Principal and the scheduled due date of   such Remaining Scheduled Payment.   “Remaining Scheduled Payments” means, with respect to the Called Principal of any   Note, all payments of such Called Principal and interest thereon that would be due after the   Settlement Date with respect to such Called Principal if no payment of such Called Principal   were made prior to its scheduled due date, provided that if such Settlement Date is not a date on   which interest payments are due to be made under the Notes, then the amount of the next   succeeding scheduled interest payment will be reduced by the amount of interest accrued to such   Settlement Date and required to be paid on such Settlement Date pursuant to Section 8.4 or   Section 12.1.   “Settlement Date” means, with respect to the Called Principal of any Note, the date on   which such Called Principal is to be prepaid pursuant to Section 8.2 or has become or is declared   to be immediately due and payable pursuant to Section 12.1, as the context requires.    Section 8.7. Prepayment in Connection with a Noteholder Sanctions Event.   (a) Upon the Issuer’s receipt of notice from any Affected Noteholder that a   Noteholder Sanctions Event has occurred (which notice shall refer specifically to   this Section 8.7(a) and describe in reasonable detail such Noteholder Sanctions     

 

-22-      Event), the Issuer shall promptly, and in any event within ten (10) Business Days,   make an offer (the “Sanctions Prepayment Offer”) to prepay the entire unpaid   principal amount of Notes held by such Affected Noteholder (the “Affected   Notes”), together with interest thereon to the prepayment date selected by the   Issuer with respect to each Affected Note but without payment of any Make-   Whole Amount with respect thereto, which prepayment shall be on a Business   Day not less than thirty (30) days and not more than sixty (60) days after the date   of the Sanctions Prepayment Offer (the “Sanctions Prepayment Date”).  Such   Sanctions Prepayment Offer shall provide that such Affected Noteholder notify   the Issuer in writing by a stated date (the “Sanctions Prepayment Response   Date”), which date is not later than ten (10) Business Days prior to the stated   Sanctions Prepayment Date, of its acceptance or rejection of such prepayment   offer.  If such Affected Noteholder does not notify the Issuer as provided above,   then the holder shall be deemed to have accepted such offer.   (b) Subject to the provisions of subparagraphs (c) and (d) of this Section 8.7, the   Issuer shall prepay on the Sanctions Prepayment Date the entire unpaid principal   amount of the Affected Notes held by such Affected Noteholder who has accepted   (or has been deemed to have accepted) such prepayment offer (in accordance with   subparagraph (a)), together with interest thereon to the Sanctions Prepayment   Date with respect to each such Affected Note, but without payment of any Make-   Whole Amount with respect thereto.   (c) If a Noteholder Sanctions Event has occurred but the Issuer and/or its Controlled   Entities have taken such action(s) in relation to their activities so as to remedy   such Noteholder Sanctions Event (with the effect that a Noteholder Sanctions   Event no longer exists, as reasonably determined by such Affected Noteholder)   prior to the Sanctions Prepayment Date, then the Issuer shall no longer be obliged   or permitted to prepay such Affected Notes in relation to such Noteholder   Sanctions Event.  If the Issuer and/or its Controlled Entities shall undertake any   actions to remedy any such Noteholder Sanctions Event, the Issuer shall keep the   holders reasonably and timely informed of such actions and the results thereof.   (d) If any Affected Noteholder that has given written notice to the Issuer of its   acceptance of (or has been deemed to have accepted) the Issuer’s prepayment   offer in accordance with subparagraph (a) also gives notice to the Issuer prior to   the relevant Sanctions Prepayment Date that it has determined (in its sole   discretion) that it requires clearance from any Governmental Authority in order to   receive a prepayment pursuant to this Section 8.7, the principal amount of each   Note held by such Affected Noteholder, together with interest accrued thereon to   the date of prepayment, shall become due and payable on the later to occur of (but   in no event later than the Maturity Date of the relevant Note) (i) such Sanctions   Prepayment Date and (ii) the date that is ten (10) Business Days after such   Affected Noteholder gives notice to the Issuer that it is entitled to receive a   prepayment pursuant to this Section 8.7 (which may include payment to an   escrow account designated by such Affected Noteholder to be held in escrow for     

 

-23-      the benefit of such Affected Noteholder until such Affected Noteholder obtains   such clearance from such Governmental Authority), and in any event, any such   delay in accordance with the foregoing clause (ii) shall not be deemed to give rise   to any Default or Event of Default.   (e) Promptly, and in any event within five (5) Business Days, after the Issuer’s receipt   of notice from any Affected Noteholder that a Noteholder Sanctions Event shall   have occurred with respect to such Affected Noteholder, the Issuer shall forward a   copy of such notice to each other holder of Notes.   (f) The Issuer shall promptly, and in any event within ten (10) Business Days, give   written notice to the holders after the Issuer or any Controlled Entity having been   notified that (i) its name appears or may in the future appear on a State Sanctions   List or (ii) it is in violation of, or is subject to the imposition of sanctions under,   any U.S. Economic Sanctions Laws, in each case which notice shall describe the   facts and circumstances thereof and set forth the action, if any, that the Issuer or a   Controlled Entity proposes to take with respect thereto.   (g) The foregoing provisions of this Section 8.7 shall be in addition to any rights or   remedies available to any holder of Notes that may arise under this Agreement as   a result of the occurrence of a Noteholder Sanctions Event; provided, that, if the   Notes shall have been declared due and payable pursuant to Section 12.1 as a   result of the events, conditions or actions of the Issuer or its Controlled Entities   that gave rise to a Noteholder Sanctions Event, the remedies set forth in Section   12 shall control.    Section 8.8. Repayment Upon Failure to Obtain Investment Grade Rating.  If the   Obligors fail to obtain an  Investment Grade Rating on the Notes by Moody’s or before January   22, 2016, then the Issuer shall make a Rating Prepayment pursuant to Section 9.16.     Section 8.9. Payments Due on Non-Business Days.  Anything in this Agreement or the   Notes to the contrary notwithstanding, (x) subject to clause (y), any payment of interest on any   Note that is due on a date that is not a Business Day shall be made on the next succeeding   Business Day without including the additional days elapsed in the computation of the interest   payable on such next succeeding Business Day; and (y) any payment of principal of or Make-   Whole Amount on any Note (including principal due on the Maturity Date of such Note) that is   due on a date that is not a Business Day shall be made on the next succeeding Business Day and   shall include the additional days elapsed in the computation of interest payable on such next   succeeding Business Day.   SECTION 9. AFFIRMATIVE COVENANTS.   Each Obligor, jointly and severally, covenants and agrees that so long as the Notes are   outstanding, such Obligor shall perform, and shall cause each of its Subsidiaries to perform, all   covenants in this Section 9.     

 

-24-       Section 9.1. Financial Statements and Other Reports. The Issuer will deliver, or will   cause to be delivered, to each holder of a Note that is an Institutional Investor:   (a) Quarterly Financial Statements for the Parent Guarantor and its Subsidiaries.  As   soon as available and in no event later than the earlier of (i) the date that is forty-   five (45) days after the end of each Fiscal Quarter of each Fiscal Year (excluding   the fourth Fiscal Quarter), or (ii) the date that is ten (10) days after the filing of   Parent Guarantor’s Quarterly Report on Form 10-Q (“Form 10-Q”) with the SEC   for such Fiscal Quarter, the consolidated and consolidating balance sheets of the   Parent Guarantor and its Subsidiaries as at the end of such Fiscal Quarter and the   related consolidated and consolidating statements of income, stockholders’ equity   and cash flows of the Parent Guarantor and its Subsidiaries for such Fiscal   Quarter and for the period from the beginning of the then current Fiscal Year to   the end of such Fiscal Quarter, setting forth in each case in comparative form the   corresponding figures for the corresponding periods of the previous Fiscal Year,   all in reasonable detail, together with (x) a Financial Officer Certification with   respect thereto and (y) a statement of the consolidated Funds From Operations of   the Parent Guarantor and its Subsidiaries;   (b) Audited Annual Financial Statements for the Parent Guarantor and its   Subsidiaries.  As soon as available and in no event later than the earlier of (x) the   date that is ninety (90) days after the end of each Fiscal Year, or (y) the date that   is ten (10) days after the filing of Parent Guarantor’s Annual Report on Form 10-   K (the “Form 10-K”) with the SEC for such Fiscal Year, (i) the consolidated and   consolidating balance sheets of the Parent Guarantor and its Subsidiaries as at the   end of such Fiscal Year and the related consolidated and consolidating statements   of income, stockholders’ equity and cash flows of the Parent Guarantor and its   Subsidiaries for such Fiscal Year, setting forth in each case in comparative form   the corresponding figures for the previous Fiscal Year, in reasonable detail,   together with (x) a Financial Officer Certification with respect thereto and (y) a   statement of the consolidated Funds From Operations of the Parent Guarantor and   its Subsidiaries; and (ii) with respect to such consolidated financial statements a   report thereon of Ernst & Young LLP or other independent certified public   accountants of recognized national standing selected by the Parent Guarantor,   which report shall be unqualified as to going concern and scope of audit, and shall   state that such consolidated financial statements fairly present, in all material   respects, the consolidated financial position of the Parent Guarantor and its   Subsidiaries as at the dates indicated and the results of their operations and their   cash flows for the periods indicated in conformity with GAAP applied on a basis   consistent with prior years (except as otherwise disclosed in such financial   statements) and that the examination by such accountants in connection with such   consolidated financial statements has been made in accordance with generally   accepted auditing standards);   (c) Compliance Certificate; Borrowing Base Certificate; Quarterly Operating   Statements for Unencumbered Pool Properties.      

 

-25-      i. Together with each delivery of the financial statements pursuant to clauses (a)   and (b) of Section 9.1, a duly completed Compliance Certificate (including all   back-up calculations); and   ii. As soon as available, and in any event within forty-five (45) days after the end   of each Fiscal Quarter of each Fiscal Year (including the fourth Fiscal   Quarter), (A) a duly completed Borrowing Base Certificate, and (B) if   requested by the Required Holders, quarterly operating statements (detailing   current quarter and same period prior year, year to date, and trailing 12-month   profit and loss summary), occupancy information, a rent roll (including rental   rate and lease expiration detail) and other information required to calculate   Net Operating Income for each of the then-existing Unencumbered Pool   Properties;   (d) Annual Budget; Actual Capital Expenditures.  As soon as available, but in any   event on or prior to January 1st of each calendar year, (i) quarterly forecasts   prepared by management of the Parent Guarantor or the Issuer of consolidated   balance sheets and statements of income or operations and cash flows of the   Parent Guarantor and its Subsidiaries for the Fiscal Year beginning on such   January 1st, and (ii) an annual operating budget consisting of statements of   income or operations and cash flows and other information for each of the   Unencumbered Pool Properties supporting pro forma covenant compliance   calculations hereunder, for the Fiscal Year beginning on such January 1st   (including the Fiscal Year in which the stated maturity of each Note shall occur).    In addition, as soon as available, but in any event on or prior to January 31st of   each calendar year, the Issuer will deliver to the holders of the Notes statements   reflecting actual capital expenditures for each of the Unencumbered Pool   Properties, in each case for the most recent Fiscal Year then ended;   (e) Information Regarding Obligors and Subsidiary Guarantors.  Each Obligor will   furnish to the holders of the Notes prompt written notice, and in any event within   ten (10) Business Days, of any change (i) in an Obligor’s or Subsidiary   Guarantor’s legal name, (ii) in an Obligor’s or Subsidiary Guarantor’s corporate   structure or (iii) in an Obligor’s or Subsidiary Guarantor’s Federal Taxpayer   Identification Number;   (f) SEC Filings.  Promptly, and in any event within five (5) Business Days, after the   same are filed, copies of all annual, regular, periodic and special reports and   registration statements that the Parent Guarantor may file or be required to file   with the SEC under Section 13 or 15(d) of the Exchange Act, provided that any   documents required to be delivered pursuant to this Section 9.1(f) shall be deemed   to have been delivered on the date (i) on which the Parent Guarantor posts such   documents, or provides a link thereto on the Parent Guarantor’s website; or (ii) on   which such documents are posted on the Issuer’s behalf on IntraLinks, another   secure website, a secure virtual workspace or otherwise, if any, to which each   holder of the Notes has access; provided, further, that: (x) upon written request by     

 

-26-      any holder of a Note that is an Institutional Investor, the Issuer shall deliver paper   copies of such documents to such holder until a written request to cease delivering   paper copies is given by the such holder and (y) the Issuer shall notify (which   may be by facsimile or electronic mail) the holders of the Notes of the posting of   any such documents and, upon written request by any holder of a Note that is an   Institutional Investor, provide to such holder by electronic mail electronic   versions (i.e., soft copies) of such documents.  Notwithstanding anything to the   contrary, as to any information contained in materials furnished pursuant to this   Section 9.1(f), the Issuer shall not be separately required to furnish such   information under Sections 9.1(a) or (b) above or pursuant to any other   requirement of this Agreement or any other Financing Agreement;   (g) Notice of Default and Material Adverse Effect.  Promptly, and in any event within   five (5) Business Days, after any Authorized Officer of an Obligor obtaining   knowledge (i) of any condition or event (including, without limitation, any   Adverse Proceeding) that constitutes a Default or an Event of Default or that   notice has been given to an Obligor with respect thereto; (ii) that any Person has   given any notice to an Obligor or any of its Subsidiaries or taken any other action   with respect to any event or condition set forth in Section 11(b) or (iii) the   occurrence of any Material Adverse Effect, a certificate of its Authorized Officers   specifying the nature and period of existence of such condition, event or change,   or specifying the notice given and action taken by any such Person and the nature   of such claimed Event of Default, Default, event or condition or change, and what   action the Obligors have taken, are taking and propose to take with respect   thereto;   (h) ERISA.  (i) Promptly, and in any event within five (5) Business Days after any   Authorized Officer of either Obligor becoming aware of the occurrence of or   forthcoming occurrence of any ERISA Event, a written notice specifying the   nature thereof, what action an Obligor, any of its Subsidiaries or any of its   respective ERISA Affiliates has taken, is taking or proposes to take with respect   thereto and, when known, any action taken or threatened in writing by the Internal   Revenue Service, the Department of Labor or the PBGC with respect thereto; and   (ii) (1) promptly upon reasonable request of the Required Holders, copies of each   Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed   by an Obligor, any of its Subsidiaries or any of its respective ERISA Affiliates   with respect to each Pension Plan; and (2) promptly after their receipt, copies of   all notices received by an Obligor, any of its Subsidiaries or any of its respective   ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA   Event;   (i) SEC Investigations.  Promptly, and in any event within five (5) Business Days   after receipt thereof by an Obligor or any Subsidiary thereof, copies of each notice   or other correspondence received from the SEC (or comparable agency in any   applicable non-U.S. jurisdiction) concerning any investigation or possible     

 

-27-      investigation or other inquiry by such agency regarding financial or other   operational results of an Obligor or any Subsidiary thereof; and   (j) Other Information.  (i) Promptly upon their becoming available, copies of all   financial statements, reports, notices and proxy statements and other   communications sent or made available generally by the Parent Guarantor to its   security holders acting in such capacity or by any Subsidiary of the Parent   Guarantor (including the Issuer) to its security holders, if any, other than the   Parent Guarantor or another Subsidiary of the Parent Guarantor, provided that no   Obligor shall be required to deliver to the holders of the Notes the minutes of any   meeting of its Board of Directors, and (ii) such other information and data with   respect to the Parent Guarantor or any of its Subsidiaries (including the Issuer) as   from time to time may be reasonably requested by the Required Holders.   Each notice pursuant to clauses (g) and (h) of this Section 9.1 shall be accompanied by a   statement of an Authorized Officer of the Issuer setting forth details of the occurrence referred to   therein and stating what action the applicable Obligor(s) has taken and proposes to take with   respect thereto.  Each notice pursuant to Section 9.1(g) shall describe with particularity any and   all provisions of this Agreement and any other Financing Agreement that have been breached.    Section 9.2. Existence. Each Obligor will, and will cause each of its Subsidiaries to, at   all times preserve and keep in full force and effect (a) its existence under the laws of its   jurisdiction of formation or organization, and (b) all rights and franchises, licenses and permits   material to its business, except in either case to the extent permitted by Section 10.10 or not   constituting an Asset Sale hereunder.    Section 9.3. Payment of Taxes and Claims. Each Obligor will, and will cause each   Unencumbered Property Owner and each of its other respective Subsidiaries to, pay (a) all   federal, state and other material taxes imposed upon it or any of its properties or assets or in   respect of any of its income, businesses or franchises before any penalty or fine accrues thereon   and (b) all claims (including claims for labor, services, materials and supplies) for sums that have   become due and payable and that by law have or may become a Lien upon any of its properties   or assets, prior to the time when any penalty or fine shall be incurred with respect thereto;   provided, no such tax or claim need be paid if it is being contested in good faith by appropriate   proceedings promptly instituted and diligently conducted, so long as (i) adequate reserve or other   appropriate provision, as shall be required in conformity with GAAP shall have been made   therefor, and (ii) as may be applicable at any time, in the case of a tax or claim which has or may   become a Lien against any Unencumbered Pool Property, such contest proceedings conclusively   operate to stay the sale of any portion of any such Unencumbered Pool Property to satisfy such   tax or claim.  The Issuer will not, nor will it permit any of its Subsidiaries to, file or consent to   the filing of any consolidated income tax return with any Person (other than the Issuer or any   Subsidiary).    Section 9.4. Maintenance of Properties. Each Obligor will, and will cause each of its   Subsidiaries to, maintain or cause to be maintained in good repair, working order and condition,   ordinary wear and tear excepted, all material properties used or useful in the business of each     

 

-28-      Obligor and its Subsidiaries and from time to time will make or cause to be made all appropriate   repairs, renewals and replacements thereof.    Section 9.5. Insurance. The Obligors will maintain or cause to be maintained, with   financially sound and reputable insurers, property insurance, such public liability insurance, third   party property damage insurance with respect to liabilities, losses or damage in respect of the   assets, properties and businesses of each Obligor and its Subsidiaries as may customarily be   carried or maintained under similar circumstances by Persons of established reputation engaged   in similar businesses, in each case in such amounts, with such deductibles, covering such risks   and otherwise on such terms and conditions as shall be customary for such Persons.  Each   Obligor and its Subsidiaries shall at all times comply in all material respects with the   requirements of the insurance policies required hereunder and of the issuers of such policies and   of any board of fire underwriters or similar body as applicable to or affecting any Unencumbered   Pool Property.     Section 9.6. Inspections.  Each Obligor will, and will cause each Unencumbered   Property Owner and each of its other respective Subsidiaries to, permit representatives of each   holder of the Notes that is an Institutional Investor to visit and inspect any of its properties, to   conduct field audits, to examine its corporate, financial and operating records, and make copies   thereof or abstracts therefrom, and to discuss its affairs, finances and accounts with its directors,   officers, and independent public accountants, all at the expense of the Issuer and at such   reasonable times during normal business hours and as often as may be reasonably desired, upon   reasonable advance notice to the Issuer; provided, however, that so long as no Event of Default   exists, the Issuer shall not be obligated to pay for more than one (1) such inspection per year;   provided, further, that when an Event of Default exists, the holders of the Notes that are   Institutional Investors (or any of their respective representatives or independent contractors) may   do any of the foregoing at the expense of the Issuer at any time during normal business hours and   without advance notice.    Section 9.7. Noteholder Meetings. The Issuer will, upon the request of the Required   Holders, participate in a meeting of the holders of the Notes once during each Fiscal Year to be   held at the Issuer’s corporate offices (or at such other location as may be agreed to by the Issuer   and the Required Holders) at such time as may be agreed to by the Issuer and the Required   Holders.    Section 9.8. Compliance with Laws and Material Contracts. Each Obligor will   comply, and shall cause each of its Subsidiaries and all other Persons, if any, on or occupying   any Facilities to comply, with (a) the USA PATRIOT Act and OFAC rules and regulations, (b)   all other Applicable Laws and (c) all Material Contracts, noncompliance with which, with   respect to clauses (b) and (c), could reasonably be expected to have, individually or in the   aggregate, a Material Adverse Effect.     Section 9.9. Use of Proceeds. The Obligors will use the proceeds of the issuance and   sale of the Notes for (a) retiring outstanding debt, (b) working capital, capital expenditures,   payment of dividends and redemptions, and other lawful corporate purposes (including, but not   limited to, the Acquisition of Healthcare Facilities), and (c) to pay transaction fees, costs and     

 

-29-      expenses related to the transactions being consummated pursuant to this Agreement and the other   Financing Agreements, in each case not in contravention of Applicable Laws or of any Financing   Agreement.  No portion of the proceeds of the issuance and sale of the Notes shall be used in any   manner that causes or might cause such issuance and sale of the Notes or the application of such   proceeds to violate Regulation T, Regulation U or Regulation X of the FRB as in effect from   time to time or any other regulation thereof or to violate the Exchange Act.    Section 9.10. Environmental Matters.   (a) Environmental Disclosure.  Each Obligor will deliver to the holders of the Notes   with reasonable promptness, such documents and information as from time to   time may be reasonably requested by any holder of a Note that is an Institutional   Investor.   (b) Hazardous Materials Activities, Etc.  Each Obligor shall promptly take, and shall   cause each of its Subsidiaries promptly to take, any and all actions necessary to (i)   cure any violation of applicable Environmental Laws by such Obligor or its   Subsidiaries that could reasonably be expected to have, individually or in the   aggregate, a Material Adverse Effect, and (ii) respond to any Environmental   Claim against such Obligor or any of its Subsidiaries and discharge any   obligations it may have to any Person thereunder where failure to do so could   reasonably be expected to have, individually or in the aggregate, a Material   Adverse Effect.    Section 9.11. Books and Records. Each Obligor will, and will cause its respective   Subsidiaries to, keep proper books of record and account in which full, true and correct entries   shall be made of all dealings and transactions in relation to its business and activities to the   extent necessary to prepare the consolidated financial statements of the Parent Guarantor in   conformity with GAAP.    Section 9.12. Unencumbered Pool Properties Subject to Eligible Ground Leases..   Each Obligor shall, and shall cause each Unencumbered Property Owner to, with respect to each   Unencumbered Pool Property subject to an Eligible Ground Lease:   (a) Make all payments and otherwise perform in all material respects all obligations   in respect of each such Eligible Ground Lease and keep each such Eligible   Ground Lease in full force and effect and not allow any such Eligible Ground   Lease to lapse or be terminated or any rights to renew any such Eligible Ground   Lease to be forfeited or cancelled, notify the holders of the Notes of any default   by any party with respect to any such Eligible Ground Lease and cooperate with   the Required Holders in all respects to cure any such default, except, in any case,   where the failure to do so would not be reasonably likely to have a Material   Adverse Effect.   (b) Without limiting the foregoing, with respect to each Eligible Ground Lease   related to any Unencumbered Pool Property:     

 

-30-      i. pay when due the rent and other amounts due and payable thereunder (subject   to applicable cure or grace periods);    ii. timely perform and observe all of the material terms, covenants and conditions   required to be performed and observed by it as tenant thereunder (subject to   applicable cure or grace periods);    iii. do all things necessary to preserve and keep unimpaired such Eligible Ground   Lease and its material rights thereunder;    iv. not waive, excuse or discharge any of the material obligations of the ground   lessor or other obligor thereunder;    v. diligently and continuously enforce the material obligations of the ground   lessor or other obligor thereunder;    vi. not do, permit or suffer any act, event or omission which would result in a   default thereunder (or which, with the giving of notice or the passage of time,   or both, would constitute a default thereunder), in each case which would   permit the applicable ground lessor to terminate or exercise any other remedy   with respect to such Eligible Ground Lease;    vii. cancel, terminate, surrender, modify or amend any of the provisions of any   such Eligible Ground Lease or agree to any termination, amendment,   modification or surrender thereof if the effect of such cancellation,   termination, surrender, modification, amendment or agreement is to (A)   shorten the term of such Eligible Ground Lease, (B) increase the rent payable   under such Eligible Ground Lease, (C) increase the purchase price under any   purchase option concerning the property included in and subject to such   Eligible Ground Lease, (D) modify the gross or net leasable area subject to   such Eligible Ground Lease, (E) transfer to the ground lessee any costs and/or   expenses previously paid by the ground lessor under such Eligible Ground   Lease, (F) terminate (or grant the ground lessor additional rights to   unilaterally terminate) such Eligible Ground Lease, or (G) subordinate the   rights of the applicable Unencumbered Property Owner under such Eligible   Ground Lease to any property manager or any other Person, in each case   without the prior written consent of the Required Holders;   viii. deliver to the holders of the Notes all default and other material notices   received by it or sent by it under the applicable Eligible Ground Lease;    ix. upon the reasonable written request of the Required Holders, provide to the   holders of the Notes any information or materials relating to such Eligible   Ground Lease and evidencing such Unencumbered Property Owner’s due   observance and performance of its material obligations thereunder;     

 

-31-      x. not permit or consent to the subordination of such Eligible Ground Lease to   any mortgage or other leasehold interest of the premises related thereto;    xi. execute and deliver (to the extent permitted to do so under such Eligible   Ground Lease), upon the reasonable request of the Required Holders, any   documents, instruments or agreements as may be required to permit the   holders of the Notes to cure any default under such Eligible Ground Lease;    xii. provide to the holders of the Notes written notice of its intention to exercise   any option or renewal or extension rights with respect to such Eligible Ground   Lease or easement at least thirty (30) days prior to the expiration of the time to   exercise such right or option and duly exercise any renewal or extension   option with respect to any such Eligible Ground Lease or easement (either   consistent with such notice or upon the direction of the Required Holders);   xiii. not treat, in connection with the bankruptcy or other insolvency proceedings   of any ground lessor or other obligor, any Eligible Ground Lease as   terminated, cancelled, or surrendered pursuant to the Bankruptcy Code   without the Required Holders prior written consent;    xiv. in connection with the bankruptcy or other insolvency proceedings of any   ground lessor or other obligor, ratify the legality, binding effect and   enforceability of the applicable Eligible Ground Lease as against the   applicable Unencumbered Property Owner within the applicable time period   therefore in such proceedings, notwithstanding any rejection by such ground   lessor or trustee, custodian or receiver related thereto; and   xv. provide to the holders of the Notes not less than thirty (30) days prior written   notice of the date on which the applicable Unencumbered Property Owner   shall apply to any court or other governmental authority for authority or   permission to reject the applicable Eligible Ground Lease in the event that   there shall be filed by or against any Unencumbered Property Owner any   petition, action or proceeding under the Bankruptcy Code or any similar   federal or state law;   provided, that each applicable Obligor hereby agrees to execute and deliver (or cause, as to each   Unencumbered Property Owner, the execution and delivery) to the holders of the Notes, within   ten (10) Business Days of any request therefor, such documents, instruments, agreements,   assignments or other conveyances reasonably requested by the Required Holders in connection   with or in furtherance of any of the provisions set forth above.    Section 9.13. REIT Status. The Parent Guarantor and the Issuer will, and will cause each   of their respective Subsidiaries to, operate their businesses at all times so as to satisfy all   requirements necessary for the Parent Guarantor to qualify as a REIT, and the Parent Guarantor   shall elect to be qualified as a REIT in connection with the filing of the Parent Guarantor’s tax   returns for the Fiscal Year ended December 31, 2015.  The Parent Guarantor will maintain its     

 

-32-      status, and such election to be treated, as a REIT.  The Issuer shall at all times be a partnership or   other disregarded entity for federal income tax purposes under the Code.     Section 9.14. Leasing Matters Regarding Unencumbered Pool Properties. Each   Obligor shall (or shall cause the applicable Unencumbered Property Owner with respect to such   Unencumbered Pool Property to) (i) observe and perform the material obligations imposed upon   the landlord under the Tenant Leases in a commercially reasonable manner; (ii) enforce the   terms, covenants and conditions contained in each Tenant Lease against the Tenant thereunder in   a commercially reasonable manner, (iii) only amend or waive the terms, covenants and   conditions contained in the Tenant Leases in a commercially reasonable manner, (iv) with regard   to any Tenant Lease, not terminate any such Tenant Lease or accept a surrender of any such   Tenant Lease except by reason of a tenant default or if otherwise commercially reasonable, (v)   shall not collect any of the rents from Tenant Leases more than one (1) month in advance (other   than security deposits) and (vi) not execute any assignment of lessor’s interest in the Tenant   Leases or the rents from Tenant Lease.     Section 9.15 Subsidiary Guarantors; Release.     (a) The Obligors will cause each of their respective Subsidiaries that guarantees or   otherwise becomes liable at any time, whether as a borrower or an additional or   co-borrower or otherwise, for or in respect of, any Indebtedness under any   Material Credit Facility to concurrently therewith:   i. enter into a Subsidiary Guarantee in scope, form and substance reasonably   satisfactory to the Required Holders or a joinder agreement in respect of   the Subsidiary Guarantee, as applicable; and       ii. deliver the following to each holder of a Note:   (A) an executed counterpart of such Subsidiary Guarantee;   (B) a certificate signed by an authorized responsible officer of such   Subsidiary containing representations and warranties on behalf of   such Subsidiary to the same effect, mutatis mutandis, as those   contained in Sections 5.1, 5.3 through 5.6, inclusive, 5.21, 5.24 and   5.28 of this Agreement (but with respect to such Subsidiary and   such Subsidiary Guarantee rather than the Obligors);   (C) all documents as may be reasonably requested by the Required   Holders to evidence the due organization, continuing existence   and, where applicable, good standing of such Subsidiary and the   due authorization by all requisite action on the part of such   Subsidiary of the execution and delivery of such Subsidiary   Guarantee and the performance by such Subsidiary of its   obligations thereunder; and     

 

-33-      (D) an opinion of counsel (including in-house counsel) reasonably   satisfactory to the Required Holders covering such matters relating   to such Subsidiary and such Subsidiary Guarantee as the Required   Holders may reasonably request.   (b)  Each holder of a Note fully releases and discharges from the Subsidiary   Guarantee a Subsidiary Guarantor, immediately and without any further act, upon   such Subsidiary Guarantor being released and discharged as a borrower, an   additional or co-borrower or otherwise, for or in respect of, Indebtedness under   the applicable Material Credit Facility; provided that (i) no Default or Event of   Default exists or will exist immediately following such release and discharge; (ii)   if any fee or other consideration is paid or given to any holder of Indebtedness   under any Material Credit Facility in connection with such release, other than the   repayment of all or a portion of such Indebtedness under such Material Credit   Facility, each holder of a Note receives equivalent consideration on a pro rata   basis; and (iii) at the time of such release and discharge, the Obligors deliver to   each holder of Notes a certificate signed by an authorized responsible officer   certifying (x) that such Subsidiary Guarantor has been or is being released and   discharged as a borrower, an additional or co-borrower or otherwise, for or in   respect of, Indebtedness under all Material Credit Facilities and (y) as to the   matters set forth in clauses (i) and (ii) above.     Section 9.16. Rating Matters.     (a) On or before January 22, 2016, the Obligors shall obtain and provide to the   holders written evidence reasonably satisfactory to such holders in form and   substance that the Notes have received an Investment Grade Rating from   Moody’s.  Promptly upon receipt of such Investment Grade Rating, the holders   and the Issuer shall jointly instruct the Escrow Agent to disburse from the Escrow   Account the escrowed Note proceeds and all other amounts held in the Escrow   Account to the Issuer.   (b) If the Obligors fail to obtain the Investment Grade Rating from Moody’s on or   before January 22, 2016, then the Issuer shall prepay (the “Rating Prepayment”)   the entire unpaid principal amount of all Notes, together with interest thereon to   the prepayment date and an aggregate termination fee for all Notes of $100,000   (the “Termination Fee”), but without payment of any Make-Whole Amount.    The Rating Prepayment shall be made on January 29, 2016 (the “Rating   Prepayment Date”).  The holders and the Issuer shall jointly instruct the Escrow   Agent to apply, on the Rating Prepayment Date, amounts held in the Escrow   Account to prepay the entire unpaid principal amount of the Notes held by each   holder, together with interest thereon to the Rating Prepayment Date and each   holder’s pro rata share of the Termination Fee.  To the extent amounts on deposit   in the Escrow Account are insufficient to pay all such amounts in full, the Issuer   shall remain liable to the holders for payment of such amounts and shall pay such   amounts by wire transfer of immediately available funds to the holders in full on     

 

-34-      the Rating Prepayment Date. Without limiting the foregoing obligations, the   Escrow Agreement shall provide that, if for any reason the Escrow Agent has not   received either of the notices described in Sections 9.16(a) or (b) above on or   before January 29, 2016, then without any further action by any party, the Escrow   Agent shall on February 3, 2016 disburse all amounts in the Escrow Account to   the Purchasers to prepay the entire unpaid principal amount of the Notes held by   each holder.  The Issuer shall remain liable for and shall pay to each holder, by   wire transfer of immediately available funds, interest on the Notes accrued to the   date of prepayment and each holder’s pro rata share of the Termination Fee.   (c) The Obligors will (at the Obligors’ expense) at all times from and after the date of   this Agreement maintain a Credit Rating for the Notes from an NRSRO   reasonably satisfactory to the Required Holders, confirmed annually in writing to   the holders of the Notes, and will provide such NRSRO with all relevant financial   information as may be necessary to maintain such Credit Rating.   SECTION 10. NEGATIVE COVENANTS.   Each Obligor covenants and agrees that so long as the Notes are outstanding, such   Obligor shall perform, and shall cause each of its Subsidiaries to perform, all covenants in this   Section 10.    Section 10.1 Indebtedness. No Obligor shall, nor shall it permit any of its Subsidiaries   to, directly or indirectly, create, incur, assume or guaranty, or otherwise become or remain   directly or indirectly liable with respect to any Indebtedness, other than:   (a) the incurrence by the Issuer and any Guarantor of Indebtedness represented by the   Notes issued on the Closing Date and the Guarantees thereof;    (b) Indebtedness of an Obligor or any Subsidiary of an Obligor to an Obligor or any   other such Subsidiary so long as any such Indebtedness owing by an Obligor to   any Subsidiary which is not an Obligor shall be subordinated to the Notes on   terms reasonably satisfactory to the Required Holders;   (c) Indebtedness incurred pursuant to the Existing Credit Facility or any Credit   Document, provided, the Obligors shall be in compliance, on a pro forma basis   after giving effect to such Indebtedness, with the financial covenants set forth in   Section 10.8, recomputed as of the last day of the most recently ended Fiscal   Quarter of the Issuer for which financial statements have been delivered pursuant   to Section 9.1;   (d) Indebtedness existing on the Closing Date and described in Schedule 5.17,   together with any Permitted Refinancing thereof;   (e) Indebtedness with respect to (x) Capital Leases and (y) purchase money   Indebtedness; provided, in the case of clause (x), that any such Indebtedness shall     

 

-35-      be secured only by the asset subject to such Capital Lease, and, in the case of   clause (y), that any such Indebtedness shall be secured only by the asset acquired   in connection with the incurrence of such Indebtedness; provided further that the   sum of the aggregate principal amount of any Indebtedness under this clause (e)   shall not exceed at any time $1,000,000;   (f) Indebtedness in respect of any Swap Contract that is entered into in the ordinary   course of business to hedge or mitigate risks to which an Obligor or any of its   Subsidiaries is exposed in the conduct of its business or the management of its   liabilities (it being acknowledged by the Obligors that a Swap Contract entered   into for speculative purposes or of a speculative nature is not a Swap Contract   entered into in the ordinary course of business to hedge or mitigate risks);   (g) Indebtedness arising in connection with the financing of insurance premiums in   the ordinary course of business;   (h) cash management obligations and other Indebtedness in respect of endorsements   for collection or deposit, netting services, overdraft protections and similar   arrangements, in each case, in connection with deposit accounts in the ordinary   course of business;   (i) Indebtedness representing deferred compensation to officers, directors, employees   of the Parent Guarantor and its Subsidiaries;   (j) Secured Recourse Indebtedness of an Obligor or any Subsidiary (other than any   Subsidiary which is a Guarantor hereunder); provided, the Obligors shall be in   compliance, on a pro forma basis after giving effect to such Recourse   Indebtedness, with the financial covenants set forth in Section 10.8, recomputed   as of the last day of the most recently ended Fiscal Quarter of the Issuer for which   financial statements have been delivered pursuant to Section 9.1;    (k) Unsecured Indebtedness of the Obligors and their Subsidiaries provided the   Obligors shall be in compliance, on a pro forma basis after giving effect to such   Unsecured Indebtedness, with the financial covenants set forth in Section 10.8,   recomputed as of the last day of the most recently ended Fiscal Quarter of the   Issuer for which financial statements have been delivered pursuant to Section 9.1;   and    (l) Non-Recourse Indebtedness of any Subsidiaries that are not, and are not required   to be, Subsidiary Guarantors hereunder and are not Unencumbered Property   Owners; provided, the Obligors shall be in compliance, on a pro forma basis after   giving effect to such Non-Recourse Indebtedness, with the financial covenants set   forth in Section 10.8, recomputed as of the last day of the most recently ended   Fiscal Quarter of the Issuer for which financial statements have been delivered   pursuant to Section 9.1.     

 

-36-       Section 10.2 Liens. No Obligor shall, nor shall it permit any of its Subsidiaries to,   directly or indirectly, create, incur, assume or permit to exist any Lien on or with respect to any   property or asset of any kind (including any document or instrument in respect of goods or   accounts receivable) of an Obligor or any of its Subsidiaries, whether now owned or hereafter   acquired, created or licensed or any income, profits or royalties therefrom, or file or permit the   filing of, or permit to remain in effect, any financing statement or other similar notice of any   Lien with respect to any such property, asset, income, profits or royalties under the UCC of any   State or under any similar recording or notice statute or under any Applicable Laws related to   Intellectual Property, except:   (a) Liens in favor of the holders of the Notes (or an agent on their behalf) securing   Indebtedness under this Agreement, the Notes or any Financing Agreement;    (b) Liens for Taxes not yet due or for Taxes if obligations with respect to such Taxes   are being contested in good faith by appropriate proceedings promptly instituted   and diligently conducted;   (c) statutory Liens of landlords, banks, carriers, warehousemen, mechanics,   repairmen, workmen and materialmen, and other Liens imposed by law (other   than any such Lien imposed pursuant to Section 430(k) of the Code or Section   303(k) or 4068 of ERISA that would constitute an Event of Default under Section   11(j)), in each case incurred in the ordinary course of business (i) for amounts not   yet overdue, or (ii) for amounts that are overdue and that are being contested in   good faith by appropriate proceedings, so long as such reserves or other   appropriate provisions, if any, as shall be required by GAAP shall have been   made for any such contested amounts;   (d) Liens incurred in the ordinary course of business in connection with workers’   compensation, unemployment insurance and other types of social security, or to   secure the performance of tenders, statutory obligations, surety and appeal bonds,   bids, leases, government contracts, trade contracts, performance and return of   money bonds and other similar obligations (exclusive of obligations for the   payment of borrowed money or other Indebtedness), so long as no foreclosure,   sale or similar proceedings have been commenced with respect to any portion of   the subject Real Estate Asset on account thereof;   (e) easements, rights of way, restrictions, encroachments, and other minor   encumbrances, defects or irregularities in title, in each case which do not and will   not interfere in any material respect with the ordinary conduct of the business of   an Obligor or any of its Subsidiaries;   (f) any interest or title of a lessor or sublessor under any lease of real estate not   prohibited hereunder (including the interests of any ground lessor under an   Eligible Ground Lease respecting any Unencumbered Pool Property);     

 

-37-      (g) Liens solely on any cash earnest money deposits made by an Obligor or any of its   Subsidiaries in connection with any letter of intent, or purchase agreement   permitted hereunder;   (h) purported Liens evidenced by the filing of precautionary UCC financing   statements relating solely to operating leases of personal property entered into in   the ordinary course of business;   (i) Liens in favor of customs and revenue authorities arising as a matter of law to   secure payment of customs duties in connection with the importation of goods;   (j) any zoning or similar law or right reserved to or vested in any governmental   office or agency to control or regulate the use, operation or development of any   real property;   (k) licenses of patents, trademarks and other intellectual property rights granted by an   Obligor or any of its Subsidiaries in the ordinary course of business and not   interfering in any respect with the ordinary conduct of the business of such   Obligor or such Subsidiary;   (l) Liens existing as of the Closing Date and described in Schedule 10.2;   (m) Liens securing purchase money Indebtedness (other than on any Borrowing Base   Properties) and Capital Leases to the extent permitted pursuant to Section 10.1(e);   provided, any such Lien shall encumber only the asset acquired with the proceeds   of such Indebtedness or the assets subject to such Capital Lease, respectively;   (n) Liens in favor of the Administrative Agent securing Indebtedness under the   Existing Credit Facility or any Credit Document, provided that the Obligations are   concurrently secured equally and ratably with all such Indebtedness under the   Existing Credit Facility or Credit Documents pursuant to documentation in form   and substance reasonably satisfactory to the Required Holders, including without   limitation, an intercreditor agreement and opinions of counsel to the Obligors   reasonably acceptable to the Required Holders;   (o) Liens on assets other than Borrowing Base Properties consisting of judgment or   judicial attachment liens relating to judgments which do not constitute an Event of   Default hereunder;   (p) licenses (including licenses of Intellectual Property), sublicenses, leases or   subleases granted to third parties in the ordinary course of business;   (q) Liens in favor of collecting banks under Section 4-210 of the UCC;   (r) Liens (including the right of set-off) in favor of a bank or other depository   institution arising as a matter of law encumbering deposits;     

 

-38-      (s) Liens arising out of conditional sale, title retention, consignment or similar   arrangements for the sale of goods in the ordinary course of business;    (t) Liens securing Secured Recourse Indebtedness and Non-Recourse Indebtedness   of an Obligor or any Subsidiary thereof (including any Foreign Subsidiary and   any Excluded Subsidiary) on assets other than Borrowing Base Properties to the   extent such Secured Recourse Indebtedness or secured Non-Recourse   Indebtedness is permitted pursuant to Section 10.1(j) or (l) or Section 10.8(h),   provided, Liens permitted under this Section 10.2(t) shall not secure Indebtedness   under the Existing Credit Facility; and   (u) Liens in favor of the Issuing Bank or the Swingline Lender (each as defined in the   Existing Credit Facility as of the date hereof) on cash collateral securing the   obligations of a Defaulting Lender (as defined in the Existing Credit Facility as of   the date hereof) to fund risk participations under the Existing Credit Facility.    Section 10.3  No Further Negative Pledges. No Obligor shall, nor shall it permit any of   its Subsidiaries to, enter into any Contractual Obligation (other than this Agreement and the   other Financing Agreements) that limits the ability of the Obligors or any such Subsidiary to   create, incur, assume or suffer to exist Liens on property of such Person; provided, however, that   this Section 10.3 shall not prohibit (i) any negative pledge incurred or provided in favor of any   holder of Indebtedness permitted under Section 10.1(e), solely to the extent any such negative   pledge relates to the property financed by or subject to Permitted Liens securing such   Indebtedness, (ii) any Contractual Obligation incurred or provided in favor of any holder of   Indebtedness permitted under Section 10.1(l), solely to the extent such Contractual Obligation   prohibits the pledge of the Capital Stock of the Issuer to secure any Indebtedness, (iii) any   Permitted Lien or any document or instrument governing any Permitted Lien; provided that any   such restriction contained therein relates only to the asset or assets subject to such Permitted   Lien, (iv) customary restrictions and conditions contained in any agreement relating to the   disposition of any property or assets permitted under Section 10.10 pending the consummation of   such disposition, (v) customary provisions restricting assignments, subletting or other transfers   contained in leases, licenses, joint venture agreements and similar agreements entered into in the   ordinary course of business, (vi) any prohibitions and restrictions contained in the Existing   Credit Facility or Credit Documents, so long as such prohibitions and restrictions are not more   restrictive than those set forth in the Existing Credit Facility or Credit Documents in effect on the   date hereof and (vii) any Contractual Obligation (including, without limitation, any negative   pledge) incurred or provided in favor of any holder of Indebtedness permitted under Section   10.1(k).    Section 10.4  Restricted Payments.  No Obligor shall, nor shall it permit any of its   Subsidiaries to, declare or make, directly or indirectly, any Restricted Payment, or incur any   obligation (contingent or otherwise) to do so, except that:   (a) each Subsidiary of the Issuer may make Restricted Payments to the Issuer, and the   Issuer and each other Subsidiary of the Parent Guarantor may make Restricted   Payments to the Parent Guarantor;     

 

-39-      (b) the Issuer and each Subsidiary may declare and make dividend payments or other   distributions payable solely in the Capital Stock of such Person; and    (c) the Obligors and the other Consolidated Parties (if any) shall be permitted to   make other Restricted Payments, subject to the limitations with respect thereto set   forth in Section 10.8(i).    Section 10.5 Burdensome Agreements. No Obligor shall, nor shall it permit any of its   Subsidiaries to, enter into, or permit to exist, any Contractual Obligation that encumbers or   restricts the ability of any such Person to (i) pay dividends or make any other distributions to an   Obligor or Subsidiary Guarantor on its Capital Stock or with respect to any other interest or   participation in, or measured by, its profits, (ii) pay any Indebtedness or other obligation owed to   an Obligor or any Subsidiary Guarantor, (iii) make loans or advances to an Obligor or any   Subsidiary Guarantor, (iv) sell, lease or transfer any of its property to an Obligor or any   Subsidiary Guarantor, (v) pledge its property pursuant to the Financing Agreements or any   renewals, refinancings, exchanges, refundings or extension thereof or (vi) other than customary   Subsidiary Indebtedness limitations or covenants, act as an issuer or guarantor pursuant to the   Financing Agreements or any renewals, refinancings, exchanges, refundings or extension   thereof, except (in respect of any of the matters referred to in clauses (i)-(v) above) for (1) this   Agreement and the other Financing Agreements, (2) any document or instrument governing   Indebtedness incurred pursuant to Section 10.1(c) or Section 10.1(e) or Section 10.1(j); provided   that any such restriction contained therein relates only to the asset or assets constructed or   acquired in connection therewith or secured thereby, (3) any Permitted Lien or any document or   instrument governing any Permitted Lien, provided that any such restriction contained therein   relates only to the asset or assets subject to such Permitted Lien, (4) customary restrictions and   conditions contained in any agreement relating to the sale of any property permitted under   Section 10.10 pending the consummation of such sale, (5) restrictions contained in the Existing   Credit Facility or Credit Documents, so long as such restrictions are not more restrictive than   those set forth in the Existing Credit Facility or Credit Documents in effect on the date hereof or   (6) any document or instrument governing Indebtedness incurred pursuant to Section 10.1(k).    Section 10.6 Investments. No Obligor shall, nor shall it permit any of its Subsidiaries to,   directly or indirectly, make or own any Investment in any Person, including any joint venture   and any Foreign Subsidiary, except:   (a) Investments in cash and Cash Equivalents and deposit accounts or securities   accounts in connection therewith;   (b) Investments owned as of the Closing Date in any Subsidiary or Unconsolidated   Affiliate, and Investments in any Subsidiary formed or acquired after the Closing   Date to the extent such Subsidiary is a Subsidiary Guarantor, or becomes a   Subsidiary Guarantor in accordance with Section 9.15;   (c) intercompany loans and Guarantees to the extent permitted under Section 10.1;   (d) Investments existing on the Closing Date and described on Schedule 10.6;     

 

-40-      (e) Investments in Real Estate Assets that constitute Healthcare Facilities (other than   Unimproved Land or Construction-In-Process Investments, which shall be subject   to the limitations set forth in clause (j) below);   (f) Investments in Subsidiaries formed or acquired after the Closing Date that do not   own any Unencumbered Pool Properties and that are not required to become   Guarantors in accordance with Section 9.15, so long as the Obligors shall be in   compliance, on a pro forma basis after giving effect to such Investment, with the   financial covenants set forth in Section 10.8, recomputed as of the last day of the   most recently ended Fiscal Quarter of the Issuer for which financial statements   have been delivered pursuant to Section 9.1;   (g) Investments constituting Swap Contracts permitted by Section 10.1(f);   (h) Investments constituting accounts or lease or rent receivables, prepayments and   deposits, in each case made in the ordinary course of business;   (i) Investments in the nature of capital expenditures in respect of any fixed or capital   asset, to the extent such capital expenditures constitute normal replacements and   maintenance which are properly charged to current operations or other reasonable   and customary capital expenditures made in the ordinary course of the business of   the Parent Guarantor and its Subsidiaries;   (j) subject to the following limitations, Investments in the following asset classes: (i)   Capital Stock, the issuer with respect to which is an Unconsolidated Affiliate, and   mezzanine loans made to, or similar Investments in, any Person (other than an   Affiliate of an Obligor) that owns, directly or indirectly, one or more Real Estate   Assets that constitute Healthcare Facilities (“Class I”), (ii) Construction-In-   Process (“Class II”), (iii) Unimproved Land (“Class III”), and (iv)   Unencumbered Mortgage Receivables (“Class IV;” each of Class I, Class II,   Class III and Class IV may be referred to herein individually as a “Class” and   collectively as “Classes”): provided, Investments in each of the foregoing asset   Classes shall be permitted hereunder only to the extent that the aggregate amount   of all Investments in such Class (based on the GAAP book value of each such   Investment at such time of determination) does not exceed the corresponding   percentage of Total Asset Value for such Class set forth below:      Class Investment Type Maximum Percentage   I Unconsolidated Affiliates (including any Investments   in Unconsolidated Affiliates permitted under clause   (b) above) and mezzanine loans and similar   Investments   15.0%     

 

-41-      II Construction-In-Process 20.0%   III Unimproved Land 5.0%   IV Unencumbered Mortgage Receivables 10.0%   In addition to the foregoing limitations on permitted Investments under this clause (j), at   no time shall the aggregate GAAP book value of the Investments in Classes I, II, III and   IV above exceed 20.0% of Total Asset Value.   Notwithstanding the foregoing, (x) in no event shall an Obligor make any Investment under this   Section 10.6 which results in or facilitates in any manner any Restricted Payment not otherwise   permitted under the terms of Section 10.4; and (y) in no event shall the Parent Guarantor be   permitted to make any equity Investment in any Person other than the Issuer.    Section 10.7  Use of Proceeds. No Obligor shall use the proceeds of the issuance and   sale of the Notes except pursuant to Section 9.9.    Section 10.8  Financial Covenants. No Obligor shall at any time:   (a) Consolidated Leverage Ratio.  Permit the Consolidated Leverage Ratio, tested as   of the end of any Fiscal Quarter of the Issuer, to be greater than 0.60 to 1.00.   (b) Consolidated Secured Indebtedness Leverage Ratio.  Permit the Consolidated   Secured Indebtedness Leverage Ratio, tested as of the end of any Fiscal Quarter   of the Issuer, to be greater than 30.0%.   (c) Consolidated Recourse Secured Leverage Ratio.  Permit the Consolidated   Recourse Secured Leverage Ratio, tested as of the end of any Fiscal Quarter of   the Issuer, to be greater than 10.0%.   (d) Consolidated Fixed Charge Coverage Ratio.  Permit the Consolidated Fixed   Charge Coverage Ratio, tested as of the end of any Fiscal Quarter of the Issuer, to   be less than 1.50 to 1.00.   (e) Consolidated Unsecured Leverage Ratio. Permit the Consolidated Unsecured   Leverage Ratio, tested as of the end of any Fiscal Quarter of the Issuer, to be less   than 0.60 to 1.00.   (f) Unencumbered Debt Service Coverage Ratio.  Permit the Unencumbered Debt   Service Coverage Ratio, tested as of the end of any Fiscal Quarter of the Issuer, to   be less than 1.75 to 1.00.   (g) Tangible Net Worth.  Permit Tangible Net Worth, tested as of the end of any   Fiscal Quarter of the Issuer, to be less than the sum of (x) $742,038,000, plus (y)     

 

-42-      an amount equal to, on a cumulative basis, the product of (i) the sum of all Net   Cash Proceeds from any Equity Issuance after March 31, 2015, multiplied by (ii)   seventy-five percent (75.0%).   (h) Priority Debt. The Obligors will not at any time permit the aggregate outstanding   principal amount of all Priority Debt to exceed 35% of Total Asset Value as of the   last day of the Fiscal Quarter then most recently ended.   (i) Distribution Limitation.  Permit, for any given four (4) calendar quarter period of   the Consolidated Parties, the amount of Restricted Payments made by the   Consolidated Parties to the holders of their Capital Stock (excluding any   Restricted Payments to such holders of Capital Stock which are Obligors) during   such period to exceed the FFO Distribution Allowance for such period; provided,   that to the extent no Default or Event of Default then exists or would result from   same, each Obligor and each other Subsidiary shall be permitted to make   Restricted Payments to the Issuer and the Issuer shall be permitted to make   Restricted Payments to Parent Guarantor (and the Issuer may make any   corresponding Restricted Payments to the holders (other than the Parent   Guarantor) of common and preferred limited partnership units in the Issuer, based   on such holders’ individual percentage ownership of Capital Stock in the Issuer or   otherwise in accordance with the Issuer’s Organizational Documents), in each   case to permit the Parent Guarantor to make Restricted Payments to the holders of   the Capital Stock in the Parent Guarantor to the extent necessary to maintain   Parent Guarantor’s status as a REIT or to enable the Parent Guarantor to avoid   payment of any Tax for any calendar year that could be avoided by reason of a   Restricted Payment by Parent Guarantor to the holders of its Capital Stock, with   such Restricted Payments by the Parent Guarantor to be made as and when   reasonably determined by Parent Guarantor, whether during or after the end of the   relevant calendar year, and in all cases as set forth in a certification to the holders   of the Notes from the chief financial officer, principal accounting officer,   treasurer or controller of the Parent Guarantor. Without limiting the forgoing, in   no event shall the Consolidated Parties make any Restricted Payments to the   holders of their Capital Stock (other than any Restricted Payments to such holders   of Capital Stock which are also Obligors) if or to the extent that a Default or   Event of Default then exists or would result from same.   (j) Minimum Property Requirement.  Permit there to be fewer than fifteen (15)   Unencumbered Pool Properties having an Aggregate Unencumbered Pool   Property Value Amount greater than or equal to $275,000,000.00 in the   Borrowing Base, tested as of the end of any Fiscal Quarter of the Issuer.    Section 10.9  Capital Expenditures. The Obligors shall not, and shall not permit any   Unencumbered Property Owners to, make or become legally obligated to make any capital   expenditures, except to the extent permitted under Section 10.6(i).     

 

-43-       Section 10.10 Fundamental Changes; Disposition of Assets; Acquisitions. No Obligor   shall, nor shall it permit any of its Subsidiaries to, enter into any Acquisition or transaction of   merger or consolidation, or liquidate, wind up or dissolve itself (or suffer any liquidation or   dissolution), or make any Asset Sale, or acquire by purchase or otherwise (other than purchases   or other Acquisitions of inventory and materials and the Acquisition of equipment and capital   expenditures in the ordinary course of business, subject to Section 10.9) the business, property or   fixed assets of, or Capital Stock or other evidence of beneficial ownership of, any Person or any   division or line of business or other business unit of any Person, except:   (a) any Subsidiary of the Issuer may be merged with or into the Issuer or any other   Subsidiary, or be liquidated, wound up or dissolved, or all or any part of its   business, property or assets may be conveyed, sold, leased, transferred or   otherwise disposed of, in one transaction or a series of transactions, to the Issuer   or a Subsidiary Guarantor; provided, in the case of such a merger, (i) if the Issuer   is party to the merger, the Issuer shall be the continuing or surviving Person and   (ii) if a Subsidiary Guarantor or an Unencumbered Property Owner is a party to   such merger, then a Subsidiary Guarantor or Unencumbered Property Owner shall   be the continuing or surviving Person;   (b) Asset Sales, so long as no Default or Event of Default then exists or would result   from any such Asset Sale and the consideration received for the assets subject to   such Asset Sale is in an amount at least equal to the fair market value thereof   (determined in good faith by the board of directors of the applicable Obligor (or   similar governing body)); provided, each of the Obligors acknowledges and   agrees that no proceeds of any such Asset Sale permitted hereunder shall be used   to make Restricted Payments other than in compliance with Sections 10.4 and   10.8(f); and   (c) Investments made in accordance with Section 10.6 and the subsequent sale or   other disposition of such Investments (so long the consideration received for such   Investments subject to such sale or other disposition is in an amount at least equal   to the fair market value thereof (determined in good faith by the board of directors   of the applicable Obligor (or similar governing body)); provided, each of the   Obligors acknowledges and agrees that no proceeds of any such sale or other   disposition permitted hereunder shall be used to make Restricted Payments other   than in compliance with Sections 10.4 and 10.8(f).    Section 10.11 Disposal of Subsidiary Interests. Except as otherwise permitted hereunder   and except for Liens securing the Obligations, no Obligor shall, nor shall it permit any of its   Subsidiaries to, (a) directly or indirectly sell, assign, pledge or otherwise encumber or dispose of   any Capital Stock of any of its Subsidiaries, except to qualify directors if required by Applicable   Laws; or (b) permit any of its Subsidiaries directly or indirectly to sell, assign, pledge or   otherwise encumber or dispose of any Capital Stock of any of its Subsidiaries, except to another   Obligor (subject to the restrictions on such disposition otherwise imposed hereunder), or to   qualify directors if required by Applicable Laws.     

 

-44-       Section 10.12 Transactions with Affiliates and Insiders. No Obligor shall, nor shall it   permit any of its Subsidiaries to, directly or indirectly, enter into or permit to exist any   transaction (including the purchase, sale, lease or exchange of any property or the rendering of   any service) with any officer, director or Affiliate of the Issuer or any its Subsidiaries on terms   that are less favorable to the Issuer or such Subsidiary, as the case may be, than those that might   be obtained at the time from a Person who is not an officer, director or Affiliate of the Issuer or   any of its Subsidiaries; provided, the foregoing restriction shall not apply to (a) any transaction   between or among the Obligors; (b) normal and reasonable compensation and reimbursement of   expenses of directors in the ordinary course of business; (c) compensation and reimbursement of   out-of-pocket expenses, employment and severance arrangements for officers and other   employees entered into in the ordinary course of business; (d) equity issuances by the Parent   Guarantor not constituting a Change of Control; (e) payments by the Parent Guarantor permitted   by Section 10.4; and (e) the payment of customary indemnities to directors, officers and   employees in the ordinary course of business.    Section 10.13 Prepayment of Other Funded Debt. No Obligor shall, nor shall it permit   any of its Subsidiaries to:   (a) after the issuance thereof, amend or modify (or permit the amendment or   modification of) the terms of any Funded Debt in a manner adverse to the   interests of the holders of the Notes (including specifically shortening any   maturity or average life to maturity or requiring any payment sooner than   previously scheduled or increasing the interest rate or fees applicable thereto);   (b) amend or modify, or permit or acquiesce to the amendment or modification   (including waivers) of, any material provisions of any Subordinated Debt,   including any notes or instruments evidencing any Subordinated Debt and any   indenture or other governing instrument relating thereto;   (c) make any payment in contravention of the terms of any Subordinated Debt; or   (d) except in connection with a repayment, refinancing or refunding permitted   hereunder, make any voluntary prepayment, redemption, defeasance or   acquisition for value of (including by way of depositing money or securities with   the trustee with respect thereto before due for the purpose of paying when due), or   refund, refinance or exchange of, any Funded Debt (other than as set forth in   Section 5.16, the Indebtedness under the Financing Agreements, intercompany   Indebtedness permitted hereunder and Indebtedness permitted under Section   10.1(b)); provided, this Section 10.13(d) shall not prohibit the prepayment or   payment at maturity by any Subsidiary of any Specified CMBS Indebtedness if,   on or prior to the date of any such payment, (x) the Real Estate Asset subject to   and securing such Specified CMBS Indebtedness is, or shall have been, proposed   for inclusion in the Borrowing Base in accordance with Section 10.17, and (y)   such Subsidiary becomes a Guarantor in accordance with Section 9.15.     

 

-45-      Without limiting the foregoing, nothing in this Section 10.13 shall be interpreted   or deemed to permit an Obligor or Subsidiary to incur any Funded Debt or   Subordinated Debt to the extent such Funded Debt or Subordinated Debt is not   otherwise expressly permitted under Section 10.1 or Section 10.8.    Section 10.14  Line of Business. The Obligors will not, and will not permit any   Subsidiary to, engage in any business if, as a result, the general nature of the business in which   the Obligors and their Subsidiaries, taken as a whole, would then be engaged would be   substantially changed from the general nature of the business in which the Obligors and their   Subsidiaries, taken as a whole, are engaged on the date of this Agreement.      Section 10.15  Fiscal Year. No Obligor shall, nor shall it permit any of its Subsidiaries   to, change its Fiscal Year-end from December 31.    Section 10.16  Amendments to Organizational Documents/Material Agreements. No   Obligor shall, nor shall it permit any of its Subsidiaries to, amend or permit any amendments to   its Organizational Documents if such amendment would reasonably be expected to be materially   adverse to holders of the Notes, taken as a whole.  No Obligor shall, nor shall it permit any of its   Subsidiaries to, amend or permit any amendment to, or terminate or waive any provision of, any   Material Contract unless such amendment, termination, or waiver would not have a Material   Adverse Effect on the holders of the Notes, taken as a whole.     Section 10.17  Addition/Removal of Unencumbered Pool Properties. Neither the   Issuer nor any other Obligor shall request the addition or a release of any Unencumbered Pool   Property or add any Real Estate Asset as an Unencumbered Pool Property hereunder except in   accordance with the following:   (a) The Issuer may from time to time amend Schedule 5.27 to add an additional Real   Estate Asset that qualifies as an Unencumbered Pool Property; provided, no Real   Estate Asset shall be included as an Unencumbered Pool Property in any   Compliance Certificate or Borrowing Base Certificate delivered to the holders of   the Notes, on Schedule 5.27 or otherwise in any calculation of the Borrowing   Base unless and until such Real Estate Asset otherwise meets all of the   requirements set forth in the definition of “Unencumbered Pool Property” for   inclusion in the Borrowing Base.   (b) Notwithstanding anything contained herein to the contrary, to the extent any Real   Estate Asset previously qualifying as an Unencumbered Pool Property ceases to   meet the criteria for qualification as such, such Real Estate Asset shall be   immediately removed from all Borrowing Base-related calculations contained   herein.  Any such property removed from Borrowing Base-related calculations   pursuant to this clause (b) shall immediately cease to be a “Unencumbered Pool   Property” hereunder, in which case Schedule 5.27 attached hereto shall be   deemed to have been immediately amended to remove such Real Estate Asset   from the list of Unencumbered Pool Properties.     

 

-46-      (c) The Obligors may voluntarily remove any Unencumbered Pool Property from   qualification as such if, and to the extent that, the Obligors shall, immediately   following such removal, be in compliance with all of the covenants contained in   Sections 9 and 10 of this Agreement on a pro forma basis after giving effect to   removal of such asset(s), and with all Borrowing Base-related limitations on   Outstanding Amounts set forth in this Agreement.  No fewer than fifteen (15)   Unencumbered Pool Properties having an Aggregate Unencumbered Pool   Property Value Amount greater than or equal to $275,000,000.00 shall remain in   the Borrowing Base at all times following any voluntary removal of any   Unencumbered Pool Property from qualification as such pursuant to this Section   10.17(c).   (d) Upon removal of an Unencumbered Pool Property pursuant to clauses (b) or (c)   above, (i) Schedule 5.27 shall be immediately amended to remove such Real   Estate Asset from the list of Unencumbered Pool Properties; and (ii) the Issuer   shall concurrently deliver to the holders of the Notes a written notice of any such   voluntary removal or other event or circumstance that results in a Real Estate   Asset previously qualifying as an Unencumbered Pool Property ceasing to qualify   as such (provided, that such notification shall be accompanied by an updated   Compliance Certificate with calculations showing the effect of such removal on   the financial covenants contained herein and on any Borrowing Base-related   restrictions on the Outstanding Amounts hereunder).    Section 10.18 Property Management Agreements Regarding Unencumbered Pool   Properties. The Obligors shall ensure that no Unencumbered Property Owner shall, following   the date on which any Real Estate Asset is first included as an Unencumbered Pool Property,   enter into any property management agreement, or agree to pay any Person any fees or   compensation in connection with the management of all or any portion of such Unencumbered   Pool Property, except with an Approved Manager.  With respect to each Unencumbered Pool   Property subject to a property management agreement, the Issuer (or the applicable   Unencumbered Property Owner with respect to such Unencumbered Pool Property) shall (i)   promptly perform and observe in a commercially reasonable manner all of the covenants   required to be performed and observed by it under such property management agreement and do   all things necessary (to the extent commercially reasonable) to preserve and to keep unimpaired   its material rights thereunder; (ii) promptly deliver to the holders of the Notes a copy of any   notice of default or other material notice under such property management agreement received   by the Issuer (or the applicable Unencumbered Property Owner with respect to such   Unencumbered Pool Property) from the Approved Manager party thereto (including any notice   that the Approved Manager intends to terminate such property management agreement or that   the Approved Manager otherwise intends to discontinue its management of such Unencumbered   Pool Property); and (iii) promptly enforce in a commercially reasonable manner the performance   and observance of all of the covenants required to be performed and observed by such Approved   Manager under such property management agreement.    Section 10.19. Terrorism Sanctions Regulations.  The Obligors will not and will not   permit any Controlled Entity (a) to become (including by virtue of being owned or controlled by     

 

-47-      a Blocked Person), own or control a Blocked Person or any Person that is the target of sanctions   imposed by the United Nations or by the European Union, or (b) directly or indirectly to have   any investment in or engage in any dealing or transaction (including, without limitation, any   investment, dealing or transaction involving the proceeds of the Notes) with any Person if such   investment, dealing or transaction (i) would cause any holder to be in violation of any law or   regulation applicable to such holder, or (ii) is prohibited by or subject to sanctions under any   U.S. Economic Sanctions, or (c) to engage, nor shall any Affiliate of either engage, in any   activity that could subject such Person or any holder to sanctions under CISADA or any similar   law or regulation with respect to Iran or any other country that is subject to U.S. Economic   Sanctions.   SECTION 11. EVENTS OF DEFAULT.   An “Event of Default” shall exist if any of the following conditions or events shall occur   and be continuing:   (a) Failure to Make Payments When Due. The Issuer defaults in the payment of (i)   any principal or Make-Whole Amount, if any, on any Note when the same   becomes due and payable, whether at maturity or at a date fixed for prepayment   or by declaration or otherwise or (ii) any interest on any Note for more than five   (5) Business Days after the same becomes due; or   (b) Default in Other Agreements.  (i) Failure of an Obligor or any of its Subsidiaries   to pay when due any principal of or interest on or any other amount payable in   respect of one or more items of (x) Recourse Indebtedness (other than   Indebtedness referred to in Section 10.1(a)) or (y) Non-Recourse Indebtedness in   an aggregate principal amount of $10,000,000 or more, in each case beyond the   grace or cure period, if any, provided therefor; or (ii) breach or default by an   Obligor with respect to any other term of (1) one or more items of Indebtedness in   the aggregate principal amounts referred to in clauses (i)(x) or (i)(y) above, or (2)   any loan agreement, mortgage, indenture or other agreement relating to such   item(s) of Indebtedness, in each case beyond the grace or cure period, if any,   provided therefor, if the effect of such breach or default is to cause, or to permit   the holder or holders of that Indebtedness (or a trustee on behalf of such holder or   holders), to cause, that Indebtedness to become or be declared due and payable (or   subject to a compulsory repurchase or redeemable) prior to its stated maturity or   the stated maturity of any underlying obligation, as the case may be; or   (c) Breach of Certain Covenants.  Failure of the Obligors or any Unencumbered   Property Owner, as applicable, to perform or comply with any term or condition   contained in Section 9.1, Section 9.2(a), Section 9.5, Section 9.9, Section 9.12 (to   the extent such failure would permit the ground lessor under the applicable   Eligible Ground Lease to terminate such Eligible Ground Lease), Section 9.13,   Section 9.15 or Section 10; or     

 

-48-      (d) Breach of Representations, etc.  Any representation, warranty, certification or   other statement made or deemed made by an Obligor or any Subsidiary Guarantor   in any Financing Agreement or in any statement or certificate at any time given   by an Obligor or any Subsidiary Guarantor or any of their Subsidiaries in writing   pursuant hereto or thereto or in connection herewith or therewith shall be false in   any material respect as of the date made or deemed made; or   (e) Other Defaults Under Financing Agreements.  Any Obligor or Subsidiary   Guarantor shall default in the performance of or compliance with any term   contained herein or any of the other Financing Agreement, other than any such   term referred to in any other Section of this Section 11.1, and such default shall   not have been remedied or waived within thirty (30) days after the earlier of (i) an   Authorized Officer of the Issuer becoming aware of such default, or (ii) receipt by   the Issuer of notice from any holder of a Note that is an Institutional Investor of   such default; provided, however, if such default is not capable of being cured   within such thirty (30) day period, such period shall be extended for a reasonable   period of time (not to exceed thirty (30) additional days), so long as such Obligor   or Subsidiary Guarantor has commenced and is diligently pursuing such cure   within such initial thirty (30) day period; or   (f) Involuntary Bankruptcy; Appointment of Receiver, etc.  (i) A court of competent   jurisdiction shall enter a decree or order for relief in respect of an Obligor or any   of its Subsidiaries in an involuntary case under the Bankruptcy Code or Debtor   Relief Laws now or hereafter in effect, which decree or order is not stayed; or any   other similar relief shall be granted under any applicable federal or state law; or   (ii) an involuntary case shall be commenced against an Obligor or any of its   Subsidiaries under the Bankruptcy Code or other Debtor Relief Laws now or   hereafter in effect; or a decree or order of a court having jurisdiction in the   premises for the appointment of a receiver, liquidator, sequestrator, trustee,   custodian or other officer having similar powers over an Obligor or any of its   Subsidiaries, or over all or a substantial part of its property, shall have been   entered; or there shall have occurred the involuntary appointment of an interim   receiver, trustee or other custodian of an Obligor or any of its Subsidiaries for all   or a substantial part of its property; or a warrant of attachment, execution or   similar process shall have been issued against any substantial part of the property   of an Obligor or any of its Subsidiaries, and any such event described in this   clause (ii) shall continue for sixty (60) days without having been dismissed,   bonded or discharged; or   (g) Voluntary Bankruptcy; Appointment of Receiver, etc.  (i) Any Obligor or any of   its Subsidiaries shall have an order for relief entered with respect to it or shall   commence a voluntary case under the Bankruptcy Code or other Debtor Relief   Laws now or hereafter in effect, or shall consent to the entry of an order for relief   in an involuntary case, or to the conversion of an involuntary case to a voluntary   case, under any such law, or shall consent to the appointment of or taking   possession by a receiver, trustee or other custodian for all or a substantial part of     

 

-49-      its property; or an Obligor or any of its Subsidiaries shall make any assignment   for the benefit of creditors; or (ii) an Obligor or any of its Subsidiaries shall be   unable, or shall fail generally, or shall admit in writing its inability, to pay its   debts as such debts become due; or the board of directors (or similar governing   body) of an Obligor or any of its Subsidiaries or any committee thereof shall   adopt any resolution or otherwise authorize any action to approve any of the   actions referred to herein or in Section 11.1(f); or   (h) Judgments and Attachments.  (i) Any one or more money judgments, writs or   warrants of attachment or similar process against all or any material portion of   any property of an Obligor, any Subsidiary Guarantor or an Unencumbered   Property Owner or involving an aggregate amount at any time in excess of   $2,000,000 (to the extent not adequately covered by insurance as to which a   solvent and unaffiliated insurance company has acknowledged coverage) shall be   entered or filed against an Obligor or any of its Subsidiaries or any of their   respective assets and shall remain undischarged, unvacated, unbonded or unstayed   for a period of thirty (30) days; or (ii) any non-monetary judgment or order shall   be rendered against an Obligor or any of its Subsidiaries that would reasonably be   expected to have a Material Adverse Effect, and shall remain undischarged,   unvacated, unbonded or unstayed for a period of thirty (30) days; or   (i) Dissolution.  Any order, judgment or decree shall be entered against an Obligor or   any of its Subsidiaries decreeing the dissolution or split up of such Obligor or   such Subsidiary and such order shall remain undischarged or unstayed for a   period in excess of thirty (30) days; or   (j) Pension Plans.  There shall occur one or more ERISA Events which individually   or in the aggregate results in liability of an Obligor, any of their Subsidiaries or   any of their respective ERISA Affiliates in excess of $2,000,000 during the term   hereof and which is not paid by the applicable due date; or   (k) Change of Control.  A Change of Control shall occur; or   (l) Invalidity of Financing Agreements and Other Documents.  At any time after the   execution and delivery thereof, (i) this Agreement or any other Financing   Agreement ceases to be in full force and effect (other than by reason of the   satisfaction in full of the Obligations (other than contingent and indemnified   obligations not then due and owing) in accordance with the terms hereof) or shall   be declared null and void, or (ii) an Obligor or any Subsidiary Guarantor shall   contest the validity or enforceability of any Financing Agreement in writing or   deny in writing that it has any further liability; or   (m) Failure to Maintain REIT Status.  The Parent Guarantor shall, for any reason, lose   or fail to maintain its status as a REIT or the Issuer shall, for any reason, lose or   fail to maintain its status as any of the following:  a REIT, a partnership or other   disregarded entity (in each case, for federal income tax purposes); or     

 

-50-      (n) Management Agreement.  There occurs a monetary or material default under a   management agreement with respect to an Unencumbered Pool Property (which   material default shall include any default which would permit the manager under   any such management agreement to terminate such management agreement or   would otherwise result in a material increase of the obligations of the   Unencumbered Property Owner that is a party to such management agreement)   and such default is not remedied prior to the date which is the earlier of (i) thirty   (30) days from the occurrence of the event or condition which caused, led to, or   resulted in such default, and (ii) the last day of any cure period provided in such   management agreement for such default.   SECTION 12. REMEDIES ON DEFAULT, ETC.    Section 12.1. Acceleration.     (a) If an Event of Default with respect to either Obligor described in Section 11(f) or   (g) has occurred, all the Notes then outstanding shall automatically become   immediately due and payable.   (b) If any other Event of Default has occurred and is continuing, the Required   Holders may at any time at its or their option, by notice or notices to the Issuer,   declare all the Notes then outstanding to be immediately due and payable.   (c) If any Event of Default described in Section 11(a)(i) or 11(a)(ii) has occurred and   is continuing, any holder or holders of Notes at the time outstanding affected by   such Event of Default may at any time, at its or their option, by notice or notices   to the Issuer, declare all the Notes held by it or them to be immediately due and   payable.   Upon any Notes becoming due and payable under this Section 12.1, whether   automatically or by declaration, such Notes will forthwith mature and the entire unpaid principal   amount of such Notes, plus (x) all accrued and unpaid interest thereon (including, but not limited   to, interest accrued thereon at the Default Rate) and (y) the Make-Whole Amount determined in   respect of such principal amount (to the full extent permitted by applicable law), shall all be   immediately due and payable, in each and every case without presentment, demand, protest or   further notice, all of which are hereby waived.  Each Obligor acknowledges, and the parties   hereto agree, that each holder of a Note has the right to maintain its investment in the Notes free   from repayment by the Obligors (except as herein specifically provided for) and that the   provision for payment of a Make-Whole Amount by the Obligors in the event that the Notes are   prepaid or are accelerated as a result of an Event of Default, is intended to provide compensation   for the deprivation of such right under such circumstances.    Section 12.2. Other Remedies.  If any Default or Event of Default has occurred and is   continuing, and irrespective of whether any Notes have become or have been declared   immediately due and payable under Section 12.1, the holder of any Note at the time outstanding   may proceed to protect and enforce the rights of such holder by an action at law, suit in equity or     

 

-51-      other appropriate proceeding, whether for the specific performance of any agreement contained   herein or in any Note or other Financing Agreement, if applicable, or for an injunction against a   violation of any of the terms hereof or thereof, or in aid of the exercise of any power granted   hereby or thereby or by law or otherwise.    Section 12.3. Rescission.  At any time after any Notes have been declared due and   payable pursuant to Section 12.1(b) or (c), the Required Holders, by written notice to the Issuer,   may rescind and annul any such declaration and its consequences if (a) the Obligors have paid all   overdue interest on the Notes, all principal of and Make-Whole Amount, if any, on any Notes   that are due and payable and are unpaid other than by reason of such declaration, and all interest   on such overdue principal and Make-Whole Amount, if any, and (to the extent permitted by   applicable law) any overdue interest in respect of the Notes, at the Default Rate, (b) neither the   Obligors nor any other Person shall have paid any amounts which have become due solely by   reason of such declaration, (c) all Events of Default and Defaults, other than non-payment of   amounts that have become due solely by reason of such declaration, have been cured or have   been waived pursuant to Section 17, and (d) no judgment or decree has been entered for the   payment of any monies due pursuant hereto or to the Notes.  No rescission and annulment under   this Section 12.3 will extend to or affect any subsequent Event of Default or Default or impair   any right consequent thereon.    Section 12.4. No Waivers or Election of Remedies, Expenses, Etc.  No course of   dealing and no delay on the part of any holder of any Note in exercising any right, power or   remedy shall operate as a waiver thereof or otherwise prejudice such holder’s rights, powers or   remedies.  No right, power or remedy conferred by any Financing Agreement (including by any   Note) upon any holder thereof shall be exclusive of any other right, power or remedy referred to   herein or therein or now or hereafter available at law, in equity, by statute or otherwise.  Without   limiting the obligations of the Issuer under Section 15, the Obligors will pay to the holder of each   Note on demand such further amount as shall be sufficient to cover all costs and expenses of   such holder incurred in any enforcement or collection under this Section 12, including, without   limitation, reasonable attorneys’ fees, expenses and disbursements.   SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.    Section 13.1. Registration of Notes.  The Issuer shall keep at its principal executive   office a register for the registration and registration of transfers of Notes.  The name and address   of each holder of one or more Notes, each transfer thereof and the name and address of each   transferee of one or more Notes shall be registered in such register.  If any holder of one or more   Notes is a nominee, then (a) the name and address of the beneficial owner of such Note or Notes   shall also be registered in such register as an owner and holder thereof and (b) at any such   beneficial owner’s option, either such beneficial owner or its nominee may execute any   amendment, waiver or consent pursuant to this Agreement.  Prior to due presentment for   registration of transfer, the Person(s) in whose name any Note(s) shall be registered shall be   deemed and treated as the owner and holder thereof for all purposes hereof, and the Issuer shall   not be affected by any notice or knowledge to the contrary.  The Issuer shall give to any holder   of a Note that is an Institutional Investor promptly upon request therefor, a complete and correct   copy of the names and addresses of all registered holders of Notes.     

 

-52-       Section 13.2. Transfer and Exchange of Notes.  Upon surrender of any Note to the   Issuer at the address and to the attention of the designated officer (all as specified in   Section 18(iii)), for registration of transfer or exchange (and in the case of a surrender for   registration of transfer accompanied by a written instrument of transfer duly executed by the   registered holder of such Note or such holder’s attorney duly authorized in writing and   accompanied by the relevant name, address and other information for notices of each transferee   of such Note or part thereof), within ten Business Days thereafter, the Issuer shall execute and   deliver, at the Issuer’s expense (except as provided below), one or more new Notes of the same   series (as requested by the holder thereof) in exchange therefor, in an aggregate principal amount   equal to the unpaid principal amount of the surrendered Note.  Each such new Note shall be   payable to such Person as such holder may request and shall be substantially in the form of   Exhibit 1(a), Exhibit 1(b), Exhibit 1(c) or Exhibit 1(d), as applicable.  Each such new Note shall   be dated and bear interest from the date to which interest shall have been paid on the surrendered   Note or dated the date of the surrendered Note if no interest shall have been paid thereon.  The   Issuer may require payment of a sum sufficient to cover any stamp tax or governmental charge   imposed in respect of any such transfer of Notes.  Notes shall not be transferred in   denominations of less than $100,000, provided that if necessary to enable the registration of   transfer by a holder of its entire holding of Notes, one Note may be in a denomination of less   than $100,000.  Any transferee, by its acceptance of a Note registered in its name (or the name of   its nominee), shall be deemed to have made the representation set forth in Section 6.2.    Section 13.3. Replacement of Notes.  Upon receipt by the Issuer at the address and to the   attention of the designated officer (all as specified in Section 18(iii)) of evidence reasonably   satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any Note   (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional   Investor of such ownership and such loss, theft, destruction or mutilation), and   (a) in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it   (provided that if the holder of such Note is, or is a nominee for, an original   Purchaser or another holder of a Note with a minimum net worth of at least   $50,000,000 or a Qualified Institutional Buyer, such Person’s own unsecured   agreement of indemnity shall be deemed to be satisfactory), or   (b) in the case of mutilation, upon surrender and cancellation thereof,   within ten Business Days thereafter, the Issuer at its own expense shall execute and deliver, in   lieu thereof, a new Note of the same series, dated and bearing interest from the date to which   interest shall have been paid on such lost, stolen, destroyed or mutilated Note or dated the date of   such lost, stolen, destroyed or mutilated Note if no interest shall have been paid thereon.   SECTION 14. PAYMENTS ON NOTES.    Section 14.1. Place of Payment.  Subject to Section 14.2, payments of principal, Make-   Whole Amount, if any, and interest becoming due and payable on the Notes shall be made in   New York, New York at the principal office of U.S. Bank, National Association, 461 Fifth   Avenue, New York, New York 10017 in such jurisdiction.  The Issuer may at any time, by notice     

 

-53-      to each holder of a Note, change the place of payment of the Notes so long as such place of   payment shall be either the principal office of the Issuer in such jurisdiction or the principal   office of a bank or trust company in such jurisdiction.    Section 14.2. Home Office Payment.  So long as any Purchaser or its nominee shall be   the holder of any Note, and notwithstanding anything contained in Section 14.1 or in such Note   to the contrary, the Issuer will pay all sums becoming due on such Note for principal, Make-   Whole Amount, if any, interest and all other amounts becoming due hereunder by the method   and at the address specified for such purpose below such Purchaser’s name in Schedule A, or by   such other method or at such other address as such Purchaser shall have from time to time   specified to the Issuer in writing for such purpose, without the presentation or surrender of such   Note or the making of any notation thereon, except that upon written request of the Issuer made   concurrently with or reasonably promptly after payment or prepayment in full of any Note, such   Purchaser shall surrender such Note for cancellation, reasonably promptly after any such request,   to the Issuer at its principal executive office or at the place of payment most recently designated   by the Issuer pursuant to Section 14.1.  Prior to any sale or other disposition of any Note held by   a Purchaser or its nominee, such Purchaser will, at its election, either endorse thereon the amount   of principal paid thereon and the last date to which interest has been paid thereon or surrender   such Note to the Issuer in exchange for a new Note or Notes pursuant to Section 13.2.  The   Issuer will afford the benefits of this Section 14.2 to any Institutional Investor that is the direct or   indirect transferee of any Note purchased by a Purchaser under this Agreement and that has   made the same agreement relating to such Note as the Purchasers have made in this Section 14.2.   SECTION 15. EXPENSES, ETC.    Section 15.1. Transaction Expenses.  Whether or not the transactions contemplated   hereby are consummated, the Issuer will pay all costs and expenses (including reasonable   attorneys’ fees of a special counsel and, if reasonably required by the Required Holders, local or   other counsel) incurred by the Purchasers and each other holder of a Note in connection with   such transactions and in connection with any amendments, waivers or consents under or in   respect of the Financing Agreements (including the Notes) (whether or not such amendment,   waiver or consent becomes effective), including, without limitation: (a) the costs and expenses   incurred in enforcing or defending (or determining whether or how to enforce or defend) any   rights under the Financing Agreements (including the Notes) or in responding to any subpoena or   other legal process or informal investigative demand issued in connection with the Financing   Agreements (including the Notes), or by reason of being a holder of any Note, (b) the costs and   expenses, including financial advisors’ fees, incurred in connection with the insolvency or   bankruptcy of an Obligor or any Subsidiary or in connection with any work-out or restructuring   of the transactions contemplated hereby and by the Notes and any Subsidiary Guarantee and (c)   the costs and expenses incurred in connection with the initial filing of this Agreement and all   related documents and financial information with the SVO provided, that such costs and   expenses under this clause (c) shall not exceed $3,500 per series.  The Obligors will pay, and will   save each Purchaser and each other holder of a Note harmless from, (i) all claims in respect of   any fees, costs or expenses, if any, of brokers and finders (other than those, if any, retained by a   Purchaser or other holder in connection with its purchase of the Notes) and (ii) any and all wire     

 

-54-      transfer fees that any bank deducts from any payment under such Note to such holder or   otherwise charges to a holder of a Note with respect to a payment under such Note.    Section 15.2. Survival.  The obligations of the Obligors under this Section 15 will   survive the payment or transfer of any Note, the enforcement, amendment or waiver of any   provision of the Financing Agreements (including the Notes) or any Subsidiary Guarantee, and   the termination of the Financing Agreements or any Subsidiary Guarantee.   SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.   All representations and warranties contained herein shall survive the execution and   delivery of this Agreement and the Notes, the purchase or transfer by any Purchaser of any Note   or portion thereof or interest therein and the payment of any Note, and may be relied upon by   any subsequent holder of a Note, regardless of any investigation made at any time by or on   behalf of such Purchaser or any other holder of a Note.  All statements contained in any   certificate or other instrument delivered by or on behalf of either Obligor pursuant to this   Agreement shall be deemed representations and warranties of such Obligor under this   Agreement.  Subject to the preceding sentence, this Agreement, the Notes and any Subsidiary   Guarantee embody the entire agreement and understanding between each Purchaser and the   Obligors and supersede all prior agreements and understandings relating to the subject matter   hereof.   SECTION 17. AMENDMENT AND WAIVER.      Section 17.1. Requirements.  This Agreement and the Notes may be amended, and the   observance of any term hereof or of the Notes may be waived (either retroactively or   prospectively), only with the written consent of the Obligors and the Required Holders, except   that:    (a) no amendment or waiver of any of Sections 1, 2, 3, 4, 5, 6 or 21 hereof, or any   defined term (as it is used therein), will be effective as to any Purchaser unless consented to by   such Purchaser in writing;    (b)  no amendment or waiver may, without the written consent of each Purchaser and   the holder of each Note at the time outstanding, (i) subject to Section 12 relating to acceleration   or rescission, change the amount or time of any prepayment or payment of principal of, or reduce   the rate or change the time of payment or method of computation of (x) interest on the Notes or   (y) the Make-Whole Amount, (ii) change the percentage of the principal amount of the Notes the   holders of which are required to consent to any amendment or waiver, or (iii) amend any of   Sections 8 (except as set forth in the second sentence of Section 8.2 and Section 17.1(c)), 11(a),   12, 17 or 20; and    (c) Section 8.5 may be amended or waived to permit offers to purchase made by the   Issuer or an Affiliate pro rata to the holders of all Notes at the time outstanding upon the same   terms and conditions only with the written consent of the Issuer and the Super-Majority Holders.     

 

-55-       Section 17.2. Solicitation of Holders of Notes.    (a) Solicitation.  The Obligors will provide each holder of a Note with sufficient   information, sufficiently far in advance of the date a decision is required, to enable such holder to   make an informed and considered decision with respect to any proposed amendment, waiver or   consent in respect of any of the provisions hereof or of the Notes or any Subsidiary Guarantee.    The Obligors will deliver executed or true and correct copies of each amendment, waiver or   consent effected pursuant to this Section 17 or any Subsidiary Guarantee to each holder of a Note   promptly following the date on which it is executed and delivered by, or receives the consent or   approval of, the requisite holders of Notes.    (b) Payment.  The Obligors will not directly or indirectly pay or cause to be paid any   remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant   any security or provide other credit support, to any holder of a Note as consideration for or as an   inducement to the entering into by such holder of Notes of any waiver or amendment of any of   the terms and provisions hereof or of any Subsidiary Guarantee or of any Note unless such   remuneration is concurrently paid, or security is concurrently granted or other credit support   concurrently provided, on the same terms, ratably to each holder of Notes then outstanding even   if such holder did not consent to such waiver or amendment.    (c) Consent in Contemplation of Transfer.  Any consent given pursuant to this   Section 17 or any Subsidiary Guarantee by a holder of a Note that has transferred or has agreed   to transfer its Note to either Obligor, any Subsidiary or any Affiliate of either Obligor (either   pursuant to a waiver under this Section 17.1(c) or subsequent to Section 8.5 having been   amended pursuant to this Section 17.1(c)) in connection with such consent shall be void and of   no force or effect except solely as to such holder, and any amendments effected or waivers   granted or to be effected or granted that would not have been or would not be so effected or   granted but for such consent (and the consents of all other holders of Notes that were acquired   under the same or similar conditions) shall be void and of no force or effect except solely as to   such holder.    Section 17.3. Binding Effect, etc.  Any amendment or waiver consented to as provided in   this Section 17 or any Subsidiary Guarantee applies equally to all holders of Notes and is binding   upon them and upon each future holder of any Note and upon the Obligors without regard to   whether such Note has been marked to indicate such amendment or waiver.  No such amendment   or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of   Default not expressly amended or waived or impair any right consequent thereon.  No course of   dealing between the Obligors and the holder of any Note nor any delay in exercising any rights   hereunder or under any Note or Subsidiary Guarantee shall operate as a waiver of any rights of   any holder of such Note.    Section 17.4. Notes Held by Obligors, etc.  Solely for the purpose of determining   whether the holders of the requisite percentage of the aggregate principal amount of Notes then   outstanding approved or consented to any amendment, waiver or consent to be given under this   Agreement, any Subsidiary Guarantee or the Notes, or have directed the taking of any action   provided herein or in any Subsidiary Guarantee or the Notes to be taken upon the direction of the     

 

-56-      holders of a specified percentage of the aggregate principal amount of Notes then outstanding,   Notes directly or indirectly owned by either Obligor or any of its Affiliates shall be deemed not   to be outstanding.   SECTION 18. NOTICES.   All notices and communications provided for hereunder shall be in writing and sent (a)   by telecopy if the sender on the same day sends a confirming copy of such notice by an   internationally recognized overnight delivery service (charges prepaid), or (b) by registered or   certified mail with return receipt requested (postage prepaid), or (c) by an internationally   recognized overnight delivery service (with charges prepaid).  Any such notice must be sent:    (i) if to any Purchaser or its nominee, to such Purchaser or nominee at the   address specified for such communications in Schedule A, or at such other address as   such Purchaser or nominee shall have specified to the Issuer in writing,    (ii) if to any other holder of any Note, to such holder at such address as such   other holder shall have specified to the Issuer in writing, or    (iii) if to the Issuer, to the Issuer at 309 N. Water Street, Suite 500, Milwaukee,   WI 53202, to the attention of Jeff N. Theiler, with a copy to the attention of Brad D.   Page, or at such other address as the Issuer shall have specified to the holder of each Note   in writing; or    (iv) if to the Parent Guarantor, in care of the Issuer at the address of the Issuer   set forth in subclause (iii) above to the attention of Jeff N. Theiler, or at such other   address as the Parent Guarantor shall have specified to the holder of each Note in writing.   Notices under this Section 18 will be deemed given only when actually received.   SECTION 19. REPRODUCTION OF DOCUMENTS.   This Agreement and all documents relating thereto, including, without limitation, (a)   consents, waivers and modifications that may hereafter be executed, (b) documents received by   any Purchaser at the Closing (except the Notes themselves), and (c) financial statements,   certificates and other information previously or hereafter furnished to any Purchaser, may be   reproduced by such Purchaser by any photographic, photostatic, electronic, digital, or other   similar process and such Purchaser may destroy any original document so reproduced.  Each   Obligor agrees and stipulates that, to the extent permitted by applicable law, any such   reproduction shall be admissible in evidence as the original itself in any judicial or administrative   proceeding (whether or not the original is in existence and whether or not such reproduction was   made by such Purchaser in the regular course of business) and any enlargement, facsimile or   further reproduction of such reproduction shall likewise be admissible in evidence.  This Section   19 shall not prohibit either Obligor or any other holder of Notes from contesting any such   reproduction to the same extent that it could contest the original, or from introducing evidence to   demonstrate the inaccuracy of any such reproduction.     

 

-57-      SECTION 20. CONFIDENTIAL INFORMATION.   For the purposes of this Section 20, “Confidential Information” means information   delivered to any Purchaser by or on behalf of either Obligor or any Subsidiary in connection with   the transactions contemplated by or otherwise pursuant to this Agreement that is proprietary in   nature and that was clearly marked or labeled or otherwise adequately identified when received   by such Purchaser as being confidential information of such Obligor or such Subsidiary,   provided that such term does not include information that (a) was publicly known or otherwise   known to such Purchaser prior to the time of such disclosure, (b) subsequently becomes publicly   known through no act or omission by such Purchaser or any Person acting on such Purchaser’s   behalf, (c) otherwise becomes known to such Purchaser other than through disclosure by either   Obligor or any Subsidiary or (d) constitutes financial statements delivered to such Purchaser   under Section 9.1 that are otherwise publicly available.  Each Purchaser will maintain the   confidentiality of such Confidential Information in accordance with procedures adopted by such   Purchaser in good faith to protect confidential information of third parties delivered to such   Purchaser, provided that such Purchaser may deliver or disclose Confidential Information to (i)   its directors, officers, employees, agents, attorneys, trustees and affiliates (to the extent such   disclosure reasonably relates to the administration of the investment represented by its Notes),   (ii) its auditors, financial advisors and other professional advisors who agree to hold confidential   the Confidential Information substantially in accordance with this Section 20, (iii) any other   holder of any Note, (iv) any Institutional Investor to which it sells or offers to sell such Note or   any part thereof or any participation therein (if such Person has agreed in writing prior to its   receipt of such Confidential Information to be bound by this Section 20), (v) any Person from   which it offers to purchase any Security of the Issuer (if such Person has agreed in writing prior   to its receipt of such Confidential Information to be bound by this Section 20), (vi) any federal or   state regulatory authority having jurisdiction over such Purchaser, (vii) the NAIC or the SVO or,   in each case, any similar organization, or any nationally recognized rating agency that requires   access to information about such Purchaser’s investment portfolio, or (viii) any other Person to   which such delivery or disclosure may be necessary or appropriate (w) to effect compliance with   any law, rule, regulation or order applicable to such Purchaser, (x) in response to any subpoena   or other legal process, (y) in connection with any litigation to which such Purchaser is a party or   (z) if an Event of Default has occurred and is continuing, to the extent such Purchaser may   reasonably determine such delivery and disclosure to be necessary or appropriate in the   enforcement or for the protection of the rights and remedies under such Purchaser’s Notes, this   Agreement or any Subsidiary Guarantee.  Each holder of a Note, by its acceptance of a Note, will   be deemed to have agreed to be bound by and to be entitled to the benefits of this Section 20 as   though it were a party to this Agreement.  On reasonable request by either Obligor in connection   with the delivery to any holder of a Note of information required to be delivered to such holder   under this Agreement or requested by such holder (other than a holder that is a party to this   Agreement or its nominee), such holder will enter into an agreement with such Obligor   embodying this Section 20.   In the event that as a condition to receiving access to information relating to the Obligors   or their Subsidiaries in connection with the transactions contemplated by or otherwise pursuant   to this Agreement, any Purchaser or holder of a Note is required to agree to a confidentiality   undertaking (whether through IntraLinks, another secure website, a secure virtual workspace or     

 

-58-      otherwise) which is different from this Section 20, this Section 20 shall not be amended thereby   and, as between such Purchaser or such holder and the Obligors, this Section 20 shall supersede   any such other confidentiality undertaking.   SECTION 21. SUBSTITUTION OF PURCHASER.   Each Purchaser shall have the right to substitute any one of its Affiliates or another   Purchaser or any one of such other Purchaser’s Affiliates (a “Substitute Purchaser”) as the   purchaser of the Notes that it has agreed to purchase hereunder, by written notice to the Obligors,   which notice shall be signed by both such Purchaser and such Substitute Purchaser, shall contain   such Substitute Purchaser’s agreement to be bound by this Agreement and shall contain a   confirmation by such Substitute Purchaser of the accuracy with respect to it of the   representations set forth in Section 6.  Upon receipt of such notice, any reference to such   Purchaser in this Agreement (other than in this Section 21), shall be deemed to refer to such   Substitute Purchaser in lieu of such original Purchaser.  In the event that such Substitute   Purchaser is so substituted as a Purchaser hereunder and such Substitute Purchaser thereafter   transfers to such original Purchaser all of the Notes then held by such Substitute Purchaser, upon   receipt by the Obligors of notice of such transfer, any reference to such Substitute Purchaser as a   “Purchaser” in this Agreement (other than in this Section 21), shall no longer be deemed to refer   to such Substitute Purchaser, but shall refer to such original Purchaser, and such original   Purchaser shall again have all the rights of an original holder of the Notes under this Agreement.   SECTION 22. PARENT GUARANTEE.    Section 22.1. Guarantee.  The Parent Guarantor hereby absolutely, unconditionally and   irrevocably guarantees (the “Parent Guarantee”), as a primary obligor and not merely as a   surety, to each holder and its successors and permitted assigns (a) the full and punctual payment   when due, whether at stated maturity, by acceleration or otherwise, of the principal of and Make-   Whole Amount and interest on (including, without limitation, interest, whether or not an   allowable claim, accruing after the date of filing of any petition in bankruptcy, or the   commencement of any bankruptcy, insolvency or similar proceeding relating to the Issuer) the   Notes and all other amounts owed or to be owing by the Issuer which becomes due under the   terms and provisions of the Financing Agreements, now or hereafter existing under the Financing   Agreements whether for principal, Make-Whole Amount, interest (including, without limitation,   interest, whether or not an allowable claim, accruing after the date of filing of any petition in   bankruptcy, or the commencement of any bankruptcy, insolvency or similar proceeding relating   to the Issuer), (b) the full and prompt performance and observance by the Issuer of each and all   of the obligations, covenants and agreements required to be performed or owed by the Issuer   under the terms of the Notes and this Agreement and (c) the full and prompt payment, upon   demand by any holder of all costs and expenses, legal or otherwise (including reasonable   attorneys’ fees) and such expenses, if any, as shall have been expended or incurred in the   protection or enforcement of any right or privilege under the Notes or this Agreement or in the   protection or enforcement of any rights, privileges or liabilities under the Parent Guarantee or in   any consultation or action in connection therewith or herewith and in each and every case   irrespective of the validity, regularity, or enforcement of any of the Notes or this Agreement or   any of the terms thereof or of any other like circumstance or circumstances (all such obligations     

 

-59-      being the “Guaranteed Obligations”), and agrees to pay any and all reasonable fees and   expenses incurred by each holder in enforcing the Parent Guarantee.   Notwithstanding any stay, injunction or other prohibition preventing such action against   the Issuer, if for any reason whatsoever the Issuer shall fail or be unable to duly, punctually and   fully (in the case of the payment of Guaranteed Obligations) pay such amounts as and when the   same shall become due and (in the case of the payment of Guaranteed Obligations) payable,   whether or not such failure or inability shall constitute an “Event of Default”, the Parent   Guarantor will forthwith (in the case of the payment of Guaranteed Obligations) pay or cause to   be paid such amounts to the holders, in lawful money of the United States of America, at the   place specified in Section 14, or pay such Guaranteed Obligations or cause such Guaranteed   Obligations to be paid, (in the case of the payment of Guaranteed Obligations) together with   interest (in the amounts and to the extent required under such Notes) on any amount due and   owing.    Section 22.2. Parent Guarantor’s Obligations Unconditional.     (a) The Parent Guarantee shall constitute a Guarantee of payment and not of   collection, and the Parent Guarantor specifically agrees that it shall not be   necessary, and that the Parent Guarantor shall not be entitled to require, before or   as a condition of enforcing the liability of the Parent Guarantor under the Parent   Guarantee or requiring payment or performance of the Guaranteed Obligations by   the Parent Guarantor hereunder, or at any time thereafter, that any holder:  (a) file   suit or proceed to obtain or assert a claim for personal judgment against the Issuer   or any other Person that may be liable for or with respect to any Guaranteed   Obligation; (b) make any other effort to obtain payment or performance of any   Guaranteed Obligation from the Issuer or any other Person that may be liable for   or with respect to such Guaranteed Obligation, except for the making of the   demands, when appropriate, described in Section 22.1; (c) foreclose against, or   seek to realize upon security now or hereafter existing for such Guaranteed   Obligations; (d) except to the extent set forth in Section 22.1, exercise or assert   any other right or remedy to which such holder is or may be entitled in connection   with any Guaranteed Obligation or any security or other guaranty therefor; or   (e) assert or file any claim against the assets of the Issuer or any other Person   liable for any Guaranteed Obligation.  The Parent Guarantor agrees that the Parent   Guarantee shall be continuing, and that the Guaranteed Obligations will be paid   and performed in accordance with their terms and the terms of the Parent   Guarantee, and are the primary, absolute and unconditional obligations of the   Parent Guarantor, irrespective of the value, genuineness, validity, legality,   regularity or enforceability or lack thereof of any part of the Guaranteed   Obligations or any agreement or instrument relating to the Guaranteed   Obligations or the Parent Guarantee, or the existence of any indemnities with   respect to the existence of any other guarantee of or security for any of the   Guaranteed Obligations, or any substitution, release or exchange of any other   guarantee of or security for any of the Guaranteed Obligations, and, to the fullest   extent permitted by Applicable Law, irrespective of any other circumstance     

 

-60-      whatsoever that might otherwise constitute a legal or equitable discharge or   defense of a surety or guarantor (other than the full and indefeasible due payment   and performance of the Guaranteed Obligations), it being the intent of this   Section 22.2 that the obligations of the Parent Guarantor hereunder shall be   irrevocable, primary, absolute and unconditional under any and all circumstances   (other than the full and indefeasible due payment and performance of the   Guaranteed Obligations).   (b) The Parent Guarantor hereby expressly waives notice of acceptance of and   reliance upon the guaranty in the Parent Guarantee, diligence, presentment,   demand of payment or performance, protest and all other notices (except as   otherwise provided for in Section 22.1) whatsoever, any requirement that the   holders exhaust any right, power or remedy or proceed against the Issuer or   against any other Person under any other guarantee of, or security for, or any   other agreement, regarding any of the Guaranteed Obligations.  The Parent   Guarantor further agrees that, subject solely to the requirement of making   demands under Section 22.1, the occurrence of any event or other circumstance   that might otherwise vary the risk of the Issuer or the Parent Guarantor or   constitute a defense (legal or equitable) available to, or a discharge of, or a   counterclaim or right of set-off by, the Issuer or the Parent Guarantor (other than   the full and indefeasible due payment and performance of the Guaranteed   Obligations), shall not affect the liability of the Parent Guarantor hereunder.   (c) The obligations of the Parent Guarantor under the Parent Guarantee are not   subject to any counterclaim, set-off, deduction, diminution, abatement,   recoupment, suspension, deferment or defense based upon any claim the Parent   Guarantor or any other Person may have against the Issuer, any holder or any   other Person, and shall remain in full force and effect without regard to, and shall   not be released, discharged or in any way affected by, any circumstances or   condition whatsoever (whether or not the Parent Guarantor or the Issuer shall   have any knowledge or notice thereof), including:   i. any renewal, extension, modification, increase, decrease, alteration or   rearrangement of all or any part of the Guaranteed Obligations or any   instrument executed in connection therewith, or any contract or understanding   with the Issuer, the holders, or any of them, or any other Person, pertaining to   the Guaranteed Obligations;   ii. any adjustment, indulgence, forbearance or compromise that might be granted   or given by any holder to the Issuer or any other Person liable on the   Guaranteed Obligations, or the failure of any holder to assert any claim or   demand or to exercise any right or remedy against the Issuer or any other   Person under the provisions of the Financing Agreements or otherwise; or any   rescission, waiver, amendment or modification of, or any release from any of   the terms or provisions of, the Financing Agreements, any guarantee or any   other agreement;     

 

-61-      iii. the insolvency, bankruptcy arrangement, adjustment, composition, liquidation,   disability, dissolution or lack of power of the Issuer or any other Person at any   time liable for the payment of all or part of the Guaranteed Obligations; or any   dissolution of the Issuer or any other such Person, or any change, restructuring   or termination of the structure or existence of the Issuer or any other such   Person, or any sale, lease or transfer of any or all of the assets of the Issuer or   any other such Person, or any change in the shareholders, partners, or   members of the Issuer or any other such Person; or any default, failure or   delay, willful or otherwise, in the performance of the Guaranteed Obligations;   iv. the invalidity, illegality or unenforceability of all or any part of the   Guaranteed Obligations, or any document or agreement executed in   connection with the Guaranteed Obligations, for any reason whatsoever,   including the fact that the Guaranteed Obligations, or any part thereof, exceed   the amount permitted by law, the act of creating the Guaranteed Obligations   or any part is ultra vires, the officers or representatives executing the   documents or otherwise creating the Guaranteed Obligations acted in excess   of their authority, the Guaranteed Obligations violate applicable usury laws,   the Issuer or any other Person has valid defenses, claims or offsets (whether at   law, in equity or by agreement) which render the Guaranteed Obligations   wholly or partially uncollectible from the Issuer or any other Person, the   creation, performance or repayment of the Guaranteed Obligations (or the   execution, delivery and performance of any document or instrument   representing part of the Guaranteed Obligations or executed in connection   with the Guaranteed Obligations or given to secure the repayment of the   Guaranteed Obligations) is illegal, uncollectible, legally impossible or   unenforceable, or the documents or instruments pertaining to the Guaranteed   Obligations have been forged or otherwise are irregular or not genuine or   authentic;   v. any full or partial release of the liability of the Issuer on the Guaranteed   Obligations or any part thereof, of any co-guarantors, or of any other Person   now or hereafter liable, whether directly or indirectly, jointly, severally, or   jointly and severally, to pay, perform, guarantee or assure the payment of the   Guaranteed Obligations or any part thereof, it being recognized,   acknowledged and agreed by the Parent Guarantor that the Parent Guarantor   may be required to pay the Guaranteed Obligations in full without assistance   or support of any other Person, and the Parent Guarantor has not been induced   to enter into the Parent Guarantee on the basis of a contemplation, belief,   understanding or agreement that any parties other than the Issuer will be liable   to perform the Guaranteed Obligations, or that the holders will look to other   parties to perform the Guaranteed Obligations;   vi. the taking or accepting of any other security, collateral or guaranty, or other   assurance of payment, for all or any part of the Guaranteed Obligations;     

 

-62-      vii. any release, surrender, exchange, subordination, deterioration, waste, loss or   impairment (including negligent, unreasonable or unjustifiable impairment) of   any collateral, property or security, at any time existing in connection with, or   assuring or securing payment of, all or any part of the Guaranteed   Obligations;   viii. the failure of any holder or any other Person to exercise diligence or   reasonable care in the preservation, protection, enforcement, sale or other   handling or treatment of all or any part of such collateral, property or security;   ix. the fact that any collateral, security, security interest or lien contemplated or   intended to be given, created or granted as security for the repayment of the   Guaranteed Obligations shall not be properly perfected or created, or shall   prove to be unenforceable or subordinate to any other security interest or lien,   it being recognized and agreed by the Parent Guarantor that the Parent   Guarantor is not entering into the Parent Guarantee in reliance on, or in   contemplation of the benefits of, the validity, enforceability, collectability or   value of any of the collateral;   x. any payment by the Issuer to any holder being held to constitute a preference   under any bankruptcy law or fraudulent conveyance law, or for any reason   any holder being required to refund such payment or pay such amount to the   Issuer or someone else;   xi. any other action taken or omitted to be taken with respect to the Guaranteed   Obligations, or the security and collateral therefor, whether or not such action   or omission prejudices the Parent Guarantor or increases the likelihood that   the Parent Guarantor will be required to pay the Guaranteed Obligations   pursuant to the terms hereof, it being the unambiguous and unequivocal   intention of the Parent Guarantor that it shall be obligated to pay the   Guaranteed Obligations when due, notwithstanding any occurrence,   circumstance, event, action or omission whatsoever, whether or not   contemplated, and whether or not otherwise or particularly described herein,   except for the full and final payment and satisfaction of the Guaranteed   Obligations in cash;   xii. the fact that all or any of the Guaranteed Obligations cease to exist by   operation of law, including by way of a discharge, limitation or tolling thereof   under applicable bankruptcy laws;   xiii. any default, failure or delay, willful or otherwise, in the performance by the   Issuer, the Parent Guarantor or any other Person of any obligations of any   kind or character whatsoever under the Financing Agreements or any other   agreement;     

 

-63-      xiv. any merger or consolidation of the Issuer or the Parent Guarantor or any other   Person into or with any other Person or any sale, lease, transfer or other   disposition of any of the assets of the Issuer, the Parent Guarantor or any other   Person to any other Person, any change in the ownership of any shares or   partnership interests of the Issuer, the Parent Guarantor or any other Person, or   any change in the relationship between the Issuer and the Parent Guarantor or   any termination of any such relationship;   xv. in respect of the Issuer, the Parent Guarantor or any other Person, any change   of circumstances, whether or not foreseen or foreseeable, whether or not   imputable to the Issuer, the Parent Guarantor or any other Person, or other   impossibility of performance through fire, explosion, accident, labor   disturbance, floods, droughts, embargoes, wars (whether or not declared), civil   commotion, acts of God or the public enemy, delays or failure of suppliers or   carriers, inability to obtain materials, action of any federal or state regulatory   body or agency, change of law or any other causes affecting performance, or   any other force majeure, whether or not beyond the control of the Issuer, the   Parent Guarantor or any other Person and whether or not of the kind   hereinbefore specified; or   xvi. any other occurrence, circumstance, or event whatsoever, whether similar or   dissimilar to the foregoing, whether foreseen or unforeseen, and any other   circumstance which might otherwise constitute a legal or equitable defense or   discharge of the liabilities of a guarantor or surety or which might otherwise   limit recourse against the Parent Guarantor (other than the full and   indefeasible due payment and performance of the Guaranteed Obligations);   provided that the specific enumeration of the above-mentioned acts, failures or omissions shall   not be deemed to exclude any other acts, failures or omissions, though not specifically mentioned   above, it being the purpose and intent of the Parent Guarantee that the obligations of the Parent   Guarantor shall be absolute and unconditional and shall not be discharged, impaired or varied   except by the payment and performance of all obligations of the Issuer under the Financing   Agreements in accordance with their respective terms as each may be amended or modified from   time to time.  Without limiting the foregoing, it is understood that repeated and successive   demands may be made and recoveries may be had hereunder as and when, from time to time, the   Issuer or the Parent Guarantor shall default under or in respect of the terms of the Financing   Agreements and that notwithstanding recovery hereunder for or in respect of any given default or   defaults by the Issuer or the Parent Guarantor under the Financing Agreements (including this    Parent Guarantee), the Parent Guarantee shall remain in full force and effect and shall apply to   each and every subsequent default.  All waivers herein contained shall be without prejudice to   the holders at their respective options to proceed against the Issuer, the Parent Guarantor or other   Person, whether by separate action or by joinder.   (d) The Parent Guarantor hereby consents and agrees that any holder or holders from   time to time, with or without any further notice to or assent from the Parent   Guarantor may, without in any manner affecting the liability of the Parent     

 

-64-      Guarantor under the Parent Guarantee, and upon such terms and conditions as any   such holder or holders may deem advisable:   i. extend in whole or in part (by renewal or otherwise), modify, change,   compromise, release or extend the duration of the time for the performance   or payment of any debt, liability or obligation of the Issuer or the Parent   Guarantor or of any other Person secondarily or otherwise liable for any debt,   liability or obligations of the Issuer under the Financing Agreements, or   waive any Default or Event of Default with respect thereto, or waive, modify,   amend or change any provision of any other agreement or waive the Parent   Guarantee; or   ii. sell, release, surrender, modify, impair, exchange or substitute any and all   property, of any nature and from whomsoever received, held by, or for the   benefit of, any such holder as direct or indirect security for the payment or   performance of any debt, liability or obligation of the Issuer, the Parent   Guarantor or of any other Person secondarily or otherwise liable for any debt,   liability or obligation of the Issuer under the Financing Agreements; or   iii. settle, adjust or compromise any claim of the Issuer or the Parent Guarantor   against any other Person secondarily or otherwise liable for any debt, liability   or obligation of the Issuer under the Financing Agreements.   The Parent Guarantor hereby ratifies and confirms any such extension, renewal, change, sale,   release, waiver, surrender, exchange, modification, amendment, impairment, substitution,   settlement, adjustment or compromise and that the same shall be binding upon it, and hereby   waives, to the fullest extent permitted by law, any and all defenses, counterclaims or offsets   which it might or could have by reason thereof, it being understood that the Parent Guarantor   shall at all times be bound by the Parent Guarantee and remain liable hereunder.   (e) All rights of any holder may be transferred or assigned at any time in accordance   with this Agreement and shall be considered to be transferred or assigned at any   time or from time to time upon the transfer of such Note in accordance with the   terms of this Agreement without the consent of or notice to the Parent Guarantor.   (f) No holder shall be under any obligation:  (i) to marshal any assets in favor of the   Parent Guarantor or in payment of any or all of the liabilities of the Issuer or the   Parent Guarantor under or in respect of the Notes or the obligations of the Issuer   and the Parent Guarantor under the Financing Agreements or (ii) to pursue any   other remedy that the Parent Guarantor may or may not be able to pursue itself   and that may lighten the Parent Guarantor’s burden, any right to which the Parent   Guarantor hereby expressly waives.    Section 22.3. Full Recourse Obligations.  The obligations of the Parent Guarantor set   forth in this Section 22 constitute the full recourse obligations of the Parent Guarantor   enforceable against it to the full extent of all its assets and properties.     

 

-65-       Section 22.4. Waiver.  The Parent Guarantor unconditionally waives, to the extent   permitted by applicable law:   (a) notice of any of the matters referred to in Section 22.2;   (b) notice to the Parent Guarantor of the incurrence of any of the Guaranteed   Obligations, notice to the Parent Guarantor of any breach or default by the Issuer   or the Parent Guarantor with respect to any of the Guaranteed Obligations or any   other notice that may be required, by statute, rule of law or otherwise, to preserve   any rights of any holder against the Parent Guarantor;   (c) presentment to the Issuer or the Parent Guarantor or of payment from the Issuer or   the Parent Guarantor with respect to any Note or other Guaranteed Obligation or   protest for nonpayment or dishonor;   (d) any right to the enforcement, assertion, exercise or exhaustion by any holder of   any right, power, privilege or remedy conferred in any Note, the other Financing   Agreements or otherwise;   (e) any requirement of diligence on the part of any holder;   (f) any requirement to mitigate the damages resulting from any default under the   Notes or the other Financing Agreements;   (g) any notice of any sale, transfer or other disposition of any right, title to or interest   in any Note or other Guaranteed Obligation by any holder, assignee or participant   thereof, or in the other Financing Agreements;   (h) any release of the Parent Guarantor from its obligations hereunder resulting from   any loss by it of its rights of subrogation hereunder; and   (i) any other circumstance whatsoever which might otherwise constitute a legal or   equitable discharge, release or defense of a guarantor or surety or which might   otherwise limit recourse against the Parent Guarantor.    Section 22.5. Waiver of Subrogation.  Notwithstanding any payment or payments made   by the Parent Guarantor hereunder, or any application by any holder of any security or of any   credits or claims, the Parent Guarantor will not exercise any rights of any holder or of the Parent   Guarantor against the Issuer to recover the amount of any payment made by the Parent Guarantor   to any holder hereunder by way of any claim, remedy or subrogation, reimbursement,   exoneration, contribution, indemnity, participation or otherwise arising by contract, by statute,   under common law or otherwise, and the Parent Guarantor shall not exercise any right of   recourse to or any claim against assets or property of the Issuer, in each case unless and until the   Guaranteed Obligations have been paid in full.  Until such time (but not thereafter), the Parent   Guarantor hereby expressly waives any right to exercise any claim, right or remedy which the   Parent Guarantor may now have or hereafter acquire against the Issuer or any other Person that     

 

-66-      arises under the Notes, the other Financing Agreements or from the performance by the Parent   Guarantor of the Guaranty hereunder including any claim, remedy or right of subrogation,   reimbursement, exoneration, contribution, indemnification or participation in any claim, right or   remedy of any holder against the Issuer or the Parent Guarantor, or any security that any holder   now has or hereafter acquires, whether or not such claim, right or remedy arises in equity, under   contract, by statute, under common law or otherwise.  If any amount shall be paid to the Parent   Guarantor by the Issuer after payment in full of the Guaranteed Obligations, and all or any   portion of the Guaranteed Obligations shall thereafter be reinstated in whole or in part and any   holder is required to repay any sums received by any of them in payment of the Guaranteed   Obligations, the Parent Guarantee shall be automatically reinstated and such amount shall be   held in trust for the benefit of the holders and shall forthwith be paid to the holders to be credited   and applied to the Guaranteed Obligations, whether matured or unmatured.  The provisions of   this Section 22.5 shall survive the termination of the Parent Guarantee, and any satisfaction and   discharge of the Issuer by virtue of any payment, court order or any federal, state or provincial   law.    Section 22.6. Subordination. If the Parent Guarantor becomes the holder of any   indebtedness payable by the Issuer, the Parent Guarantor hereby subordinates all indebtedness   owing to it from the Issuer to all indebtedness of the Issuer to the holders, and agrees that, during   the continuance of any Event of Default, it shall not accept any payment on the same until   payment in full of the Guaranteed Obligations and shall in no circumstance whatsoever attempt   to set-off or reduce any obligations hereunder because of such indebtedness.  If any amount shall   nevertheless be paid in violation of the foregoing to the Parent Guarantor by the Issuer prior to   payment in full of the Guaranteed Obligations, such amount shall be held in trust for the benefit   of the holders and shall forthwith be paid to the holders to be credited and applied to the   Guaranteed Obligations, whether matured or unmatured, provided further, and notwithstanding   this Section 22.6 to the contrary, and for the avoidance of doubt, amounts paid to and accepted   by the Parent Guarantor on indebtedness payable by the Issuer to the Parent Guarantor during the   non-existence of an Event of Default are permitted and may be retained by the Parent Guarantor.    Section 22.7. Effect of Bankruptcy Proceedings, Etc.  (a) If after receipt of any   payment of, or proceeds of any security applied (or intended to be applied) to the payment of all   or any part of, the Guaranteed Obligations, any holder is for any reason compelled to surrender   or voluntarily surrenders (under circumstances in which it believes it could reasonably be   expected to be so compelled if it did not voluntarily surrender), such payment or proceeds to any   Person (i) because such payment or application of proceeds is or may be avoided, invalidated,   declared fraudulent, set aside, determined to be void or voidable as a preference, fraudulent   conveyance, fraudulent transfer, impermissible set-off or a diversion of trust funds or (ii) for any   other similar reason, including, without limitation, (x) any judgment, decree or order of any court   or administrative body having jurisdiction over any holder or any of their respective properties or   (y) any settlement or compromise of any such claim effected by any holder with any such   claimant (including the Issuer), then the Guaranteed Obligations or part thereof intended to be   satisfied shall be reinstated and continue, and the Parent Guarantee shall continue in full force as   if such payment or proceeds had not been received, notwithstanding any revocation thereof or   the cancellation of any Note or any other instrument evidencing any Guaranteed Obligations or   otherwise, and the Parent Guarantor shall be liable to pay the holders, and hereby does indemnify     

 

-67-      the holders and hold them harmless for, the amount of such payment or proceeds so surrendered   and all expenses (including reasonable attorneys’ fees, court costs and expenses attributable   thereto) incurred by any holder in defense of any claim made against any of them that any   payment or proceeds received by any holder in respect of all or part of the Guaranteed   Obligations must be surrendered.  The provisions of this Section 22.7(a) shall survive the   termination of the Parent Guarantee, and any satisfaction and discharge of the Issuer by virtue of   any payment, court order or any federal or state law.   (b)If an event permitting the acceleration of the maturity of any of the Guaranteed Obligations   shall at any time have occurred and be continuing, and such acceleration shall at such time be   prevented by reason of the pendency against the Issuer or any other Person of any case or   proceeding contemplated by Section 22.7(a) hereof, then, for the purpose of defining the   obligation of the Parent Guarantor under the Parent Guarantee, the maturity of the principal   amount of the Guaranteed Obligations shall be deemed to have been accelerated with the same   effect as if an acceleration had occurred in accordance with the terms of such Guaranteed   Obligations, and the Parent Guarantor shall forthwith pay such principal amount, all accrued and   unpaid interest thereon, and all other Guaranteed Obligations, due or that would have become   due but for such case or proceeding, without further notice or demand.    Section 22.8. Term of Guarantee.  This guarantee and all guarantees, covenants and   agreements of the Parent Guarantor contained herein shall continue in full force and effect and   shall not be discharged until such time as all of the principal of and interest on the Notes, the   other Guaranteed Obligations and other independent payment obligations of the Parent   Guarantor under this guarantee shall be indefeasibly paid in cash and performed in full.   SECTION 23. MISCELLANEOUS.    Section 23.1. Successors and Assigns.  All covenants and other agreements contained in   this Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their   respective successors and assigns (including, without limitation, any subsequent holder of a   Note) whether so expressed or not.    Section 23.2. Accounting Terms.  All accounting terms used herein which are not   expressly defined in this Agreement have the meanings respectively given to them in accordance   with GAAP.  Except as otherwise specifically provided herein, (i) all computations made   pursuant to this Agreement shall be made in accordance with GAAP, and (ii) all financial   statements shall be prepared in accordance with GAAP.  For purposes of determining   compliance with this Agreement (including, without limitation, Section 9, Section 10 and the   definition of “Indebtedness”), any election by the Issuer to measure any financial liability using   fair value (as permitted by Financial Accounting Standards Board Accounting Standards   Codification Topic No. 825-10-25 – Fair Value Option, International Accounting Standard 39 –   Financial Instruments: Recognition and Measurement or any similar accounting standard) shall   be disregarded and such determination shall be made as if such election had not been made.    Section 23.3. Severability.  Any provision of this Agreement that is prohibited or   unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such     

 

-68-      prohibition or unenforceability without invalidating the remaining provisions hereof, and any   such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law)   not invalidate or render unenforceable such provision in any other jurisdiction.    Section 23.4. Construction, etc.  Each covenant contained herein shall be construed   (absent express provision to the contrary) as being independent of each other covenant contained   herein, so that compliance with any one covenant shall not (absent such an express contrary   provision) be deemed to excuse compliance with any other covenant.  Where any provision   herein refers to action to be taken by any Person, or which such Person is prohibited from taking,   such provision shall be applicable whether such action is taken directly or indirectly by such   Person.    Section 23.5. Counterparts.  This Agreement may be executed in any number of   counterparts, each of which shall be an original but all of which together shall constitute one   instrument.  Each counterpart may consist of a number of copies hereof, each signed by less than   all, but together signed by all, of the parties hereto.    Section 23.6. Governing Law.  This Agreement shall be construed and enforced in   accordance with, and the rights of the parties shall be governed by, the law of the State of New   York excluding choice-of-law principles of the law of such State that would permit the   application of the laws of a jurisdiction other than such State.    Section 23.7. Jurisdiction and Process; Waiver of Jury Trial.  (a) Each Obligor   irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court   sitting in the Borough of Manhattan, The City of New York, over any suit, action or proceeding   arising out of or relating to this Agreement or the Notes.  To the fullest extent permitted by   Applicable Law, each Obligor irrevocably waives and agrees not to assert, by way of motion, as   a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any   objection that it may now or hereafter have to the laying of the venue of any such suit, action or   proceeding brought in any such court and any claim that any such suit, action or proceeding   brought in any such court has been brought in an inconvenient forum.    (b) Each Obligor consents to process being served by or on behalf of any holder of   Notes in any suit, action or proceeding of the nature referred to in Section 23.7(a) by mailing a   copy thereof by registered or certified mail (or any substantially similar form of mail), postage   prepaid, return receipt requested, to it at its address specified in Section 18 or at such other   address of which such holder shall then have been notified pursuant to said Section.  The Issuer   agrees that such service upon receipt (i) shall be deemed in every respect effective service of   process upon it in any such suit, action or proceeding and (ii) shall, to the fullest extent permitted   by applicable law, be taken and held to be valid personal service upon and personal delivery to it.    Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt   furnished by the United States Postal Service or any reputable commercial delivery service.    (c) Nothing in this Section 23.7 shall affect the right of any holder of a Note to serve   process in any manner permitted by law, or limit any right that the holders of any of the Notes     

 

-69-      may have to bring proceedings against the Issuer in the courts of any appropriate jurisdiction or   to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.    (d) THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR   WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN   CONNECTION HEREWITH OR THEREWITH.         *    *    *    *    *    

 

   [Signature Page―Note Purchase and Guarantee Agreement]   If you are in agreement with the foregoing, please sign the form of agreement on a   counterpart of this Agreement and return it to the Issuer, whereupon this Agreement shall   become a binding agreement between you and the Obligors.      Very truly yours,      PHYSICIANS REALTY L.P., a Delaware   limited partnership   By:  Physicians Realty Trust, as General Partner         By /s/ John T. Thomas ____________________    Name: John T. Thomas   Title: President and Chief Executive              Officer            PHYSICIANS REALTY TRUST, a Maryland   real estate investment trust      By /s/ John T. Thomas ____________________    Name: John T. Thomas   Title: President and Chief Executive              Officer                  

 

 [Signature Page―Note Purchase and Guarantee Agreement]   This Agreement is hereby   accepted and agreed to as    of the date hereof.         AMERICAN GENERAL LIFE INSURANCE   COMPANY   THE UNITED STATES LIFE INSURANCE   COMPANY IN THE CITY OF NEW YORK   THE VARIABLE ANNUITY LIFE INSURANCE   COMPANY   AMERICAN HOME ASSURANCE COMPANY   LEXINGTON INSURANCE COMPANY   NATIONAL UNION FIRE INSURANCE   COMPANY OF PITTSBURGH, PA   UNITED GUARANTY MORTGAGE INDEMNITY   COMPANY   UNITED GUARANTY RESIDENTIAL   INSURANCE COMPANY      By: AIG Asset Management (U.S.) LLC, Investment           Adviser            By: /s/ G. Griffin Behncke ___________________     Name: G. Griffin Behncke                   Title: Vice President        

 

   SCHEDULE B   (to Note Purchase Agreement)   DEFINED TERMS      As used herein, the following terms have the respective meanings set forth below or set   forth in the Section hereof following such term:   “Acquisition”, by any Person, means the acquisition by such Person, in a single   transaction or in a series of related transactions, of all or any substantial portion of the assets of   another Person or at least a majority of the Capital Stock of another Person, in each case whether   or not involving a merger or consolidation with such other Person and whether for cash,   property, services, assumption of Indebtedness, securities or otherwise.   “Adjusted EBITDA” means, for any period, the sum of (a) EBITDA of the   Consolidated Parties for the immediately preceding calendar quarter plus (b) non-recurring   charges not otherwise added back in the calculation of EBITDA of the Consolidated Parties for   the purposes hereof under the definition of “EBITDA”, including Acquisition expenses less (c)   the Capital Reserves for such period.   “Adjusted NOI” means, for any period with respect to any Unencumbered Pool   Property, (a) NOI for such period, less (b) Capital Reserves for such period.   “Adverse Proceeding” means any action, suit, proceeding (whether administrative,   judicial or otherwise), governmental investigation or arbitration (whether or not purportedly on   behalf of an Obligor or any of its Subsidiaries) at law or in equity, or before or by any   Governmental Authority, whether pending, threatened in writing against an Obligor or any of its   Subsidiaries or any material property of an Obligor or any of its Subsidiaries.   “Affected Noteholder” is defined within the definition of “Noteholder Sanctions Event.”   “Affected Notes” is defined in Section 8.7(a).   “Affiliate” means, with respect to any Person, another Person that directly, or indirectly   through one or more intermediaries, Controls or is Controlled by or is under common Control   with the Person specified.   “Aggregate Unencumbered Pool Property Value Amount” means, with respect to any   pool of Unencumbered Pool Properties as of any date of determination, the aggregate sum of the   respective Unencumbered Pool Property Value amounts of each of the Unencumbered Pool   Properties in such pool.   “Agreement” means this Agreement, including all Schedules attached to this Agreement,   as it may be amended, restated, supplemented or otherwise modified from time to time.   “Anti-Corruption Laws” is defined in Section 5.18(d)(1).     

 

SCHEDULE B   (to Note Purchase Agreement)   “Anti-Money Laundering Laws” is defined in Section 5.18(c).   “Applicable Laws” means, as to any Person, all laws, including all applicable provisions   of constitutions, statutes, rules, ordinances, regulations and orders of all Governmental   Authorities and all orders, rulings, writs and decrees of all courts, tribunals and arbitrators, in   each case, applicable to or binding upon such Person or any of its property or to which such   Person or any of its property is subject.   “Approved Manager” means (a) any Person listed on Schedule B(1) (as such schedule   may be amended from time to time by the Issuer with the approval of the Required Holders) or   (b) any other property manager with experience managing properties which are substantially   similar to the applicable Unencumbered Pool Property, and which is engaged to manage one or   more Unencumbered Pool Properties pursuant to a management agreement between such Person   or property manager and the applicable Unencumbered Property Owner that owns (or ground   leases) such Unencumbered Pool Property.   “Asset Sale” means a sale, lease, sale and leaseback, assignment, conveyance, exclusive   license (as licensor), transfer or other disposition to, or any exchange of property with, any   Person, in one transaction or a series of transactions, of all or any part of an Obligor or any of its   Subsidiaries’ businesses, assets or properties of any kind, whether real, personal, or mixed and   whether tangible or intangible, whether now owned or hereafter acquired, created, leased or   licensed, including the Capital Stock of any Subsidiary of the Issuer, other than (a) dispositions   of surplus, obsolete or worn out property or property no longer used or useful in the business of   the Issuer and its Subsidiaries, whether now owned or hereafter acquired, in the ordinary course   of business; (b) dispositions of inventory sold, and Intellectual Property licensed or sublicensed,   in the ordinary course of business; (c) dispositions of accounts or payment intangibles (each as   defined in the UCC) resulting from the compromise or settlement thereof in the ordinary course   of business for less than the full amount thereof; (d) dispositions of Cash Equivalents in the   ordinary course of business; (e) licenses, sublicenses, leases or subleases granted to any third   parties in arm’s-length commercial transactions in the ordinary course of business that do not   interfere in any material respect with the business of the Issuer or any of its Subsidiaries; (f)   dispositions of property or assets to the extent that (i) such property or assets are exchanged for   credit against the purchase price of similar replacement property or (ii) the proceeds of such   dispositions of property or assets are promptly applied to the purchase price of such replacement   property; (g) dispositions in the ordinary course of business consisting of the abandonment or   cancellation of any Intellectual Property which, in the reasonable good faith determination of the   Issuer is not material to the conduct of the business of the Issuer and its Subsidiaries, taken as a   whole; and (h) transfers of property or assets subject to casualty, condemnation or similar event   upon receipt of the insurance or condemnation proceeds thereof.   “Attributable Indebtedness” means, on any date, (a) in respect of any Capital Lease of   any Person, the capitalized amount thereof that would appear on a balance sheet of such Person   prepared as of such date in accordance with GAAP, (b) in respect of any Off-Balance Sheet   Obligation, the capitalized amount of the remaining lease or similar payments under the relevant   lease or agreement that would appear on a balance sheet of such Person prepared as of such date   in accordance with GAAP if such lease or agreement were accounted for as a Capital Lease, (c)     

 

SCHEDULE B   (to Note Purchase Agreement)   in the case of Securitization Transactions, the outstanding principal amount of such financing,   after taking into account reserve amounts and making appropriate adjustments, determined by   the Administrative Agent in its reasonable judgment and (d) in the case of Sale and Leaseback   Transactions, the present value (discounted in accordance with GAAP at the debt rate implied in   the applicable lease) of the obligations of the lessee for rental payments during the term of such   lease.   “Authorized Officer” means, as applied to any Person, any individual holding the   position of chairman of the board (if an officer), chief executive officer, president or one of its   vice presidents (or the equivalent thereof), chief financial officer, treasurer or assistant treasurer   and, solely for purposes of making the certifications required under Section 4.3(c), any secretary   or assistant secretary.   “Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy.”   “Bankruptcy Event” means, with respect to any Person, the occurrence of any of the   following: (a) the entry of a decree or order for relief by a court or governmental agency in an   involuntary case under any applicable Debtor Relief Law or any other bankruptcy, insolvency or   other similar law now or hereafter in effect, or the appointment by a court or governmental   agency of a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of   such Person or for any substantial part of its Property or the ordering of the winding up or   liquidation of its affairs by a court or governmental agency and such decree, order or   appointment is not vacated or discharged within sixty (60) days of its filing; or (b) the   commencement against such Person of an involuntary case under any applicable Debtor Relief   Law or any other bankruptcy, insolvency or other similar law now or hereafter in effect, or of   any case, proceeding or other action for the appointment of a receiver, liquidator, assignee,   custodian, trustee, sequestrator (or similar official) of such Person or for any substantial part of   its property or for the winding up or liquidation of its affairs, and such involuntary case or other   case, proceeding or other action shall remain undismissed for a period of sixty (60) consecutive   days, or the repossession or seizure by a creditor of such Person of a substantial part of its   property; or (c) such Person shall commence a voluntary case under any applicable Debtor Relief   Law or any other bankruptcy, insolvency or other similar law now or hereafter in effect, or   consent to the entry of an order for relief in an involuntary case under any such law, or consent to   the appointment of or the taking possession by a receiver, liquidator, assignee, creditor in   possession, custodian, trustee, sequestrator (or similar official) of such Person or for any   substantial part of its property or make any general assignment for the benefit of creditors; or (d)   the filing of a petition by such Person seeking to take advantage of any Debtor Relief Law or any   other applicable Law, domestic or foreign, relating to bankruptcy, insolvency, reorganization,   winding up, or composition or adjustment of debts; or (e) such Person shall fail to contest in a   timely and appropriate manner (and if not dismissed within sixty (60) days) or shall consent to   any petition filed against it in an involuntary case under such bankruptcy laws or other   Applicable Law or consent to any proceeding or action relating to any bankruptcy, insolvency,   reorganization, winding up, or composition or adjustment of debts with respect to its assets or   existence; or (f) such Person shall admit in writing an inability to pay its debts generally as they   become due.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Blocked Person” is defined in Section 5.18(a).   “Borrowing Base” means, as of any date of determination, that amount which is the   lesser of: (a) that amount which would result in a Consolidated Unsecured Leverage Ratio of   0.60 to 1.00, and (b) that amount which would result in an Unencumbered Debt Service   Coverage Ratio of 1.75 to 1.00; provided, however, at no time shall:   (a) the percentage of the Borrowing Base attributable to Unencumbered Pool   Properties that are Healthcare Facilities other than medical office buildings   exceed 50.0%; and       (b) the percentage of the Borrowing Base attributable to Unencumbered Pool   Properties (A) that are subject to Eligible Ground Leases and (B) which are so-   called off-campus properties (greater than 1⁄2 mile of a hospital campus) exceed   10.0% (but for the avoidance of doubt, any such Real Estate Assets subject to   Eligible Ground Leases which are so-called on-campus properties (located within   1⁄2 mile of a hospital campus) shall not be subject to the percentage limitation set   forth in this clause (b)); and       (c) the percentage of the Borrowing Base attributable to any single Unencumbered   Pool Property exceed (A) during the period commencing from the first   anniversary of the Closing Date to but not including the second anniversary of the   Closing Date, 30.0%, and (B) during the period from and after the second   anniversary of the Closing Date, 20.0%.    To the extent any of the limitations in the forgoing proviso are exceeded, any such excess   shall be excluded from the calculation of the Borrowing Base hereunder.  All of the foregoing   shall be as calculated by Issuer and supported by financial information which has been delivered   to the holders of the Notes pursuant to the terms of this Agreement (subject to any restatement of   or other adjustment to the financial statements of the Issuer or for any other reason), as approved   by the Required Holders from time to time in its sole but reasonable discretion.   “Borrowing Base Certificate” shall mean a certificate substantially in the form of   Exhibit 9.1(c)-2 hereto delivered to holders of the Notes and (a) setting forth each Real Estate   Asset of the Obligors and their Subsidiaries, identifying which such Real Estate Assets are   Unencumbered Pool Properties and certifying (subject to the qualifications set forth in clause (b)   herein) (1) the Aggregate Unencumbered Pool Property Value Amount, detailing the calculation   of the Unencumbered Pool Property Value with respect to each Unencumbered Pool Property,   (2) the then applicable Consolidated Unsecured Leverage Ratio, (3) the then applicable   Unencumbered Debt Service Coverage Ratio, and (4) the respective percentages of the   Borrowing Base attributable to: Unencumbered Pool Properties that are Healthcare Facilities (x)   other than medical office buildings, (y) (A) subject to Eligible Ground Leases and (B) which are   so-called off-campus properties (greater than 1⁄2 mile of a hospital campus), and (z) comprising   the single largest Unencumbered Pool Property (based on the percentage of the Borrowing Base   attributable to such Unencumbered Pool Property); (b) certifying (in the Issuer’s good faith and   based upon its own information and the information made available to an Obligor or     

 

SCHEDULE B   (to Note Purchase Agreement)   Unencumbered Property Owner by the applicable Tenants respecting the Unencumbered Pool   Properties, which information the Obligors believe in good faith to be true and correct in all   material respects) (x) as to the calculation of the Borrowing Base as of the date of such   certificate and (y) that each Real Estate Asset included in the calculation of the Borrowing Base   meets each of the criteria for qualification as (1) an Unencumbered Pool Property and (2) set   forth in the definition of Borrowing Base; and (c) providing such other information with respect   to the Unencumbered Pool Properties as the Required Holders may reasonably require.   “Borrowing Base Properties” means those Unencumbered Pool Properties upon which   the Borrowing Base is calculated (or based).   “Business Day” means (a) for the purposes of Section 8.6 only, any day other than a   Saturday, a Sunday or a day on which commercial banks in New York City are required or   authorized to be closed, and (b) for the purposes of any other provision of this Agreement, any   day other than a Saturday, a Sunday or a day on which commercial banks in New York, New   York are required or authorized to be closed.   “Calculation Period” means the trailing twelve (12) month calculation period ending on   any date of determination.   “Called Principal” is defined in Section 8.6.   “Capitalization Rate” means, the rate indicated below with respect to each type of Real   Estate Asset, or such higher or lower percentage as shall be required or permitted under the   Existing Credit Facility as of such date of determination, provided that the Capitalization Rate   shall in no event be less than the floor rate indicated below with respect to each type of Real   Estate Asset:      Type of Real Estate Asset Rate Floor Rate   Medical office buildings 7.25% 6.00%   Life science facilities 7.25% 6.25%   Long term acute care facilities 9.25% 8.25%   Rehabilitation facilities 9.25% 8.25%   Skilled nursing facilities 10.00% 9.00%   Independent living facilities 7.75% 6.75%   Assisted living facilities 7.75% 6.75%   “Capital Lease” means, as applied to any Person, any lease of any property (whether   real, personal or mixed) by that Person as lessee that, in conformity with GAAP, is or should be   accounted for as a capital lease on the balance sheet of that Person.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Capital Reserves” means a capital reserve per annum calculated as the sum of $0.50   per square foot times the gross leasable area for each Real Estate Asset owned by a Consolidated   Party or an Unconsolidated Affiliate.   “Capital Stock” means (a) in the case of a corporation, capital stock, (b) in the case of an   association or business entity, any and all shares, interests, participations, rights or other   equivalents (however designated) of capital stock, (c) in the case of a partnership, partnership   interests (whether general or limited), (d) in the case of a limited liability company, membership   interests and (e) any other interest or participation that confers on a Person the right to receive a   share of the profits and losses of, or distributions of assets of, the issuing Person.   “Capitalized Lease Obligation” means an obligation under a lease of any property   (whether real, personal or mixed) that is required to be capitalized for financial reporting   purposes in accordance with GAAP.  The amount of a Capitalized Lease Obligation is the   capitalized amount of such obligation as would be required to be reflected on a balance sheet   prepared in accordance with GAAP as of the applicable date.   “Cash Equivalents” means, as at any date of determination, any of the following: (a)   marketable securities (i) issued or directly and unconditionally guaranteed as to interest and   principal by the United States government, or (ii) issued by any agency of the United States the   obligations of which are backed by the full faith and credit of the United States, in each case   maturing within one (1) year after such date; (b) marketable direct obligations issued by any state   of the United States or any political subdivision of any such state or any public instrumentality   thereof, in each case maturing within one (1) year after such date and having, at the time of the   acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (c)   commercial paper maturing no more than one (1) year from the date of creation thereof and   having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1   from Moody’s; (d) certificates of deposit or bankers’ acceptances maturing within one (1) year   after such date and issued by any commercial bank organized under the laws of the United States   or any state thereof or the District of Columbia that (i) is at least “adequately capitalized” (as   defined in the regulations of its primary federal banking regulator), and (ii) has Tier 1 capital (as   defined in such regulations) of not less than $100,000,000; and (e) shares of any money market   mutual fund that (i) has substantially all of its assets invested continuously in the types of   investments referred to in clauses (a) and (b) above, (ii) has net assets of not less than   $500,000,000, and (iii) has the highest rating obtainable from either S&P or Moody’s.   “CERCLA” is defined within in the definition of “Hazardous Materials” contained in   this Schedule B.    “Change of Control” means an event or series of events by which:   (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of   the Exchange Act, but excluding any employee benefit plan of such person or its   subsidiaries, and any person or entity acting in its capacity as trustee, agent or   other fiduciary or administrator of any such plan) becomes the “beneficial owner”   (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a     

 

SCHEDULE B   (to Note Purchase Agreement)   person or group shall be deemed to have “beneficial ownership” of all securities   that such person or group has the right to acquire (such right, an “option right”),   whether such right is exercisable immediately or only after the passage of time),   directly or indirectly, of 20% or more of the Capital Stock of the Parent Guarantor   entitled to vote for members of the board of directors or equivalent governing   body of the Parent Guarantor on a fully diluted basis (and taking into account all   such securities that such person or group has the right to acquire pursuant to any   option right); or   (b) during any period of 24 consecutive months, a majority of the members of the   board of directors or other equivalent governing body of the Parent Guarantor   cease to be composed of individuals (i) who were members of that board or   equivalent governing body on the first day of such period, (ii) whose election or   nomination to that board or equivalent governing body was approved by   individuals referred to in clause (i) above constituting at the time of such election   or nomination at least a majority of that board or equivalent governing body or   (iii) whose election or nomination to that board or other equivalent governing   body was approved by individuals referred to in clauses (i) and (ii) above   constituting at the time of such election or nomination at least a majority of that   board or equivalent governing body; or   (c) the Parent Guarantor ceases to own, directly or indirectly, sixty percent (60.0%)   of the limited partnership interests in the Issuer.    “CISADA” is defined in Section 5.18(a).   “Closing” is defined in Section 3.   “Closing Date” is defined in Section 3.   “Closing Fee” is defined in Section 4.13.   “CMS” means the Centers for Medicare & Medicaid Services, the federal agency   responsible for administering the Medicare, Medicaid, SCHIP (State Children’s Health   Insurance), HIPAA (Health Insurance Portability and Accountability Act), CLIA (Clinical   Laboratory Improvement Amendments), and several other federal health-related programs.   “Code” means the Internal Revenue Code of 1986, as amended from time to time, and   the rules and regulations promulgated thereunder from time to time.   “Compliance Certificate” means a Compliance Certificate substantially in the form of   Exhibit 9.1(c)-1.   “Confidential Information” is defined in Section 20.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Consolidated Fixed Charge Coverage Ratio” means, as of any date of determination,   the ratio of (a) Adjusted EBITDA for the four-Fiscal Quarter period most recently ended, to (b)   Fixed Charges for such four-Fiscal Quarter period.   “Consolidated Interest Charges” means, for any period, for the Consolidated Parties on   a consolidated basis, an amount equal to the sum of (i) all interest, premium payments, debt   discount, fees, charges and related expenses in connection with borrowed money (including   capitalized interest) or in connection with the deferred purchase price of assets, in each case to   the extent treated as interest in accordance with GAAP, plus (ii) the portion of rent expense with   respect to such period under Capital Leases that is treated as interest in accordance with GAAP   plus (iii) the implied interest component of Synthetic Leases with respect to such period.   “Consolidated Leverage Ratio” means, as of any date of determination, the ratio of (a)   Consolidated Total Indebtedness on such date to (b) Total Asset Value on such date.   “Consolidated Net Income” means, for any period, without duplication, for the   Consolidated Parties on a consolidated basis, the net income of the Parent Guarantor and its   Subsidiaries, excluding extraordinary gains and losses for such period, as determined in   accordance with GAAP (for the avoidance of doubt, gains and losses from the sale of Real Estate   Assets shall not be considered extraordinary gains and losses).   “Consolidated Parties” means a collective reference to the Parent Guarantor and the   Subsidiaries of the Parent Guarantor, and “Consolidated Party” means any one of them.   “Consolidated Recourse Secured Leverage Ratio” means, as of any date of   determination, the quotient (expressed as a percentage) of (a) Secured Recourse Indebtedness,   divided by (b) Total Asset Value.     “Consolidated Secured Indebtedness Leverage Ratio” means, as of any date of   determination, the quotient (expressed as a percentage) of (a) Secured Indebtedness, divided by   (b) Total Asset Value.   “Consolidated Total Indebtedness” means, as of any date of determination, without   duplication, the aggregate amount of Indebtedness of the Consolidated Parties, on a consolidated   basis.   “Consolidated Total Unsecured Indebtedness” means, as of any date of determination,   without duplication, the aggregate amount of Unsecured Indebtedness of the Consolidated   Parties, on a consolidated basis.   “Consolidated Unsecured Interest Charges” means, for any period, for the   Consolidated Parties on a consolidated basis, an amount equal to the Consolidated Interest   Charges determined solely with respect to Consolidated Total Unsecured Indebtedness.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Consolidated Unsecured Leverage Ratio” means, as of any date of determination, the   ratio of (a) Consolidated Total Unsecured Indebtedness on such date to (b) the Aggregate   Unencumbered Pool Property Value Amount on such date.   “Construction-In-Process” means any Real Estate Asset which does not have buildings   or other improvements located thereon, but which is under development for the construction of   buildings or improvements which will qualify as or will constitute Healthcare Facilities upon   completion (or, to the extent any buildings or improvements are located thereon, such buildings   or other improvements are under construction and are non-operational, and no certificate(s) of   occupancy have been issued with respect thereto), and/or the budgeted costs associated with the   Acquisition and construction of such Real Estate Asset, including, but not limited to, the cost of   acquiring such Real Estate Asset as reasonably determined by Issuer in good faith, as the context   may require.   “Contractual Obligation” means, as applied to any Person, any provision of any   Security issued by that Person or of any indenture, mortgage, deed of trust, contract, undertaking,   agreement or other instrument to which that Person is a party or by which it or any of its   properties is bound or to which it or any of its properties is subject.   “Control” means the possession, directly or indirectly, of the power to direct or cause the   direction of the management or policies of a Person, whether through the ability to exercise   voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings   correlative thereto.   “Controlled Entity” means (i) any of the Subsidiaries of the Issuer and any of their or   the Issuer’s respective Controlled Affiliates and (ii) if the Issuer has a parent company, such   parent company and its Controlled Affiliates. As used in this definition, “Control” means the   possession, directly or indirectly, of the power to direct or cause the direction of the management   and policies of a Person, whether through the ownership of voting securities, by contract or   otherwise.   “Credit Document” means any “Credit Document” as defined in the Existing Credit   Facility as of the date hereof.   “Credit Rating” means the rating assigned by a Rating Agency to the senior unsecured   long term Indebtedness of a Person.   “Customary Recourse Exceptions” means, with respect to any Indebtedness, personal   recourse that is limited to fraud, misrepresentation, misapplication of cash, waste, environmental   claims and liabilities, prohibited transfers, and violations of single purpose entity covenants.   “Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation,   conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement,   receivership, insolvency, reorganization, or similar debtor relief laws of the United States or   other applicable jurisdictions from time to time in effect.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Default” means an event or condition the occurrence or existence of which would, with   the lapse of time or the giving of notice or both, become an Event of Default.   “Default Rate” means that rate of interest that is 2.00% per annum above the rate of   interest stated in clause (a) of the first paragraph of the Notes.   “Disclosure Documents” is defined in Section 5.22.   “Discounted Value” is defined in Section 8.6.   “Domestic Subsidiary” means any Subsidiary organized under the laws of the United   States, any state thereof or the District of Columbia.   “EBITDA” means, with respect to a Person for any period, the sum of: (a) net income (or   loss) of such Person for such period determined on a consolidated basis (excluding any income   or losses from minority interests in the case of the Parent Guarantor), in accordance with GAAP   excluding Acquisition related costs, and, exclusive of the following (but only to the extent   included in determination of such net income (loss)): (i) depreciation and amortization expense;   (ii) interest expense; (iii) income tax expense; (iv) extraordinary or non-recurring gains and   losses; plus (b) such Person’s pro rata share of EBITDA of its Unconsolidated Affiliates.    EBITDA shall be adjusted to remove any impact from straight line rent leveling adjustments   required under GAAP and amortization of deferred market rent into income pursuant to   Statement of Financial Accounting Standards number 141.   “Eligible Ground Lease” means, at any time, a ground lease (a) under which an   Unencumbered Property Owner is the lessee and is the fee owner of the structural improvements   located thereon, (b) that has a remaining term of not less than thirty (30) years (including the   initial term and any additional extension options that are solely at the option of such   Unencumbered Property Owner), (c) where no party to such lease is subject to a then continuing   Bankruptcy Event, (d) such ground lease (or a related document executed by the applicable   ground lessor) contains customary provisions protective of a first mortgage lender to the ground   lessee thereunder, (e) where such Unencumbered Property Owner’s interest in the underlying   Real Estate Asset or the ground lease is not subordinate to any Lien other than any fee mortgage   (so long as the mortgagee under such fee mortgage has agreed not to disturb the rights and   interests of such Unencumbered Property Owner pursuant to a non-disturbance agreement   reasonable satisfactory to the Required Holders), any Permitted Liens and such other   encumbrances that are reasonably acceptable to the Required Holders, and (f) which is otherwise   reasonably acceptable to the Required Holders.   “Eligible Tenant” means a Tenant which (a) is not in arrears on any required rental   payment, principal or interest payment, payments of real property taxes or payments of   premiums on insurance policies with respect to its lease beyond the later of (i) the applicable   grace period with respect thereto, if any, and (ii) sixty (60) days; (b) is not subject to a then   continuing Bankruptcy Event; and (c) is reasonably acceptable in all material respects to the   Required Holders.     

 

SCHEDULE B   (to Note Purchase Agreement)   “employee benefit plan” is defined in Section 6.2   “Environmental Claim” means any known investigation, written notice, written notice   of violation, written claim, action, suit, proceeding, written demand, abatement order or other   written order or directive (conditional or otherwise), by any Person arising (i) pursuant to or in   connection with any actual or alleged violation of any Environmental Law; (ii) in connection   with any Hazardous Material or any actual or alleged Hazardous Materials Activity; or (iii) in   connection with any actual or alleged damage, injury, threat or harm to human health, safety,   natural resources or the environment.   “Environmental Laws” means any and all current or future federal or state (or any   subdivision of either of them), statutes, ordinances, orders, rules, regulations, judgments,   Governmental Authorizations, or any other written requirements of Governmental Authorities   relating to (i)  any Hazardous Materials Activity; (ii) the generation, use, storage, transportation   or disposal of Hazardous Materials; or (iii)  protection of the environment from pollution, in any   manner applicable to an Obligor or any of its Subsidiaries or their respective Facilities.   “Equity Interests” means, with respect to any Person, all of the shares of Capital Stock   of (or other ownership or profit interests in) such Person, all of the warrants, options or other   rights for the purchase or acquisition from such Person of shares of Capital Stock of (or other   ownership or profit interests in) such Person, all of the securities convertible into or   exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person   or warrants, rights or options for the purchase or acquisition from such Person of such shares (or   such other interests), and all of the other ownership or profit interests in such Person (including   partnership, member or trust interests therein), whether voting or nonvoting, and whether or not   such shares, warrants, options, rights or other interests are outstanding on any date of   determination.   “Equity Issuance” means, with respect to the Parent Guarantor or any of its Subsidiaries,   any issuance or sale by the Parent Guarantor or such Subsidiary of shares of its Equity Interests,   other than an issuance (a) to the Parent Guarantor or any of its wholly-owned Subsidiaries, (b) in   connection with a conversion of debt securities to equity, (c) in connection with the exercise by a   present or former employee, officer or director under a stock incentive plan, stock option plan or   other equity-based compensation plan or arrangement, (d) which occurred prior to the Closing   Date, or (e) in connection with any Acquisition or capital expenditures permitted under this   Agreement.   “ERISA” means the Employee Retirement Income Security Act of 1974, as amended   from time to time, and the rules and regulations promulgated thereunder from time to time in   effect.    “ERISA Affiliate” means any trade or business (whether or not incorporated) that is   treated as a single employer together with an Obligor under section 414 of the Code.   “ERISA Event” means (i) a “reportable event” within the meaning of Section 4043 of   ERISA and the regulations issued thereunder with respect to any Pension Plan (excluding those     

 

SCHEDULE B   (to Note Purchase Agreement)   for which notice to the PBGC has been waived by regulation); (ii) the failure to meet the   minimum funding standard of Section 412 of the Code with respect to any Pension Plan (whether   or not waived in accordance with Section 412(c) of the Code), the failure to make by its due date   any minimum required contribution or any required installment under Section 430(j) of the Code   with respect to any Pension Plan or the failure to make by its due date any required contribution   to a Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan pursuant to   Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress termination   described in Section 4041(c) of ERISA; (iv) the withdrawal from any Pension Plan with two (2)   or more contributing sponsors or the termination of any such Pension Plan, in either case   resulting in material liability pursuant to Section 4063 or 4064 of ERISA; (v) the institution by   the PBGC of proceedings to terminate any Pension Plan, or the occurrence of any event or   condition reasonably likely to constitute grounds under ERISA for the termination of, or the   appointment of a trustee to administer, any Pension Plan; (vi) the imposition of liability pursuant   to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of   ERISA, each case reasonably likely to result in material liability; (vii) the withdrawal of an   Obligor, any of its Subsidiaries or any of their respective ERISA Affiliates in a complete or   partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any   Multiemployer Plan if such withdrawal is reasonably likely to result in material liability, or the   receipt by an Obligor, any of its Subsidiaries or any of their respective ERISA Affiliates of   notice from any Multiemployer Plan that it is in reorganization or insolvency pursuant to Section   4241 or 4245 of ERISA, or that it is in “critical” or “endangered” status within the meaning of   Section 103(f)(2)(G) or ERISA, or that it intends to terminate or has terminated under Section   4041A or 4042 of ERISA, if such reorganization, insolvency or termination is reasonably likely   to result in material liability; (viii) the imposition of fines, penalties, taxes or related charges   under Chapter 43 of the Code or under Section 409, Section 502(c), (i) or (l), or Section 4071 of   ERISA in respect of any Pension Plan if such fines, penalties, taxes or related charges are   reasonably likely to result in material liability; (ix) the assertion of a material claim (other than   routine claims for benefits and funding obligations in the ordinary course) against any Pension   Plan other than a Multiemployer Plan or the assets thereof, or against any Person in connection   with any Pension Plan such Person sponsors or maintains reasonably likely to result in material   liability; (x) receipt from the Internal Revenue Service of a final written determination of the   failure of any Pension Plan intended to be qualified under Section 401(a) of the Code to qualify   under Section 401(a) of the Code, or the failure of any trust forming part of any such plan to   qualify for exemption from taxation under Section 501(a) of the Code; or (xi) the imposition of a   lien pursuant to Section 430(k) of the Code or pursuant to Section 303(k) or 4068 of ERISA.   “Escrow Account” is defined in Section 4.11.   “Escrow Agent” means First American Title Insurance Company, in its capacity as   Escrow Agent under the Escrow Agreement, or its successors from time to time.   “Escrow Agreement” means the Escrow Agreement, dated as of the date hereof, among   the Escrow Agent, the Issuer and the Purchasers, as amended from time to time.   “Event of Default” means each of the conditions or events set forth in Section 11.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to   time, and any successor statute.   “Excluded Subsidiary” means (a) any Subsidiary of the Obligors (i) holding title to   assets which are or are to become collateral for any Secured Indebtedness of such Subsidiary; (ii)   which is prohibited from guarantying the Indebtedness of any other Person pursuant to (A) any   document, instrument or agreement evidencing such Secured Indebtedness or (B) a provision of   such Subsidiary’s organizational documents which provision was included in such Subsidiary’s   organizational documents as a condition to the extension of such Secured Indebtedness; and (iii)   the liabilities for which none of the Guarantors (other than the Parent Guarantor), any of their   respective Subsidiaries (other than another Excluded Subsidiary) has any contingent liability or   is otherwise liable with respect to any of the Indebtedness of such Subsidiary, except for   customary exceptions for fraud, misapplication of funds, environmental indemnities, violation of   “special purpose entity” covenants, bankruptcy, insolvency, receivership or other similar events   and other similar exceptions from non-recourse liability, or (b) any Subsidiary which is not a   Wholly-Owned Subsidiary and with respect to which the Parent Guarantor or the Issuer, as   applicable, does not have sufficient voting power (and is unable, after good faith efforts to do so,   to cause any necessary non-affiliated equity holders to agree) to cause such entity to become a   “Guarantor” or, notwithstanding such voting power, the interests of such non-affiliated holders   has material economic value in the reasonable judgment of the Issuer that would be impaired by   such Subsidiary becoming a “Guarantor,” or (c) Ziegler-Florida 4, so long as the only assets   owned by Ziegler-Florida 4 consist of the Florida Equity Interests and any proceeds from the sale   or other disposition of the Florida Equity Interests.   “Existing Credit Facility” is defined within the definition of “Material Credit Facility.”   “Facility” means any real property including all buildings, fixtures or other   improvements located on such real property now, hereafter or heretofore owned, leased, operated   or used by the Obligors or any of their Subsidiaries or any of their respective predecessors.   “FFO Distribution Allowance” means (a) prior to March 31, 2016, an unlimited   amount, (b) as of the end of any Fiscal Quarter on or after March 31, 2016 and prior to   December 31, 2016, an amount equal to 100% of Funds From Operations for the period   commencing January 1, 2016 through such Fiscal Quarter end, and (c) for any four (4) Fiscal   Quarter period of the Consolidated Parties ending as of the end of any Fiscal Quarter on or after   December 31, 2016, an amount equal to 95% of Funds From Operations for such four (4) Fiscal   Quarter period.     “Financial Officer Certification” means, with respect to the financial statements for   which such certification is required, the certification of the chief financial officer, principal   accounting officer, treasurer or controller of the Parent Guarantor that such financial statements   fairly present, in all material respects, the financial condition of the Parent Guarantor and its   Subsidiaries as at the dates indicated and the results of their operations and their cash flows for   the periods indicated, subject to changes resulting from audit and normal year end adjustments.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Financing Agreements” means, collectively, this Agreement, the Notes, each   Subsidiary Guarantee, the Escrow Agreement and any other agreement or instrument executed   and delivered in connection with this Agreement.   “Fiscal Quarter” means a fiscal quarter of any Fiscal Year.   “Fiscal Year” means the fiscal year of the Obligors and their Subsidiaries ending on   December 31 of each calendar year.   “Fitch” means Fitch Ratings Inc., together with its successors.   “Fixed Charges” means, for any period, the sum of (a) Consolidated Interest Charges for   such period, plus (b) all regularly scheduled principal payments made with respect to   Indebtedness of the Obligors and their respective Subsidiaries during such period, other than any   balloon, bullet or similar principal payment which repays such Indebtedness in full (provided   that any such regularly scheduled principal payments that are not payable monthly shall, for   purposes of this definition, be treated as if such payment were payable in equal monthly   installments commencing on such payment date to and including the month immediately prior to   the date of the next such scheduled payment or, if there is no such next scheduled payment, the   maturity date therefor), plus (c) all Preferred Dividends paid during such period.  Each   Consolidated Party’s Ownership Share of the Fixed Charges of its Unconsolidated Affiliates   shall be included in the determination of Fixed Charges.   “Florida Equity Interests” means the Equity Interests in CED Summerfield Square,   LLC held or owned by Ziegler-Florida 4 as of the Closing Date.   “Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.   “Form 10-Q” is defined in Section 9.1(a).   “Form 10-K” is defined in Section 9.1(b).   “FRB” means the Board of Governors of the Federal Reserve System of the United   States.   “Funded Debt” means, as to any Person at a particular time, without duplication, all of   the following, whether or not included as indebtedness or liabilities in accordance with GAAP   (except as provided in clauses (a)(ii) and (b) below):   (a) all obligations for borrowed money, whether current or long-term (including the   Obligations hereunder), all obligations evidenced by bonds, debentures, notes,   loan agreements or other similar instruments but specifically excluding (i) trade   payables incurred in the ordinary course of business and (ii) earn outs or other   similar deferred or contingent obligations incurred in connection with any   Acquisition until such time as such earn outs or obligations are recognized as a     

 

SCHEDULE B   (to Note Purchase Agreement)   liability on the balance sheet of the Issuer and its Subsidiaries in accordance with   GAAP;   (b) all obligations in respect of the deferred purchase price of property or services   (other than trade accounts payable in the ordinary course of business and, in each   case, not past due for more than 60 days after the date on which such trade   account payable was created), including, without limitation, any earn out   obligations recognized as a liability on the balance sheet of the Parent Guarantor   and its Subsidiaries in accordance with GAAP;   (c) all obligations under letters of credit (including standby and commercial),   bankers’ acceptances and similar instruments (including bank guaranties);   (d) the Attributable Indebtedness of Capital Leases, Synthetic Leases and   Securitization Transactions;   (e) all Preferred Stock and comparable Equity Interests providing for mandatory   redemption, sinking fund or other like payments;   (f) Guarantees in respect of Funded Debt of another Person; and   (g) Funded Debt of any partnership or joint venture or other similar entity in which   such Person is a general partner or joint venturer, and, as such, has personal   liability for such obligations, but only to the extent there is recourse to such   Person for payment thereof.   For purposes hereof, the amount of Funded Debt shall be determined (i) based on the   outstanding principal amount in the case of borrowed money indebtedness under clause (a) and   purchase money indebtedness and the deferred purchase obligations under clause (b), (ii) based   on the maximum amount available to be drawn in the case of letter of credit obligations and the   other obligations under clause (c), and (iii) based on the amount of Funded Debt that is the   subject of the Guarantees in the case of Guarantees under clause (f).   “Funds From Operations” means, with respect to the immediately prior Fiscal Quarter,   Consolidated Net Income after adjustments for unconsolidated partnerships and joint ventures as   hereafter provided, plus depreciation and amortization; provided, that, to the extent such   calculations include amounts allocable to Unconsolidated Affiliates, such calculations shall be   without duplication and shall only include such amounts to the extent attributable to the   applicable Ownership Share of any Consolidated Party in such Unconsolidated Affiliate.    Without limiting the foregoing, notwithstanding contrary treatment under GAAP, for purposes   hereof, (a) “Funds From Operations” shall include, and be adjusted to take into account, (i) the   Parent Guarantor’s interests in unconsolidated partnerships and joint ventures, on the same basis   as consolidated partnerships and subsidiaries, as provided in the “white paper” issued in April   2002 by the National Association of Real Estate Investment Trusts, as may be amended from   time to time, and (ii) amounts deducted from net income as a result of pre-funded fees or   expenses incurred in connection with Acquisitions permitted under the Financing Agreements     

 

SCHEDULE B   (to Note Purchase Agreement)   that can no longer be capitalized due to FAS 141R changes and charges relating to the under-   accrual of earn outs due to the FAS 141R changes, and (b) net income (or loss) of the   Consolidated Parties shall not include gains (or, if applicable, losses) resulting from or in   connection with (i) restructuring of indebtedness, (ii) sales of property, (iii) sales or redemptions   of Preferred Stock or (iv) non cash asset impairment charges.   “GAAP” means accounting principles generally accepted in the United States in effect as   of the date of determination thereof.   “Governmental Authority” means the government of the United States or any other   nation, or of any political subdivision thereof, whether state or local, and any agency, authority,   instrumentality, regulatory body, court, central bank or other entity exercising executive,   legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to   government (including any supra-national bodies such as the European Union or the European   Central Bank and any group or body charged with setting financial accounting or regulatory   capital rules or standards (including, without limitation, the Financial Accounting Standards   Board, the Bank for International Settlements or the Basel Committee on Banking Supervision or   any successor or similar authority to any of the foregoing)).   “Governmental Authorization” means any permit, license, authorization, plan,   directive, consent order or consent decree of or from any Governmental Authority.   “Governmental Official” means any governmental official or employee, employee of   any government-owned or government-controlled entity, political party, any official of a political   party, candidate for political office, official of any public international organization or anyone   else acting in an official capacity.   “governmental plan” is defined in Section 6.2.   “Guarantee” means, as to any Person, any obligation, contingent or otherwise, of such   Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other   obligation payable or performable by another Person (the “primary obligor”) in any manner,   whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i)   to purchase or pay (or advance or supply funds for the purchase or payment of) such   Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the   purpose of assuring the obligee in respect of such Indebtedness or other obligation of the   payment or performance of such Indebtedness or other obligation, (iii) to maintain working   capital, equity capital or any other financial statement condition or liquidity or level of income or   cash flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or   other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee   in respect of such Indebtedness or other obligation of the payment or performance thereof or to   protect such obligee against loss in respect thereof (in whole or in part).  The amount of any   Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the   related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if   not stated or determinable, the maximum reasonably anticipated liability in respect thereof as     

 

SCHEDULE B   (to Note Purchase Agreement)   determined by the guaranteeing Person in good faith.  The term “Guarantee” as a verb has a   corresponding meaning.   “Guarantors” means the Parent Guarantor and any Subsidiary Guarantor.    “Hazardous Materials” means any hazardous substances defined by the   Comprehensive Environmental Response Compensation and Liability Act, 42 USCA 9601, et.   seq., as amended (“CERCLA”), including any hazardous waste as defined under 40 C.F.R. Parts   260-270, gasoline or petroleum (including crude oil or any fraction thereof), asbestos or   polychlorinated biphenyls.   “Hazardous Materials Activity” means any past, current, proposed or threatened   activity, event or occurrence involving any Hazardous Materials, including the use, manufacture,   possession, storage, holding, presence, existence, location, Release, threatened Release,   discharge, placement, generation, transportation, processing, construction, treatment, abatement,   removal, remediation, disposal, disposition or handling of any Hazardous Materials, and any   corrective action or response action with respect to any of the foregoing.   “Healthcare Facility” means any medical office building, outpatient center, group   medical practice clinic, ambulatory surgery center (ASC) (hospital-sponsored or seasoned group   practice-sponsored), specialty hospital (short-term stay surgery, inpatient rehabilitation hospitals   (IRH), oncology), general acute care hospitals, selected post-acute/long-term care facilities and   selected senior housing facilities or other property typically owned by healthcare real estate   investment trusts and any ancillary businesses that are incidental to the foregoing.   “Healthcare Laws” is defined in Section 5.25(a).   “HIPAA” means the Health Insurance Portability and Accountability Act of 1996 and the   related regulations set forth at 45 CFR Parts 160 and 164.   “HMO” means any health maintenance organization, managed care organization, any   Person doing business as a health maintenance organization or managed care organization, or   any Person required to qualify or be licensed as a health maintenance organization or managed   care organization under applicable federal or state law (including, without limitation, HMO   regulations).   “holder” means, with respect to any Note, the Person in whose name such Note is   registered in the register maintained by the Issuer pursuant to Section 13.1, provided, however,   that if such Person is a nominee, then for the purposes of Sections 7, 12, 17.2 and 18 and any   related definitions in this Schedule B, “holder” shall mean the beneficial owner of such Note   whose name and address appears in such register.   “INHAM Exemption” is defined in Section 6.2(e).   “Indebtedness” means, with respect to a Person, at the time of computation thereof, all   of the following (without duplication): (a) all obligations of such Person in respect of money     

 

SCHEDULE B   (to Note Purchase Agreement)   borrowed or for the deferred purchase price of property or services (excluding trade debt   incurred in the ordinary course of business); (b) all obligations of such Person, whether or not for   money borrowed (i) represented by notes payable, or drafts accepted, in each case representing   extensions of credit, (ii) evidenced by bonds, debentures, notes or similar instruments, or (iii)   constituting purchase money indebtedness, conditional sales contracts, title retention debt   instruments or other similar instruments, upon which interest charges are customarily paid or that   are issued or assumed as full or partial payment for property or for services rendered; (c)   Capitalized Lease Obligations of such Person; (d) all reimbursement obligations (contingent or   otherwise) of such Person under or in respect of any letters of credit or acceptances (whether or   not the same have been presented for payment); (e) all Off-Balance Sheet Obligations of such   Person; (f) all obligations of such Person to purchase, redeem, retire, defease or otherwise make   any payment in respect of any Mandatorily Redeemable Stock issued by such Person or any   other Person, valued at the greater of its voluntary or involuntary liquidation preference plus   accrued and unpaid dividends; (g) all obligations of such Person in respect of any purchase   obligation, repurchase obligation, takeout commitment or forward equity commitment, in each   case evidenced by a binding agreement (excluding any such obligation to the extent the   obligation can be satisfied by the issuance of Capital Stock (other than Mandatorily Redeemable   Stock)); (h) net obligations under any Swap Contract (which shall be deemed to have an amount   equal to the Swap Termination Value thereof at such time but in no event shall be less than zero);   (i) all Indebtedness of other Persons which such Person has Guaranteed or is otherwise recourse   to such Person (except for guaranties of customary exceptions for fraud, misapplication of funds,   environmental indemnities, voluntary bankruptcy, collusive involuntary bankruptcy and other   similar exceptions to non-recourse liability); (j) all Indebtedness of another Person secured by (or   for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be   secured by) any Lien on property or assets owned by such Person, even though such Person has   not assumed or become liable for the payment of such Indebtedness or other payment obligation;   and (k) such Person’s Ownership Share of the Indebtedness of any Unconsolidated Affiliate of   such Person.  Indebtedness of any Person shall include Indebtedness of any partnership or joint   venture in which such Person is a general partner or joint venturer to the extent of such Person’s   Ownership Share of such partnership or joint venture (except if such Indebtedness, or portion   thereof, is recourse to such Person, in which case the greater of such Person’s Ownership Share   of such Indebtedness or the amount of the recourse portion of the Indebtedness, shall be included   as Indebtedness of such Person).   “Institutional Investor” means (a) any Purchaser of a Note, (b) any holder of a Note   holding (together with one or more of its affiliates) more than 5% of the aggregate principal   amount of the Notes then outstanding, (c) any bank, trust company, savings and loan association   or other financial institution, any pension plan, any investment company, any insurance   company, any broker or dealer, or any other similar financial institution or entity, regardless of   legal form, and (d) any Related Fund of any holder of any Note.   “Intellectual Property” means all trademarks, service marks, trade names, copyrights,   patents, patent rights, franchises related to intellectual property, licenses related to intellectual   property and all other intellectual property rights.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Investment” means, as to any Person, any direct or indirect acquisition or investment by   such Person, whether by means of (a) the purchase or other acquisition of Capital Stock of   another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt   of, or purchase or other acquisition of any other debt or equity participation or interest in, another   Person, including any partnership or joint venture interest in such other Person and any   arrangement pursuant to which the investor Guarantees Indebtedness of such other Person, or (c)   an Acquisition.  For purposes of covenant compliance, the amount of any Investment shall be the   amount actually invested plus the cost of all additions thereto, minus repayment of or returns on   such Investment, without adjustment for subsequent increases or decreases in the value of such   Investment.   “Investment Grade Rating” means a Credit Rating of BBB-/Baa3/BBB- (or the   equivalent) or higher from a Rating Agency.   “Issuer” is defined in the preamble.   “Lien” means (i) any lien, mortgage, pledge, assignment, security interest, charge or   encumbrance of any kind (including any agreement to give any of the foregoing, any conditional   sale or other title retention agreement, and any lease or license in the nature thereof) and any   option, trust or other preferential arrangement having the practical effect of any of the foregoing,   and (ii) in the case of Securities, any purchase option, call or similar right of a third party with   respect to such Securities.   “Make-Whole Amount” is defined in Section 8.6.   “Mandatorily Redeemable Stock” means, with respect to any Person, any Capital Stock   of such Person which by the terms of such Capital Stock (or by the terms of any security into   which it is convertible or for which it is exchangeable or exercisable), upon the happening of any   event or otherwise (a) matures or is mandatorily redeemable, pursuant to a sinking fund   obligation or otherwise (other than Capital Stock which is redeemable solely in exchange for   common stock or other equivalent common Capital Stock), (b) is convertible into or   exchangeable or exercisable for Indebtedness or Mandatorily Redeemable Stock, or (c) is   redeemable at the option of the holder thereof, in whole or in part (other than Capital Stock   which is redeemable solely in exchange for common stock or other equivalent common Capital   Stock); in each case, on or prior to the date on which all of the Obligations are scheduled to be   due and payable in full.   “Margin Stock” means as defined in Regulation U of the FRB as in effect from time to   time.   “Master Agreement” means as defined in the definition of “Swap Contract” contained   in this Schedule B.   “Material” means material in relation to the business, operations, affairs, financial   condition, assets, properties or prospects of the Obligors and their Subsidiaries taken as a whole.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Material Adverse Effect” means any effect, event, condition, action, omission, change   or state of facts that, individually or in the aggregate, has resulted in, or could reasonably be   expected to result in, a material adverse effect with respect to (i) the business, operations,   properties, assets, or financial condition of the Obligors and their Subsidiaries taken as a whole;   (ii) the ability of the Obligors, taken as a whole, to fully and timely perform their obligations   under Financing Agreements to which they are a party; (iii) the legality, validity, binding effect,   or enforceability against an Obligor or Subsidiary Guarantor of any Financing Agreement to   which it is a party; or (iv) the rights, remedies and benefits available to, or conferred upon, the   holders of the Notes under any Financing Agreement.   “Material Contract” means any Contractual Obligation to which the Obligors or any of   their Subsidiaries, or any of their respective assets, are bound (other than those evidenced by the   Financing Agreements) for which breach, nonperformance, cancellation or failure to renew could   reasonably be expected to have a Material Adverse Effect.   “Material Credit Facility” means, as to each Obligor and its Subsidiaries,    (a) the Credit Agreement, dated as of September 18, 2014, among the Issuer, the   Parent Guarantor and certain Subsidiaries and other Affiliates party thereto, KeyBank National   Association, as administrative agent, KeyBanc Capital Markets Inc., Regions Capital Markets   and BMO Capital Markets, and the lenders party thereto, as amended by the First Amendment to   Credit Agreement, dated as of June 5, 2015, Second Amendment to Credit Agreement, dated as   of July 22, 2015, Third Amendment to Credit Agreement, dated as of December 16, 2015, and   Fourth Amendment to Credit Agreement, dated as of January 6, 2016, including any renewals,   extensions, amendments, supplements, restatements, replacements or refinancing thereof   (collectively, the “Existing Credit Facility”); and   (b) any other agreement(s) creating or evidencing indebtedness for borrowed money   entered into on or after the date of Closing by the Obligors, or in respect of which an Obligor is   an obligor or otherwise provides a guarantee or other credit support (“Credit Facility”), in a   principal amount outstanding or available for borrowing equal to or greater than $50,000,000 (or   the equivalent of such amount in the relevant currency of payment, determined as of the date of   the closing of such facility based on the exchange rate of such other currency); and if no Credit   Facility or Credit Facilities equal or exceed such amounts, then the largest Credit Facility shall   be deemed to be a Material Credit Facility; provided, however, that the agreements, instruments   and other documentation evidencing Secured Indebtedness related to any Real Estate Asset will   not be a Material Credit Facility under any circumstances.   “Material Lease” means any Tenant Lease which, individually or when aggregated with   all other leases at such Unencumbered Pool Property with the same Tenant or any Affiliate of   such Tenant, demises either (x) 15,000 square feet or more or (y) 50% or more of such   Unencumbered Pool Property’s gross leasable area.  For purposes of determining whether a   Tenant Lease which is a “pad” or “ground lease” is a Material Lease under the foregoing clause   (y), the gross leasable area of any building to be used by the tenant shall be considered and not   the surface land area to be leased pursuant to such Tenant Lease.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Maturity Date” is defined in the first paragraph of each of the Notes.   “Medicaid” means the medical assistance programs administered by state agencies and   approved by CMS pursuant to the terms of Title XIX of the Social Security Act, codified at 42   U.S.C. §§1396 et seq. and related regulations.   “Medical Services” means medical and health care services provided to a Person,   including, but not limited to, medical and health care services provided to a Person which are   covered by a policy of insurance, and includes, without limitation, physician services, nurse and   therapist services, dental services, hospital services, skilled nursing facility services,   comprehensive outpatient rehabilitation services, home health care services, residential and out-   patient behavioral healthcare services, and medicine or health care equipment provided to a   Person for a necessary or specifically requested valid and proper medical or health purpose.   “Medicare” means the program of health benefits for the aged and disabled administered   by CMS pursuant to the terms of Title XVIII of the Social Security Act, codified at 42 U.S.C.   §§1395 et seq. and related regulations.   “Moody’s” means Moody’s Investor Services, Inc., together with its successors.    “Mortgage Receivables” means any loan receivables or similar contracts or   arrangements for the payment of money, whether senior or subordinated (in right of payment or   otherwise), the obligations under which are secured or backed by commercial real estate, which   loan receivables may include commercial mortgage pass-through certificates and commercial   mortgage-backed bonds or similar securities and the commercial mortgage loans and properties   underlying or backing them, or whole loans, whether senior or subordinated (in right of payment   or otherwise), secured by commercial real estate.   “Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term is   defined in section 4001(a)(3) of ERISA).   “NAIC” means the National Association of Insurance Commissioners or any successor   thereto.   “Negative Pledge” means any agreement (other than the Financing Agreements) that in   whole or in part prohibits the creation of any Lien on any assets of a Person; provided, however,   that an agreement that establishes a maximum ratio of unsecured debt to unencumbered assets, or   of secured debt to total assets, or that otherwise conditions a Person’s ability to encumber its   assets upon the maintenance of one or more specified ratios that limit such Person’s ability to   encumber its assets but that do not generally prohibit the encumbrance of its assets, or the   encumbrance of specific assets, shall not constitute a “Negative Pledge” for purposes of this   Agreement.   “Net Cash Proceeds” means the aggregate proceeds paid in cash or Cash Equivalents   received by any Consolidated Party in connection with any Equity Issuance, net of (a) direct   costs incurred in connection therewith (including legal, accounting and investment banking fees     

 

SCHEDULE B   (to Note Purchase Agreement)   and expenses, sales commissions and underwriting discounts), and (b) estimated taxes paid or   payable (including sales, use or other transactional taxes and any net marginal increase in income   taxes) as a result thereof.  For purposes hereof, “Net Cash Proceeds” includes any cash or Cash   Equivalents received upon the disposition of any non-cash consideration received by any   Consolidated Party in connection with any Equity Issuance from and after the date of such   disposition of such non-cash consideration.   “Net Operating Income” or “NOI” means, for any Real Estate Asset and for a given   period, an amount equal to the sum of (a) the gross revenues for such Real Estate Asset for such   fiscal period received in the ordinary course of business (excluding pre-paid rents and revenues   and security deposits except to the extent applied in satisfaction of Tenants’ obligations for rent),   minus (b) all operating expenses incurred with respect to such Real Estate Asset for such fiscal   period (including an appropriate accrual for property taxes, insurance and other expenses not   paid quarterly, but excluding debt service charges, income taxes, depreciation, amortization and   other non-cash expenses), including a management fee equal to the greater of 4.0% or actual,   minus, without duplication of the foregoing, applicable rental payments made by the applicable   Unencumbered Property Owner, including with respect to any Eligible Ground Lease relating to   such Real Estate Asset.   “Non-Recourse Indebtedness” means, for any Person, any Indebtedness of such Person   for the repayment of which such Person has no personal liability (other than for Customary   Recourse Exceptions) and/or with respect to which recourse of the applicable holder of such   Indebtedness for non-payment is limited to such holder’s Liens on a particular asset or group of   assets (other than for Customary Recourse Exceptions).   “Noteholder Sanctions Event” means, with respect to any holder of a Note (an   “Affected Noteholder”), such holder or any of its affiliates being in violation of or subject to   sanctions (a) under any U.S. Economic Sanctions Laws as a result of an Obligor or any   Controlled Entity becoming a Blocked Person or, directly or indirectly, having any investment in   or engaging in any dealing or transaction (including any investment, dealing or transaction   involving the proceeds of the Notes) with any Blocked Person or (b) under any similar laws,   regulations or orders adopted by any State within the United States as a result of the name of an   Obligor or any Controlled Entity appearing on a State Sanctions List.   “Notes” is defined in Section 1.   “NRSRO” means a Nationally Recognized Statistical Rating Organization so designated   by the SEC whose status has been confirmed by the SVO.   “Obligations” means, with respect to each Obligor and Subsidiary Guarantor, all   advances to, and debts, liabilities, obligations, covenants and duties of, the Obligors and the   Subsidiary Guarantors arising under or otherwise with respect to this Agreement, the Notes and   each other Financing Agreement, whether direct or indirect (including those acquired by   assumption), absolute or contingent, due or to become due, now existing or hereafter arising and   including interest and fees that accrue after the commencement by or against an Obligor, any   Subsidiary Guarantor or any Affiliate thereof of any proceeding under any Debtor Relief Laws     

 

SCHEDULE B   (to Note Purchase Agreement)   naming such Person as the debtor in such proceeding, regardless of whether such interest and   fees are allowed claims in such proceeding.   “Obligors” is defined in the preamble.   “Occupancy Rate” means, as of any date of determination (a) the aggregate square   footage of leaseable area of an Unencumbered Pool Property that is leased by one or more   Tenants (in possession and paying rent) on such date divided by (b) the gross square footage of   leaseable area of such Unencumbered Pool Property on such date.    “OFAC” is defined in Section 5.18(a).   “OFAC Listed Person” is defined in Section 5.18(a).   “OFAC Sanctions Program” means any economic or trade sanction that OFAC is   responsible for administering and enforcing.  A list of OFAC Sanctions Programs may be found   at http://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx.   “Off-Balance Sheet Obligation” means the monetary obligation of a Person under (a) a   Synthetic Lease or similar off-balance sheet or tax retention lease, or (b) an agreement for the   use or possession of property creating obligations that do not appear on the balance sheet of such   Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as   the indebtedness of such Person (without regard to accounting treatment).   “Officer’s Certificate” means a certificate of an Authorized Officer of the Issuer whose   responsibilities extend to the subject matter of such certificate.   “Organizational Documents” means (a) with respect to any corporation, its certificate or   articles of incorporation or organization, as amended, and its by laws, as amended, (b) with   respect to any limited partnership, its certificate of limited partnership, as amended, and its   partnership agreement, as amended, (c) with respect to any general partnership, its partnership   agreement, as amended, and (d) with respect to any limited liability company, its articles of   organization, certificate of formation or comparable documents, as amended, and its operating   agreement, as amended.  In the event any term or condition of this Agreement or any other   Financing Agreement requires any Organizational Document to be certified by a secretary of   state or similar Governmental Official, the reference to any such “Organizational Document”   shall only be to a document of a type customarily certified by such Governmental Official.    “Ownership Share” means the percentage of the Capital Stock owned by a   Consolidated Party in an Unconsolidated Affiliate accounted for pursuant to the equity method   of accounting under GAAP.   “Parent Guarantee” is defined in Section 22.1.   “Parent Guarantor” is defined in the preamble.      

 

SCHEDULE B   (to Note Purchase Agreement)   “PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in   ERISA or any successor thereto.   “Pension Plan” means any “employee pension benefit plan” as defined in Section 3(2) of   ERISA other than a Multiemployer Plan, which is subject to Section 412 of the Code or   Section 302 of ERISA and which is sponsored, maintained or contributed to by, or required to be   contributed to by, an Obligor or any of its ERISA Affiliates or with respect to which an Obligor   or any of its ERISA Affiliates previously sponsored, maintained or contributed to, or was   required to contribute to, and still has liability.   “Permitted Liens” means each of the Liens permitted pursuant to Section 10.2.   “Permitted Refinancing” means any extension, renewal or replacement of any existing   Indebtedness so long as any such renewal, refinancing and extension of such Indebtedness (a)   has market terms and conditions, (b) has an average life to maturity that is greater than that of the   Indebtedness being extended, renewed or refinanced, (c) does not include an obligor that was not   an obligor with respect to the Indebtedness being extended, renewed or refinanced, (d) remains   subordinated, if the Indebtedness being refinanced or extended was subordinated to the prior   payment of the Obligations, such extended, renewed or refinanced Indebtedness, (e) does not   exceed in a principal amount the Indebtedness being renewed, extended or refinanced plus   reasonable fees and expenses incurred in connection therewith, and (f) is not incurred, created or   assumed, if any Default or Event of Default has occurred and continues to exist or would result   therefrom.   “Person” means an individual, partnership, corporation, limited liability company,   association, trust, unincorporated organization, business entity or Governmental Authority.   “Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA) subject   to Title I of ERISA that is or, within the preceding five years, has been established or   maintained, or to which contributions are or, within the preceding five years, have been made or   required to be made, by the Issuer or any ERISA Affiliate or with respect to which the Issuer or   any ERISA Affiliate may have any liability.   “Preferred Dividends” means, for any given period and without duplication, all   Restricted Payments accrued or paid (and in the case of Restricted Payments paid, which were   not accrued during a prior period) during such period on Preferred Stock issued by an Obligor or   a Subsidiary.  Preferred Dividends shall not include dividends or distributions paid or payable (a)   solely in Capital Stock (other than Mandatorily Redeemable Stock) payable to holders of such   class of Capital Stock; (b) to the Issuer or a Subsidiary; or (c) constituting or resulting in the   redemption of Preferred Stock, other than scheduled redemptions not constituting balloon, bullet   or similar redemptions in full.   “Preferred Stock” means, with respect to any Person, Capital Stock in such Person   which are entitled to preference or priority over any other Capital Stock in such Person in respect   of the payment of dividends or distribution of assets upon liquidation or both.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Priority Debt” means (without duplication), as of the date of any determination thereof,   the sum of (a) all Indebtedness of the Obligors and their Subsidiaries secured by Liens, other   than Indebtedness secured by Liens permitted by Sections 10.2(a) through (s), inclusive, and   10.2(u) and (b) all unsecured Indebtedness of Subsidiaries, including all of their Guarantees of   Indebtedness of an Obligor, but excluding (i) unsecured Indebtedness of Subsidiaries owing to an   Obligor or any other Subsidiary, and (ii) all unsecured Indebtedness of the Subsidiary   Guarantors.   “Property” means an interest of any kind in any property or asset, whether real, personal   or mixed, and whether tangible or intangible.   “PTE” is defined in Section 6.2(a).   “Purchaser” or “Purchasers” means each of the purchasers that has executed and   delivered this Agreement to the Obligors and such Purchaser’s successors and assigns (so long as   any such assignment complies with Section 13.2), provided, however, that any Purchaser of a   Note that ceases to be the registered holder or a beneficial owner (through a nominee) of such   Note as the result of a transfer thereof pursuant to Section 13.2 shall cease to be included within   the meaning of “Purchaser” of such Note for the purposes of this Agreement upon such transfer.    “Qualified Institutional Buyer” means any Person who is a “qualified institutional   buyer” within the meaning of such term as set forth in Rule 144A(a)(1) under the Securities Act.   “QPAM Exemption” is defined in Section 6.2(d).   “Rating Agency” means S&P, Moody’s, or Fitch.   “Rating Prepayment” is defined in Section 9.16(b).   “Rating Prepayment Date” is defined in Section 9.16(b).   “Real Estate Asset” means, a parcel of real property, together with all improvements (if   any) thereon (including all tangible personal property owned by the Person with a fee or   leasehold interest in such real property and used in connection with such fee or leasehold interest   in such real property), owned in fee simple or leased pursuant to a ground lease by any Person;   “Real Estate Assets” means a collective reference to each Real Estate Asset.   “Recourse Indebtedness” means Indebtedness that is not Non-Recourse Indebtedness;   provided that personal recourse for Customary Recourse Exceptions shall not, by itself, cause   such Indebtedness to be characterized as Recourse Indebtedness.   “Reinvestment Yield” is defined in Section 8.6.   “REIT” means a real estate investment trust as defined in Sections 856 through 860 of   the Code.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Related Fund” means, with respect to any holder of any Note, any fund or entity that   (i) invests in Securities or bank loans, and (ii) is advised or managed by such holder, the same   investment advisor as such holder or by an affiliate of such holder or such investment advisor.   “Related Parties” means, with respect to any Person, such Person’s Affiliates and the   partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and   representatives of such Person and of such Person’s Affiliates.   “Release” means any release, spill, emission, leaking, pumping, pouring, injection,   escaping, deposit, disposal, discharge, dispersal, dumping, leaching or migration of any   Hazardous Material into the indoor or outdoor environment (including the abandonment or   disposal of any barrels, containers or other closed receptacles containing any Hazardous   Material), including the movement of any Hazardous Material through the air, soil, surface water   or groundwater.   “Remaining Average Life” is defined in Section 8.6.   “Remaining Scheduled Payments” is defined in Section 8.6.   “Rent Coverage Ratio” means, as of any date of determination with respect any Real   Estate Asset to be included as an Unencumbered Pool Property, for the applicable Calculation   Period, the ratio, as calculated by Issuer and approved by the Required Holders, of (a) the   aggregate sum of Adjusted NOI for such Real Estate Asset to (b) the actual rental payments   received by the Issuer or applicable Unencumbered Property Owner which owns such Real   Estate Asset in fee simple (or leases such Real Estate Asset under an Eligible Ground Lease)   with respect to all applicable Tenant Leases during such applicable Calculation Period.   “Required Holders” means at any time on or after the Closing, the holders of at least a   majority in aggregate principal amount of the Notes at the time outstanding (exclusive of Notes   then owned by the Issuer or any of its Affiliates).   “Restricted Payment” means any dividend or other distribution (whether in cash,   securities or other property) with respect to any Capital Stock of the Obligors or any Subsidiary,   or any payment (whether in cash, securities or other property), including any sinking fund or   similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or   termination of any such Capital Stock or on account of any return of capital to such Person’s   stockholders, partners or members (or the equivalent Person thereof), or any setting apart of   funds or property for any of the foregoing.   “S&P” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial   Services LLC business, and any successor thereto.   “Sale and Leaseback Transaction” means, with respect to either Obligor or any   Subsidiary, any arrangement, directly or indirectly, with any Person (other than an Obligor or an   Unencumbered Property Owner) whereby an Obligor or such Subsidiary shall sell or transfer any   property, real or personal, used or useful in its business, whether now owned or hereafter     

 

SCHEDULE B   (to Note Purchase Agreement)   acquired, and thereafter rent or lease such property or other property that it intends to use for   substantially the same purpose or purposes as the property being sold or transferred.   “Sanctions Prepayment Date” is defined in Section 8.7(a).   “Sanctions Prepayment Offer” is defined in Section 8.7(a).   “Sanctions Prepayment Response Date” is defined in Section 8.7(a).   “SEC” means the Securities and Exchange Commission of the United States, or any   successor thereto.   “Secured Indebtedness” means, as of any date of determination, that portion of   Consolidated Total Indebtedness which is secured by a Lien on any real property owned or   leased by the Obligors or any Subsidiary or Unconsolidated Affiliate, as applicable.   “Secured Recourse Indebtedness” means any Secured Indebtedness that is also   Recourse Indebtedness.   “Security” or “Securities” means any stock, shares, partnership interests, limited   liability company interests, voting trust certificates, certificates of interest or participation in any   profit sharing agreement or arrangement (e.g., stock appreciation rights), options, warrants,   bonds, debentures, notes, or other evidences of indebtedness, secured or unsecured, convertible,   subordinated or otherwise, or in general any instruments commonly known as “securities” or any   certificates of interest, shares or participations in temporary or interim certificates for the   purchase or acquisition of, or any right to subscribe to, purchase or acquire, any of the foregoing.   “Securities Act” means the Securities Act of 1933, as amended from time to time, and   the rules and regulations promulgated thereunder from time to time in effect.   “Securitization Receivables” is defined within the definition of “Securitization   Transaction” contained in this Schedule B.    “Securitization Subsidiary” is defined within the definition of “Securitization   Transaction” contained in this Schedule B.   “Securitization Transaction” means any financing or factoring or similar transaction (or   series of such transactions) entered by the Obligors or any of their Subsidiaries pursuant to which   the Obligors or such Subsidiary may sell, convey or otherwise transfer, or grant a security   interest in, accounts, payments, receivables, rights to future lease payments or residuals or   similar rights to payment (the “Securitization Receivables”) to a special purpose subsidiary or   affiliate (a “Securitization Subsidiary”) or any other Person.   “separate account” is defined in Section 6.2.   “Series A Notes” is defined in Section 1.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Series B Notes” is defined in Section 1.    “Series C Notes” is defined in Section 1.   “Series D Notes” is defined in Section 1.   “Shareholder Equity” means, as of any date of determination, consolidated   shareholders’ equity of the Parent Guarantor and its Subsidiaries as of that date determined in   accordance with GAAP.   “Solvent” or “Solvency” means, with respect to any Person as of a particular date, that   on such date (a) such Person is able to pay its debts and other liabilities, contingent obligations   and other commitments as they mature in the ordinary course of business, (b) such Person does   not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s   ability to pay as such debts and liabilities mature in their ordinary course, (c) such Person is not   engaged in a business or a transaction, and is not about to engage in a business or a transaction,   for which such Person’s property would constitute unreasonably small capital after giving due   consideration to the prevailing practice in the industry in which such Person is engaged or is to   engage, (d) the fair value of the property of such Person is greater than the total amount of   liabilities, including, without limitation, contingent liabilities, of such Person and (e) the present   fair salable value of the assets of such Person is not less than the amount that will be required to   pay the probable liability of such Person on its debts as they become absolute and matured.  In   computing the amount of contingent liabilities at any time, it is intended that such liabilities will   be computed at the amount which, in light of all the facts and circumstances existing at such   time, represents the amount that can reasonably be expected to become an actual or matured   liability.   “Specified CMBS Indebtedness” means (x) the Indebtedness of (i) Ziegler-Georgia 7,   LLC, (ii) Ziegler-Michigan 12, LLC, (iii) Ziegler-Tennessee 14, LLC, (iv) Ziegler-Wisconsin 16,   LLC, (v) DOC-Greymark HQ OKC MOB, LLC, and (vi) DOC-Baylor Mansfield ASC, LLC, as   such Indebtedness is more particularly identified on Schedule 5.27, and (y) the Indebtedness in   existence as of the Closing Date of the following Affiliates:  (i) Sandwich Development Partners,   LLC (an Affiliate of Ziegler-Illinois 12, LLC), (ii) Bath Road Associates, LLC (an Affiliate of   Ziegler-Maine 15, LLC), (iii) Remington Development Partners, LLC (an Affiliate of Ziegler-   Illinois 18, LLC), or (iv) Crescent City Surgical Centre Facility, L.L.C. (an Affiliate of DOC-   CCSC Crescent City Surgical Centre, LLC) in each case to the extent the applicable Affiliate   becomes a Wholly-Owned Subsidiary of either Obligor.     “Source” is defined in Section 6.2.   “Subordinated Debt” means any Indebtedness of each Obligors or any of its   Subsidiaries that by its terms is expressly subordinated in right of payment to the prior payment   of the Obligations under this Agreement on terms and conditions, and evidenced by   documentation, reasonably satisfactory to the Required Holders.     

 

SCHEDULE B   (to Note Purchase Agreement)   “Subsidiary” means, with respect to any Person, any corporation, partnership, limited   liability company, association, joint venture or other business entity of which more than fifty   percent (50%) of the total voting power of Capital Stock entitled (without regard to the   occurrence of any contingency) to vote in the election of the Person or Persons (whether   directors, managers, trustees or other Persons performing similar functions) having the power to   direct or cause the direction of the management and policies thereof is at the time owned or   controlled, directly or indirectly, by that Person; provided, in determining the percentage of   ownership interests of any Person controlled by another Person, no ownership interest in the   nature of a “qualifying share” of the former Person shall be deemed to be outstanding.  Unless   otherwise provided, “Subsidiary” shall refer to a Subsidiary of the Issuer.   “Subsidiary Guarantee” or “Subsidiary Guarantees” is defined in Section 2.3.   “Subsidiary Guarantor” means any Subsidiary that executes and delivers a Subsidiary   Guarantee in accordance with Section 9.15 hereof.     “Substitute Purchaser” is defined in Section 21.   “Super-Majority Holders” means at any time on or after the Closing, the holders of at   least 66-2/3% in principal amount of the Notes at the time outstanding (exclusive of Notes then   owned by the Issuer or any of its Affiliates).   “SVO” means the Securities Valuation Office of the NAIC or any successor to such   Office.   “Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit   derivative transactions, forward rate transactions, commodity swaps, commodity options,   forward commodity contracts, equity or equity index swaps or options, bond or bond price or   bond index swaps or options or forward bond or forward bond price or forward bond index   transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor   transactions, collar transactions, currency swap transactions, cross-currency rate swap   transactions, currency options, spot contracts, or any other similar transactions or any   combination of any of the foregoing (including any options to enter into any of the foregoing),   whether or not any such transaction is governed by or subject to any master agreement, and (b)   any and all transactions of any kind, and the related confirmations, which are subject to the terms   and conditions of, or governed by, any form of master agreement published by the International   Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement,   or any other master agreement (any such master agreement, together with any related schedules,   a “Master Agreement”), including any such obligations or liabilities under any Master   Agreement.   “Swap Termination Value” means, in respect of any one or more Swap Contracts, after   taking into account the effect of any legally enforceable netting agreement relating to such Swap   Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and   termination value(s) determined in accordance therewith, such termination value(s) and (b) for   any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-    

 

SCHEDULE B   (to Note Purchase Agreement)   market value(s) for such Swap Contracts, as determined based upon one or more mid-market or   other readily available quotations provided by any recognized dealer in such Swap Contracts.   “Synthetic Lease” means, at any time, any lease (including leases that may be   terminated by the lessee at any time) of any property (a) that is accounted for as an operating   lease under GAAP and (b) in respect of which the lessee retains or obtains ownership of the   property so leased for U.S. federal income tax purposes, other than any such lease under which   such Person is the lessor.   “Tangible Net Worth” means, as of a given date, (a) the Shareholder Equity of the   Parent Guarantor and its Subsidiaries determined on a consolidated basis plus (b) accumulated   depreciation and amortization expense minus (c) the following (to the extent reflected in   determining Shareholder Equity of the Parent Guarantor and its Subsidiaries):  (i) the amount of   any write-up in the book value of any assets contained in any balance sheet resulting from   revaluation thereof or any write-up in excess of the cost of such assets acquired, and (ii) all   amounts appearing on the assets side of any such balance sheet for assets which would be   classified as “goodwill” under GAAP, all determined on a consolidated basis.   “Taxes” means all present or future taxes, levies, imposts, duties, deductions,   withholdings (including backup withholding), assessments, fees or other similar charges imposed   by any Governmental Authority, including any interest, additions to tax or penalties applicable   thereto.   “Tenant” means any Person who is a lessee with respect to any Tenant Lease held by an   Unencumbered Property Owner as lessor or as an assignee of the lessor thereunder.   “Tenant Lease” means any lease, letting, license, concession or other agreement   (whether written or oral) pursuant to which any Person (other than an Obligor, any future   Subsidiary Guarantor or an Unencumbered Property Owner) is granted a possessory interest in,   or right to use or occupy all or any portion of, any Unencumbered Pool Property (provided, the   term “Tenant Lease” shall not include any lease, sublease, sub-sublease, letting, license,   concession or other agreement with respect to any residential unit in a multi-family residential   Real Estate Asset), and every modification, amendment or other agreement relating to such lease,   sublease, sub-sublease, or other agreement entered into in connection with such lease, sublease,   sub-sublease, or other agreement, and every guarantee of the performance and observance of the   covenants, conditions and agreements to be performed and observed by such Person under any   such lease, sublease, sub-sublease, letting, license, concession or other agreement.   “Termination Fee” is defined in Section 9.16(b).   “Total Asset Value” means, as of any date of determination, the sum of the following,   without duplication, of the Consolidated Parties for the Fiscal Quarter then most recently ended:   (a) the real estate property values of all Real Estate Assets as determined by acquisition cost,   plus (b) unrestricted cash and Cash Equivalents as of the last day of such Fiscal Quarter, plus (c)   the GAAP book value of land holdings as of the last day of such Fiscal Quarter, plus (d) the   GAAP book value of the actual funded portion of Construction-in-Process as of the last day of     

 

SCHEDULE B   (to Note Purchase Agreement)   such Fiscal Quarter, plus (e) the GAAP book value of Unencumbered Mortgage Receivables as   of the last day of such Fiscal Quarter, plus (f) the Ownership Share of any Consolidated Party of   items (a) through (e) above attributable to Unconsolidated Affiliates as of the last day of such   Fiscal Quarter; subject at all times, however, to the provisions of Section 10.6(j).   “UCC” means the Uniform Commercial Code (or any similar or equivalent legislation)   as in effect in the State of New York (or any other applicable jurisdiction, as the context may   require).   “Unconsolidated Affiliate” means any corporation, partnership, association, joint   venture or other entity in each case which is not a Consolidated Party and in which a   Consolidated Party owns, directly or indirectly, any Capital Stock.   “Unencumbered Debt Service Coverage Ratio” means, as of any date of determination,   for the applicable Calculation Period, the ratio, as calculated by Issuer and approved by the   Required Holders, of (a) the aggregate sum of Adjusted NOI for the Unencumbered Pool   Properties to (b) the actual Consolidated Unsecured Interest Charges payable under the   Consolidated Total Unsecured Indebtedness during such applicable Calculation Period.   “Unencumbered Mortgage Receivables” means, with respect to any Person, Mortgage   Receivables owned or held by such Person that are not pledged as collateral for, or otherwise   subject to a Lien as security for, any Indebtedness.   “Unencumbered Pool Property” means a Real Estate Asset which, as of any date of   determination, is included as an “Unencumbered Pool Property” on the most recent Borrowing   Base Certificate and satisfies all of the following requirements:     (a) such Real Estate Asset (a) is 100% (i) owned in fee simple or (ii) leased pursuant   to an Eligible Ground Lease by (x) the Issuer or (y) an Unencumbered Property Owner that is (1)   a Domestic Subsidiary and (2) a Wholly-Owned Subsidiary of the Issuer and (b) is located in a   state in the contiguous United States or the District of Columbia;    (b)  if at the applicable time the Issuer does not have an Investment Grade Rating, the   holders of the Notes shall have received each of the Unencumbered Pool Property Deliverables   with respect to such Real Estate Asset;    (c) such Real Estate Asset is not subject to any Lien (other than a Permitted Lien   (with the exception of a Permitted Lien described in Section 10.2(m))) or any Negative Pledge   (other than pursuant to an Eligible Ground Lease);    (d) such Real Estate Asset is free of all material mechanical and structural defects, or   other adverse matters except for defects, conditions or matters individually or collectively which   are not material to the profitable operation of such Real Estate Asset;     

 

SCHEDULE B   (to Note Purchase Agreement)   (e) such Real Estate Asset is a Healthcare Facility that has been fully developed, is   operational and is well located within a primary or secondary market and is maintaining a stable   current income;    (f) to the extent managed by a third-party property manager, the applicable property   manager with respect to such Real Estate Asset is an Approved Manager, and such Real Estate   Asset is being managed pursuant to a management agreement with such Approved Manager;    (g) no required rental payment, principal or interest payment, payments of real   property taxes (except taxes which are being contested in good faith and for which adequate   reserves have been established in accordance with GAAP) or payments of premiums on   insurance policies payable to the applicable Unencumbered Property Owner with respect to such   Real Estate Asset is past due beyond the applicable grace period with respect thereto, if any;     (h) no Tenant under any Material Lease with respect to such Real Estate Asset is then   subject to a Bankruptcy Event;    (i) no event of default (after the expiration of any applicable notice and/or cure   period) has occurred and is then continuing under any Material Lease applicable to such Real   Estate Asset;    (j) no condemnation or condemnation proceeding shall have been instituted (and   remain undismissed for a period of ninety (90) consecutive days), in each case, with respect to a   material portion of any Real Estate Asset;   (k) no material casualty event shall have occurred with respect to the improvements   located on such Real Estate Asset which is not able to be fully remediated with available   insurance proceeds and/or funds the Issuer or the applicable Unencumbered Property Owner has   put into escrow;   (l) no Hazardous Materials are located on or under such Real Estate Asset and no   other environmental conditions exist in connection with such Real Estate Asset which constitute   a violation of any Environmental Law; and   (m) such Real Estate Asset, as of such date of determination, shall satisfy the   Unencumbered Pool Property Specified Tenant Lease Requirements.   “Unencumbered Pool Property Deliverables” means, with respect to any Real Estate   Asset which is proposed for qualification as a “Unencumbered Pool Property” hereunder, a   collective reference to each of the following items to be satisfied as a condition to such Real   Estate Asset initially becoming an Unencumbered Pool Property, provided such information will   only be required to be delivered with respect to a Real Estate Asset being included at a time   when the Issuer maintains an Investment Grade Rating if requested by the Required Holders:   (a) a current rent roll and current operating statement for such Real Estate Asset (and   operating statements or other operating history for the prior two (2) years for such Real Estate     

 

SCHEDULE B   (to Note Purchase Agreement)   Asset, to the extent available), and, if requested by the Required Holders, a fully executed copy   of each Tenant Lease with respect to such Real Estate Asset;    (b) if any Tenant Lease with respect to such Unencumbered Pool Property is a   Material Lease, evidence that the Tenant under the applicable Tenant Lease is an Eligible   Tenant, such evidence (if required) being satisfied from and after the Investment Grade Pricing   Effective Date by a written certification from the Obligors;   (c) in the case of a Real Estate Asset which constitutes a leasehold interest, evidence   that the applicable lease, a memorandum of lease with respect thereto, or other evidence of such   lease, has been properly recorded in all places to the extent necessary or desirable and that such   lease qualifies as an Eligible Ground Lease hereunder;   (d) a new Borrowing Base Certificate showing, on a pro forma basis, the effect on the   Borrowing Base of the addition of such Real Estate Asset as an Unencumbered Pool Property;    (e)  if requested by the Required Holders, copies of title policies, registry lien searches   or such other evidence that no Liens exist other than Permitted Liens; and   (f)  a summary description of such Real Estate Asset (including without limitation, the   street address of such Real Estate Asset, the size and type of property and such other information   as may reasonably be required by the Required Holders to identify the location and the material   characteristics of such Real Estate Asset).    “Unencumbered Pool Property Specified Tenant Lease Requirements” means, as of   any date of determination, with respect to each Unencumbered Pool Property (or any Real Estate   Asset proposed by Issuer to be added as an Unencumbered Pool Property hereunder), the   satisfaction of each of the following requirements:   (a) such Real Estate Asset has an Occupancy Rate of at least eighty percent (80.0%);   and   (b) with respect to any such Real Estate Asset which is either (i) a long term acute   care hospital facility or (ii) a rehabilitation facility, at the time such Real Estate Asset is being   added as an Unencumbered Pool Property (whether on the Closing Date or under Section 10.17   hereof), the Rent Coverage Ratio shall be greater than or equal to 1.50 to 1.00.   “Unencumbered Pool Property Value” means, as of any date of determination with   respect to any Unencumbered Pool Property, the value of the subject Real Estate Asset (a) during   the period commencing from the Closing Date to but not including the second anniversary of the   Closing Date, based upon a valuation which is determined by using the un-depreciated book   value cost in accordance with GAAP, and (b) during the period from and after the second   anniversary of the Closing Date, based upon a valuation determined, for the applicable   Calculation Period, by dividing (x) Adjusted NOI by (y) the applicable Capitalization Rate based   on the type of Real Estate Asset during such applicable Calculation Period, as determined by     

 

SCHEDULE B   (to Note Purchase Agreement)   Issuer (subject to any restatement of or other adjustment to the financial statements of the Issuer   or for any other reason).   “Unencumbered Property Owner” means each Person that owns a Real Estate Asset   which is or is proposed to be an Unencumbered Pool Property and which is (1) a Domestic   Subsidiary and (2) a Wholly-Owned Subsidiary of the Issuer.   “Unimproved Land” means any Real Estate Asset consisting solely of unimproved land   on which no construction or general development activity has commenced, but which is zoned   for its intended use and is otherwise suitable for future development as a Healthcare Facility;   provided, the term “Unimproved Land” shall not include any pad, out-parcel or similar separate   parcel included in or adjacent to and part of a larger development of real property comprising   any other Real Estate Asset (unless such other Real Estate Asset is Unimproved Land).   “United States” or “U.S.” means the United States of America.   “Unsecured Indebtedness” means, for any Person, any Indebtedness of such Person that   is not secured by a Lien.    “U.S. Person” means any Person that is a “United States person” as defined in Section   7701(a)(30) of the Code.   “USA PATRIOT Act” means United States Public Law 107-56, Uniting and   Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct   Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time, and the rules and   regulations promulgated thereunder from time to time in effect.   “U.S. Economic Sanctions” is defined in Section 5.18(a).   “U.S. Economic Sanctions Laws” means those laws, executive orders, enabling   legislation or regulations administered and enforced by the United States pursuant to which   economic sanctions have been imposed on any Person, entity, organization, country or regime,   including the Trading with the Enemy Act, the International Emergency Economic Powers Act,   the Iran Sanctions Act, the Sudan Accountability and Divestment Act and any other OFAC   Sanctions Program.   “Wholly-Owned Subsidiary” means, at any time, any Subsidiary all of the Equity   Interests (except directors’ qualifying shares) and voting interests of which are owned by any one   or more of the Issuer and the Issuer’s other Wholly-Owned Subsidiaries at such time.   “Ziegler-Florida 4” means Ziegler-Florida 4, LLC, a Wisconsin limited liability   company.     

 

   EXHIBIT 1(A)   (to Note Purchase Agreement)   [FORM OF 4.03% SENIOR NOTES, SERIES A, DUE JANUARY 7, 2023]   PHYSICIANS REALTY L.P.   4.03% SENIOR NOTE, SERIES A, DUE JANUARY 7, 2023   No. RA – [_____] [Date]   $[_______] PPN[______________]      FOR VALUE RECEIVED, the undersigned, PHYSICIANS REALTY L.P. (herein called the   “Issuer”), a Delaware limited partnership, hereby promises to pay to [____________], or   registered assigns, the principal sum of [_____________________] DOLLARS (or so much   thereof as shall not have been prepaid) on January 7, 2023 (the “Maturity Date”), with interest   (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance   hereof at the rate of 4.03% per annum from the date hereof, payable semiannually, on the 7th day   of January and July in each year, commencing with the January 7 or July 7 next succeeding the   date hereof, and on the Maturity Date, until the principal hereof shall have become due and   payable, and (b) to the extent permitted by law, (x) on any overdue payment of interest and (y)   during the continuance of an Event of Default, on such unpaid balance and on any overdue   payment of any Make-Whole Amount, at a rate per annum from time to time equal to 6.03%,   payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).   Payments of principal of, interest on and any Make-Whole Amount with respect to this   Note are to be made in lawful money of the United States of America at the principal office of   U.S. Bank, National Association, at 461 Fifth Avenue, New York, New York 10017, or at such   other place as the Issuer shall have designated by written notice to the holder of this Note as   provided in the Note Purchase Agreement referred to below.   This Note is one of the 4.03% Senior Notes, Series A, due January 7, 2023 (the “Series A   Notes”) of the Issuer, which, together with the Issuer’s (a) 4.43% Senior Notes, Series B, due   January 7, 2026, (b) 4.57% Senior Notes, Series C, due January 7, 2028, and (c) 4.74% Senior   Notes, Series D, due January 7, 2031 (being herein referred to collectively with the Series A   Notes as the “Notes”) were issued pursuant to the Note Purchase and Guarantee Agreement,   dated as of January 7, 2016 (as from time to time amended, the “Note Purchase Agreement”),   among the Issuer, PHYSICIANS REALTY TRUST, a Maryland real estate investment trust (the   “Parent Guarantor”), and the respective Purchasers named therein and is entitled to the benefits   thereof.  Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to   the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and   (ii) made the representation set forth in Section 6.2 of the Note Purchase Agreement.  Unless   otherwise indicated, capitalized terms used in this Note shall have the respective meanings   ascribed to such terms in the Note Purchase Agreement.   This Note is a registered Note and, as provided in the Note Purchase Agreement, upon   surrender of this Note for registration of transfer, accompanied by a written instrument of     

 

EXHIBIT 1(A)   (to Note Purchase Agreement)   transfer duly executed by the registered holder hereof or such holder’s attorney duly authorized   in writing, a new Note for a like principal amount will be issued to, and registered in the name   of, the transferee.  Prior to due presentment for registration of transfer, the Issuer may treat the   person in whose name this Note is registered as the owner hereof for the purpose of receiving   payment and for all other purposes, and the Issuer will not be affected by any notice to the   contrary.   The Issuer will make required prepayments of principal on the dates and in the amounts   specified in the Note Purchase Agreement.  This Note is also subject to optional prepayment, in   whole or from time to time in part, at the times and on the terms specified in the Note Purchase   Agreement, but not otherwise.   The Parent Guarantor has absolutely and unconditionally guaranteed payment in full of   the principal of, Make-Whole Amount, if any, and interest on this Note and the performance by   the Issuer of its obligations contained in the Note Purchase Agreement all as more fully set forth   in the Note Purchase Agreement.   Certain Subsidiaries of the Issuer and Parent Guarantor may from time to time absolutely   and unconditionally guarantee payment in full of the principal of, Make-Whole Amount, if any,   and interest on this Note and the performance by the Issuer of its obligations contained in the   Note Purchase Agreement, all as more fully provided in Note Purchase Agreement.   If an Event of Default occurs and is continuing, the principal of this Note may be   declared or otherwise become due and payable in the manner, at the price (including any   applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.     

 

EXHIBIT 1(A)   (to Note Purchase Agreement)   This Note shall be construed and enforced in accordance with, and the rights of the Issuer   and the holder of this Note shall be governed by, the law of the State of New York excluding   choice-of-law principles of the law of such State that would permit the application of the laws of   a jurisdiction other than such State.      PHYSICIANS REALTY L.P., a Delaware Limited   Partnership      By:  Physicians Realty Trust, as General Partner         By: ____________________________________    Name: _______________________________    Title: ________________________________        

 

   EXHIBIT 1(B)   (to Note Purchase Agreement)   [FORM OF 4.43% SENIOR NOTES, SERIES B, DUE JANUARY 7, 2026]      PHYSICIANS REALTY L.P.   4.43% SENIOR NOTE, SERIES B, DUE JANUARY 7, 2026   No. RB – [_____] [Date]   $[_______] PPN[______________]      FOR VALUE RECEIVED, the undersigned, PHYSICIANS REALTY L.P. (herein called the   “Issuer”), a Delaware limited partnership, hereby promises to pay to [____________], or   registered assigns, the principal sum of [_____________________] DOLLARS (or so much   thereof as shall not have been prepaid) on January 7, 2026 (the “Maturity Date”), with interest   (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance   hereof at the rate of 4.43% per annum from the date hereof, payable semiannually, on the 7th day   of January and July in each year, commencing with the January 7 or July 7 next succeeding the   date hereof, and on the Maturity Date, until the principal hereof shall have become due and   payable, and (b) to the extent permitted by law, (x) on any overdue payment of interest and (y)   during the continuance of an Event of Default, on such unpaid balance and on any overdue   payment of any Make-Whole Amount, at a rate per annum from time to time equal to 6.43%,   payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).   Payments of principal of, interest on and any Make-Whole Amount with respect to this   Note are to be made in lawful money of the United States of America at the principal office of   U.S. Bank, National Association, at 461 Fifth Avenue, New York, New York 10017, or at such   other place as the Issuer shall have designated by written notice to the holder of this Note as   provided in the Note Purchase Agreement referred to below.   This Note is one of the 4.43% Senior Notes, Series B, due January 7, 2026 (the “Series B   Notes”) of the Issuer, which, together with the Issuer’s (a) 4.03% Senior Notes, Series A, due   January 7, 2023, (b) 4.57% Senior Notes, Series C, due January 7, 2028, and (c) 4.74% Senior   Notes, Series D, due January 7, 2031 (being herein referred to collectively with the Series B   Notes as the “Notes”) were issued pursuant to the Note Purchase and Guarantee Agreement,   dated as of January 7, 2016 (as from time to time amended, the “Note Purchase Agreement”),   among the Issuer, PHYSICIANS REALTY TRUST, a Maryland real estate investment trust (the   “Parent Guarantor”), and the respective Purchasers named therein and is entitled to the benefits   thereof.  Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to   the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and   (ii) made the representation set forth in Section 6.2 of the Note Purchase Agreement.  Unless   otherwise indicated, capitalized terms used in this Note shall have the respective meanings   ascribed to such terms in the Note Purchase Agreement.     

 

EXHIBIT 1(B)   (to Note Purchase Agreement)   This Note is a registered Note and, as provided in the Note Purchase Agreement, upon   surrender of this Note for registration of transfer, accompanied by a written instrument of   transfer duly executed by the registered holder hereof or such holder’s attorney duly authorized   in writing, a new Note for a like principal amount will be issued to, and registered in the name   of, the transferee.  Prior to due presentment for registration of transfer, the Issuer may treat the   person in whose name this Note is registered as the owner hereof for the purpose of receiving   payment and for all other purposes, and the Issuer will not be affected by any notice to the   contrary.   The Issuer will make required prepayments of principal on the dates and in the amounts   specified in the Note Purchase Agreement.  This Note is also subject to optional prepayment, in   whole or from time to time in part, at the times and on the terms specified in the Note Purchase   Agreement, but not otherwise.   The Parent Guarantor has absolutely and unconditionally guaranteed payment in full of   the principal of, Make-Whole Amount, if any, and interest on this Note and the performance by   the Issuer of its obligations contained in the Note Purchase Agreement all as more fully set forth   in the Note Purchase Agreement.   Certain Subsidiaries of the Issuer and Parent Guarantor may from time to time absolutely   and unconditionally guarantee payment in full of the principal of, Make-Whole Amount, if any,   and interest on this Note and the performance by the Issuer of its obligations contained in the   Note Purchase Agreement, all as more fully provided in Note Purchase Agreement.   If an Event of Default occurs and is continuing, the principal of this Note may be   declared or otherwise become due and payable in the manner, at the price (including any   applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.     

 

EXHIBIT 1(B)   (to Note Purchase Agreement)   This Note shall be construed and enforced in accordance with, and the rights of the Issuer   and the holder of this Note shall be governed by, the law of the State of New York excluding   choice-of-law principles of the law of such State that would permit the application of the laws of   a jurisdiction other than such State.         PHYSICIANS REALTY L.P., a Delaware Limited   Partnership      By:  Physicians Realty Trust, as General Partner         By: ____________________________________    Name: _______________________________       Title:  ________________________________                  

 

   EXHIBIT 1(C)   (to Note Purchase Agreement)   [FORM OF 4.57% SENIOR NOTES, SERIES C, DUE JANUARY 7, 2028]      PHYSICIANS REALTY L.P.   4.57% SENIOR NOTE, SERIES C, DUE JANUARY 7, 2028   No. RC – [_____] [Date]   $[_______] PPN[______________]   FOR VALUE RECEIVED, the undersigned, PHYSICIANS REALTY L.P. (herein called the   “Issuer”), a Delaware limited partnership, hereby promises to pay to [____________], or   registered assigns, the principal sum of [_____________________] DOLLARS (or so much   thereof as shall not have been prepaid) on January 7, 2028 (the “Maturity Date”), with interest   (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance   hereof at the rate of 4.57% per annum from the date hereof, payable semiannually, on the 7th day   of January and July in each year, commencing with the January 7 or July 7 next succeeding the   date hereof, and on the Maturity Date, until the principal hereof shall have become due and   payable, and (b) to the extent permitted by law, (x) on any overdue payment of interest and (y)   during the continuance of an Event of Default, on such unpaid balance and on any overdue   payment of any Make-Whole Amount, at a rate per annum from time to time equal to 6.57%,   payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).   Payments of principal of, interest on and any Make-Whole Amount with respect to this   Note are to be made in lawful money of the United States of America at the principal office of   U.S. Bank, National Association, at 461 Fifth Avenue, New York, New York 10017, or at such   other place as the Issuer shall have designated by written notice to the holder of this Note as   provided in the Note Purchase Agreement referred to below.   This Note is one of the 4.57% Senior Notes, Series C, due January 7, 2028 (the “Series C   Notes”) of the Issuer, which, together with the Issuer’s (a) 4.03% Senior Notes, Series A, due   January 7, 2023, (b) 4.43% Senior Notes, Series B, due January 7, 2026, and (c) 4.74% Senior   Notes, Series D, due January 7, 2031 (being herein referred to collectively with the Series C   Notes as the “Notes”) were issued pursuant to the Note Purchase and Guarantee Agreement,   dated as of January 7, 2016 (as from time to time amended, the “Note Purchase Agreement”),   among the Issuer, PHYSICIANS REALTY TRUST, a Maryland real estate investment trust (the   “Parent Guarantor”), and the respective Purchasers named therein and is entitled to the benefits   thereof.  Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to   the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and   (ii) made the representation set forth in Section 6.2 of the Note Purchase Agreement.  Unless   otherwise indicated, capitalized terms used in this Note shall have the respective meanings   ascribed to such terms in the Note Purchase Agreement.   This Note is a registered Note and, as provided in the Note Purchase Agreement, upon   surrender of this Note for registration of transfer, accompanied by a written instrument of     

 

EXHIBIT 1(C)   (to Note Purchase Agreement)   transfer duly executed by the registered holder hereof or such holder’s attorney duly authorized   in writing, a new Note for a like principal amount will be issued to, and registered in the name   of, the transferee.  Prior to due presentment for registration of transfer, the Issuer may treat the   person in whose name this Note is registered as the owner hereof for the purpose of receiving   payment and for all other purposes, and the Issuer will not be affected by any notice to the   contrary.   The Issuer will make required prepayments of principal on the dates and in the amounts   specified in the Note Purchase Agreement.  This Note is also subject to optional prepayment, in   whole or from time to time in part, at the times and on the terms specified in the Note Purchase   Agreement, but not otherwise.   The Parent Guarantor has absolutely and unconditionally guaranteed payment in full of   the principal of, Make-Whole Amount, if any, and interest on this Note and the performance by   the Issuer of its obligations contained in the Note Purchase Agreement all as more fully set forth   in the Note Purchase Agreement.   Certain Subsidiaries of the Issuer and Parent Guarantor may from time to time absolutely   and unconditionally guarantee payment in full of the principal of, Make-Whole Amount, if any,   and interest on this Note and the performance by the Issuer of its obligations contained in the   Note Purchase Agreement, all as more fully provided in Note Purchase Agreement.   If an Event of Default occurs and is continuing, the principal of this Note may be   declared or otherwise become due and payable in the manner, at the price (including any   applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.     

 

EXHIBIT 1(C)   (to Note Purchase Agreement)   This Note shall be construed and enforced in accordance with, and the rights of the Issuer   and the holder of this Note shall be governed by, the law of the State of New York excluding   choice-of-law principles of the law of such State that would permit the application of the laws of   a jurisdiction other than such State.      PHYSICIANS REALTY L.P., a Delaware Limited   Partnership      By:  Physicians Realty Trust, as General Partner      By: ____________________________________    Name: _______________________________    Title: ________________________________        

 

   EXHIBIT 1(D)   (to Note Purchase Agreement)   [FORM OF 4.74% SENIOR NOTES, SERIES D, DUE 2031]      PHYSICIANS REALTY L.P.   4.74% SENIOR NOTE, SERIES D, DUE JANUARY 7, 2031   No. RD – [_____] [Date]   $[_______] PPN[______________]   FOR VALUE RECEIVED, the undersigned, PHYSICIANS REALTY L.P. (herein called the   “Issuer”), a Delaware limited partnership, hereby promises to pay to [____________], or   registered assigns, the principal sum of [_____________________] DOLLARS (or so much   thereof as shall not have been prepaid) on January 7, 2031 (the “Maturity Date”), with interest   (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance   hereof at the rate of 4.74% per annum from the date hereof, payable semiannually, on the 7th day   of January and July in each year, commencing with the January 7 or July 7 next succeeding the   date hereof, and on the Maturity Date, until the principal hereof shall have become due and   payable, and (b) to the extent permitted by law, (x) on any overdue payment of interest and (y)   during the continuance of an Event of Default, on such unpaid balance and on any overdue   payment of any Make-Whole Amount, at a rate per annum from time to time equal to 6.74%,   payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).   Payments of principal of, interest on and any Make-Whole Amount with respect to this   Note are to be made in lawful money of the United States of America at the principal office of   U.S. Bank, National Association, at 461 Fifth Avenue, New York, New York 10017, or at such   other place as the Issuer shall have designated by written notice to the holder of this Note as   provided in the Note Purchase Agreement referred to below.   This Note is one of the 4.74% Senior Notes, Series D, due January 7, 2031 (the “Series D   Notes”) of the Issuer, which, together with the Issuer’s (a) 4.03% Senior Notes, Series A, due   January 7, 2023, (b) 4.43% Senior Notes, Series B, due January 7, 2026, and (c) 4.57% Senior   Notes, Series C, due January 7, 2028 (being herein referred to collectively with the Series D   Notes as the “Notes”) were issued pursuant to the Note Purchase and Guarantee Agreement,   dated as of January 7, 2016 (as from time to time amended, the “Note Purchase Agreement”),   among the Issuer, PHYSICIANS REALTY TRUST, a Maryland real estate investment trust (the   “Parent Guarantor”), and the respective Purchasers named therein and is entitled to the benefits   thereof.  Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to   the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and   (ii) made the representation set forth in Section 6.2 of the Note Purchase Agreement.  Unless   otherwise indicated, capitalized terms used in this Note shall have the respective meanings   ascribed to such terms in the Note Purchase Agreement.   This Note is a registered Note and, as provided in the Note Purchase Agreement, upon   surrender of this Note for registration of transfer, accompanied by a written instrument of     

 

EXHIBIT 1(D)   (to Note Purchase Agreement)   transfer duly executed by the registered holder hereof or such holder’s attorney duly authorized   in writing, a new Note for a like principal amount will be issued to, and registered in the name   of, the transferee.  Prior to due presentment for registration of transfer, the Issuer may treat the   person in whose name this Note is registered as the owner hereof for the purpose of receiving   payment and for all other purposes, and the Issuer will not be affected by any notice to the   contrary.   The Issuer will make required prepayments of principal on the dates and in the amounts   specified in the Note Purchase Agreement.  This Note is also subject to optional prepayment, in   whole or from time to time in part, at the times and on the terms specified in the Note Purchase   Agreement, but not otherwise.   The Parent Guarantor has absolutely and unconditionally guaranteed payment in full of   the principal of, Make-Whole Amount, if any, and interest on this Note and the performance by   the Issuer of its obligations contained in the Note Purchase Agreement all as more fully set forth   in the Note Purchase Agreement.   Certain Subsidiaries of the Issuer and Parent Guarantor may from time to time absolutely   and unconditionally guarantee payment in full of the principal of, Make-Whole Amount, if any,   and interest on this Note and the performance by the Issuer of its obligations contained in the   Note Purchase Agreement, all as more fully provided in Note Purchase Agreement.   If an Event of Default occurs and is continuing, the principal of this Note may be   declared or otherwise become due and payable in the manner, at the price (including any   applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.     

 

EXHIBIT 1(D)   (to Note Purchase Agreement)   This Note shall be construed and enforced in accordance with, and the rights of the Issuer   and the holder of this Note shall be governed by, the law of the State of New York excluding   choice-of-law principles of the law of such State that would permit the application of the laws of   a jurisdiction other than such State.      PHYSICIANS REALTY L.P., a Delaware Limited   Partnership      By:  Physicians Realty Trust, as General Partner         By: ____________________________________    Name: _______________________________    Title: ________________________________           

 

   EXHIBIT 2.3   (to Note Purchase Agreement)   FORM OF SUBSIDIARY GUARANTY      (See attached)    

 

      EXHIBIT 2.3   (to Note Purchase Agreement)   SUBSIDIARY GUARANTEE   THIS GUARANTEE (this “Guarantee”) dated as of _____________, 20__ is made by   each undersigned (each a “Subsidiary Guarantor”), in favor of the holders from time to time of   the Notes hereinafter referred to and their respective successors and assigns (collectively, the   “Holders” and each individually, a “Holder”).   W I T N E S S E T H:   WHEREAS, PHYSICIANS REALTY L.P., a Delaware limited partnership (the   “Issuer”), PHYSICIANS REALTY TRUST, a Maryland real estate investment trust (the   “Parent Guarantor” and, together with the Issuer, the “Obligors”), and the initial Holders have   entered into a Note Purchase and Guarantee Agreement dated as of January 7, 2016 (the Note   Purchase and Guarantee Agreement as amended, supplemented, restated or otherwise modified   from time to time in accordance with its terms and in effect, the “Note Purchase Agreement”);   WHEREAS, the Note Purchase Agreement provides for the issuance by the Issuer of (i)   $15,000,000 aggregate principal amount of its 4.03% Senior Notes, Series A, due January 7,   2023, (ii) $45,000,000 aggregate principal amount of its 4.43% Senior Notes, Series B, due   January 7, 2026, (iii) $45,000,000 aggregate principal amount of its 4.57% Senior Notes, Series   C, due January 7, 2028 and (iv) $45,000,000 aggregate principal amount of its 4.74% Senior   Notes, Series D, due January 7, 2031 (collectively, the “Notes”);   WHEREAS, pursuant to the Note Purchase Agreement the payment and performance by   the Issuer of its obligations under the Note Purchase Agreement and under the Notes are   absolutely and unconditionally guaranteed by the Parent Guarantor;   WHEREAS, the Obligors directly or indirectly own all of the issued and outstanding   capital stock of each Subsidiary Guarantor and, by virtue of such ownership and otherwise, each   Subsidiary Guarantor has derived substantial benefits from the purchase by the Holders of the   Issuer’s Notes;   WHEREAS, it is a requirement of the Note Purchase Agreement that each Subsidiary   Guarantor execute and deliver this Guarantee to the Holders; and   WHEREAS, each Subsidiary Guarantor desires to execute and deliver this Guarantee to   satisfy the requirement described in the preceding paragraph.   NOW, THEREFORE, in consideration of the premises and other benefits to each   Subsidiary Guarantor, and of the purchase of the Issuer’s Notes by the Holders, and for other   good and valuable consideration, the receipt and sufficiency of which are acknowledged, each   Subsidiary Guarantor makes this Guarantee as follows:   SECTION 1. DEFINITIONS. Any capitalized terms not otherwise herein defined shall   have the meanings attributed to them in the Note Purchase Agreement.     

 

EXHIBIT 2.3   (to Note Purchase Agreement)      SECTION 2. GUARANTY. Each Subsidiary Guarantor hereby absolutely, unconditionally   and irrevocably guarantees, jointly and severally with each other Subsidiary Guarantor and the   Parent Guarantor, as a primary obligor and not merely as a surety, to each Holder and its   successors and permitted assigns (a) the full and punctual payment when due, whether at stated   maturity, by acceleration or otherwise, of the principal of and Make-Whole Amount and interest   on (including, without limitation, interest, whether or not an allowable claim, accruing after the   date of filing of any petition in bankruptcy, or the commencement of any bankruptcy, insolvency   or similar proceeding relating to the Issuer) the Notes and all other amounts owed or to be owing   by the Issuer which becomes due under the terms and provisions of the Financing Agreements,   now or hereafter existing under the Financing Agreements whether for principal, Make-Whole   Amount or interest (including, without limitation, interest, whether or not an allowable claim,   accruing after the date of filing of any petition in bankruptcy, or the commencement of any   bankruptcy, insolvency or similar proceeding relating to the Issuer), (b) the full and prompt   performance and observance by the Issuer of each and all of the obligations, covenants and   agreements required to be performed or owed by the Issuer under the terms of the Notes and the   Note Purchase Agreement and (c) the full and prompt payment, upon demand by any Holder of   all costs and expenses, legal or otherwise (including reasonable attorneys’ fees) and such   expenses, if any, as shall have been expended or incurred in the protection or enforcement of any   right or privilege under the Notes or the Note Purchase Agreement or in the protection or   enforcement of any rights, privileges or liabilities under this Guarantee or in any consultation or   action in connection therewith or herewith and in each and every case irrespective of the validity,   regularity, or enforcement of any of the Notes or the Note Purchase Agreement or any of the   terms thereof or of any other like circumstance or circumstances (all such obligations being the   “Obligations”), and agrees to pay any and all reasonable fees and expenses incurred by each   Holder in enforcing this Guarantee. Notwithstanding the foregoing, the right of recovery against   each Subsidiary Guarantor under this Guarantee is limited to the extent it is judicially determined   with respect to any Subsidiary Guarantor that entering into this Guarantee would violate Section   548 of the Bankruptcy Code or any comparable provisions of any state law, in which case such   Subsidiary Guarantor shall be liable under this Guarantee only for amounts aggregating up to the   largest amount that would not render such Subsidiary Guarantor’s obligations hereunder subject   to avoidance under Section 548 of the Bankruptcy Code or any comparable provisions of any   state law.   Notwithstanding any stay, injunction or other prohibition preventing such action against   the Issuer, if for any reason whatsoever the Issuer shall fail or be unable to duly, punctually and   fully (in the case of the payment of Obligations) pay such amounts as and when the same shall   become due and (in the case of the payment of Obligations) payable, whether or not such failure   or inability shall constitute an “Event of Default”, each Subsidiary Guarantor will forthwith (in   the case of the payment of Obligations) pay or cause to be paid such amounts to the holders, in   lawful money of the United States of America, at the place specified in Section 14 of the Note   Purchase Agreement, or pay such Obligations or cause such Obligations to be paid, (in the case   of the payment of Obligations) together with interest (in the amounts and to the extent required   under such Notes) on any amount due and owing.     

 

EXHIBIT 2.3   (to Note Purchase Agreement)      SECTION 3. SUBSIDIARY GUARANTORS’ OBLIGATIONS UNCONDITIONAL The   obligations of each Subsidiary Guarantor under this Guarantee shall be primary, absolute and   unconditional obligations of each Subsidiary Guarantor, shall not be subject to any counterclaim,   set-off, deduction, diminution, abatement, recoupment, suspension, deferment, reduction or   defense based upon any claim each Subsidiary Guarantor or any other Person may have against   the Issuer or any other Person, and to the full extent permitted by applicable law shall remain in   full force and effect without regard to, and except as provided in Section 9.15(b) of the Note   Purchase Agreement, shall not be released, discharged or in any way affected by, any   circumstance or condition whatsoever (whether or not each Subsidiary Guarantor or the Obligors   shall have any knowledge or notice thereof), including:   (a)  any termination, amendment or modification of or deletion from or addition or   supplement to or other change in any of the Financing Agreements or any other   instrument or agreement applicable to any of the parties to any of the Financing   Agreements (including, without limitation, any change to the covenants, Events of   Default, principal amounts, interest rates, or other terms and conditions of or   pertaining to the Notes or any other Financing Agreement, or any change to the   time for payment of all or any part of the obligations payable under the Notes or   any other Financing Agreement), or any assignment or transfer of any interest   therein;    (b) any furnishing or acceptance of any security or other guaranty, or any release of   any security or other guaranty, for the Obligations, or the application of any such   security or guaranty or order or manner of sale of any such security as the Holders   in their sole discretion may determine, or the failure of any security or the failure   of any Person to perfect any interest in any collateral;   (c)  any failure, omission or delay on the part of the Issuer to conform or comply with   any term of any of the Financing Agreements or any other instrument or   agreement referred to in paragraph (a) above, including, without limitation, failure   to give notice to any Subsidiary Guarantor of the occurrence of a “Default” or an   “Event of Default” under any Financing Agreement;   (d) any waiver of the payment, performance or observance of any of the obligations,   conditions, covenants or agreements contained in any Financing Agreement, or   any other waiver, consent, extension, indulgence, compromise, settlement, release   or other action or inaction under or in respect of any of the Financing Agreements   or any other instrument or agreement referred to in paragraph (a) above or any   obligation or liability of the Issuer, or any exercise or non-exercise of any right,   remedy, power or privilege under or in respect of any such instrument or   agreement or any such obligation or liability;   (e) any failure, omission or delay on the part of any of the Holders to enforce, assert   or exercise any right, power or remedy conferred on such Holder in this   Guarantee, or any such failure, omission or delay on the part of such Holder in     

 

EXHIBIT 2.3   (to Note Purchase Agreement)      connection with any Financing Agreement, or any other action on the part of such   Holder;    (f) any voluntary or involuntary bankruptcy, insolvency, reorganization,   arrangement, readjustment, assignment for the benefit of creditors, composition,   receivership, conservatorship, custodianship, liquidation, marshaling of assets and   liabilities or similar proceedings with respect to the Issuer, the Parent Guarantor   any Subsidiary Guarantor or to any other Person or any of their respective   properties or creditors, or any action taken by any trustee or receiver or by any   court in any such proceeding;   (g) any discharge, termination, cancellation, frustration, irregularity, invalidity or   unenforceability, in whole or in part, of any of the Financing Agreements or any   other agreement or instrument referred to in paragraph (a) above or any term   hereof;   (h)  any merger or consolidation of the Issuer, the Parent Guarantor or any Subsidiary   Guarantor into or with any other Person, or any sale, lease or transfer of any of the   assets of the Issuer, the Parent Guarantor or any Subsidiary Guarantor to any other   Person;   (i) any change in the ownership of any shares of capital stock of the Obligors or any   change in the corporate relationship between the Obligors and any Subsidiary   Guarantor, or any termination of such relationship;    (j) any release or discharge, by operation of law or otherwise, of the Parent   Guarantor or any Subsidiary Guarantor from the performance or observance of   any obligation, covenant or agreement contained in the Parent Guarantee or this   Guarantee, as applicable;    (k) any application by the Holders of any sums, by whomever paid or however   realized, to the payment of the Obligations and all other obligations owed   hereunder; or   (l)  any other occurrence, circumstance, happening or event whatsoever, whether   similar or dissimilar to the foregoing, whether foreseen or unforeseen, and any   other circumstance which might otherwise constitute a legal or equitable defense   or discharge of the liabilities of a Subsidiary Guarantor or surety or which might   otherwise limit recourse against any Subsidiary Guarantor.   SECTION 4. FULL RECOURSE OBLIGATIONS. The obligations of each Subsidiary   Guarantor set forth herein constitute the full recourse obligations of such Subsidiary Guarantor   enforceable against it to the full extent of all its assets and properties.     

 

EXHIBIT 2.3   (to Note Purchase Agreement)      SECTION 5. WAIVER. Each Subsidiary Guarantor unconditionally waives, to the extent   permitted by applicable law, (a) notice of any of the matters referred to in Section 3, (b) notice to   such Subsidiary Guarantor of the incurrence of any of the Obligations, notice to such Subsidiary   Guarantor or the Obligors of any breach or default by the Issuer with respect to any of the   Obligations or any other notice that may be required, by statute, rule of law or otherwise, to   preserve any rights of the Holders against such Subsidiary Guarantor, (c) presentment to, notice   of acceleration of, notice of intent to accelerate or demand of payment from the Obligors or the   Subsidiary Guarantor with respect to any amount due under any Financing Agreement or protest   for nonpayment or dishonor, (d) any right to the enforcement, assertion or exercise by any of the   Holders of any right, power, privilege or remedy conferred in the Note Purchase Agreement or   any other Financing Agreement or otherwise, (e) any requirement of diligence on the part of any   of the Holders, (f) any requirement to exhaust any remedies or to mitigate the damages resulting   from any default under any Financing Agreement, (g) any notice of any sale, transfer or other   disposition by any of the Holders of any right, title to or interest in the Note Purchase Agreement   or in any other Financing Agreement and (h) any other circumstance whatsoever which might   otherwise constitute a legal or equitable discharge, release or defense of a guarantor or surety or   which might otherwise limit recourse against such Subsidiary Guarantor.   SECTION 6. SUBROGATION, CONTRIBUTION, REIMBURSEMENT OR INDEMNITY;   SUBORDINATION. Until one year and one day after all Obligations have been indefeasibly paid in   full in cash, each Subsidiary Guarantor agrees not to take any action pursuant to any rights which   may have arisen in connection with this Guarantee to be subrogated to any of the rights (whether   contractual, under the Bankruptcy Code, as amended, including Section 509 thereof, under   common law or otherwise) of any of the Holders against the Issuer or against any collateral   security or guaranty or right of offset held by the Holders for the payment of the Obligations.   Until one year and one day after all Obligations have been indefeasibly paid in full in cash, each   Subsidiary Guarantor agrees not to take any action pursuant to any contractual, common law,   statutory or other rights of reimbursement, contribution, exoneration or indemnity (or any similar   right) from or against the Issuer which may have arisen in connection with this Guarantee.  If any   Subsidiary Guarantor becomes the holder of any indebtedness payable by the Issuer, such   Subsidiary Guarantor hereby subordinates all indebtedness owing to it from the Issuer to all   indebtedness of the Issuer to the Holders, and agrees that, during the continuance of any Event of   Default, it shall not accept any payment on the same until payment in full of the Obligations and   shall in no circumstance whatsoever attempt to set-off or reduce any obligations hereunder   because of such indebtedness.  So long as the Obligations remain outstanding, if any amount   shall be paid by or on behalf of the Issuer to any Subsidiary Guarantor on account of any of the   rights waived in this paragraph, such amount shall be held by such Subsidiary Guarantor in trust,   segregated from other funds of such Subsidiary Guarantor, and shall, forthwith upon receipt by   such Subsidiary Guarantor, be turned over to the Holders (duly endorsed by such Subsidiary   Guarantor to the Holders, if required), to be applied against the Obligations, whether matured or   unmatured, in such order as the Holders may determine. The provisions of this paragraph shall   survive the term of this Guarantee and the payment in full of the Obligations.   SECTION 7. EFFECT OF BANKRUPTCY PROCEEDINGS, ETC. This Guarantee shall   continue to be effective or be automatically reinstated, as the case may be, if at any time     

 

EXHIBIT 2.3   (to Note Purchase Agreement)      payment, in whole or in part, of any of the sums due to any of the Holders pursuant to the terms   of the Note Purchase Agreement or any other Financing Agreement is rescinded or must   otherwise be restored or returned by such Holder upon the insolvency, bankruptcy, dissolution,   liquidation or reorganization of either Obligor, any of their Subsidiaries or any other Person, or   upon or as a result of the appointment of a custodian, receiver, trustee or other officer with   similar powers with respect to either Obligor, any of their Subsidiaries or any other Person or   any substantial part of its property, or otherwise, all as though such payment had not been made.   If an event permitting the acceleration of the maturity of the principal amount of the Notes shall   at any time have occurred and be continuing and one or more Holders shall have attempted to   accelerate the maturity of the principal amount of the Notes pursuant to and in compliance with   Section 12.1 of the Note Purchase Agreement, or an event shall have occurred that pursuant to   Section 12.1 of the Note Purchase Agreement purportedly results in the automatic acceleration of   the maturity of the principal amount of the Notes, and in either such case such acceleration shall   at such time be prevented by reason of the pendency against either Obligor, any of their   Subsidiaries or any other Person of a case or proceeding under a bankruptcy or insolvency law,   each Subsidiary Guarantor agrees that, for purposes of this Guarantee and its obligations   hereunder, the maturity of the principal amount of the Notes and all other Obligations shall be   deemed to have been accelerated with the same effect as if any Holder had accelerated the same   in accordance with the terms of the Note Purchase Agreement or other applicable Financing   Agreement, and such Subsidiary Guarantor shall forthwith pay such principal amount, Make-   Whole Amount, if any, and interest thereon and any other amounts guaranteed hereunder without   further notice or demand.   SECTION 8. REPRESENTATIONS AND WARRANTIES OF EACH SUBSIDIARY GUARANTOR.   Each Subsidiary Guarantor represents and warrants to the Holders that:   (a) Such Subsidiary Guarantor is duly organized, validly existing and in good standing   under the laws of its jurisdiction of organization, has all requisite power and   authority to own and operate its properties, if applicable, and to carry on its business   as now conducted and as proposed to be conducted, and is duly qualified to do   business and is in good standing in every jurisdiction where necessary to carry out   its business and operations, except in jurisdictions where the failure to be so   qualified or in good standing has not had, and could not be reasonably expected to   have, a Material Adverse Effect.   (b) The execution, delivery and performance of this Guarantee has been duly authorized   by all necessary corporate or other organizational action on the part of such   Subsidiary Guarantor.   (c) The execution, delivery and performance by such Subsidiary Guarantor of this   Guarantee will not (a) violate in any Material respect any provision of any   Applicable Laws relating to such Subsidiary Guarantor, any of the Organizational   Documents of such Subsidiary Guarantor, or any order, judgment or decree of any   court or other agency of government binding on such Subsidiary Guarantor; (b)   except as would not reasonably be expected to have a Material Adverse Effect,     

 

EXHIBIT 2.3   (to Note Purchase Agreement)      conflict with, result in a breach of or constitute (with due notice or lapse of time   or both) a default under any other Contractual Obligations of either such   Subsidiary Guarantor; (c) result in or require the creation or imposition of any   Lien upon any of the properties or assets of such Subsidiary Guarantor (other than   any Liens subsequently created under any of the Financing Agreements in favor   of the holders of the Notes) whether now owned or hereafter acquired; or (d)   require any approval of stockholders, members or partners or any approval or   consent of any Person under any Contractual Obligation of such Subsidiary   Guarantor (other than those which have already been obtained or to the extent the   failure to obtain any such approval or consent would not reasonably be expected   to have a Material Adverse Effect).   (d) The execution, delivery and performance by such Subsidiary Guarantor of the   Guarantee and the consummation of the transactions contemplated thereby do not   and will not require, as a condition to the effectiveness thereof, any registration with,   consent or approval of, or notice to, or other action to, with or by, any Governmental   Authority except for any filings, recordings or consents which heretofore have been   obtained or made, as applicable.   (e) This Guarantee has been duly executed and delivered by such Subsidiary Guarantor   and is the legally valid and binding obligation of such Subsidiary Guarantor,   enforceable against such Subsidiary Guarantor in accordance with its terms, except   as may be limited by Debtor Relief Laws or by equitable principles relating to   enforceability.   (f) Such Subsidiary Guarantor is solvent and able to pay all its debts as and when they   fall due (after taking into account contingencies and contributions from others).     (g) Such Subsidiary Guarantor is in compliance with all Applicable Laws, except such   noncompliance with such other Applicable Laws that, individually or in the   aggregate, could not reasonably be expected to result in a Material Adverse Effect.    Such Subsidiary Guarantor possesses all certificates, authorities or permits issued by   appropriate Governmental Authorities necessary to conduct the business now   operated by them and the failure of which to have could reasonably be expected to   have a Material Adverse Effect and have not received any notice of proceedings   relating to the revocation or modification of any such certificate, authority or permit   the failure of which to have or retain could reasonably be expected to have a   Material Adverse Effect.   (h) Such Subsidiary Guarantor’s payment obligations under this Guarantee constitute   direct and general obligations of such Subsidiary Guarantor and rank in right of   payment at least pari passu, without preference or priority, with all other unsecured   and unsubordinated Indebtedness of such Subsidiary Guarantor, except for such   Indebtedness preferred by operation of bankruptcy laws or other similar laws of   general application.     

 

EXHIBIT 2.3   (to Note Purchase Agreement)      All representations and warranties contained herein shall survive the execution and   delivery of this Guarantee.   SECTION 9. TERM OF AGREEMENT. Subject to Section 9.15(b) of the Note Purchase   Agreement and Section 7 hereof, this Guarantee and all guaranties, representations and   agreements of each Subsidiary Guarantor contained herein shall continue in full force and effect   and shall not be discharged until such time as all of the Obligations shall be irrevocably paid and   performed in full in cash and all of the agreements of such Subsidiary Guarantor hereunder shall   be irrevocably duly paid and performed in full in cash.   SECTION 10. AMENDMENT AND WAIVER.  Except as otherwise provided herein, this   Guarantee may be amended, and the observance of any term hereof may be waived (either   retroactively or prospectively), with (and only with) the written consent of each Subsidiary   Guarantor and the Required Holders.   SECTION 11. NOTICES. All notices under the terms and provisions hereof shall be in   writing, and shall be delivered or sent by telecopy or mailed by first-class mail, postage prepaid,   or otherwise as provided in Section 18 of the Note Purchase Agreement, addressed (a) if to the   Issuer or any Holder, at the address set forth in the Note Purchase Agreement or (b) if to a   Subsidiary Guarantor, in care of the Issuer at the Issuer’s address set forth in the Note Purchase   Agreement, or in each case at such other address as the Issuer, any Holder or such Subsidiary   Guarantor shall from time to time designate in writing to the other parties. Any notice so   addressed shall be deemed to be given when actually received.   SECTION 12. JURISDICTION AND PROCESS; WAIVER OF JURY TRIAL.   (a) Each Subsidiary Guarantor irrevocably submits to the non-exclusive jurisdiction   of any New York state or federal court sitting in the Borough of Manhattan, The   City of New York, over any suit, action or proceeding arising out of or relating to   this Guarantee, the Note Purchase Agreement or the Notes. To the fullest extent   permitted by applicable law, each Subsidiary Guarantor irrevocably waives and   agrees not to assert, by way of motion, as a defense or otherwise, any claim that it   is not subject to the jurisdiction of any such court, any objection that it may now   or hereafter have to the laying of the venue of any such suit, action or proceeding   brought in any such court and any claim that any such suit, action or proceeding   brought in any such court has been brought in an inconvenient forum.   (b) Each Subsidiary Guarantor agrees, to the fullest extent permitted by applicable   law, that a final judgment in any suit, action or proceeding of the nature referred   to in Section 12(a) brought in any such court shall be conclusive and binding upon   it subject to rights of appeal, as the case may be, and may be enforced in the   courts of the United States of America (or any other courts to the jurisdiction of   which it or any of its assets is or may be subject) by a suit upon such judgment.     

 

EXHIBIT 2.3   (to Note Purchase Agreement)       (c) Each Subsidiary Guarantor consents to process being served in any suit, action or   proceeding solely of the nature referred to in Section 12(a) by mailing a copy   thereof by registered or certified or priority mail, postage prepaid, return receipt   requested, or delivering a copy thereof in the manner for delivery of notices   specified in Section 11, to it. Each Subsidiary Guarantor agrees that such service   upon receipt (i) shall be deemed in every respect effective service of process upon   it in any such suit, action or proceeding and (ii) shall, to the fullest extent   permitted by applicable law, be taken and held to be valid personal service upon   and personal delivery to it. Notices hereunder shall be conclusively presumed   received as evidenced by a delivery receipt furnished by the United States Postal   Service or any reputable commercial delivery service.    (d) Nothing in this Section 12 shall affect the right of any holder of a Note to serve   process in any manner permitted by law, or limit any right that the holders of any   of the Notes may have to bring proceedings against the Issuer in the courts of any   appropriate jurisdiction or to enforce in any lawful manner a judgment obtained in   one jurisdiction in any other jurisdiction.    (e) EACH SUBSIDIARY GUARANTOR WAIVES TRIAL BY JURY IN ANY   ACTION BROUGHT ON OR WITH RESPECT TO THIS AGREEMENT, THE   NOTES OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION   HEREWITH OR THEREWITH.   SECTION 13. MISCELLANEOUS. Any provision of this Guarantee which is prohibited or   unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such   prohibition or unenforceability without invalidating the remaining provisions hereof, and any   such prohibition or unenforceability in any jurisdiction shall not invalidate or render   unenforceable such provision in any other jurisdiction.    To the extent permitted by applicable law, each Subsidiary Guarantor hereby waives any   provision of law that renders any provisions hereof prohibited or unenforceable in any respect.   The terms of this Guarantee shall be binding upon, and inure to the benefit of, each Subsidiary   Guarantor and the Holders and their respective successors and assigns. It is agreed and   understood that any Person may become a Subsidiary Guarantor hereunder by executing a   Joinder Agreement substantially in the form of Exhibit A attached hereto and delivering the same   to the Holders. Any such Person shall thereafter be a “Subsidiary Guarantor” for all purposes   under this Guarantee. No term or provision of this Guarantee may be changed, waived,   discharged or terminated orally, but only by an instrument in writing signed by each Subsidiary   Guarantor and the Holders; provided, however, that a Subsidiary Guarantor may be fully released   and discharged from this Guarantee pursuant to the terms of Section 9.15(b) of the Note   Purchase Agreement. Each Subsidiary Guarantor agrees to execute and deliver all such   instruments and take all such action as the Required Holders may from time to time reasonably   request in order to effectuate fully the purposes of this Guarantee.      

 

EXHIBIT 2.3   (to Note Purchase Agreement)      The section and paragraph headings in this Guarantee are for convenience of reference   only and shall not modify, define, expand or limit any of the terms or provisions hereof, and all   references herein to numbered sections, unless otherwise indicated, are to sections in this   Guarantee. This Guarantee shall in all respects be governed by, and construed in accordance   with, the laws of the state of New York, including all matters of construction, validity and   performance, excluding choice-of-law principles of the law of such state that would permit the   application of the laws of a jurisdiction other than such state.     

 

      EXHIBIT 2.3   (to Note Purchase Agreement)   IN WITNESS WHEREOF, each Subsidiary Guarantor has caused this Guarantee to be   duly executed as of the day and year first above written.         [NAME OF SUBSIDIARY GUARANTOR]         By  ____________________________________   Name:    Title:      [Notice Address for such Guarantor    ______________________________________     ______________________________________ ]                 

 

   EXHIBIT 2.3   (to Note Purchase Agreement)      SUBSIDIARY GUARANTEE   JOINDER AGREEMENT      This Joinder Agreement (this “Joinder Agreement”) is entered into as of ________ __,   20__, by the undersigned set forth on the signature page hereto (the “Additional Subsidiary   Guarantor”), with respect to that certain Subsidiary Guarantee, dated as of _____________,   20__ (the “Guarantee Agreement”), entered into by the Subsidiary Guarantors named on the   signature pages thereto in favor of the holders from time to time of the Notes hereinafter referred   to and their respective successors and assigns (collectively, the “Holders” and each individually,   a “Holder”). Capitalized terms used but not defined herein shall have the meaning set forth in   the Guarantee Agreement.      W I T N E S S E T H:   WHEREAS, PHYSICIANS REALTY L.P., a Delaware limited partnership (the   “Issuer”), PHYSICIANS REALTY TRUST, a Maryland real estate investment trust (the   “Parent Guarantor” and, together with the Issuer, the “Obligors”), and the initial Holders have   entered into a Note Purchase and Guarantee Agreement dated as of January 7, 2016 (the Note   Purchase and Guarantee Agreement as amended, supplemented, restated or otherwise modified   from time to time in accordance with its terms and in effect, the “Note Purchase Agreement”);   WHEREAS, the Note Purchase Agreement provides for the issuance by the Issuer of   $150,000,000 aggregate principal amount of Notes (as defined in the Note Purchase Agreement);   WHEREAS, pursuant to the Note Purchase Agreement the payment and performance by   the Issuer of its obligations under the Note Purchase Agreement and under the Notes are   absolutely and unconditionally guaranteed by the Parent Guarantor;   WHEREAS, the Obligors directly or indirectly own all of the issued and outstanding   capital stock of the Additional Subsidiary Guarantor and, by virtue of such ownership and   otherwise, the Additional Subsidiary Guarantor has derived substantial benefits from the   purchase by the Holders of the Issuer’s Notes;   WHEREAS, it is a requirement of the Note Purchase Agreement that the Additional   Subsidiary executes and delivers this Joinder Agreement to the Holders in order to join the other   Subsidiary Guarantors and the Parent Guarantor in absolutely and unconditionally guaranteeing   the Issuer’s obligations under the Note Purchase Agreement and under the Notes; and   WHEREAS, the Additional Subsidiary Guarantor desires to execute and deliver this   Joinder Agreement to satisfy the requirement described in the preceding paragraph.   NOW, THEREFORE, the Additional Subsidiary Guarantor hereby (i) acknowledges   receipt of a copy of the Guarantee Agreement and (ii) joins fully in the Guarantee Agreement as   a “Subsidiary Guarantor,” and shall be bound by all the terms and conditions of the Guarantee   Agreement as if the Additional Subsidiary Guarantor was a signatory thereto as a “Subsidiary     

 

EXHIBIT 2.3   (to Note Purchase Agreement)      Guarantor.”  Without limiting the foregoing, the Additional Subsidiary Guarantor hereby   (a) jointly and severally with the other Subsidiary Guarantors under the Guarantee Agreement,   guarantees to the Holders from time to time the prompt payment in full when due (whether at   stated maturity, by acceleration or otherwise) and the full and prompt performance and   observance of all Obligations (as defined in Section 2 of the Guarantee Agreement) in the same   manner and to the same extent as is provided in the Guarantee Agreement, (b) waives the rights   set forth in Section 5 of the Guarantee Agreement, (c) makes the representations and warranties   set forth in Section 8 of the Guarantee Agreement and (d) waives the rights, submits to   jurisdiction, and waives service of process as described in Section 12 of the Guarantee   Agreement.      Notice of acceptance of this Joinder Agreement and of the Guarantee Agreement, as   supplemented hereby, is hereby waived by the Additional Subsidiary Guarantor.      The address for notices and other communications to be delivered to the Additional   Subsidiary Guarantor pursuant to Section 12 of the Guarantee Agreement is set forth below.      IN WITNESS WHEREOF, the Additional Subsidiary Guarantor has executed this   Joinder Agreement as of the date first written above.            [NAME OF ADDITIONAL SUBSIDIARY   GUARANTOR]         By  ____________________________________    Name:     Title:         Notice Address for such Additional Subsidiary   Guarantor    ______________________________________

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